Stock Market News for October 14, 2009

Stocks meandered at the start as uncertainty over the quarterly results this week kept investors from building positions.  Jittery investors, wanting to see more sings of an economic revival, sold off financial stocks after influential analyst Meredith Whitney downgraded shares of Goldman Sachs.  Whitney also lowered her earnings outlook for Bank of America and Citigroup.  Although late morning saw some strength, stocks struggled to stay afloat and ended the day mixed.   

Gains in commodity prices helped some mid-session buying in energy and material shares but the overall weakness in financial and healthcare stocks kept sentiment in check.  Shares of UnitedHealth Group Inc. (NYSE:UNH - Analyst Report) and Aetna Inc. (NYSE:AET - Analyst Report) fell more than 3% as the Senate Finance Committee approved an $829 billion plan to overhaul the U.S. health system.  Johnson & Johnson (NYSE:JNJ - Analyst Report) fell 2.4% after the company reported revenue that was below the Street expectations.  However, the company reported higher quarterly earnings, helped by cost-cutting measures and a one-time tax benefit; Johnson &Johnson also raised its full-year guidance.  Nevertheless, shares of the company led the decliners on the DJIA.

The Dow Jones industrial average, which traded 70 points lower in the morning, recovered some ground to close at 9871.06, off 0.2% or 14.74 points, its first decline in four sessions.  The S&P500 retreated 0.3% from a new 2009 high set on Monday.  The tech-heavy NASDAQ, however, finished the day virtually unchanged.  On the NYSE, 1.14 billion shares exchanged hands with decliners ahead of advancing shares by a three-to-two margin.

After Whitney’s downgrade, shares of Goldman Sachs (NYSE:GS - Analyst Report) fell 1.5%, with Bank of America (NYSE:BAC - Analyst Report) easing 1.2%, and Morgan Stanley (NYSE:MS - Analyst Report) down 2.0%.

However, after the close, Intel's (NASDAQ:INTC - Analyst Report), a DJIA component, results offered to ease some worries.  The company reported third-quarter earnings of 33 cents a share, versus Zacks estimates of 27 cents a share; the company reported revenues of $9.4 billion that was off 8.1% from last year, but bettered Zacks estimates of $9.0 billion.

CSX (NYSE:CSX - Snapshot Report), joining Intel (NASDAQ:INTC - Analyst Report) in painting an upbeat picture.  The company announced third quarter earnings of 74 cents a share, down from 94 cents a year ago, but above Zacks estimates of 71 cents a share as revenues of $2.36 billion bettered estimates of $2.33 billion.

This morning, however, JP Morgan’s (NYSE:JPM - Analyst Report) results showed an upside surprise as losses from the firm’s credit cards and other consumer loans businesses were offset by strong underwriting revenues.  Third quarter results were well ahead of Zacks estimates at 82 cents and were sharply up from last year's 9 cents a share.

The US dollar remained under pressure, falling to a fresh 14-month low yesterday.  Strong demand for $30 billion in 3-month and $30 billion in 6-month notes helped support Treasury prices.  Gold prices jumped $7.50 to $1073 and crude prices hit $74.

Companies reporting their results include: Abbott (NYSE:ABT - Analyst Report), WW Grainger (NYSE:GWW - Analyst Report), Host Hotels and Resorts (NYSE:HST - Snapshot Report) and Xilinx (NASDAQ:XLNX - Analyst Report).

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