Stock Market News for August 19, 2010

Stocks managed to close higher for a second consecutive session, but the gains were modest as weakness in energy shares offset strength in retailers’ stocks. Target led the strength in stocks of consumer-discretionary companies after its profit outlook for the current quarter matched Street estimates. Its earnings, however, were lackluster.

Stocks started the day on a down note and lacked direction throughout the session before closing with tepid gains. Barring retailers, whose numbers are important for determining consumer spending patterns Wednesday had little to offer to investors. However, retailers’ earnings numbers were mixed. Target’s (NYSE:TGT - Analyst Report) shares jumped 2.5% while Chico’s FAS (NYSE:CHS - Snapshot Report) shares jumped 10% after its stellar earnings numbers that also beat estimates.

BJ’s Wholesale Club (NYSE:BJ), however, disappointed after its numbers fell below analysts’ projections. The firm also lowered its outlook, sending its shares off 2.7%. Ann Taylor (NYSE:ANN - Snapshot Report) jumped 5.4% and Kohl’s Corp. (NYSE:KSS - Analyst Report) added 3.7%.

Reports that Bank of Japan was considering measures to combat deflation, including introducing economic stimulus measures pushed up Asian equity markets today. In Tokyo, the Nikkei 225 Stock Average advanced 1.3% on the news.  In Mainland China, the Shanghai Composite index climbed 0.8% and the Hang Seng index in Hong Kong inched up 0.2%.

Meanwhile, the long-awaited initial public offering of General Motors was filed late yesterday. GM hopes to raise about $12 billion to $16 billion in common shares, and about $3 billion in convertible securities. The proceeds would lower the Treasury’s stake in the automaker to below 50%.

The Dow Jones Industrial Average added 10 points, or 0.1% to 10,416. Home Depot (NYSE:HD - Analyst Report), yet again led the gainers on the DJIA, up 1.9%, after Citigroup (NYSE:C - Analyst Report) raised its price target on the firm to $38 from $34. Also pushing the DJIA higher were technology shares, with Cisco (NASDAQ:CSCO - Analyst Report) adding 1.6% and Hewlett-Packard (NYSE:HPQ - Analyst Report) gaining 1.3%. However, pulling the Dow lower were ExxonMobil (NYSE:XOM - Analyst Report) and Chevron (NYSE:CVX - Analyst Report), off 1.1% and 0.9%, respectively. Oil prices dropped to $75.42 per barrel after a report said crude inventories rose to a record high.

The broader S&P500 index edged up 0.2% to close at 1,094, but failed to cross the psychologically-important 1,100 level. The NASDAQ gained 0.3% to 2,216. On the New York Stock Exchange, advancing shares beat those that fell in price by a three-to-two margin.

The mergers and acquisitions front remained active, with reports saying ArcelorMittal (NYSE:MT - Analyst Report) is planning a bid for US Steel (NYSE:X - Analyst Report). However, S&P warned of a possible, one-notch downgrade to BHP Billiton's A+ credit rating. BHP Billiton’s (NYSE:BHP - Analyst Report) $39 billion bid for Canadian fertilizer maker Potash (NYSE:POT - Analyst Report) was turned down by the latter as inadequate. Other deals announced include Windstream's (NYSE:WIN - Analyst Report) offer to purchase Q-Comm for about $782 million and MasterCard's (NYSE:MA - Analyst Report) announcement to buy DataCash for $517 million.

Among companies slated to release results are several more retailers, including Sears Holdings (NASDAQ:SHLD - Analyst Report), Gap (NYSE:GPS - Analyst Report), Ross Stores (NASDAQ:ROST - Snapshot Report), and Staples (NASDAQ:SPLS - Analyst Report). Also reporting are tech companies Hewlett-Packard (NYSE:HPQ - Analyst Report) and Dell (NASDAQ:DELL - Analyst Report), both suffering under clouds of management issues.

Read the full analyst report on TGT

Read the full analyst report on CHS

Read the full analyst report on BJ

Read the full analyst report on ANN

Read the full analyst report on KSS

Read the full analyst report on HD

Read the full analyst report on C

Read the full analyst report on CSCO

Read the full analyst report on HPQ

Read the full analyst report on XOM

Read the full analyst report on CVX

Read the full analyst report on MT

Read the full analyst report on X

Read the full analyst report on BHP