Wednesday's Summary....

U.S. Markets

Dow +41.19 (+0.34%)
Nasdaq +12.53 (+0.55%)
S&P 500 +6.95 (+0.52%)

News That Moved the Market

Markets End Up After Digesting Ambac News. The markets finished the day up, but that was not before it tested the previous day's lows. For much of the day, most of the attention went to Ambac (ABK, -19.8%), which announced plans to raised $1.5 billion through sales of common shares and equity units. After the announcement, markets seemed disappointed with the news. Investors were looking for a true bailout that would solidify the company's balance sheet and extinguish concerns that Ambac would lose its AAA rating. Though S&P and Moody's did say they would probably confirm the bond insurer's AAA rating, the let down from the announcement pushed the markets down in the middle of the day. But like yesterday, the bottom fishers grabbed control in the afternoon and pushed the major indices back into the green to end the day.

Oil Rallies Off Inventory Decline. Crude spiked to a new record high of $104.95, before closing at $104.45. The jump was caused by OPEC's announcement that it will leave productions levels unchanged and an unexpected decline in inventories.

ISM Services Data Gives Market Hope. Before the bell the ADP Employment Report showed an unexpected decline in payrolls. Markets mostly shrugged off the figure and will pay much closer to Friday's Job's Report. The Institute for Supply Management services index data was better than expected and provided a much needed positive piece of economic data; markets were higher immediately after the announcement. Factory orders were also released, and were in-line with forecasts.

Quick Tics:

The Fed Beige Book survey showed economic growth has slowed, with 8 of the 12 Fed regional banks noticing a "weakening in the pace of business activity."

Goldman Sachs (GS, +0.7%) CEO Lloyd Blankfein believes the credit-market contraction is at least half way over.

Big Lots (BIG, +22.2%) jumped after increasing its 2008 profits forecasts.

Tomorrow Notable Earnings

Marvell Technology Group Ltd. (MRVL) After Close
National Semiconductor (NSM) After Close
Urban Outfitters (URBN) Before Open

Economic Events:

Chain Store Sales
Bank of England and European Central Bank Announcements
8:30 AM: Job Claims
10:00 AM: Pending Home Sales

US Stock Lose Gains on Ambac Disappointment...

Shares turn lower as details of Ambac's big bailout plan disappoint. Several sectors have fall into the red, including financials and both consumer staples and discretionary. Dow falls 50 points after being up more than 100 points earlier.

Updating our Beats and Raises Portfolio...

Here is an updated list of companies that, since January 1, have Beat Earnings Expectations AND have Raised Guidance for 2008.

Potash (POT)
Terex (TEX)
Intuitive Surgical (ISRG)
Hewlett-Packard (HPQ)
Medco Health (MHS)
Buffalo Wild Wings (BWLD)
Gamestop (GME)
Mosanto (MON)
JC Penney (JCP)
Zimmer Holdings (ZMH)
Sohu (SOHU)
Dolby Labs (DLB)
Research in Motion (RIMM)
Express Scripts (ESRX)
Boeing (BA)
Chattem (CHTT)
Corning (GLW)
IBM (IBM)
Netflix (NFLX)
EOG Resources (EOG)

These stocks are all down over the last week, might be an opportunity to Buy quality...

Earnings Due Today....

COMPANIES REPORTING EARNINGS

ADC (ADCT). Expected to report Q1 profit of $0.18 per share, according to analysts polled by Thomson Financial.

Brown Shoe Co. (BWS). Projected to report Q4 earnings of $0.37 a share.

Chico's FAS (CHS). Expected to report a Q4 loss of $0.15 a share.

Coldwater Creek (CWTR). Forecast to break even in Q4.

Comtech Telecommunications (CMTL). Likely to report Q2 earnings of $0.79 a share.

H&R Block (HRB). Estimated to post Q3 earnings of $0.06 a share, a decrease of 25% from the same quarter last year when the company earned $0.08.

PetSmart (PETM). Expected to post Q4 earnings of $0.62 a share, up 13.89% from the same quarter last year when the company earned $0.54.

Longs Drug Stores (LDG). Likely to report Q4 earnings of 40.97 a share.

Saks Inc. (SKS). Forecast to report Q4 earnings of $0.20 a share.

Tivo (TIVO). Likely to post a Q4 loss of $0.11 a share.

Yahoo in Talks with Time Warner..

The latest on Yahoo (YHOO) has it in talks with Time Warner (TWX) to take over its AOL unit, in exchange for which TWX would receive a sizeable minority stake in Yahoo. The combined company could save $1B annually. Oh, and Yahoo is still talking to News Corp. (NWS) to take over MySpace etc. for a stake in Yahoo.

With all these complex negotiations, it now seems likely Yahoo will push off a March 14 deadline by when Microsoft (MSFT) must make a push to take over the board, in order to get greater clarity on its defense stance. Many doubt a YHOO/AOL merger will float.

Apple Has No Plans for Buyback or Dividend...

Apple says at its annual shareholder meeting that it has no plans for a stock buyback or dividend. Apple also said it plans to sell the iPhone in Asia this year, targeting India and China.

Costco Reports In-Line Earnings...

Costco Wholesale Corp. (COST) posted a 31% increase in fiscal second-quarter net income on strong international growth and continued consumer flight toward discount retailers.
For the period ended Feb. 17, net income was $327.9 million, or 74 cents a share, compared with $249.5 million, or 54 cents a share, a year earlier.

Last year's second quarter included $53.4 million in charges.

The wholesale-club giant's revenue increased 12% to $17 billion as same-store sales rose 7%.
Chief Financial Officer Richard Galanti said in December that a Wall Street forecast of 74 cents a share for the quarter "sounds good," saying the retailer had "gotten off to a good start" in the period.

The latest mean estimates of analysts polled by Thomson Financial were for earnings of 74 cents a share on revenue of $16.9 billion.