Thursday's Summary....

U.S. Markets:

Dow -112.10 (-0.88%)
Nasdaq -22.21 (-0.94%)
S&P 500 -12.34 (-0.89%)

News That Moved the Market

GDP and Initial Job Claims Disappoints. The markets began the day lower off worse than expected economic data and never recovered. Before the bell, the preliminary GDP reading was released, coming in at 0.6%, slightly less than economists' expectations. The figure matched the initial estimates from last month. Additionally, initial job claims increased to 373,000 which was above forecasts. Combined with the data from the last couple days, things are beginning to look bleak. "We have absolutely no momentum going into the first quarter,'' said Josh Shapiro, chief U.S. at Maria Fiorini Ramirez Inc. "Things are looking pretty grim for the economy. If we're not in a recession already, we're very close."

Bernanke Speaks, Market Drops. Fed Chairman Ben Bernanke appeared before the Senate Finance Committee today and yet again caused a sell-off. Bernanke, while answering questions, said he thought the current economic environment was more challenging than the 2001 recession and believed oil would remain high. The markets noticeably sold off when he said some small U.S. banks may fail, though he said he believed larger banks would be able to survive.

Dell Misses Analysts' Targets. Dell (DELL, +0.5% day; -1.3% A.H.) reported a drop in fourth-quarter earnings after the bell. Net income fell 6%, while sales increased 10%; both the top and bottom-lines missed analysts' forecasts.

Sprint Falls On Unlimited Plan Offer. Sprint (S, -9.6%) jumped into the wireless price war by offering unlimited voice calls, data, and Web surfing for $99.99/month. The company reported a $29.5 billion loss after taking a enormous charge related to its acquisition of Nextel Communications. It also suspended its dividend.

Quick Tics:

Oil rallied 1.8% while gold traded at another all-time high

Kohl's (KSS, -3.5% day, -0.7% A.H.) missed analysts' targets and reported same-store sales were down after the bell.

Tomorrow Notable Earnings:

NONE

Economic Events:

8:30 AM: Personal Income
8:30 AM: Personal Spending
9:45 AM: Chicago PMI
10:00 AM: Consumer Sentiment

Dell Disappoints...

Dell Inc. (DELL) after the close reported a fourth-quarter profit of $679 million, or 31 cents a share, on revenue of $16 billion. During the year-ago period, Dell earned $726 million, or 32 cents a share, on $14.47 billion in revenue.

Analysts surveyed by FactSet Research had forecast Dell to earn 36 cents a share on sales of $16.24 billion. Dell said it expects to incur more costs as part of its business realignment plans and such actions could hurt its performance in the near term.

The stock is down slightly in after hours trading.

Another Large Hedge Fund Unwinds....

Prominent London Hedge Fund Liquidates Fund
Peloton Partners, a large London-based hedge fund, is liquidating one of its funds in the latest casualty of the credit crisis. The firm is in the process of alerting investors that is winding down its Peloton ABS fund.

In my opinion this is why last years high fliers are getting crushed of late. This is the 2nd large hedge fund in the last week to fold. They sell their assets with no regard for price. Exactly what we have seen since January 1.

Bush Speaking on TV again....

and once again the Market sells off.

It's amazing how much Wall Street hates this guy.

Dow -95
S&P -8
Nasdaq -11

Only one guy they hate as much (Bernanke) and he'll be speaking later....ohhh nooo!!!

Today's Notable Movers:

Netflix (NFLX) up 1.57 to $34.00- continues to run after yesterday's earnings beat

LG Philips (LPL) up 1.17 to 24.63 - no news released but stock is breaking higher on abnormal volume. They are becoming household name in electronic display and TVs

Apple (AAPL) up 4.69 to $127.64 - on positive comments about iphone sales

EOG Resources Inc. (EOG) up 12.89 to $118.50 - boosted its 2009 and 2010 organic production growth estimates to 13% to 15% from the previously stated annual average of 10%.

Earnings Due Today....

COMPANIES REPORTING EARNINGS

• American International Group (AIG). Expected to post Q4 earnings of $0.60 cents a share, according to analysts polled by Thomson Financial.

• Barr Pharmaceuticals Inc. (BRL). Expected to post Q4 profit of $0.74 a share.

• Cablevision Systems Corp. (CVC). Expected to report Q4 earnings of $0.11 a share.

• Cooper Tire & Rubber Co. (CTB). Expected to report Q4 profit of $0.36 a share.

• Dell Inc. (DELL). Expected to report Q4 earnings of $0.36 a share.

• Fluor Corp. (FLR). Expected to report Q4 earnings of $1.18 a share.

• Gap Inc. (GPS). Expected to report Q4 earnings of $0.35 a share.

• Hansen Natural Corp. (HANS). Expected to report Q4 profit of $0.38 a share.

• Kohl's Corp. (KSS). Expected to report Q4 profit of $1.30 per share.

• Leap Wireless International Inc. (LEAP). Expected to post Q4 loss of $0.17 a share.

• Liberty Media Holding Corp. (LINTA). Expected to post Q4 profit of $0.30 a share.

• Rowan Cos. (RDC). Expected to report Q4 profit of $1.18 a share.

• Universal Health Services Inc. (UHS). Expected to post Q4 profit of $0.70 a share.

• United Rentals Inc. (URI). Expected to report Q4 profit of $0.73 a share.

• Viacom Inc. (VIA). Expected to post Q4 earnings of $0.83 a share.

• XM Satellite Radio Holdings Inc. (XMSR). Expected to post Q4 loss of $0.63 a share.

Sears Profits Get Cut in Half...

Retailer's 4Q profit falls by nearly half to $426 million, or $3.17 a share, from last year's $811 million, or $5.27 a share, on a lower margins and 7% revenue drop on markdowns. Analysts were expecting earnings of $3.05 a share.

Not surprising if you have been in one of their stores lately.

Wednesday's Summary....

U.S. Markets:

Dow +9.36 (+0.07%)
Nasdaq +8.79 (+0.37%)
S&P 500 -1.27 (-0.09%)

News That Moved the Market

Cap Lifted For Home Loan Providers. The markets took off early in the session on news that the Office of Federal Housing Enterprise Oversight decided to remove Fannie Mae's (FNM, +1.1%) and Freddie Mac's (FRE, -0.5%) $1.5 trillion mortgage portfolio cap. The cap was created after the two companies found $11.3 billion in accounting errors in 2006. The lenders should now be better able to provide financing for the U.S.'s troubled housing market.

Earlier in the morning, Fannie Mae reported a greater than expected $3.6 billion loss and shares of the company hit a 12-year low, but news of the regulator's decision turned the stock around. Later in the day, the markets sold off, as investors pocketed profits. It seems many do not want to leave profits on the table when a bad piece of data or headline could erase any gains.

Bernanke Signals Further Rate Cuts. Fed Chairman Ben Bernanke spoke in front of the Senate Banking Committee Wednesday and provided some relief to investors. Despite rising inflation pressures, he indicated the Fed would continue easing rates as economic downside risks remained the key focus.

Economic Data Misses Estimates. The Commerce Department reported durable goods fell 5.3%, which was slightly worse than expected. Meanwhile, new homes sales came in at 588,000, missing the 600,000 expected and representing a 13-year low. Both pieces of data were not horrible, but showed signs of a deteriorating economy.

Quick Tics:

The EU slapped Microsoft (MSFT, -0.4%) with a record $1.35 billion anti-trust fine.

The U.S. dollar hit a record low against the euro ($1.5118/euro) after Bernanke signaled further rate cuts.

Gold futures hit an all-time high of $967.70/ounce.

Nortel Networks (NT, -13.3%) reported steeper losses, announced job cuts, and released a worse than expected growth forecast for 2008.

Tomorrow Notable Earnings:

Cablevision Systems Corp.(CVC) Before Open
Dell, Inc. (DELL) Before Open
Gap Inc. (GPS) After Close
Kohls Corporation (KSS) After Close
Sears Holdings Corp (SHLD) Before Open
Viacom (VIA) After Close
XM Satellite Radio (XMSR) Before Open

Economic Events:

8:30 AM: GDP
8:30 AM: Chain Deflator
8:30 AM: Initial Job Claims

My Daughter Says Buy Abercrombie & Fitch....

No kidding. ANF is the owner of the Hollister chain...and this is the hottest store for young teens.

The stock is up .75 to $81.75 today. Technically...the stock has alot of resistance at $84-85 level. We'll keep an eye on it and let you know if it breaks out.

Technical Alert: Sony Corp.(SNE)

We have been following Sony Corp., as the company has had alot of wins over the past month. The stock is higher again today on high volume, currently up .60 to $49.50. It has climbed out of a base, up 20%, in the last two weeks.

Next resistance is at $55-56 level.

Technical Alert: Juniper (JNPR)

Juniper Networks is breaking higher out of one month base on higher volume.

The stock is up 1.25 to $28.75 today. The stock was looking strong in the low 30's back in December before the market sold off the first few weeks in January.

Technical Alert: Research in Motion (RIMM)

Research in Motion is breaking higher out of a cup and handle formation on higher volume.

The stock is up 3.12 to $110.87. The next level of resistance on the stock is at $122.

Upgrades this morning...

Stocks that have been Upgraded this Morning:

Healthways (HWAY) by Stifel Nicolaus
AXT Inc (AXTI) by Roth Capital
Medarex (MEDX) by BMO Capital Markets
SuperGen (SUPG) by Susquehanna Financial
Xilinx (XLNX) by UBS
Overseas Shipholding (OSG) by Bear Stearns
Tenet Healthcare (THC) by Jefferies & Co
Telefonica S.A. (TEF) by UBS

Downgrades this morning...

Here is a list of stocks that have been Downgraded this morning:

Autodesk (ADSK) by Needham & Co
Ceradyne (CRDN) by Morgan Joseph
Orthofix (OFIX) by Susquehanna Financial
NovaGold Resources (NG) by RBC Capital Mkts
K-Swiss (KSWS) by Susquehanna Financial
Solarfun Power (SOLF) by Banc of America Sec
JA Solar (JASO) by Banc of America Sec
Chesapeake Energy (CHK) by Citigroup
Quicksilver (KWK) by Citigroup
EOG Resources (EOG) by Citigroup
SW Energy (SWN) by Citigroup
Barrick Gold (ABX) by Credit Suisse
Ultra Petroleum (UPL) by JP Morgan

Costco Down as Goldman Cuts Rating on Co....

Shares of Costco Wholesale Corp. (COST) is down 2.4% to $64.86 after Goldman Sachs cut its rating on the warehouse retailer to neutral from buy.

In a note to clients, Goldman Sachs analyst Adrianne Shapira wrote that "with current relative valuation well above historic averages and limited remaining catalysts on the horizon, we view current risk/reward less compelling."

The stock appeared to be breaking out yesterday, but this downgrade should cause it to pull back. It has key support at $62.50.

Netflix Up After Boosting 1Q Outlook...

Shares of Netflix Inc. (NFLX) are up 6.9% to $31 before the opening bell Wednesday after the online DVD rental service boosted its first-quarter earnings outlook.

The Los Gatos, Calif., company said it now sees first-quarter earnings of 15 cents to 22 cents a share on revenue of $324 million to $328 million. The company had previously forecast first quarter earnings of 13 cents to 21 cents a share on revenue of $323 million to $328 million.

Analysts expect, on average, earnings of 20 cents a share on revenue of $325 million.
In addition, Netflix sees first-quarter ending subscribers of 8.16 million to 8.26 million, up from a prior view of 7.85 million to 8.05 million ending subscribers.

Not much of a raise, but...

US January Durable Goods Orders Drop 5.3%..

Orders for durable goods fall 5.3% to $212.80 billion and a barometer of capital spending by businesses slumps, an indication the sluggish economy might be restraining companies. Economists expected a smaller 4% decrease in durable goods orders.

US Stock futures dropped on the news...

Bernanke Speaks to Congress this Morning...

Eyes will be trained on Washington D.C. on Wednesday as Bernanke begins his two days of Congressional testimony, starting at 10 a.m. Eastern.

Vice Chairman Donald Kohn on Tuesday said that, despite signs that inflation actually strengthened in January, the nation's weak economy and fragile financial markets remain a bigger threat than higher prices. Kohn's views are generally thought to be closely aligned with Bernanke's.

In the last six months, traders have been selling off the market EVERY time either Bernanke or Bush appear on TV. It is obvious neither guy has any respect on Wall Street. Stock futures are already down in anticipation...

J&J, Amgen Fall on New Study...

Anemia drugs Aranesp and Procrit sold by Amgen (AMGN) and Johnson & Johnson (JNJ) raise the risk of death among cancer patients by about 10%, a new study of previous trials found. Amgen played down the study, saying the risks are already in the drugs' labels.

The FDA will convene in March to decide whether to impose further restrictions on the drugs, commonly used to treat chemotherapy-induced anemia. Shares of Amgen and J&J were down 3.2% and 1.15% in Europe.

Dollar Tumbles...

The U.S. dollar hit record lows against the euro after weak consumer confidence and surprise inflation raised the odds of further interest-rate cuts.

Consumer Confidence fell to 75 vs. 82 consensus, down from 87.3 -- its lowest in nearly 15 years. Both core (+0.4%) and headline (+1%) wholesale inflation surprised to the upside; 12-month PPI of 7.4% is at its highest in over 25 years.