Stocks recharge the advance

Stocks rallied Wednesday afternoon, pushing Wall Street to two-week highs, as investors found the positives in the day's bleak report on first-quarter economic growth.

Investors also geared up for an announcement from the Federal Reserve, due out shortly.

The Dow Jones industrial average (INDU) gained 180 points, or 2.3% at around 2:00 p.m. ET, just ahead of the Fed announcement. The S&P 500 (SPX) index added 20 points, or 2.4%. The Nasdaq composite (COMP) rose 42 points, or 2.5%.

Stocks were rising again after two down sessions, recharging the advance that boosted the major gauges all more than 20% over a six-week period. Last week only the Nasdaq gained, with the Dow and S&P 500 posting small losses.

"We had a period of consolidation on the back of a strong move," said Michael Church, president at Addison Capital.

"There have been some reports and earnings that were not as bad as expected and that's helped," he said. "At one point, investors were fearing the apocalypse, but it's become clearer that that's not what is happening."

Wall Street retreated Monday on worries about the potential economic impact of swine flu. On Tuesday, stocks slipped on reports that Bank of America (BAC, Fortune 500) and Citigroup (C, Fortune 500) may need more capital should the recession deepen.

Fears that major banks may need more cash on hand have been in play this week ahead of the results of Treasury's "stress tests" of the largest companies, due next Monday.

"I think people are just looking forward to the tests being over," said Church.

GDP: The economy shrank at a faster-than-expected pace in the first quarter, surprising economists who were looking for an even slower pace of contraction after a rough fourth quarter of last year.

Gross domestic product fell at a 6.1% annualized rate in the first quarter after falling 6.3% in the fourth quarter. Economists thought it would fall at 4.7% pace, according to Briefing.com forecasts.

GDP was weighed down by a sharp decline in exports and plummeting business inventories. However, the inventory slowdown was seen as a positive, as it could mean the correction cycle is ending. In addition, personal consumption rose, after falling in the previous quarter, raising hopes that consumer spending will pick up.

In other economic news, home loan applications fell last week to the lowest levels in more than a month due to a drop in refinancing demand.

Federal Reserve: The Federal Reserve's two-day policy meeting ends Wednesday, with a decision on interest rates and a statement due at around 2:15 p.m. ET.

The central bank is widely expected to hold rates steady at historic lows near zero. However, the bank's assessment of the economy will be closely scrutinized. In addition, the Fed could announce it is speeding up its Treasury purchasing plan.

Wednesday is also significant as it markets President Obama's 100th day in office.

Banks: Citigroup (C, Fortune 500) has reportedly asked Treasury if it can pay out bonuses to certain workers, according to the Wall Street Journal. Citi has received $45 billion in federal bailout money and may need to raise more. Shares gained 7%.

Bank of America (BAC, Fortune 500) shareholders criticized CEO Ken Lewis for his handling of the company's recent purchase of Merrill Lynch. A vote has been taken at BofA's annual meeting on whether Lewis should retain his chairmanship with results to be announced soon. Lewis will retain his CEO position.

However, shares gained 5% as part of a broad bank stock rally. Wells Fargo (WFC, Fortune 500), Goldman Sachs (GS, Fortune 500), Morgan Stanley (MS, Fortune 500), Fifth Third were among the other gainers. The KBW Bank (BKX) sector index rose 4%.

Company news: Aetna (AET, Fortune 500) reported higher quarterly sales and earnings that topped estimates. But the health insurer also said it saw higher-than-expected medical costs. Shares slumped 9%.

Time Warner (TWX, Fortune 500), the parent of CNNMoney.com, reported weaker quarterly profit on slowing ad sales, but results were better than what analysts were expecting.

Dendreon (DNDN) shares rallied 105% in its first day of trading after saying its experimental treatment for advanced prostate cancer extended the lives of men suffering from the disease by four months. Shares were halted after the Tuesday afternoon announcement.

Market breadth was positive. On the New York Stock Exchange, winners beat losers six to one on volume of 700 million shares. On the Nasdaq, advancers topped decliners four to one on volume of 1.4 billion shares.

Bonds: Treasury prices slipped, raising the yield on the benchmark 10-year note to 3.02% from 3.01% Tuesday. Treasury prices and yields move in opposite directions.

Lending rates were mixed. The 3-month Libor rate fell to 1.04% from 1.05% Monday, according to Bloomberg.com. The overnight Libor rate was unchanged at 0.21%. Libor is a bank-to-bank lending rate.
0:00 /00:59100 Days: Rating Obama

Other markets: In global trading, Asian markets ended mostly higher and European markets were higher in afternoon trading.

In currency trading, the dollar fell versus the euro and gained against the yen.

U.S. light crude oil for June delivery rose 97 cents to $50.89 a barrel.

COMEX gold for June delivery rose $6.90 to $900.50 an ounce.

Oil weak as demand fears remain

  The price of oil remains weak, at just under $49 a barrel, amid Opec warnings of falling demand and reports of high inventories. 

US light crude was down 42 cents at $48.99 a barrel, after three days of falls. Brent oil fell 54 cents to $51.42 a barrel. 

The oil producers' cartel said demand was shrinking faster than expected. 

Oil prices have slumped since hitting a record high of more than $147 a barrel in July last year. 

Prices dropped below $40 a barrel late last year. 

Demand drag 

Crude stocks reached 366.7 million barrels in the US, according to government data, the highest total since September 1990. 

At the same time, Opec forecast that demand would drop by 1.37 million barrels per day this year - greater than the 1.01 million barrels per day originally forecast - to average 84.2 million. 

"In the coming months, the market is expected to remain under pressure from uncertainties in the economic outlook, demand deterioration and the substantial overhang in supply," Opec said. 

Retail sales dropped 1.1% in March in the US, according to a government report released on Tuesday, renewing fears of a slowdown in demand. 

"Crude fell on the back of weaker-than-expected March retail sales, which also dragged on equities, and the main worry is still the large weekly increase in crude inventories," said Peter McGuire, managing director of Commodity Warrants Australia. 

There is as yet little sign that demand is picking up, said Ben Westmore, energy analyst with National Australia Bank. "Demand will have to come back before you see the oil price move up from $50 in a sustained way," he added. 

Last week, the International Energy Agency predicted that the global recession would cut demand for crude this year, with world oil demand falling by 2.4 million barrels a day to 83.4 million barrels. 

Separately, Mexico's state-owned oil company Pemex has unveiled plans to built its first new refinery in 30 years. The $9.1bn (£6.1bn) refinery is expected to come online in 2015. 

Even though Mexico is the world's sixth-biggest oil producer, it relies on US refineries to process a lot of its crude.

Stocks slump in early trading

     Wall Street retreats as worries about swine flu outbreak give investors a reason to step back after the rally. GM unveils restructuring.

 Stocks slipped Monday morning as fears about the economic impact of swine flu gave investors a reason to retreat after a rally that propelled the Dow industrials more than 20% in less than two months.

GM's restructuring plan was also in focus.

The Dow Jones industrial average (INDU) lost 80 points, or 1%, in the early going. The S&P 500 (SPX) index lost 9 points, or 1%. The Nasdaq composite (COMP) lost 17 points, or 1%.

Swine flu outbreak: The World Health Organization has called the outbreak of swine flu a "public health emergency of international concern." 

Mexico seems to be the center of the outbreak, although cases have spread to countries around the world.

As many as 103 deaths in Mexico are thought to have been caused by swine flu, CNN reported. In the United States, the largest number of cases has been reported in New York City.

Most U.S. airlines, including Delta (DAL, Fortune 500), American Airlines (AMR, Fortune 500), Continental (CAL, Fortune 500), United (UAUA, Fortune 500) and U.S. Airways (LCC, Fortune 500) have begun to waive fees for customers who have tickets to Mexico and wish to change their travel plans due to the flu outbreak.

"There are certain companies that are being affected by the flu, and people are worrying that this could mushroom into full-blown epidemic," said Peter Cardillo, chief market economist at Avalon Partners. "Obviously that would cut into GDP, and with global economies still in recession, that would add to economic woes."

Autos: General Motors (GM, Fortune 500) announced a restructuring plan Monday morning in an attempt to avoid entering bankruptcy. The company said it would cut 7,000 to 8,000 jobs in addition to its previously announced reductions, terminate its Pontiac line by 2010, cut more dealerships and restructure its debt. 

Shares of GM rose 20% in early trading.

On Sunday, Chrysler reached a tentative labor agreement with the United Auto Workers -- a key step in final efforts to help the automaker avoid bankruptcy. 

Market downgrade: Credit Suisse downgraded its rating on U.S. stocks one notch on Monday, saying the equities were expensive relative to those in other countries. The bank's report also said that first quarter earnings have been mediocre.

"Markets are also lower because Credit Suisse downgraded its rating on the U.S. market," Cardillo said. "Combined with the flu concerns, people have a reason they were looking for to take some profits off the table."

Cardillo said that many investors are worried that the seven-week market rally will end this week, as a number of economic reports -- including an initial report on first-quarter gross domestic product -- will likely pressure stocks. He believes the flu outbreak and market downgrade have given anxious investors the excuse to sell off some of their positions.

Earnings: Whirlpool (WHR, Fortune 500) on Monday reported profit fell 27% and sales dropped 23% in the first quarter. The company cut its outlook on exports.

Verizon Communications (VZ, Fortune 500) reported slightly higher earnings than a year earlier. Qualcomm (QCOM, Fortune 500) posted a net loss.

World markets: Concern about the economic fallout of the flu outbreak pressured airline and hotel stocks in overseas trading.

Most Asian shares tumbled, although Japan's Nikkei finished afternoon trading.

Oil and money: Oil prices tumbled, with U.S. light crude for June delivery falling $2.78 to $48.77 a barrel on the New York Mercantile Exchange.

The dollar edged higher against the euro and fell versus the yen. 

Stocks Slide After Drop in Home Sales

     quick pop at the open fizzled Thursday as economic data cast a shadow over the market and some better-than-expected earnings.

"I think there's nervousness back in the market," Art Cashin, director of floor operations at UBS, told CNBC. "The next several days will tell us whether it's going to be a significant pullback or just a cleanup of the overbought condition ... I'm leaning toward a significant pullback," he said.

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Today's wobbly start followed a turbulent session Wednesday that left the Dow down about 1 percent. The tech-heavy Nasdaq, however, eked out a gain of 0.1 percent.

“We need about two to four weeks to recharge the batteries of the market … then we’ll be ready for the next leg higher,” Paul Schatz, president of Heritage Capital, told CNBC.

Existing-home sales dropped 3 percent to a 4.57 million annual rate in March, much lower than the 4.7-percent pace expected. February was downwardly revised to a 4.71 million pace.

And the Labor Department reported that initial jobless claims rose by 27,000 last week. The four-week moving average declined slightly but continuing claims shot up to a record 6.137 million.

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Most of the earnings of the past two days came in better than expected, which helped curb stocks' losses somewhat.

Apple [AAPL Loading... () ] shares rose after the technology giant late Wednesday delivered solid earnings, which showed sales of iPhones and iPods topped forecasts.

Fifth Third [FITB Loading... () ] also beat expectations, with a loss of 4 cents a share. Analysts had expected a more severe 27-cent loss.

Online auctioneer eBay [EBAY Loading... () ] reported its earnings fell but still beat expectations.

Defense contractor Raytheon [RTN Loading... () ] said its profit grew 14 percent in the first quarter. 

Hershey [HSY Loading... () ] reported its earnings rose more than expected, helped by price increases and market-share gains.

Radio Shack [RSH Loading... () ] also beat earnings expectations, after a dismal fourth quarter, helped by sales of digital-converter boxes.

But United Parcel Service [UPS Loading... () ], a bellwether for the economy, missed analysts' target. The package-delivery giant said the weak economy was dampening demand for the delivery service.

General Electric [GE Loading... () ] shares climbed after a contentious shareholder meeting in which shareholders blastede CEO Jeff Immelt for the 68-percent dividend cut. GE is the parent of CNBC.

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The auto sector remained in flux as the government wrangled with the struggling sector. US taxpayers are now likely to own a large stake in General Motors [GM Loading... () ] as the government could convert a $13.4 billion loan into common stock. The move could reduce the company's debt burden.

Meanwhile, Chrysler’s loans could also be converted into stock under Treasury plans, sources told Reuters. The Treasury offered the lenders $1.5 billion of first-lien debt and a 5 percent equity stake in the company in exchange for about $7 billion of debt they currently hold, according to the sources. 

And Fiat is apparently in talks to buy GM's Opel unit, though that is contingent on the outcome of its talks with Chrysler, the Wall Street Journal reported.

Among the other buzz in the market, Bank of America [BAC Loading... () ] CEO Ken Lewis claims to have come under pressure from Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Henry Paulson to keep quiet about the problems at Merrill Lynch and BofA, the Wall Street Journal reported. 

Johnson & Johnson [JNJ Loading... () ] shares fell even as the consumer-products company raised its dividend by 6.5 percent to 49 cents a share from 46 cents a share.

Still to Come: 

THURSDAY: Existing-home sales; Earnings from Microsoft, Amazon, AmEx and Burlington Northern after the bell
FRIDAY: G-7 meeting in Washington; durable-goods orders; new-home sales; Earnings from 3M, Honeywell, Schlumberger and Xerox

Stocks pull forward

   Stocks turned higher near midday Tuesday as investors shrugged off some early weakness following a mixed batch of quarterly results and attempted to revive the six-week market advance.

The Dow Jones industrial average (INDU) gained 30 points, or 0.4%, around 2 hours into the session. The S&P 500 (SPX) index gained 6 points, or 0.7%. The Nasdaq composite (COMP) gained 21 points, or 1.3%.

Stocks tumbled Monday, falling after a six-week run after Bank of America (BAC, Fortune 500) reported results that beat forecasts, but also warned about deteriorating credit quality. Despite better-than-expected results from JPMorgan Chase (JPM, Fortune 500), Goldman Sachs (GS, Fortune 500) and others, investors remain wary about bank results.

That wariness continued Tuesday, sending the KBW Bank (BKX) index down 3.5%.

Results: After the close Monday, IBM (IBM, Fortune 500) reported higher earnings that beat estimates on weaker revenue that missed estimates. The tech leader reiterated its goal of earnings of $9.20 per share in 2009 and said it is on track to meet its profit goal of $10 to $11 per share in 2010. Shares were little changed Tuesday. 

Also late Monday, Texas Instruments (TXN, Fortune 500) reported weaker quarterly sales and earnings that topped expectations. The chipmaker forecast first-quarter earnings per share above analysts' forecasts. Shares lost 2% Tuesday.

On Tuesday morning, Dow components Caterpillar (CAT, Fortune 500), Merck (MRK, Fortune 500), DuPont (DD, Fortune 500), Coca-Cola (KO, Fortune 500) and United Technologies (UTX, Fortune 500) all reported results.

Caterpillar reported its first quarterly loss since 1992, due to charges related to recession-tied layoffs. The heavy equipment maker also cut its full-year earnings and sales forecast, sending shares 3% lower in morning trading.

Merck reported weaker quarterly sales and earnings that missed analysts' forecasts, citing the global economic slowdown. The company also said its soon-to-be-completed purchase of Schering-Plough (SGP, Fortune 500) would help drive growth in the coming years. Merck shares fell 5.5%.

Separately, Schering-Plough reported higher-than-expected first-quarter earnings. 

DuPont reported weaker quarterly earnings that topped estimates on lower sales that missed forecasts. The chemical maker also cut its full-year 2009 earnings forecast and said it will take on most of its cost-cutting initiatives in the months ahead. Shares gained 3.5%.

Coca-Cola reported weaker quarterly earnings that met Wall Street's forecasts. The world's biggest soft-drink maker also reported lower quarterly revenue. Shares lost 3%.

United Technologies reported weaker quarterly earnings that met estimates on a drop in quarterly sales. However, the company said it expects to see profit growth in 2010, sending shares higher. Shares rose 4.5%.

Bonds: Treasury prices gained, lowering the yield on the benchmark 10-year note to 2.82% from 2.84% Monday. Treasury prices and yields move in opposite directions.

Obama Proposes $100 Billion US Loan to IMF

 President Barack Obama on Monday proposed a $100 billion U.S. loan to the International Monetary Fund to boost the IMF's war chest and urged a bigger stake in the IMF for emerging powers like China and India.

In a letter sent to Democrat and Republican leaders in the U.S. Congress, Obama said the U.S. funding "does not represent a budgetary expenditure or any increase in the deficit since it effectively represents an exchange of assets." 

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The letter comes days before world finance leaders gather in Washington on April 24 and 25 for meetings of the IMF and World Bank to discuss among other things IMF lending and governance reforms at the global institutions.

The $100 billion is part of pledges made by Group of 20 member countries during a summit in London on April 2 to combat the worst economic crisis since the Great Depression.

The G20 committed to triple IMF resources to a total of $750 billion by adding $500 billion on top of $250 billion in existing resources to allow the fund to respond to crises in hard hit emerging market and developing countries.

The U.S. funding will boost the IMF's so-called New Arrangements to Borrow (NAB), an emergency facility established in 1998 that allows IMF member countries to provide credit to the Fund to deal with crises that may threaten the stability of the global financial system.




Obama urged Congress to quickly pass legislation to allow the U.S. to keep its G20 promises, and emphasized it would not require budgetary outlays.

"The United States transfers dollars to the IMF under the NAB, the United States receives in exchange another monetary asset in the form of a liquid, interest-bearing claim on the IMF, which is backed by the IMF's strong financial position, including its significant holdings of gold," Obama wrote.

He said the NAB's pool of capital was "woefully inadequate" for the IMF to support emerging and developing countries in the current severe economic and financial crisis.

"The deteriorating conditions threaten to worsen the recessions in these countries and could cause currencies to collapse," Obama wrote.

"Together, these factors, particularly if they become more acute, will further lower global growth and, as we saw during the Asian financial crisis, they will cause U.S. growth, jobs, and exports to fall even more sharply," he added.

Obama said an enlargement of the NAB facility by an overall $500 billion would allow for more participation by emerging market economies, in particular China and India, in the IMF. Chinese officials have already indicated Beijing plans to contribute $40 billion to the IMF through a bond issued to its central bank by the Fund.

Meanwhile, IMF officials have said Brazil and Saudi Arabia could also contribute.

Obama said countries were looking to Washington to deliver on its G20 commitment, indicating that other governments could follow the lead of the U.S., which is the IMF's largest and most influential shareholder.

Emerging market economies have long pushed for a greater stake in the IMF and a rebalancing of voting power to reflect their rising clout in the global economy.

Stocks set for lower open

   Futures drop ahead of Bank of America's quarterly results. Pepsi bids for 2 main bottlers.

LONDON (CNNMoney.com) -- U.S. stocks were poised for a lower start Monday, as jitters about corporate results overshadowed deal news.

At 5:26 a.m. ET, Dow Jones industrial average, Standard & Poor's 500 and Nasdaq 100 futures were all lower.

Futures measure current index values against perceived future performance and give an indication of how markets may open when trading begins in New York.

Earnings: With an estimated 10% of the S&P 500 having reported results so far, profits are on track to have shrunk 37.4% from a year ago, according to the latest from Thomson Reuters. 

About 140 companies, or 28% of the S&P 500 report results this week. In focus Monday is Bank of America (BAC, Fortune 500), which releases its financial results before U.S. markets open.
0:00 /3:33Big oil tops the Fortune 500

Deals: PepsiCo (PEP, Fortune 500) offered $6 billion to buy out shareholders of its two largest bottlers, Pepsi Bottling Group (PBG, Fortune 500) and PepsiAmericas (PAS). The drinks giant also announced better-than-expected quarterly earnings. 

In the drugs sector, British firm GlaxoSmithKline (GSK) agreed to pay up to $3.6 billion for independent skincare specialist Stiefel Laboratories. Stiefel is partly owned by private equity firm Blackstone Group (BX).

World markets: Stocks in Asia managed to end mostly in positive territory. Japan's Nikkei edged higher and the Hang Seng in Hong Kong rose nearly 1%. European markets, meanwhile, tumbled in morning trading. 

Obama: How to get business going

     'I have always believed that our rule as lawmakers is not to stifle the market.'

Fortune Magazine) -- Barack Obama has been more critical of corporate America than any recent President. After his speech on the economy on April 14, Washington editor Nina Easton submitted written questions about his views on business. The answers he sent Fortune sounded notably conciliatory. Excerpts:

How can corporate America redeem itself? You reportedly told bankers in a private meeting recently that your administration "is the only thing between you and the pitchforks." Could you broaden that message for the Fortune 500?

The causes of this economic and financial crisis are complex, and extend from Washington to Wall Street to Main Street. Americans are angry at the extent of the damage that has been done to our economy, and justifiably so. Understanding that frustration is important in restoring confidence and helping our economy and our businesses recover.

The truth is that there is plenty of blame to go around. Many Americans took out loans that they could not afford. Others were enticed into loans they did not understand by lenders trying to make a quick profit. Investment banks bought and packaged these questionable mortgages into securities, arguing that by pooling the mortgages, the risks had been reduced. Credit agencies stamped these securities with their safest rating when they should have been labeled "Buyer Beware." And as the bubble grew, there was almost no accountability or oversight from anyone in Washington.

Addressing this crisis will require change across the spectrum, not just from corporate America but from Washington and Main Street as well. We need to update our regulatory structure with sound rules of the road that reward drive and innovation instead of shortcuts and abuse. We also need to invest in the drivers of productivity that will make our businesses more competitive in areas like health care, energy, and education.

You said you'd like to see "our best and brightest commit themselves to making things" rather than responding to a culture that celebrates "those who can manipulate numbers." In what ways do you want to foster companies that make things?

One of the goals of my economic policy is to help lay the foundation for durable economic growth, which drives innovation in our businesses and helps nurture the next generation of homegrown scientists, engineers, and innovators. But as we move forward in this effort, we cannot ignore the fact that our education system is not adequately preparing our workers for a 21st-century economy. Our businesses cannot compete and win in the global economy without a more effectively trained workforce - especially in areas like math and science. That is why so many corporate leaders are advocating for more effective investments in education - from early-childhood education to cultivating more homegrown engineering talent. And that is why I have set a goal that will greatly enhance our ability to compete for the jobs of the 21st century: By 2020, America will once again have the highest proportion of college graduates in the world.

Much of the business community is alarmed over tax increases in your budget. A coalition of business groups argues that this will impede an economic recovery. Do you believe there is validity to this concern, and do you continue to entertain the possibility of lowering the U.S. corporate tax rate?

I have long advocated a fairer, simpler tax code. That's why my administration has taken far-reaching action to cut taxes in ways that will spur an economic recovery. We have enacted a tax cut for 95% of working families. We passed a recovery act with $75 billion in tax cuts to help businesses create jobs over the next two years. And we are helping small businesses keep their doors open so they can weather this economic storm. Instead of the normal two years, small businesses are now allowed to offset their losses during this downturn against the income they've earned over the last five years. Going forward, I'm committed to reforming our tax code to remove the distortions and complexities that get in the way of businesses investing in expanding operations and creating jobs here in the U.S.

The economic crisis has compelled the administration to assert itself over corporate America in ways that Americans aren't used to. How permanent will this be?

I did not invite the crises that I inherited, and I have always believed that our role as lawmakers is not to stifle the market, but to strengthen its ability to unleash creativity and innovation. But I also have a responsibility to take aggressive action to avoid an even deeper recession and to move this nation toward recovery. History has shown repeatedly that when nations do not take early and aggressive action to get credit flowing again, they have crises that last for many years instead of many months. My hope is that by taking the steps we are taking today, from stabilizing our financial system to helping our auto industry restructure to become more competitive, it will help speed the day that the government can get out of the way and let the private sector do what it does best - innovate, create jobs, and grow the economy.

Many economists seem to think that while the recession is bottoming, the real problem is that we will have a very weak recovery. Do you agree?

While there have been some encouraging signs that our economy may be stabilizing, the risks remain real and significant. We've already taken important steps to address our economy's weakness, including a recovery act that will help create or save 3.5 million jobs and a financial stabilization plan that is expanding credit for homeowners and small businesses. But there is substantial work left to be done - not only to repair the immediate damage, but to ensure that we emerge from this recession with an economic model that leads to durable, sustainable growth.

We've heard much about what corporate America does wrong - greed, excessive debt, shortsightedness. What do you believe Fortune 500 leaders do well?

American businesses and workers will remain the very engine of America's progress - the source of a prosperity that has gone unmatched in human history. Even amid our current downturn, we continue to have the deepest pool of innovators and entrepreneurs of anywhere in the world, many of whom have nurtured strong companies represented on the Fortune 500. These leaders are second to none in creating good jobs, innovative products, and services for consumers and long-term value for their shareholders. And U.S. companies have been on the cutting edge of productivity advances across a range of industries, which is at the heart of sustainable prosperity in the long run.

As many corporate leaders themselves have recognized, in recent years our economy has fallen out of balance. But as we restore this balance, I look forward to working in partnership with America's business leaders to help repair our broken economy and ensure that we emerge from this recession stronger and more prosperous than before. 

Stocks Edge Higher on Earnings News

 
  Stocks closed slightly higher Friday after seesawing earlier, allowing the market to score a sixth straight week of gains. General Electric (GE) and Citigroup (C) earnings were better than expected as the market closed out a somewhat trendless week looking for clues about the state of global economies, says S&P MarketScope. 

There was muted reaction to news that the Michigan Consumer Sentiment Index rose to 61.9 in April from March's 57.3 reading. 

On Friday, the 30-stock Dow Jones industrial average edged up 5.90 points, or 0.07%, to 8,131.33. The broad S&P 500 index rose 4.30 points, or 0.50%, to 869.60. The tech-heavy Nasdaq composite index added 2.63 points, or 0.16%, to 1,673.07 -- following Thursday's 2.7% gain. 

Treasuries were lower, sending the yield on the 10-year note up to 2.93%. The dollar index rose. Gold futures fell to $868, while and crude oil rose to $50.66. 

Among companies in the news, Citigroup (C) posted $0.18 first quarter loss, vs. $1.03 loss a year ago, on 99% revenue rise. Wall Street was looking for a loss of $0.34. Citi says the $0.18 loss reflected the reset in January 2009 of conversion price of the $12.5 billion convertible preferred stock issued in a private offering in January 2008. It Says this did not have an impact on net income but resulted in a reduction to income available to common shareholders of $1.3 billion or $0.24 per share; without this reduction, EPS were positive. S&P believes trading results at current levels are unsustainable, and it maintained a hold opinion. The shares fell 0.36 to 3.65. 

General Electric (GE) reported $0.26, vs. $0.43, first quarter EPS from continuing operations on a 9% revenue drop. It says first quarter results consistent with its GE Capital investor meeting on March 19 and the framework provided last December, which included a smaller but still-profitable GE Capital and 0%-5% earnings growth in its Industrial segments. 

Google (GOOG) reported $4.49, vs. $4.12, first quarter EPS on 6.2% revenue rise. S&P says revenue was below expectations, reiterates strong buy. 

Biogen Idec (BIIB) posted $1.05, vs. $0.83, first quarter non-GAAP EPS on 10% revenue rise. Revenue was seen as below expectations. It confirms 2009 forecast for revenue growth in the high single digits, non-GAAP EPS above $4.00. 

Fed Chairman Ben Bernanke, in a speech at the Kansas City Federal Reserve Bank's conference, said innovation in credit markets must not be stifled, but complexity designed to confuse customers and drive up lending fees would not be tolerated. Bernanke also said that the pain from the most severe recession in a generation would linger for a whil

Stocks extend advance

Better-than-expected results from GE, Citi and Google help Wall Street gain on session. Stocks stretch run to 6 weeks.

NEW YORK (CNNMoney.com) -- Stocks inched higher Friday as better-than-expected earnings from Citigroup, General Electric and Google, helped stretch the recent advance to a sixth straight week.

The Dow Jones industrial average (INDU) added 6 points or less than 0.1%. The S&P 500 (SPX) index rose 4 points or 0.5%. Both ended at more than two-month highs.

The Nasdaq composite (COMP) gained 2 points or 0.2%, ending at a more than five-month high.

Stocks, as represented by the S&P 500, have gained 28.5% in the past six weeks, on bets that the economy is closer to stabilizing. The gains followed a selloff that left the S&P 500 at a 12 1/2 year low. A rash of better-than-expected profit reports has helped sentiment this week.

The six week run is the market's best since May 2007, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research.

"No matter what is thrown at the market, it seems to want to chug higher, which is a big change in psychology from last fall or even earlier this year," Detrick said.

However, he noted that even if the rally proves to be more than a bear market bounce, at six weeks old, it's starting to look ripe for a pullback on a technical basis.

Quarterly results: Citigroup (C, Fortune 500) reported a quarterly profit Friday morning, due to strength in its investment banking division. But after paying out preferred dividends, results amounted to a per-share loss of 18 cents. Nonetheless, that was smaller than the 34-cent per share loss analysts expected. Shares of the Dow component fell 9%.

JPMorgan Chase (JPM, Fortune 500) and Goldman Sachs (GS, Fortune 500) both reported weaker quarterly profit that beat estimates earlier this week. Last week, Wells Fargo (WFC, Fortune 500) forecast that it would report a $3 billion profit.

Regional Bank BB&T (BBT, Fortune 500) reported a weaker quarterly profit that nonetheless handily topped analysts' forecasts. The company also said loan losses are lessening. Shares gained 11%.

Dow component General Electric (GE, Fortune 500) reported weaker quarterly earnings that beat estimates on weaker quarterly sales that missed forecasts. Weakness in the company's finance unit countered mixed results at other divisions. Shares gained 1%. 

After the close Thursday, Google (GOOG, Fortune 500) posted quarterly earnings that rose from a year ago and topped estimates on revenue that rose from a year ago but was shy of forecasts. Shares rose 1% Friday morning.

In other company news, General Motors (GM, Fortune 500) CEO Fritz Henderson said that the company will announce more job cuts and plant closings in the next few weeks. The company has until June 1 to reach agreements with its creditors and unions if it wants to avoid a government-mandated bankruptcy. Shares fell 4%.

Market breadth was positive. On the New York Stock Exchange, winners beat losers two to one on volume of 1.95 billion shares. On the Nasdaq, advancers topped decliners eight to five on volume of 2.43 billion shares.

Economy: The April consumer sentiment index from the University of Michigan rose to 61.9 from 57.3 in March. Economists surveyed by Briefing.com thought the index would rise to 58.5.

Bonds: Treasury prices fell, raising the yield on the benchmark 10-year note to 2.94% from 2.83% Thursday. Treasury prices and yields move in opposite directions.

Crackdown on housing scams

   NEW YORK (CNNMoney.com) -- In the wake of an Obama administration program to rescue troubled homeowners, several federal agencies are teaming up to fight mortgage and foreclosure scams, Treasury Secretary Tim Geithner said Monday.

The administration's $75 billion effort to help as many as 9 million mortgage holders get new or refinanced loans is drawing a lot of interest from homeowners, Treasury Department officials explained.
  "Those who would seek to prey on the most vulnerable also seek to intensify their efforts as well," Treasury Secretary Tim Geithner said. "We will aggressively pursue those involved in mortgage rescue scams."

Treasury, the Department of Justice, the Federal Trade Commission and the Department of Housing and Urban Development will lead the effort from Washington. State attorneys general will also participate. 

The Treasury's financial crimes investigative unit is sending financial institutions a checklist to help them spot suspicious loan activity and foreclosure rescue scams. 

Meanwhile, the Federal Trade Commission reviewed online and print advertising for mortgage foreclosure companies nationwide and found "71 distinct companies running suspicious ads," Treasury said.

The FTC has filed five civil cases against companies offering loan modification or foreclosure services, including one against a company that spent $9 million on TV and radio ads in less than a year.

"These companies are kicking people when they're down, charging enormous upfront fees and sabotaging homeowners who could be getting help for free," said FTC Chairman Jon Leibowitz. "These companies are giving people false hope. They are shameless, as well as opportunistic."

The initiative will bring more resources for the FBI and the Justice Department to investigate and prosecute mortgage fraud, Housing Secretary Shaun Donovan told a congressional panel last week.

Structure of Nigeria Capital Markets

  Accessing the Nigerian capital markets:

The Nigerian Capital Market is the most vibrant in Africa after that of South Africa.

The Nigerian Stock Exchange which was founded in 1960. It is 2nd most active exchange in Africa after the Johannesburg Exchange with 197securities listed on the daily official list of the Exchange.

Companies have their Shares listed by the Stock Exchange to be bought and sold daily by the public.

The market Capitalisation (The total value of each store multiplied by the number of the stores of each company taken together) is about N3.7Trillion which at current exchange rates converts to about 29 Billion US Dollars.

The returns (The Profit) in real terms in the Nigerian Capital Markets have been the highest Worldwide for many years running.

The Nigerian capital Market is generous not only in the dividend yields (The % of the cost of the Shares to the dividend paid annually) but also in terms of price appreciation of stocks.

This year alone, the Nigerian Capital market has grown by more than 50%, although most of the growth can be linked to the pressure on the Capital Markets by the new Pension Fund Administrators who are required by the new Pension Reform Act 2004 to invest a good portion of the Pension Funds they manage in the Nigerian Capital Market.
   The most appreciating Stocks this year (Those Stocks that achieved more than 100% appreciation from 1st January 2006 – 30th November 2006 are as follows:-1 Incar Motors 700%
2 Union Dicon Salt 444%
3 BenueCement 431%
4 Cement CNN 332%
5 Access Bank 300%
6 CAP Plc 250%
7 WAPCO 243%
8 R.T. Briscoe 194%
9 Poly Products 159%
10 Flour Mills 152%
11 Oceanic Bank 148%
12 Evans Medical 140%
13 Nampak Nigeria 138%
14 Julius Berger 131%
15 Vono Products 130%
16 University Press 121%
17 May and Baker 120%
18 NCR 116%
19 Glaxosmithline 107%
20 Okomu Oil 103%


Nine (9) other Securities appreciated between 90% and 99% therefore, nearly 15% of Stocks listed on the Nigerian Stocks Exchange have appreciated between 90% and 100% in the last 11 months!!

How to Trade…

Any new Capital Market investor has to contact Stock Brokers who will give them a number of forms to complete.

A Stock Broker is required by Money Laundering Regulations in Nigeria to know his Client and so you will be required to complete a personal information form. You will also be required to complete a form R005 which is lodged at the Central Securities Clearing System

The role of the Central Securities Clearing System is to act as a clearing house for transactions on the Nigerian Stock Exchange. Stock broking firms are credited from funds earlier lodged by the buying house in its account in one of the Settlement banks registered for that purpose by the CSCS. These banks include Sterling Bank Plc, formerly Magnum Trust bank Plc, UBA formerly Standard Trust Bank and Guaranty Trust Bank Plc

After this, as account is opened for the customer by the Stock-broking firm after which the investor funds the account.
Some Stockbrokers will execute any “bid” order for no matter how small, but some other would rather deal with bigger customers.

You can invest any amount of money in the Nigerian Capital Market, Even as low as N1,000. You can decide to control what your Stockbroker buys or sells on your behalf (known as the execution only) or you may allow the Stockbroker to buy or sell on your behalf for maximum returns, in which case the Stockbroker will be allowed to use his discretion.

Once you own shares on the Nigerian Stock Exchange, you will be automatically subscribed to the CSCS Trade Alert . The CSCS Trade Alert enables the investor to receive a text by your phone if any Shares being held in your name are being traded. This may be useful also for those international Shareholders whose phones can receive texts from Nigeria or email.

Customers who have left their investments in care of their stockbrokers can upon receipt of the text message from the CSCS enquire about the price the stock is to be sold for and as to what shares the stock-broker intends to buy in replacement.

Investors can mandate dividends to be paid directly into any bank account held in their names in Nigeria.

Can Foreigners invest in the Stock market?

Yes Foreigners can invest in the Nigerian capital Market and will have unimpeded access and can repatriate their dividends without hindrance.

The Foreign Exchange Monitoring and Miscellaneous Provisions Act abolished the regime of exchange controls, especially for capital importation and repatriation. Under the new Act, foreign investors can know bring in investment capital by wire transfer through bankers, which will issue the necessary certificate of capital importation, without seeking any approval from Government. Foreign investors may also repatriate dividends/profit arising from their investment in Nigeria.