Stocks Slide as AIG Hearing Begins; Ford Gains
Stocks had a weak open Wednesday as investors were disappointed with some earnings outlooks and waited for the Federal Reserve's statement this afternoon.
Stocks slipped further into the red after a report showed new home sales unexpectedly unexpectedly fell 7.6 percentin December, an improvement from November but short of expectations, and as the House hearing on AIG got underway. (Watch the live streaming video.)
It's a busy day in Washington today: The Fed will issue a statement this afternoon following a two-day meeting, plus Treasury Secretary Tim Geithner will testify at the AIG hearing and tonight, President Obama gives his first State of the Union address. Obama's focus is expected to be jobs the and the economy amid recent criticism that he's spent too much time on health-care reform.
Oil moved toward $75 a barrelahead of the EIA's weekly crude oil inventory report.
In the latest round of earnings, companies continued to beat expectations but several tempered their full-year outlooks, perhaps as a measure to dampen Wall Street's inflated expectations.
Heavy-equipment maker Caterpillar beat analyst estimates on the bottom line, but issued a weak 2010 outlook.
Aerospace giant Boeing swung to a profit and beat expectations with its quarterly numbers but fell short with its full-year forecast.
United Technologies also topped forecasts but the company, which makes everything from elevators to air conditioners, said it expects domestic commercial construction activity to remain weak. That may be partially offset by growth in China.
Apple will unveil its long-anticipated tablet computer at an event in San Francisco later today, complete with the usual Apple fanfare that surrounds a new product introduction.
Yahoo late Thursday hit its earnings targets and said it may see revenue growth in the first quarter, which would be the first time in six quarters.
After the bell today, we'll get earnings from Qualcomm.
Banks bounced back at the open after a late selloff Tuesday amid worries about Washington's crackdown on the sector ahead of the State of the Union tonight and a hearing next week on Capitol Hill.
The Senate set a vote for Thursday on Fed Chairman Ben Bernanke's confirmation.
In a turn of events in the auto industry, this time it's a Japanese car maker that's in trouble: Toyota is suspending sales of about 57 percent of its new cars and shutting down production on eight models due to a flaw that may cause sudden acceleration. The models involved are the RAV4, Corolla, Matrix, Avalon, Camry, Highlander, Tundra, and Sequoia.
Toyota's U.S.-traded shares skidded, while the news gave a boost to shares of American rival Ford.
European shares were lower and Asian shares closed down on continuing fears over China's monetary tightening and the euro zone's debt problems.
Chinal's economy will grow in 2010 at a similar rate to the previous year but it is starting to see signs or inflation forming, People’s Bank of China Deputy Governor Zhu Min told CNBC in Davo.
The ECB will start phasing out the measures it took to boost liquidityat the height of the crisis and it cannot cater to the needs of individual countries with problems, Axel Weber, ECB governing council member told CNBC in an interview.
Still to Come:
WEDNESDAY: Geithner to testify; Five-year auction; Apple announcement; Fed statement; Earnings from Qualcomm after the bell; Obama State of the Union
THURSDAY: Jim Chanos speaks on China bubble; durable-goods orders; seven-year auction; Earnings from 3M, AT&T, Eli Lilly, Ford, Nokia, P&G, Altria, Colgate-Palmolive, Lockheed Martin, Motorola, Microsoft and Amazon
FRIDAY: First look at Q4 GDP; Chicago PMI; consumer sentiment; Earnings from Chevron
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