Stocks wobbled Wednesday as a slew of earnings beats, including one from Pfizer, were encouraging but disappointing reports from two of Wall Street's biggest names dragged on the market.
The Dow stumbled out of the gate, then bobbed in and out of positive territory throughout the morning, leaving the Dow chart looking like the Rocky Mountains.
Strong results from Apple after the bell Tuesday buoyed the Nasdaq.
Morgan Stanley and Wells Fargo both declined, even though the Wells numbers appeared to beat analyst estimates. Traders appeared to be focusing on the sustainability of the Wells numbers, while Morgan's loss was much broader than expectations.
This came after the Dow on Tuesday logged its seventh straight gain, in which it has gained 9.5 percent. The Nasdaq has gained 10 percent in a 10-day winning streak, its longest such run in 12 years.
Bank of America was also back in the news after a KBW analyst reversed his assessment of the bank, saying it probably won't incur a $12 billion pretax charge in the first quarter of 2010. He now expects the bank to post a profit of 80 cents a share in 2010, a far cry from his prior estimate of a 10-cent loss.
Citigroup continued to rise, gaining another 5 percent.
Pfizer was the biggest percentage gainer on the Dow after the drug maker beat its earnings target, helped by cost-cutting measures,and raised its full-year outlook.
Among other companies that beat this morning were Boeing , Eli Lilly and PepsiCo .
After Pfizer, the biggest gainers on the Dow were Home Depot and McDonald's .
In addition to earnings, investors will be watching Capitol Hill, where Fed Chairman Ben Bernanke is testifying for a second day.
In his testimony Tuesday before the House, Bernanke repeated the Fed's projection that the economy will start growing again in the second half but cautioned that it would be modest growthand unemployment would continue to rise. He also said the Fed is working on an exit strategy to avoid having its stimulus measures cause a spike in inflation.
"The [Fed] has been devoting considerable attention to issues relating to its exit strategy, and we are confident that we have the necessary tools to implement that strategy when appropriate," he said, echoing comments he made in an op-ed in Tuesday's Wall Street Journal.
- Watch a live stream of Bernanke's testimony before the Senate
And in the morning's economic news, mortgage applications were up 2.8 percentlast week, the Mortgage Bankers Association reported. And the FHFA home-price index rose 0.9 percentin May from April.
More earnings are due out after the bell today, including reports from eBay and SanDisk .
Apple jumped 4 percent after the iPod and iPhone maker late Tuesday beat estimates for both revenue and EPS, causing analysts to say Apple is one of the few companies not partaking in the recession.
Advanced Micro Deviceswas down over 10 percent after the chip maker
posted a wider-than-expected earnings loss.
Starbucks posted a profit that blew past expectations as the grande coffee chain aggressively cut costs and closed stores to weather the recession. Shares shot up 15 percent.
Yahoo beat consensus on EPS but not revenue. Its shares rose.
Still to Come:
It's a jam-packed week of earnings, with about a third of the S&P—and half the Dow—reporting.
WEDNESDAY: Earnings from Qualcomm, eBay and Sandisk after the bell; Obama news conference on health care at 8pm ET
THURSDAY: Weekly jobless claims; existing-home sales; Earnings from AT&T, Bristol-Myers Squibb, Ford, MMM, CIT Group, Fifth Third, PNC Financial, UPS, Xerox, Amazon, AmEx, Microsoft, Broadcom and Capital One
FRIDAY: Earnings from Ericsson, Ingersoll-Rand, Schlumberger; Red Hat replaces CIT in S&P 500 after the closing bell
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