Market Recap: Stocks End Mixed on M&A News, Fed Suspense

Stocks started the day on a negative note, after the latest quarterly earnings results from Dell (DELL) hit the Street with a resounding thud. The firm fell woefully short of analysts' profit and revenue expectations, sparking concerns about the health of the broader tech sector. Elsewhere, European Central Bank president Jean-Claude Trichet warned that "... it is too early to declare the [financial] crisis over." Nevertheless, Trichet indicated that supportive stimulus measures must soon be unwound, prompting traders to buy the U.S. dollar in a safe-haven stampede. The greenback's gains pressured oil futures lower, and energy stocks soon joined tech issues in the red.

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The Chicago Board Options Exchange's (CBOE) Market Volatility Index (VIX) – best known as the broad-market "fear gauge" – epitomized the mood on the Street today, advancing almost 5%. Chipmakers charged the path lower, after brokerage firm Bank of America-Merrill Lynch downgraded a handful of industry heavyweights. The analysts warned that inventory levels are close to exceeding demand, and pointed to a "risk of correction in the supply chain." Elsewhere, banking stocks also retreated into the red, after analyst Meredith Whitney said lenders "are still grossly overvalued."

Meanwhile, data on the economic front did little to calm the broad-market jitters; the Conference Board said economic activity picked up at a slower-than-anticipated pace in October, while the government reported that first-time jobless claims remained stagnant last week. Against this backdrop, the Dow Jones Industrial Average (DJIA) succumbed to its largest single-session deficit this month, while the S&P 500 Index (SPX) surrendered its perch above the 1,100 level.

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The tech sector led a broad-based retreat today, with stocks snapping their recent winning streak. Paving the route into the red were Autodesk Inc. (ADSK) and salesforce.com (CRM), which both issued gloomy earnings guidance, as well as Research In Motion Ltd. (RIMM), which received a bearish brokerage note ahead of the bell. Elsewhere, the bears got a boost from Uncle Sam's latest housing data, after the Commerce Department reported that U.S. home construction and building permits fell by more than anticipated in October. On that same note, the Labor Department announced that consumer prices rose at a faster-than-forecast rate last month, agitating investors' inflationary fears. Despite a valiant eleventh-hour rebound, the sour statistics were too much for the Street, with the major market indexes settling in the red for only the third time in 10 sessions.

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Stocks flirted with breakeven for most of the session today, as the Street weighed muted inflationary measures against disappointing economic data and a batch of humdrum earnings reports. Investors viewed a smaller-than-forecast rise in the Producer Price Index with rose-colored glasses, as the tame data revived hopes that interest rates will remain low. Meanwhile, retail titans Home Depot (HD) and Target Corp. (TGT) both issued weaker-than-anticipated fourth-quarter guidance, sparking consumer spending concerns ahead of the holiday season. Elsewhere, the bears got a boost from the government's report that factory output rose by less than expected in October, as well as the disenchanting results of the National Association of Home Builders' latest sentiment index. However, the bulls eventually won the battle in afternoon trading, with help from the commodities pits. Both crude and gold futures pared early losses to finish in the black, defying the greenback's rebound off 15-month lows.

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Traders today turned their attention to Federal Reserve Chairman Ben Bernanke, who delivered a speech at the Economic Club of New York. "I expect moderate economic growth to continue next year," asserted Bernanke, although he warned that "restrictive bank lending and the weak job market" could hamper the pace of recovery. In fact, admitted the central banker, "The best thing we can say about the labor market right now is that it may be getting worse more slowly." Despite Bernanke's pragmatic tone, it was hard to put a damper on investors' bullish mood today -- particularly in the wake of a stronger-than-expected gross domestic product (GDP) report out of Japan. The world's third-largest oil consumer notched a 1.2% GDP jump during the third quarter, roughly doubling analysts' expectations. The report sent commodity stocks soaring, and financial issues joined in the rally after news broke that hedge fund manager Paulson & Co. scooped up 300 million shares of Citigroup (C) during the third quarter. Thanks to these positive catalysts, the major market indexes blazed their way to a fresh round of 2009 highs.

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Fresh off yesterday's pullback, stocks were determined to finish the week on a high note today. A handful of optimistic earnings reports helped to fuel the bulls, with the Street cheering an upbeat outlook from The Walt Disney Co. (DIS), as well as stronger-than-anticipated results from retailers Abercrombie & Fitch (ANF), Nordstrom Inc. (JWN), and J.C. Penney (JCP). The plethora of positive profits overshadowed preliminary data indicating that consumer sentiment unexpectedly fell in early November, and helped to offset concerns about a larger-than-expected increase in the trade deficit in September. Taking the glass half-full approach, the bulls successfully negated most of yesterday's losses, with the major market indexes finishing their second straight week in the black.

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After six straight days of gains for the Dow Jones Industrial Average (DJIA) -- during which time the blue-chip barometer added no fewer than 519 points -- investors today seemed ready to take a break. The market offered a muted reaction to stronger-than-expected earnings from Wal-Mart Stores (WMT), and after a mixed start to the session, stocks were headed due south by 11 a.m. Energy issues contributed to the downward momentum following a big weekly build in crude supplies, while banking stocks skidded lower after leading the market higher in recent days. Cisco Systems (CSCO) also dragged on the Dow, with the tech titan recoiling after rival firm Hewlett-Packard (HPQ) announced its plans to acquire 3Com Corp. (COMS). As a result, the major market indexes spent most of the day retreating from their recent peaks.

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It was a relatively quiet Veterans' Day on Wall Street, thanks to a general lack of major economic reports. Instead, traders turned their attention to comments from Federal Reserve Bank of Dallas President Richard Fisher, who espoused his dovish viewpoint in remarks delivered late Tuesday in Austin. Citing his expectation for "suboptimal" economic growth in 2010 and 2011, Fisher argued that there's a solid case for maintaining interest rates near their current historic lows. This news apparently came as a relief for most traders, as stocks started the day on a strong note and nimbly maintained a foothold in positive territory throughout the session. In fact, the Dow and the S&P 500 both found their way to fresh annual highs, with investors shrugging off not only a dismal fourth-quarter forecast from Macy's (M), but also a Chapter 11 warning from Ambac Financial (ABK).

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Stocks didn't stray too far from breakeven today, as investors took a respite following the Dow's second 200-point gain in three sessions on Monday. A lack of potential catalysts on the economic calendar did little to curb the apathetic price action, with the Street instead digesting a handful of big-cap stock news reports. Among the equities making headlines, insurance issue MBIA Inc. (MBI) retreated into the red after reporting a wider-than-anticipated loss in the third quarter. On the flip side, the shares of priceline.com (PCLN) tagged a multi-year high after the online travel titan upped its fourth-quarter forecast. Elsewhere, Federal Reserve officials Janet Yellen and Dennis Lockhart separately warned that rising unemployment levels could plague the economy for the next several years, with Yellen predicting the recovery to be "gradual and ... vulnerable to shocks." Against this backdrop, most stocks ended mixed, with the Dow Jones Industrial Average ending on the north side of breakeven for the fifth straight session.

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Stocks enjoyed a serious boost today, continuing the positive momentum that left the Dow perched above 10,000 by the end of last week. Investors were initially heartened by news that the Group of 20 (G20) finance ministers decided over the weekend to maintain current economic stimulus measures, in order to "restore the global economy and financial system to health." Elsewhere, in equity news, positive developments for a pair of Dow members fanned the bullish flames. General Electric (GE) and Comcast (CMCSA) have reportedly agreed on a fair valuation for the former company's NBC Universal unit, according to The Wall Street Journal, hinting that a joint venture deal could be imminent. Fast-food titan McDonald's (MCD), meanwhile, reported a 3.3% jump in same-store sales for October, as robust results from around the globe offset a weak month on the home front. Traders took the opportunity to send the Dow Jones Industrial Average to a new 52-week peak, with the index tagging its highest price since Oct. 6, 2008.

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