This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Stocks Slip as Economy Shrinks

"The message was tamped down a bit, because although the chairman [Ben Bernanke] is trying to encourage transparency and open dialogue among the members, the last report went a little too far for his taste," Hugh Anderson, managing director at HighTower Las Vegas, said in an interview.

Facebook (FB - Get Report) issued its fourth-quarter earnings after the closing bell on Wednesday as the social-networking company reported earnings of 17 cents a share on $1.59 billion in revenue. Analysts expected Facebook to post profit of 15 cents a share on revenue of $1.51 billion.

Shares rose 1.5% during the regular session, but slipped in extended trading.

Bank of America Merrill Lynch reiterated its "buy" rating on Facebook on Monday, citing expected revenue acceleration and upside from mobile.

Earlier Wednesday, Research In Motion (RIMM) unveiled its eagerly anticipated BlackBerry 10 technology and surprised investors by announcing that the company was changing its name to BlackBerry. Shares slid 12%.

In other tech news, (AMZN) said fourth-quarter revenue rose 22%, but the online retailer missed Wall Street's bottom-line estimate.

Shares surged 4.8%.

The Bureau of Economic Analysis reported Wednesday that the advanced estimate on U.S. fourth-quarter gross domestic product showed that the economy shrank 0.1% during that period, compared with third-quarter growth of 3.1%. Economists were expecting growth of 1.1%.

The ADP report on private sector employment showed a gain of 192,000 jobs in January, versus a downwardly revised 185,000 the prior month. Economists, on average, were expecting an increase of 165,000 in January.

"Despite a downsizing to the December reading ... we remain optimistic that Friday's official report will leave room for upside revision," said Andrew Wilkinson, chief economic strategist at Miller Tabak.

David Ader, a strategist at CRT, said that although the GDP data was disappointing, it doesn't point to a recession. Ader noted that much of the decline was attributable to weak defense spending. Government spending in that sector fell by the most since 1972.

David Song, a currency analyst at DailyFX, wrote in a note that he saw encouraging numbers for the economy after looking deeper into the report, including data showing that personal consumption increased 2.2% during the fourth quarter, compared with projections of 2.1%. Disposable income was the largest since the second quarter of 2008 even as the savings rate increased to 4.7% from 3.6% during the period, Song said.

The Mortgage Bankers Association's seasonally adjusted index of mortgage application activity pointed to a decline of 8.1% for the week ended Jan. 26. Traders shrugged off the data, saying despite the week-to-week fluctuations in the report, the longer-term trend for housing remains positive.
2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
FB $105.45 0.04%
CHK $5.26 0.00%
AAPL $117.81 -0.19%
GOOG $750.26 0.28%
TSLA $231.61 0.86%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs