Stocks Stagger Back to Midline

IBM and Citi climb, while Pfizer slumps as investors absorb the latest slew of quarterly results.
By Sarina Penn ,

Updated from 4:15 p.m. EDT

Stocks in the U.S. spent Thursday bobbing in and out of the red as investors dealt with a mixed bag of earnings news and drab economic data but finished the day little changed from the morning.

Among the major market averages, the blue-chip Dow and S&P had a slightly better day than the more tech-heavy Nasdaq. The

Dow Jones Industrial Average

managed to claw higher by 1.22 points, or 0.01%, to end the day at 12,620.49, propped up its best-performing components,

IBM

(IBM) - Get Report

and

Citigroup

(C) - Get Report

. Similarly, the

S&P 500

rose 0.85 points, or 0.06%, to 1365.56.

The

Nasdaq Composite

, however, never entered positive territory and finished down 8.28 points, or 0.35%, to 2341.83.

Matt King, chief investment officer with Bell Investment Advisors, commented that today's news has served to remind investors that the earnings season remains a mixed one -- that "the bad times are not quite over yet" -- notwithstanding yesterday's barrage of positive numbers, which had sent equity measures soaring.

Doug Roberts, chief investment strategist with ChannelCapitalResearch.com, pointed out that the market has nonetheless shifted its stance to "two steps forward and one step back," rather than the other way around, in large part thanks to the lingering cushion that the

Federal Reserve

has provided in actively addressing the liquidity problems and credit issues that have dragged on the market for the past few months.

Still, he noted, "The market has settled on a trading range, and it doesn't want to stick its neck out too far." He added that he believes it's unlikely stocks will break out of that range any time soon.

Breadth was poor for the day. Winners and losers were split about evenly on the

New York Stock Exchange

, but decliners had a slight edge, and the Nasdaq saw losers beating gainers 3 to 2. Volume reached about 1.84 billion shares on both exchanges.

Helping to pressure stocks was drugmaker

Pfizer

(PFE) - Get Report

, which said first-quarter earnings slid 18% from last year to $2.78 billion, or 48 cents a share. Adjusted income missed analyst expectations by a nickel a share. Shares of the Dow component surrendered 3.3%.

Fellow industrial

United Technologies

undefined

, a purveyor of building and aerospace systems, topped projections but left its outlook unchanged at a subpar range, and shares were down 2.5%.

IBM, however, lent support to the Dow after trouncing analyst estimates with

surging continuing-operations

earnings of $2.32 billion, or $1.65 a share. Shares climbed 2.2%.

Staying in the tech sector,

eBay

(EBAY) - Get Report

eased 3.5% after user growth came in

weaker than expected

in the first quarter. That's despite earnings and revenue rising more than 20% from a year earlier to beat consensus.

Elsewhere,

Merrill Lynch

(MER)

widely missed Wall Street's sharply lowered expectations as

enormous writedowns

forced a continuing-operations loss of $1.97 billion, or $2.20 a share. Further, the struggling investment bank said it plans to lay off around 4,000 employees, or 10% of its workforce, from year-end levels. Shares took an initial fall, but added 4.1% to close at $46.71.

Away from earnings, word surfaced last night that

JPMorgan Chase

(JPM) - Get Report

launched a

preferred-share offering

worth $6 billion. The stock was up slightly at $45.12 following a day of mixed trading.

Separately, Citigroup stock lifted by 2.5% after the bank agreed to

sell most of CitiCapital

, its North American commercial lending-and-leasing business, for an unspecified price to

General Electric's

(GE) - Get Report

commercial-finance unit. Citi also is due to report Friday morning. GE was down 0.7% at $32.02.

As for economic data, the Philadelphia

Fed

Index registered at negative 24.9 for April, indicating a severe contraction in northeast factory activity. That's down sharply from March's reading of minus 17.4, and far worse than the slight improvement that economists had called for. It also represents the lowest level since February 2001, when the U.S. was on the brink of its last recession.

Meanwhile, the Labor Department said the number of people filing for unemployment benefits climbed by 17,000 people from last week's revised numbers to 372,000 -- less grim than expected, but still higher than at the start of the last recession seven years ago.

"We can think of no good reason why claims should now level off, and plenty of reasons why they should be expected to rise further," said Ian Shepherdson, chief U.S. economist with High Frequency Economics. "Expect 400,000-plus by midyear."

The Conference Board said leading economic indicators were up an in-line 0.1% thanks in large part to a rising real-money supply and vendor performance, which helped offset mounting jobless claims, among other downbeat figures. That follows five straight months of declines, though the Board noted that the past six months still reflect a 1.6% slide. Shepherdson, for his part, called the uptick "nothing more than a blip."

Back in equities, among other financial names shuttling through numbers was

Bank of New York Mellon

(BK) - Get Report

, which came in ahead with a

rising quarterly profit

. Still, shares recently lost 2.1%.

Having a better day was

Sallie Mae

(SLM) - Get Report

, even though the student lender

swung to a first-quarter loss

. "Core earnings" came to 48 cents a share, stripping out special items, beating Street forecasts by a dime, and shares advanced 5.7%.

CIT

(CIT) - Get Report

, the largest publicly-traded leasing company, also swung to a loss but climbed 6.1% as it detailed a raft of liquidity-boosting measures.

As for regional banks,

KeyCorp

(KEY) - Get Report

,

PNC

(PNC) - Get Report

and

Comerica

(CMA) - Get Report

each

reported

a

dwindling

bottom line.

BB&T's

(BBT) - Get Report

operating profit slipped, as well, even as its net income

edged higher

.

KeyCorp fell 2%, and Comerica was down marginally, but PNC and BB&T recouped early losses to add 1.2% and 2.9%, respectively.

Also, after the market closed,

Google

(GOOG) - Get Report

reported

clocking analyst estimates

with adjusted first-quarter earnings of $4.84 a share and a revenue of $3.70 billion, counting in traffic-acquisition costs. Both top and bottom lines surged from a year ago. Shares of the search giant soared 17% to $528 in after-hours trading after ending the regular session down 1.2%.

As for commodities, crude oil hit a new intraday high of $115.54 before falling 7 cents at $114.86 a barrel, and gold futures lost $5.40 at $942.90. The dollar recovered a bit from yesterday's plunge against the euro, closing at $1.5890, while also firming against the yen.

Treasury prices extended on yesterday's losses. The 10-year note was down 11/32 in price to yield 3.73% and the 30-year bond gave up 14/32 in price, yielding 4.52%.

Markets abroad were mixed. In Asia, Tokyo's Nikkei 225 was up 1.9%, and Hong Kong's Hang Seng Index rose 1.6%. Among European exchanges, London's FTSE 100 lost 1.1% and Germany's Xetra Dax dipped 0.3%, but the Paris Cac tacked on 0.1%.

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