H-P, Yahoo! Help Lift Investor Sentiment
Updated from 9:14 a.m. EST
Stocks on Wall Street opened roughly flat Tuesday, after traders received encouraging news from several big technology companies, but troubles among the financials and automakers were dampening enthusiasm elsewhere.
The
Dow Jones Industrial Average
was gaining 70 points at 8343, and the
S&P 500
was adding 5.8 points to 856. The
Nasdaq
was climbing 11.4 points at 1,493.
Early futures trading had suggested Tuesday's open could have been a lot worse, but two pieces of news were helping lift technology shares. Computer hardware and software maker
Hewlett-Packard
(HPQ) - Get Report
was partly responsible, after the company said its fourth-quarter profit would exceed analysts' expectations. Shares of H-P, part of the Dow, were rising in early trading.
Another boost came from
Yahoo!
(YHOO)
, which said CEO Jerry Yang is set to step down from his position as soon as the Internet firm can find a replacement. Yang's tenure was recently marked by a refusal to sell his company to
Microsoft
(MSFT) - Get Report
. Yahoo! shares were likewise rising.
Financial firms continued to look weak as the new session arrived. Asset manager
(BLK) - Get Report
joined the set of companies to announce layoffs by announcing its first round of job cuts in its 20-year history, according to a report by
Bloomberg
.
Meanwhile,
at Deutsche Bank cut their price target on
Citigroup
(C) - Get Report
to $9, which on Monday announced plans to lay off 20% of its work force.
As the financials slim down in an effort to stem damage from the credit crisis,
Federal Reserve
Chairman Ben Bernanke and Treasury Secretary Henry Paulson were testifying before Congress to discuss their $700 billion
Troubled Asset Relief Program
, which was designed to bolster liquidity for banks with stressed balance sheets.
Secretary Paulson said at the event that he does not plan to initiate new programs beyond the TARP to prop up ailing banks.
The automakers, also lately on the ropes, were once again on investors' radar, as
Mazda Motor
said
Ford
(F) - Get Report
was reducing its stake in the Japanese company to 13% from 33%. Ford, along with
General Motors
(GM) - Get Report
and
Chrysler
, are facing mounting cash-flow problems on declining vehicle sales, credit crunch -related financing troubles and substantial legacy costs.
Looking at the day's
, hardware store operator
(HD) - Get Report
announced earnings that fell 31% year over year on declining revenue. Fashion retailer
Saks
(SKS)
swung to a third-quarter loss.
In merger news,
Alpha Natural
(ANR)
and
Cliffs Natural Resources
(CLF) - Get Report
announced they had agreed to drop previous plans for a merger valued at about $10 billion.
Shifting to economic data, the Bureau of Labor Statistics reported that producer prices fell by a record 2.8% in October. Economists were expecting a decline of 1.8%. The core rate
PPI
increased by 0.4%, above expectations for a 0.1% uptick.
As for commodities, crude oil was adding 20 cents to $55.15 a barrel. Gold was losing $7.70 at $734.30 an ounce.
Longer-dated U.S. Treasury securities were rising in price. The 10-year note was adding 3/32 to yield 3.64%. The 30-year was up 6/32, yielding 4.18%. The dollar was flat vs. the euro, gaining on the pound and declining against the yen.
Overseas, European exchanges such as the FTSE in London and the DAX in Frankfurt were trading lower. In Asia, Japan's Nikkei and Hong Kong's Hang Seng closed with losses.
