Updated from 6:58 p.m. ET to include commentary on existing home sales, reference to Apple hitting a new 52-week high.



) -- The slow

melt-up continues


One of the hallmarks of 2011 was extreme volatility, especially in the final few months of the year. Triple-digit swings in the

Dow Jones Industrial Average

seemed to occur every other day for a while there after Standard & Poor's downgraded the United States' credit rating in early August. The blue-chip index ranged across more than 400 points alone on Oct. 4.

2012 has been a very different story though. While the first session of the year on Jan. 3 saw the Dow sprint out of the gate with a 180-point gain, that's the only time the index has swung more than 100 points one way or the other so far this year. Wednesday's 97-point advance was close but no cigar. The tight 60-point trading range on Thursday was the lowest since Dec. 27, according to

Dow Jones Indexes


Overall, the results have obviously been quite positive with the Dow rising in eight of the first 12 trading days of 2012 through Thursday, booking a 3.3% gain.

The S&P 500

is up 4.4% on a price basis after its flat 2011.

But there's also been

some criticism

about how the strength has been mostly in large-caps and volumes aren't providing much validation. After all, slow gains can be wiped out awful fast.

Suffices to say, the bulls would eventually like to see a high-volume surge that sends the Dow up a couple hundred points or so, if only so they can puff out their chests a bit.

Credit Suisse is a believer though. The firm lifted its year-end target for the S&P 500 by 8% to 1400 from 1340 on Thursday, adding enticingly that it sees "a significantlikelihood of an overshoot near term."

The firm's case for the boost is pretty straightforward. In the main, it's very encouraged by the European Central Bank's long-term refinancing operation and believes improving U.S. economic data has reduced the risk of the country sliding back into recession.

"The ECB's 3-year LTRO is a potential game changer: it is printing money; could be exceptionally large; could drive the euro to levels required to stop the recession; is driving the three-year bond yield to levels consistent with temporary debt sustainability in Italy and Spain; and, critically, it is a form of debt mutualization (as the haircuts applied to collateral aretoo low) that is less emotive for the German public than QE

quantitative easing or the SMP

securities market program," the firm said.

Credit Suisse lowered its estimate of the risk for a U.S. recession to 5% from 15%, saying: "US macro momentum is consistent with GDP growth 1.2 percentage points above consensus -- and the breadth of better data is impressive."

The firm also cited continued low bond yields and improving earnings momentum for its decision to boost the target for the S&P 500, which if hit would constitute price appreciation of 11.3% from the 2011 close at 1258.

As for Friday,

General Electric

(GE) - Get Report

is the lone blue chip reporting tomorrow and the average estimate of analysts polled by

Thomson Reuters

is for a profit of 38 cents a share in the December-ended period on revenue of $40 billion from CEO Jeff Immelt's juggernaut.

The stock is up 3.2% in the past year, in keeping with the slow progress the company has made in getting back on track since the financial crisis. If GE can deliver an in-line revenue performance, it will be a sequential increase of 13% on the top line but still 3.5% below the diversified industrial giant's year-ago revenue total of $41.4 billion.

The bottom-line results have been a bit better, and if GE can hit the average analysts' view for net income of $4.02 billion, it would be above the year-ago total of $3.86 billion (despite the lower revenue), and that would constitute its best tally since the third quarter of 2008 when it earned $4.48 billion on revenue of $47.23 billion.

Of paramount importance to many investors is that the dividend is once again a priority at GE. The company

boosted its quarterly payout again in mid-December

, bringing it to 17 cents a share from 15 cents a share.

This increase of 13.3% was the fourth time in the past two years that the company had lifted the payout, and it puts the forward annual yield of the stock at 3.6%.

"We believe that the GE business model will continue to deliver strong earnings and cash flow growth going forward," said Immelt at the time, expressing confidence in the company's prospects for 2012.

Wall Street is very bullish on GE with 14 of the 17 analysts covering the stock at either strong buy or buy, and the median 12-month price target at $21, implying potential upside of 9% from Thursday's regular session close at $19.15.

Sterne Agee is a GE bull with a buy rating and a price target of $22.75, and it outlined its case for the stock to make a run higher in 2012 on Jan. 3, saying the company " is now better positioned for growth and profitability than it has been in the last 4 years."

Like most GE watchers, the firm sees the health of GE Capital as a central issue for the company, but it believes market fears about the vulnerability of the business to souring domestic mortgages and Europe's debt crisis are overblown.

"The negative view and misconception on GE Capital is that it deserves a multiple discount like the large cap banks, and that Europe could cause it to fail," Sterne Agee said. "We would highlight that GE Capital has no US residential mortgage exposure, is actively shrinking its loan book while US banks try to do the opposite, has no trading platform, and has de-risked thefunding model considerably."

Even if conditions in Europe turn materially worse, the firm thinks GE is prepared to weather the storm.

"Is Europe a threat? With $132B in receivables that are 85% collateralized, and GE Capital currently reserved at 96% of prior peak losses, we do not view a non-cash charge to the balance sheet or income statement as a deal-breaker if losses and impairments were to go up," Sterne Agee said.

The finance arm staying in the black this year could prompt a fresh repurchase program from GE in 2012, the firm added.

"As long as GE Cap is profitable in 2012, Capital Ratios will improve with the ongoing asset shrinkage," Sterne Agee said. "We believe GE maintains a 45% dividend payout and that the GE Cap dividend could potentially be used by the parent to fund a stock buyback."

Fifth Third Bancorp

(FITB) - Get Report

also reports its fiscal fourth-quarter results before the opening bell, and Wall Street is forecasting earnings of 36 cents a share in the December-ended period on revenue of $1.53 billion.

The performance of the regional banks has been a bit of a mixed bag so far this quarter, and Fifth Third shares look vulnerable if the company can't deliver a convincing beat, having already gained 8% so far in 2012. Sentiment is fairly positive with 19 of the 32 analysts covering the stock at strong buy (7) or buy (12), and the median 12-month price target at $15 vs. Thursday's close at $13.56.

Miller Tabak reaffirmed strong buy rating on Fifth Third in late December and initiated a 2012 price target of $13.69. The stock was trading just below $12 at the time. The firm's investment thesis is based on a belief that Fifth Third is an attractive takeover target.


In the larger scheme of things, we believe the continuing evidence of FITB's good 'nuts and bolts' management is likely to draw interest from a strategic buyer during a fresh round of US banking industry consolidation in 2012-2013," Miller Tabak said. "We think the excellent balance-sheet stewardship of FITB management in recent periods is more likely to be rewarded in the M&A market than in the stock market."

The firm has a point as Fifth Third's quarterly revenue has stalled out at around $1.5 billion but it's been able to beat Wall Street's earnings expectations handily in the past two quarters, delivering upside surprises of more than 20% both time.

So if a deal were to come to pass, what kind of valuation might Fifth Third fetch?


Our estimate of FITB's strategic-takeover NAV

net asset value has increased to $23.8/share from the previous $23.2, and we expect that figure to keep increasing quarter by quarter," Miller Tabak said. "Trading just under 50% of our NAV estimate, we believe FITB represents an unusually attractive upside potential within the banking sector."

Check out TheStreet's quote page for Fifth Third Bancorp for year-to-date share performance, analyst ratings, earnings estimates and much more.

Friday's other notable earnings reports include


(CMA) - Get Report


East West Bancorp

(EWBC) - Get Report


First Horizon National Corp.

(FHN) - Get Report



(PH) - Get Report


Schlumberger Ltd.

(SLB) - Get Report

, and

SunTrust Banks

(STI) - Get Report


Of course, Thursday's late quarterly reports could very well have the most impact on Friday's trading.


(GOOG) - Get Report

missed what most on Wall Street viewed as fairly pedestrian expectations, and saw its shares fall nearly 10% in the

extended session


The other big tech reports --


(IBM) - Get Report



(INTC) - Get Report



(MSFT) - Get Report

, all Dow components -- were mostly good. The other Dow component reporting after the bell was

American Express

(AXP) - Get Report

, which saw some weakness in late trades after the blue-chip credit card issuer's revenue came in a bit soft.

The economic calendar is light with just existing home sales for December hitting the wires at 10 a.m. ET. The consensus is at 4.55 million, up from a reading of 4.25 million in November.


, however, is a bit below at 4.35 million.

Ian Shepherdson, chief U.S. economist at

High Frequency Economics

, is expecting a "substantial upside surprise" in tomorrow's number.

"We expect sales to hit 5.0M for the first time since November 2009, and for the first time without assistance from a homebuyer tax credit since July 2007," he wrote in commentary published late Thursday. "If we're right, and if the gain in sales can be sustained -- we think it can -- then we'll have to start thinking about the potential second-round effects of higher housing market activity on retailers of items like furniture and other household goods."

And finally, it's worth noting that


(AAPL) - Get Report

hit a all-time 52-week high of $431.37 on Thursday. The stock couldn't hold the gains though and pulled back to close at $427.75, down 0.3%. The company's market capitalization stands at $397.6 billion now vs. $417.2 billion for

Exxon Mobil

(XOM) - Get Report

in their ongoing battle for the title of world's biggest company.

Apple's decision to jump into the digital textbook publishing game saw

some criticism

on Thursday, but investors are likely starting to position themselves ahead of the company's quarterly report next Tuesday.


Written by Michael Baron in New York.

>To contact the writer of this article, click here:

Michael Baron


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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.