Updated from 4:04 p.m. EST
Stocks finished virtually unchanged Tuesday for the second straight day, after a bunch of positive earnings reports and the discovery of a deadly poison at a Senate building late Monday.
Dow Jones Industrial Average
gained 6 points, or 0.1%, to 10505.18; the
added 3.06 points, or 0.2%, to 2066.21; and the
climbed 0.77 points, or 0.1%, to 1136.03.
Volume on the New York Stock Exchange was 1.48 billion shares, while 1.8 billion shares exchanged hands on the Nasdaq. Advancers outpaced decliners by about 5 to 4 on the NYSE, but trailed on the Nasdaq by the same margin.
Contributing some uneasiness, the deadly toxin ricin was found in the mailroom of Senate Majority Leader Bill Frist on Monday. The Senate will convene as scheduled today, but the Hart, Dirksen and Russell Senate office buildings will be closed for cleanup and additional testing.
The discovery is clearly having an effect on the bond and currency markets as investors move to safety, said Jay Suskind, equity trading director at Ryan Beck. "But the equity market is not focusing on it too much, except for some small allocation shifts to bonds. There is definitely no hysteria."
The real focus "is the debate on the strength of the economy; whether the glass is half full or half empty," added Suskind. "Investors are looking ahead to Friday's employment report."
Markets overseas finished mixed, with London's FTSE 100 up 0.2% at 4391 and Germany's Xetra DAX losing 0.4% at 4058. In Asia, Hong Kong's Hang Seng gained 0.7% at 13,090, while Japan's Nikkei lost 1.3% at 10,642.
The 10-year Treasury note gained 12/32, yielding 4.1%, on flight-to-quality flows.
The discovery of ricin was weighing on the dollar. The greenback was hovering near a three-and-a-half-year low vs. the Japanese yen, recently fetching 105.53 yen. The U.S. currency was weaker vs. the euro, with one euro lately worth about $1.253.
It's Jobs, Stupid
Earnings reports continue to beat expectations, but surprises have been the rule rather than the exception this season and stocks were caught in a tight range Tuesday with investors looking ahead to Friday's employment report.
The labor market has failed to reap the rewards of the burgeoning economy. In December, nonfarm payrolls disappointed severely, growing by only 1,000 with economists forecasting a 150,000 gain; most economists believe that payrolls need to add at least that many jobs simply to keep up with the growing labor force.
The stakes are even higher for January, with the consensus looking for payroll growth of about 170,000. Although December's carnage was severe and triggered a 134 point Dow decline, most experts are confident January's number will not be a letdown.
Ted Wieseman, an economist at Morgan Stanley, is far more bullish than the consensus and expects payrolls to grow by 275,000 in January. Although December's reading was very weak, "every other indicator points to improvement in the employment picture."
Initial jobless claims have been below the key 400,000 threshold for 17 straight weeks and the employment component of the Institute for Supply Management's manufacturing index has been above the benchmark level of 50 for three consecutive months. Weiseman also pointed out that hiring surveys have been strong and a seasonal bounce from the retail sector should add 100,000 jobs alone.
Cary Nordan, a fund manager at BB&T Asset Management, feels forecasts calling for payroll growth of 170,000 may be a little aggressive. "Companies are cautiously optimistic and are not willing to aggressively hire because there is still excess capacity and they want to be sure this is a cyclical recovery."
said Tuesday that it earned 34 cents a share in its first quarter and that sales increased 8.7%. Analysts were expecting 32 cents a share. Shares of the company improved 72 cents, or 2.7%, at $27.82.
said its quarterly earnings improved to 65 cents a share from 59 cents last year; analysts had expected the company to post a profit of 63 cents. The shares gained $1.49, or 3%, to $51.83.
Despite a 3.6% drop in revenue,
( FON) earned 39 cents a share in the fourth quarter, a 2-cent improvement over last year. Analysts had expected profit at the land-line operator to hold steady at 37 cents. The shares shed 6 cents, or 0.3%, to $17.94.
Sprint's wireless operation,
, also beat expectations by 2 cents a share. The company posted a loss of 10 cents in the quarter, 8 cents better than a year earlier. The stock dipped 12 cents, or 1.5%, to $8.12.
Fourth-quarter earnings at
were 54 cents a share, matching analysts' estimate, on a 10.9% increase in total sales. The stock slipped 68 cents, or 1.7%, to $38.37.
said fourth-quarter earnings were 87 cents a share, below analysts' consensus for 89 cents a share. Revenue was up 11.1% in the quarter. The stock declined $1.30, or 1.5%, to $86.
stock fell 22 cents, or 1.6%, to $13.73, after the company said car sales plunged 14.4% in January. Total sales fell 5.2% to 230,036 vehicles.
January sales were also soft at
. Sales at GM fell 2%, sending the stock down 85 cents, or 1.8%, to $47.85, while sales at DaimlerChrysler dropped 6.8% and the stock lost $1.17, or 2.5%, to $46.39.
In research, Goldman Sachs cut its rating on the semiconductor-equipment sector to neutral from attractive. And RBC Capital Markets upgraded
to outperform from sector perform. Boston Scientific stock rallied $1.25, or 3.1%, to $42.25.
( PIXR) and
, are all set to report quarterly earnings. In addition, apparel manufacturers,
Polo Ralph Lauren
( TOM), will be on the tape.
In economics, the ISM services index for January will be released at 10:00 a.m. EST and is expected to improve to a reading of 60 from 58; this would make 10 straight months above the level of 50, indicative of an expansion. Also at 10:00 a.m. EST, factory orders are expected to improve by 0.2% in December after a 1.4% decline in the prior month.