The Day After: Stocks Struggle to Overcome Geithner’s Stumble, RIM’s Warning
Aaron Task 11 February 2009
Tuesday’s tumble was a clear and direct response to Tim Geithner’s new bank bailout plan, and the lack of details therein. The good news is world markets were fairly stable overnight and stocks were modestly higher early Wednesday.
In recent trading, the Dow and S&P were each up about 0.3% and the Nasdaq by 0.1% as the TARP Accountability hearing got underway and despite another round of weak corporate news, notably:
• Research In Motion said its fourth-quarter earnings will be at the low end of its previous guidance. • Nvidia reported fourth-quarter results below expectations and was subsequently downgraded by BMO Capital Markets. • Credit Suisse reported its largest-ever annual loss (but said 2009 is off to a good start.) • Ingersoll-Rand reported a fourth-quarter loss, including charges related to its acquisition of Trane. (Excluding those charges, results did beat expectations and the company gave solid guidance for 2009.)
The bad news, for those long stocks, is Tuesday’s session revived the fear trade as stocks and commodities tumbled while Treasuries benefited from a “flight to safety” trade. If not panic, Tuesday’s session brought about a major revival of uncertainty, which is almost as bad for the market.
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The Day After: Stocks Struggle to Overcome Geithner’s Stumble, RIM’s Warning
Aaron Task
11 February 2009
Tuesday’s tumble was a clear and direct response to Tim Geithner’s new bank bailout plan, and the lack of details therein. The good news is world markets were fairly stable overnight and stocks were modestly higher early Wednesday.
In recent trading, the Dow and S&P were each up about 0.3% and the Nasdaq by 0.1% as the TARP Accountability hearing got underway and despite another round of weak corporate news, notably:
• Research In Motion said its fourth-quarter earnings will be at the low end of its previous guidance.
• Nvidia reported fourth-quarter results below expectations and was subsequently downgraded by BMO Capital Markets.
• Credit Suisse reported its largest-ever annual loss (but said 2009 is off to a good start.)
• Ingersoll-Rand reported a fourth-quarter loss, including charges related to its acquisition of Trane. (Excluding those charges, results did beat expectations and the company gave solid guidance for 2009.)
The bad news, for those long stocks, is Tuesday’s session revived the fear trade as stocks and commodities tumbled while Treasuries benefited from a “flight to safety” trade. If not panic, Tuesday’s session brought about a major revival of uncertainty, which is almost as bad for the market.
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