Stocks finished mixed Thursday ahead of a three-day weekend. Blue chips fell, despite good earnings news from General Electric (GE ), while the Nasdaq edged higher amid positive earnings news from Yahoo! (YHOO ), as well as higher revenue guidance from Dell (DELL ).
The Dow Jones industrial average fell 38.12 points, or 0.36%, to 10,442.03, held back by weakness in Wal-Mart (WMT ) on expectations that same-store sales growth may slow after a strong March. The broader Standard & Poor's 500-stock index was down 1.2 points, or 0.11%, to 1,139.33. The tech-heavy Nasdaq composite index lost 2.62 points, or 0.13%, to 2,052.86.
Trading volume was light ahead of the Good Friday holiday, when both the equity and bond markets will be closed. On the New York Stock Exchange, roughly 1.19 billion shares traded hands, while volume on the Nasdaq was around 1.69 billion shares.
Next week will be heavy for economic releases. On Tuesday, the government will report March retail sales, business inventories, and the budget deficit. Wednesday brings the consumer price index for March, real earnings, and trade deficit for January. Thursday's reports include weekly jobless claims, the Empire State Index, NAHB Housing index, and the Philadelphia Fed survey. Friday's docket has housing starts, industrial production and utilization, and consumer sentiment.
Earnings season also picks up steam next week, with the roster of companies reporting results including big names like Intel (INTC ), Johnson & Johnson (JNJ ), McDonald's (MCD ), and Merrill Lynch (MER ) on Tuesday; Apple Computer (AAPL ), Advanced Micro Devices (AMD ), Texas Instruments (TXN ), Bank of America (BAC ), and Progressive (PGR ) on Wednesday; Citigroup (C ), EMC (EMC ), IBM (IBM ), and PepsiCo (PEP ) on Thursday; and E*Trade (ET ) and Nokia (NOK ) on Friday.
On Thursday, Yahoo shares jumped after the Internet outfit posted first-quarter net income of 14 cents per share (including 1 cent from a one-time gain), vs. 8 cents one year earlier and above analysts' forecast. The company's revenues surged on strength in traditional online and Web-search advertising. Yahoo raised its revenue guidance for the second quarter and 2004, and announced a 2-for-1 stock split.
Dell raised its first-quarter sales estimate to $11.4 billion, $200 million higher than earlier guidance. The PC maker reiterated its 28 cents first-quarter EPS forecast. It cited strong demand across its full range of products and services.
GE posted first-quarter EPS of 32 cents, vs. 30 cents a year ago, on a 9.5% revenue rise. The conglomerate says it's positioned for double-digit EPS growth in 2005.
Retailers were mixed after some stores released strong March sales figures. J.C. Penney (JCP ) reported better-than-expected 11% higher March comparable-store sales and 9.7% higher catalog and Internet sales. It says it sees 20 cents to 25 cents for first-quarter EPS, citing strong sales and positive gross margin trends.
After the market close Wednesday, Genentech (DNA ) reported first-quarter EPS of 33 cents, vs. 29 cents a year ago (GAAP), on a 30% rise in total operating revenues. It sees 20% to 25% 2004 EPS (non-GAAP) rise.
Research in Motion (RIMM ) posted fourth-quarter EPS of 56 cents (before items), vs. 20 cents, on a sharp revenue rise. The maker of the Blackberry wireless communications device raised first-quarter guidance to 28 cents to 33 cents EPS on revenue of $250 million to $260 million. It also set a 2-for-1 stock split.
In economic news, initial jobless claims for the week ended Apr. 3 fell 14,000 to 328,000, stronger than expected, adding to positive tone of the market.
The wholesale trade report for February showed inventories up a whopping 1.2% (the median estimate was for a rise of 0.2%), with sales up 1.3%. That is the largest inventory rise since November, 1999. Inventory growth for January was revised to 0.2% from 0.1%, and sales to 0.9% from 0.6%. For now, the big February gain and upward revision to January should provide a boost to first-quarter gross domestic product estimates, says economic research outfit Informa Global Markets.
In the early hours, some traders kept an eye on National Security Advisor Condoleezza Rice's highly anticipated testimony to the Commission on Terrorist Activities. Rice said Thursday that "there was no silver bullet that could have prevented" the September 11 terrorist attacks.
Treasuries finished lower, as the fall in jobless claims data set the bearish tone, and prices could not recover in the shortened trading session, reports Informa Global Markets.
European stock markets finished higher. London's Financial Times-Stock Exchange 100 index was up 21 points, or 0.47%, to 4,489.7. The Bank of England, apparently worried about aborting the economic recovery, left interest rates unchanged despite some concerns about inflation that showed up in the 2.3% jump in March retail prices.
Germany's DAX index added 12.37 points, or 0.31%, to 4,013.53, despite a report German industrial production fell 0.7% in February. Investors were encouraged by earnings of some U.S. tech companies. Siemens was higher after Samsung raised its forecast for mobile phone sales this year. Infineon Technologies rose in sympathy with Dell's strong forecast.
In Paris, the CAC 40 index gained 5.55 points, or 0.15%, to 3,740.11.
Asian markets finished mixed on Thursday. In Japan, the Nikkei 225 index gained 72.97 points, or 0.61%, to close at 12,092.59. Retailers rose after Ito-Yokado Co. and Seven-Eleven Japan Co. forecast higher profits helped by cost cuts amid an increase in consumer spending.
In Hong Kong, the Hang Seng index lost 10.68 points, or 0.08%, to close at 12,909.37.