The Wall Street Journal-20080125-Qualcomm- U-S- Steel- Nucor Rise
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Qualcomm, U.S. Steel, Nucor Rise
U.S. stocks rose as the government promised taxpayers that the checks were in the mail and energy stocks such as Exxon Mobil, technology stocks like Qualcomm and metals stocks such as Nucor regained some of the momentum that lifted markets last year.
Market participants debated to what extent activity related to one trader's huge loss at Societe Generale skewed volatility.
A rush of hedge funds to swap out of "momentum" sectors into value areas contributed to some of the recent jarring action, according to a Lehman Brothers analyst.
After an opening rally failed Thursday, stocks picked up again after government officials unveiled details of an economic-stimulus plan.
"That will have some impact quicker than the Fed can, so you begin to get a little more hopeful about the shape of the economy maybe a quarter out as opposed to several quarters out," said William Sutherland, senior analyst at Boenning & Scattergood, referring to tax rebates.
As turmoil in international markets subsided and U.S. economic data came in mixed -- with labor markets apparently firming and homes sales still sliding -- traders turned their focus to individual earnings reports.
Technology stocks returned to favor, although there were some exceptions. Microsoft (Nasdaq), which reported brisk earnings growth after the bell, rose $1.32, or 4.1%, to 33.25. EBay (Nasdaq) fell 1.76, or 6.1%, to 27.18 after the Internet auctioneer projected unexpectedly muted revenue growth for 2008.
Qualcomm rose 3.78, or 10%, to 40.41 on the Nasdaq after the maker of cellphone technology posted strong fiscal-first-quarter profit growth, helped by demand for "third-generation" mobile-phone providers.
Apple (Nasdaq) fell 3.47, or 2.5%, to 135.60. A Securities and Exchange Commission filing indicated that Chief Executive Steve Jobs agreed to take $1 in salary for the year in 2007.
On the telecommunications side, American depositary shares of Nokia added 4.05, or 12%, to 36.48 after the mobile-phone maker topped Wall Street's fourth-quarter earnings expectation. AT&T declined 94 cents, or 2.6%, to 35.75. The phone company posted robust fourth-quarter growth, but investors saw some hiccups in Internet additions and wire- line-subscriber losses.
Among commodities issues, Nucor added 3.71, or 7.1%, to 56.16 after the steelmaker and metals recycler exceeded its recent fourth-quarter profit projection. U.S. Steel added 4.27, or 4.1%, to 108.45.
Shares of Exxon Mobil rose 2.55, or 3.1%, to 86 as the price of oil rebounded on renewed optimism for the U.S. economy.
Elsewhere, Xerox rose 1.08, or 8.1%, to 14.33 after the office- equipment maker said it is witnessing some slowdown in corporate spending but was girded against the effects.
Some of the major defense contractors reported profits. Lockheed Martin added 4.21, or 4.1%, to 105.90 after increasing its 2008 profit outlook. Another aerospace giant, Northrop Grumman, fell 88 cents, or 1.1%, to 77.44 after it eked out marginal growth in earnings. Rockwell Collins rose 3.02, or 5.2%, to 61.50 as its fiscal-first-quarter revenue rose sharply.
Financials were mixed.
Capital One Financial rose 3.55, or 8%, to 47.75 after the credit- card provider posted a drop in quarterly profit on higher provisions for bad loans.
SunTrust Banks fell 1.45, or 2.2%, to 64.28 after the Atlanta bank posted a 98% drop in quarterly profit amid an increase in failing loans. Morgan Stanley eased 47 cents to 51.23 after the brokerage said it would lay off about 1,000 people, or about 2% of its entire work force.
Bank of America shed 67 cents, or 1.7%, to 39.90 after it laid off about a quarter of its securities analysts.
Fannie Mae fell 59 cents, or 1.7%, to 34.19. Freddie Mac gave back 52 cents, or 1.6%, to 32. The economic-stimulus disclosure would alter some of the criteria of the government-sponsored home lenders' business.
Citigroup was one of the leading gainers, adding 97 cents, or 3.7%, to 27.33.
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Kaja Whitehouse contributed to this article.
