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MV Weather Report: Geithner's Rain Dance Saves the Financials


Rain or shine, we review the day's biggest stock stories.

Timmy's Turnaround Tuesday was today's tale of the tape. (How many words that start with T can I put in one sentence?)

During a congressional hearing, Tim Geithner said that most banks have enough capital to survive. His statements sparked today's rally - hence, Turnaround Tuesday.

The leaders of the day were Bank of America (BAC), JPMorgan (JPM), and Wells Fargo (WFC). Mastercard (MA) and Visa (V) also traded very strong. The industrials had a big day as well - Dupont (DD), 3M (MMM), Deere (DE), and Caterpillar (CAT).

I wanted to point out that Caterpillar was down almost 6%, but reversed midday after an upbeat conference call. The company said that China is the strongest market right now, and the company is looking to increase business exposure there. This will be something to watch in the future, especially since many pundits believe China is going to lead the world out of the recession.

As we discussed yesterday, the S&P was perched right at its 20 DMA, breached quickly, but then recovered. This is typical action, and I wouldn't be surprised if we got a little sideways action as the battle continues into the week.

Tomorrow's trading day will be filled with earnings again, with an onslaught both before and after the bell. Before, look for Wells Fargo to be the most talked-about. We already know the numbers, but investors will be looking for additional detail regarding the blowout quarter.

Minyan Peter had a nice Buzz today about bank earnings:

"I realize that these are very difficult times for financial services companies, but I learned a long time ago that the only route to progress is dealing with reality.

"With that as background I would offer to any number of regional banks who reported earnings this week that the correct disclosure when writing off goodwill is not 'This is a non-cash charge which should be ignored because it does not effect cash or regulatory capital' but 'In hindsight we overpaid for an acquisition and based on lower forecast earnings from this business in the future, we need to write down most of the purchase price.'"

Another big company reporting before the bell is Morgan Stanley (MS). Can MS put out the same kind of performance as Goldman Sachs (GS) and JPMorgan. Current estimates call for a loss of $0.08 per share, with revenues of $5.01 billion.

After the close, tech bellwether Apple (AAPL) will report. The company should have no problem beating EPS; it always does, then low-balls the guidance. Other biggies will be Qualcomm (QCOM) and eBay (EBAY).

For a complete list of all of the companies reporting earnings tomorrow, check out the trading radar.

All right, Minyans - have a great night!
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