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MV Weather Report: Google Makes It Rain


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


JPMorgan (JPM) was the story of the day. The company reported earnings per share of $0.40, beating estimates by $0.08 a share. Revenues where $25.02 billion compared to $22.95 billion. It was an across-the-board beat for the company: Shares rose by 2% in today's trading helping the Dow and the S&P 500 rally.

The S&P shot threw the important 859/860 level, mentioned here for about a week now. The high for the day was 870 and it closed at 865. Here's Professor Jeff Cooper's technical take on the S&P.

"The S&P needed a bonafide Gap 'N Go to the upside this morning to avoid being vulnerable.

"The daily chart shows the reversal back up yesterday from a 1 to 2 day pullback was the 7th instance of such behavior since the stampede started in early March. The market often plays out in 7's and culminates in 7's, up and down.

"The SP tagged the low of the high hourly bar this morning and reversed triggering an ORB or opening range breakdown: it looks like there are 'natural sellers' around and if the shorts were squeezed out on yet another rebound yesterday this only weakens the market prior to expiration. So, heads for another possible panty raid an an extension lower, if that's not a mixed metaphor."

This has been a powerful rally, and the short side is tempting here, but bears should respect Hoofy.

While writing this, Google (GOOG) reported its first quarter earnings. Earnings per share were $5.16 on revenues of $4.07 billion, compared to the consensus estimate of $4.93 and $4.08 billion. The company said paid clicks rose by 17% from first quarter 2008, and increased 3% from fourth quarter 2008. The beat by Google is no shock; the company always kills on the bottom line.

The stock is currently trading at $408, up from a close of $388. On the heels of options expiration tomorrow, I'm interested to see what the stock does.

Before the bell tomorrow traders will be dissecting 2 earnings reports: General Electric (GE) and Citigroup (C).

General Electric options are currently pricing in a 7.5% move in either direction. Current estimates call for earnings per share of $0.21 on revenue of $39.0 billion.

As for Citigroup, current estimates call for a loss of $0.34 a share on revenues of 21.94 billion. Citi did say it was profitable during the first 2 quarters of the year, but it should be noted that analysts have very wide estimates on Citi, ranging is from ($1.14) to $0.10. Reports from both companies should shape early trading tomorrow.

Have a great night!

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No positions in stocks mentioned.

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