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Market Recap: Retailers and Financials Lead The Way


Flip flop action in today's trading but stocks gain.

Whipsaw action in today's trading. The Dow Industrials added +46 points, or +0.38% to 12,247, the S&P 500 added 10 points, or +0.79% to 1,336, and the Nasdaq Composite gained +14 points, or +0.63% to 2,293.

Stock futures pointed to a negative opening this morning after investors digested the release of January retail sales. According to Bloomberg, the International Council of Shopping said collectively, retailers reported same-store sales of just 0.5% for the month of January. It was the worst performance since 1970 spooking investors as consumer spending accounts for over two-thirds of the U.S. economy.

Individual retailers reported dismal results. Target (TGT) reported a decrease in January same-store sales of -1.1% vs. expectations of -0.7%. Macy's (M) said yesterday that January figures were -7.1% vs. expectations of -5.8%. And Wal-Mart (WMT) reported same-store sales figures for the month of January of just 0.5% vs. expectations of 2.1%. Professor Kevin Depew noted in the sales call that the company said consumers were redeeming their gift cards at a slower pace "using them more often for food and consumables than discretionary purchases."

The retailers; however, rallied in today's session. WMT added +2.07% to $49.84. J.Crew (JCG) finished +4.07% to $19.65. TGT finished +6.08% to $54.10, and Macy's added +4.89% to $25.11. But Retail Specialist Professor Jeff Macke cautioned Buzz readers on the strength, "We got horrible results but the stock prices stayed pretty strong, generally speaking. Do I wish I would have come in long retailers today? Well, sure… but I'd be selling them like crazy right now. In a bearish tape, I'd rather miss dozens of dicey set-ups than swing hard at bad pitches…" For more, read his article, Reality Bites For Retail.

Also adding fuel to bulls was comments made by Warren Buffet. The billionaire investor denied there was a credit crunch due to money being available. The comments acted as an upside catalyst to the financial sector. The best performers included Lehman Brothers (LEH) adding +3.95% to $60.48. J.P. Morgan Chase (JPM) added +3.18% to $45.11, and Bank of America (BAC) closed +2.46% to $43.37. Read Professor Kevin Depew's Five Things You Need To Know.

Commodities were strong as well. Crude oil traded +0.97 to 88.11. Gold added +5.40 to 906.10. Silver gained +0.225 to 16.775, and copper surged +14.05 to 344.80.

For more summaries, check out Minyanville's Buzz Bits.

Idea Flow

Below is a recap of some of the idea flow on today's Buzz & Banter. Please note that stocks may appear in both bullish and bearish categories, due to long and short term trades by our many Minyanville professors.

Some bullish trade or investment ideas: LCC, WIM, QQQQ, AAPL, SPG, MA, SPY, EWZ, BIDU, INFN, Gold, Gold shares, Pharma, Consumer Nondurables

Some bearish trade or investment ideas: EWM

See y'all at the Rolling Bones! Goodnight!
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No positions in stocks mentioned.

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