Stocks fall, but the week remains positive after a very strong session Thursday. The Dow ($INDU) gave up 60.89 points Friday to close the session at 10,157.71. The S&P 500 ($SPX) closed at 1,152.12, a decline of 0.7 percent. The Nasdaq ($COMPQ) fell 30.22 points, or 1.5 percent, to 1,932.19. Volume came in at 1.67 billion on the NYSE and at 1.84 billion on the Naz. Market breadth was negative by a 13-to-19 and 10-to-21 margin on the Big Board and Naz respectively.
Earnings news was the big story Friday, with no economic reports to speak of. Eastman Kodak (EK) didn’t help the bulls cause when the company announced disappointing results in the first quarter. EK missed estimates by 30-cents share, sending its stock down nearly 10 percent on the session.
Another stock that took a hit Friday was Yahoo (YHOO). The company was hurt by a downgrade following a better than expected earnings report from competitor Google (GOOG). Google shares rose more than 11 percent, while Yahoo shares fell one percent on the news. However, Yahoo did see a nice gain in price this week following a strong earnings report.
Merger news was a story Friday as well, with the Nasdaq (NDAQ) announcing plans to buy Reuter’s Instinet (INGP) for $1.8 billion in cash. This news follows an announcement earlier in the week that the NYSE would buy Archipelago (AX). NDAQ shares rose 26.10 percent on the news to $13.43 a share. INGP shares fell 8.95 percent to $5.19.
In other merger news, Qwest (Q) continues to pursue MCI (MCIP) despite the fact the company announced plans to accept a lower offer from Verizon (VZ). Q raised its bid for MCIP to $30 a share, raising the chances that a major proxy war is going to play out. Qwest shares fell 1.66 percent on the session, with MCIP shares up 0.72 percent and VZ shares off 0.58 percent.
Oil prices were a disappointment for the bulls today as well, with crude rising 2.2 percent to $55.39 a barrel Friday. For the week, crude gained 6.4 percent, with gasoline prices rising 11 percent. Concerns about the ability of refineries to keep up with demand have sent prices for gasoline higher and this could be a negative for consumer spending down the road.
Overall, the week saw higher prices for the major market indices, but resistance is holding and there was no follow through on Thursday’s strong advances. This has many analysts calling for sideways trading in the week’s to come, as a strong week of earnings reports was unable to carry stocks to new levels.
Jody Osborne Senior Staff Writer & Options Strategist Optionetics.com ~ Your Options Education Site
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