Stocks Make Up Some Losses

News at a Glance

Dow Declines: Stocks edge up in late afternoon but close down for the day.
Weaker Growth: Revised numbers show only 2.8% GDP growth in third quarter.
Home Improvement: Case-Shiller index shows another month of gains.
Confidence Shaken: Consumer Confidence Index increases, but remains weak.

The Lowdown

After closing at a new high for the year yesterday, stocks fell slightly today following the release of some mixed economic data.

The Dow closed down 17 points, at 10,434. The S&P 500 dipped just 0.59 points to 1,105.65 and the Nasdaq lost 7 points, falling to 2,169.

A wider trade deficit and weaker consumer spending led to the revised estimate of a third-quarter growth rate of 2.8%, lower than the earlier estimate of 3.5%. The new figure met expectations, but showed consumer spending rose only 2.9%, compared to earlier estimates of 3.4% for the quarter. Both imports and exports were revised upward, leading to a wider trade deficit than had been previously estimated.

The Standard & Poor's Case-Shiller index, released this morning, showed steady improvement in home prices for the third quarter. Both the 10-City and 20-City Composite indices saw their fifth consecutive months of gains. The index was 8.9% lower in the third quarter compared to 2008, an improvement over the second quarter's 14.7% year-over-year drop. Quarter-to-quarter, the index gained 3.1% in the second and third quarters.

The Conference Board's Consumer Confidence Index edged up in November after an unexpected October drop. The index rose from 48.7 to 49.5, still below August's 54.5 reading. Consumers' readings of the labor market and prospects for income growth both fell slightly.

The Federal Reserve's Open Market Committee released the minutes from its November meeting, at which it left the federal funds rate unchanged, at 2 p.m.

Corporate News

Hewlett-Packard (HPQ) late Monday reported GAAP earnings per share for the fiscal fourth quarter of 99 cents, up 18% from a year ago, despite net revenue of $30.8 billion, down 8% year over year. REPORT.
American Eagle Outfitters (AEO) beat analysts' estimates with earnings of 28 cents per share, better than the expected 21 cents per share, despite total sales that slid a bit more than expected, down 1% year-over-year to $749 million. REPORT.
Barnes & Noble (BKS) reported a wider-than-expected loss for its fiscal second quarter of 43 cents per share. Comparable same-store sales were down 3.2%, although total sales, at $1.2 billion, were up 4% over the previous year. REPORT. Borders Group (BGP) also reported a wider-than-expected loss of 65 cents per share for its third quarter. Total sales were down 12.7% and comparable same-store sales were down 12.1% at Borders superstores and 7.2% at Waldenbooks stores. REPORT.
Signet Jewelers (SIG) reported a smaller quarterly loss than it saw a year ago, of $10.5 million, compared to last year's loss of $23.6 million. Diluted loss per share was 8 cents, better than last year's 18 cents. REPORT. Zale Corporation (ZLC) reported a wider loss for its fiscal first quarter, of $1.80 per share, compared to a loss of $1.52 for the same quarter last year. Revenue of $329 million was also down from the previous year, and comparable same-store sales were down 6.8%. REPORT. Tiffany & Co. (TIF) is scheduled to report third quarter earnings before the market opens tomorrow.

The Economy

Revised third-quarter GDP showed only 2.8% growth. REPORT.
Case-Shiller index shows six months of improvement in home prices. REPORT.
The Conference Board's Consumer Confidence Index showed a slight improvement over October's disappointing reading. REPORT.
The minutes of the Federal Reserve's Open Market Committee's November 4 meeting were released at 2 p.m. REPORT.

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