After five straight losing sessions, the Dow is on a two-day winning streak including a sizable gain today. Here's how the major indexes did.
Index |
Gain (Loss) |
% Change |
Ending Value |
---|---|---|---|
Dow Jones Industrial Average |
+181.19 | +1.41% | 12,986.58 |
Nasdaq |
+39.09 | +1.30% | 3,055.55 |
S&P 500 |
+18.86 | +1.38% | 1,387.57 |
On the global economic front, there were apparently some rumors in the market for stronger-than-previously expected growth figures out of China (reporting well after market close at 10 p.m. ET). And European bond yields fell a bit.
But what I prefer to look at are the individual earnings reports coming out as we kick into earnings season this week. So far, so good. Alcoa started us off on Tuesday with a positive surprise. Hewlett-Packard
Google
Google slightly missed on the top line ($8.1 billion versus an expected $8.2 billion) but beat on the bottom line ($10.08 per share versus $9.65, both on an adjusted basis). It saw increased volume growth of 39% in its advertising cash cow but at a 12% lower cost per click. There is debate on whether this is a sign of weakness or merely a mix shift.
That said, Google's earnings were overshadowed by its announcement of an unorthodox 2:1 stock split. The mechanism is a stock dividend that will issue non-voting shares, so that Google's founders can maintain control as they currently do under a dual-class structure. Basically, the non-voting shares will allow Google to stave off "dilution from routine equity-based employee compensation and other possible dilution, such as stock-based acquisitions."Cynics will say this move is a corporate governance no-no. Believers in the long-term vision of Larry Page and Sergey Brin may argue that it allows them to maintain their long-term strategies for the company.
Google's earnings did not disappoint, but will Apple's? We preview what to look for from Apple and four other must-watch companies in "5 Stocks Investors Need to Watch This Earnings Season." Get access now.