Sheri Caplan is on vacation, so I'll be your substitute this week for our Markets Recap. As always, there WILL be a quiz, so no snoozing through class!

Stocks rallied sharply on Wednesday, after Fed Chairman Ben Bernanke hinted that rate hikes were coming to a close. The S&P 500 came back down to earth the next day, when minutes from the Fed's June meeting only revealed more uncertainty. Concerns about Middle East violence and higher oil prices probably didn't sit well with investors, either. The S&P 500 finished the week up 0.33%.

Second-quarter earnings were in full swing last week. Intel (NASDAQ:INTC), Google (NASDAQ:GOOG), Apple (NASDAQ:AAPL), Coca Cola (NYSE:KO), Johnson & Johnson, and Citigroup were a few of the companies to release quarterly results. Investors cheered Microsoft's decision to repurchase up to $40 billion in stock, but did not look so kindly on Intel's lowered outlook.

Meanwhile, PC titan Dell (NASDAQ:DELL) projected earnings below Wall Street expectations, sending shares down to a five-year low. Debate rages among Fools whether Dell has hit value territory. Vitaliy Katsenelson recently said that he is not ready to jump in. On the other hand, Nate Parmelee thinks shares at this price have a good chance of outperforming the market. Meanwhile, value guru Philip Durell continues to recommend Dell to his Inside Value subscribers.

OK, put those notes away and get your No. 2 pencils out. It's quiz time!

Capital Markets Summary

U.S. Equities

Index

7/21/06 Close

Weekly Change (%)

YTD Change (%)

Dow

10,868.38

1.20

1.41

Nasdaq

2,020.39

-0.83

-8.39

S&P

1,240.29

0.33

-0.64


Foolish Quiz
1. Which of these sectors performed the best over the last week?
(a) energy
(b) industrials
(c) information technology
(d) health care

2. Which of the following industries has performed the best year-to-date?
(a) telecom
(b) oil and gas
(c) Internet software
(d) semiconductors

3. The National Bureau of Statistics recently announced China's economy grew at what rate over the first half of the year?
(a) -5%
(b) 6%
(c) 11%
(d) 27%

4. True or False: Strong results in India, the Philippines, and Japan helped Coca-Cola beat sales and earnings estimates in Q2.

5. True or False: Google and Yahoo both ended the week down after reporting results.

6. Our Foolish bank analyst Stephen Simpson recently stated that which of the following big banks was undervalued?
(a) Bank of America
(b) JPMorgan Chase
(c) Citigroup
(d) Wachovia
(e) all of the above

7. According to the conference call, Apple's pipeline of new products includes:
(a) an iPod that is smaller than a penny
(b) a feature-length film about the differences between a Mac and a PC
(c) if only we knew!

8. True or false: Yum! Brands dropped 6% on Thursday, despite beating earning estimates by 10%.

9. True or False: Marvel Entertainment (NYSE:MVL) announced plans for a sequel to the blockbuster Hulk, tentatively titled Hulk's Vegas Vacation.

10. The Knot (NASDAQ:KNOT) dropped about 18% last week on what news?
(a) a secondary offering
(b) a merger
(c) weak earnings

Answers
1. (d) The health-care sector notched a 3% gain last week, according to Capital IQ. Energy, industrials, and IT all dropped lower.

2. (a) Telecom performed the best year-to-date, with a 14% gain. Internet software came in last place, with a 31% drop.

3. (c) China's economy grew 10.9% through the first half of the year. China just keeps on getting hotter.

4. False. India, the Phillipines, and Japan were actually weak spots in an otherwise strong international market. See "Coca-Cola Shows Some Fizz" for Nate Parmelee's Foolish take.

5. True. Google's results were generally more impressive than Yahoo's, but both companies ended the week down. See "Yahoo! Bores Me to Tears."

6. (e) Stephen Simpson sees value in large-cap banks right now. Bank of America, JPMorgan Chase, Wachovia and Citigroup are among the most promising. See "Can Bank of America Become a Cash Machine?"

7. (c) Apple's reticence on new products was one of Anders Bylund's peeves regarding an otherwise strong quarter. Come on, Apple! Throw us a bone here!

8. True. Weak domestic same-store sales weighed on the stock price, despite beating earnings estimates.

9. False. Marvel does have plans for a sequel to Hulk, but the real working title is The Incredible Hulk.

10. (a) The Knot announced a secondary offering that appears to be "excessive," according to one Fool. More than half of the shares will come from bailing insiders. In the words of Rick Munarriz: "Not cool."

Scoring:

  • 8-10 correct: Foolishly impressive.
  • 6-7 correct: Almost Foolish.
  • 1-5 correct: OK, but just barely.
  • 0 correct: Really? Keep reading the Fool and watch your scores improve!

Dell, Intel, and Coca-Cola are Motley Fool Inside Value picks. Bank of America, JPMorgan Chase, and Johnson & Johnson were selected by Motley Fool Income Investor . The Knot is a Rule Breakers recommendation. Marvel and Dell are Stock Advisor picks.

Fool sector head Joseph Khattab owns shares of Johnson & Johnson. The Fool has an ironclad disclosure policy .