RTTNews - Stocks were able to recover from a modestly weak open on Wednesday and have been bouncing between gains and losses since then. The major averages are extending their lackluster movement into the early afternoon, as reaction to the latest earnings reports has been subdued.

Earlier this morning, traders were presented with quarterly results from big-name companies such as Apple (AAPL), Yahoo! (YHOO), Pfizer (PFE) Boeing (BA), Morgan Stanley (MS), Wells Fargo (WFC), and PepsiCo (PEP).

Reactions were mixed, however, as most firms met or beat estimates by cost cutting rather than revenue growth.

Meanwhile, Federal Reserve Chairman Ben Bernanke is fielding questions regarding monetary policy as well as the current and near-term economic outlook, testifying before the Senate Banking Committee.

In his prepared remarks, Bernanke reiterated that the U.S. economy is showing signs of stabilization, although he noted that the economy is still in a fragile state, with unemployment high and consumer spending shaky.

Questioning the Fed chief, Sen. Chris Dodd, D-Conn., the chairman of the Senate Banking Committee, said that while some signs of economic recovery have been seen on Wall Street, the benefits have yet to make it to Main Street.

The major averages are currently all in positive territory, with the tech-heavy Nasdaq posting a notable gain. The Dow is currently up 14.67 at 8,930.61, while the Nasdaq is up 10.41 at 1,926.61 and the S&P 500 is up 2.58 at 957.16.

Sector News

Electronic storage and semiconductor stocks continue to see strong gains, with the NYSE Arca Disk Drive Index and the Philadelphia Semiconductor Index rising by 3.1 percent and 2.3 percent, respectively. Both indices reached their best intraday levels in over nine months earlier in the session.

Housing stocks are also advancing by considerable margins on the day, as reflected by the 3.4 percent gain being shown by the Philadelphia Housing Sector Index. The index has resumed its recent upward move and has reached its best intraday level in six weeks.

Lennar (LEN) is turning in one of the housing sector's best performances, with the homebuilder surging up by 8.2 percent. The day's upward move has propelled the stock to its best intraday price in over two months.

While health insurance and transportation stocks are also on the rise, the day's gains are being limited by weakness in the resource and financial sectors.

Oil service and steel stocks are leading the resource sector lower, with a decline in the price of oil contributing to the losses by oil stocks. The financial service sector is moving lower following a negative reaction to quarterly results from Morgan Stanley and Wells Fargo.

Stocks In The News

Starbucks (SBUX) is surging higher in early afternoon trading after the company reported adjusted third quarter net income of $0.24 per share, compared to $0.16 per share in the prior year quarter. The firm exceeded Wall Street forecasts of $0.19 per share and said it is on pace to beat yearly EPS estimates. The stock is up by 18.5 percent and reached its best intraday price in over eleven months earlier in the session.

Shares of Linear Technology (LLTC) said its adjusted fourth quarter net income was $0.31 per share, compared to $0.51 per share in the year ago quarter. The results beat analyst estimates of $0.22 per share as did quarterly revenues. Shares of the integrated circuit manufacturer are up by 7.6 percent, rising to their highest intraday level in over nine months.

On the other hand, shares of Advanced Micro Devices (AMD) are plunging after the company posted a second quarter loss that was wider than analysts had expected. The stocks has plummeted by 12.5 percent, backing further off of the one-month closing high set on Monday.

In Focus: Earnings Reports

Tech giant Apple reported a third quarter profit of $1.35 per share, compared to profit of $1.19 per share in the year-ago quarter. Wall Street analysts expected the company to earn $1.17 per share for the quarter, while the company's quarterly sales also beat estimates.

Yahoo! revealed second-quarter earnings of $0.10 per share, compared to $0.09 per share in the prior year quarter. The results beat analyst expectations of $0.08 per share, and third quarter revenue estimates also cleared forecasts by a notable margin.

Drug maker Pfizer Inc. announced adjusted second quarter net income of $0.48 per share, compared to $0.55 per share in the same quarter last year. Although the firm met Wall Street expectations of $0.48 per share, quarterly revenues fell well short.

Boeing Co. said its second-quarter net income was $1.41 per share, compared to $1.16 per share in the same period last year. The earnings crushed earnings forecasts of $1.21 per share, while revenues came in-line with estimates.

Morgan Stanley reported a second quarter net loss of $1.10, compared to net income of $1.02 in the year ago quarter. Wall Street looked for the financial services giant to show a loss of $0.49 per share, while the firm's revenues met forecasts.

Meanwhile, Wells Fargo, PepsiCo, QLogic (QLGC), and Altria (MO) posted results that exceeded estimates.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. While Japan's benchmark Nikkei 225 Index posted a 0.7 percent gain, Hong Kong's Hang Seng Index fell by 1.3 percent.

Meanwhile, the major European markets all closed modestly higher, with the German DAX Index and the U.K.'s FTSE 100 Index finishing up by 0.5 percent and 0.3 percent, respectively, while the French CAC 40 Index lagged behind, posting a gain of only 0.1 percent.

In the bond markets, treasuries continue to see modest weakness. Subsequently the yield on the benchmark ten-year note is trading at 3.510 percent, posting a gain of 3.3 basis points on the day.

For comments and feedback: contact editorial@rttnews.com