Wall Street Greek: Today's Business Summary

By Markos N. Kaminis - Economy & Markets:

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This article is not as boring as the title makes it seem, so read on! Business news is anything but boring these days. In fact, it's the new sexy! Today's market-moving business included some more depressing data out of the U.K. This was a rough week for the Brits, and we're guessing the pubs are full tonight. The economic scene offered no reports, but plenty of D.C. happenings, including Tim Geithner bad mouthing our loan shark, China. President Obama spoke to the GOP today about fiscal stimulus, and while he offered an open ear, he made "no promises." The corporate front was troubling, but Google showed there's still money to be made, or at least there was anyhow, before they made it all.

(Article interests: AMEX: DIA, AMEX: SPY, Nasdaq: QQQQ, NYSE: NYX, AMEX: DOG, AMEX: SDS, AMEX: QLD, AMEX: XLF, AMEX: IWM, AMEX: TWM, AMEX: IWD, AMEX: SDK, NYSE: QLD, NYSE: SDS)

Overseas Markets

Overseas markets traded tumultuously today, as U.K. economic contraction in Q4 was the worst seen since 1980. GDP contracted by 1.5% in the fourth quarter, after a 0.6% drift in Q3. Applying the popular recession measuring stick of two consecutive contracting quarters, this marked the first recession in the U.K. since 1991. That news compounded upon yesterday's revelation that China's growth slipped to 6.8% in Q4, taking its full year rate to 9.0%. Growth fell short of what economists had foreseen, and raised panic levels in Asia.

Meanwhile, unimaginable speculation about pending bank nationalization across the globe is raising the level of investor concern the world over. Global corporate news releases have only offered more reason for worry. For instance, China's largest car maker declared today its 2008 profit would be more than halved due to slowing sales in China and South Korea. Also, a UBS analyst noted expectations for a 10% dividend decline across European firms (in 2008) and another 3% this year. Despite the heavy dose of reality, European markets flattened out by the close of trading.

Asia:

MSCI Asia APEX 50: -1.4%

Japan NIKKEI 225: -3.8%

Hong Kong Hang Seng: -0.6%

China CSI 300: -0.6%

India BSE SENSEX 30: -1.6%

Europe:

DJ Euro STOXX 50: -0.6%

UK FTSE 100: +0.01%

France CAC 40: -0.7%

Germany DAX: -1.0%

(Prices as of hour of publishing, which may not be the close)

Economic Events

There were no economic reports on today's schedule, but President Obama met with GOP lawmakers in order to win the opposing party's favor for his stimulus package. He is, of course, hearing suggestions and likely making concessions in order to do so. Republicans are concerned that the President's plan is too forward looking, and will not get people to work quickly enough. The GOP is pushing for more of the same tax refunds we saw last year.

Tax cuts are welcomed, we have to agree, but we would direct them to the lowest tax brackets where they might make meaningful impact. I'm not sure that people who remain fully employed necessarily need a tax cut, where that money could be spent to create jobs and bring long-term gains for the nation. I would like to see greater assistance to those forced to work part-time now and barely making it, and those unemployed who are seeking work (you know, but not bums like me). We (America, and actually me too) need to find money, and make proper use of it.

I for one would like to see smart government spending, and cuts in areas where we are wasting funds. I agree that investment in our long-term energy independence is important, and believe it will put people to work over the long run as well.

Sorry to offend Republicans (I'm now an Independent), but Obama's plan really incorporates a form of trickle-down economics, since he seeks to create jobs by promoting industry. Was that right there, blasphemous of me to say? Will I ever be welcome at another GOP shindig? We need an alternative energy infrastructure in America, something I've been pushing for for over eight years now! Many concerns could be remedied this way: energy independence could be gained; global warming quelled; Middle East tensions perhaps somewhat eased.

Through experience, I've come to see too many struggling citizens of countries in peril too often blame America for anything and everything wrong in their individual lives because of our demand for oil. I suggest that argument can be proven false through energy independence. Let me say that again in case you missed it! Too frequently, I find the case made against America that everything we do is driven by our oil interests. I'm not so naive to say oil has not swayed some political decisions here or there, and that it even lies behind a few supposedly noble political causes. But, the view outside the United States is too often overwhelmingly biased toward this argument.

In case you think I missed it... it being the whole Timothy Geithner thing, where he pissed off our most important trading partner and our most critical lender, China... well I didn't. The topic is just too big to discuss here. It'll have to have it's own place on our little blogosphere... stay tuned

Corporate News Drivers

Depressing corporate news dominated market direction this week. However, one bright spot came from Internet search giant Google (Nasdaq: GOOG). The tech leader reported earnings last evening, and it was one of very few companies to actually beat estimates. As a result, GOOG shares jumped $18 or 5.9%. Sales jumped 18%, and both revenue and profits exceeded estimates when excluding charges. That 18% sales increase represented a not insignificant $870 million dollars more than the year ago period.

General Electric (NYSE: GE) shares sank 10.8% through late afternoon trading, despite meeting analysts views. That said, meeting estimates meant posting 44% lower net income than the prior year period. Investors were not only concerned about the present though, as there's growing fear that GE could lose its coveted AAA credit rating and find itself forced to cut its dividend eventually... as the global economy sags upon it.

A sign of the times? Even though it had warned investors a month ago, Schlumberger (NYSE: SLB) still posted results that disappointed today, though only by a penny. What troubled shareholders most was management's warning that customers were likely to reduce spending in 2009. The shares, however, followed the price of oil, which soared 6.6%. SLB followed suit and rose 10%. You need to know why oil traded up, considering the economy is finished and the world sunken. Well, it seems traders finally started thinking about what we warned you would be the stabilizing factor for oil eventually, draws from storage. OPEC cuts are anticipated to start working shortly, and limited supply means higher pricing, even when the supply is held captive by an unruly consortium. Love all my Arab brothers... send money (or potatoes) for nice words though.

Are people trading down, and if they are, how far down? For instance, would motorcycle enthusiasts hit by financial strife ride bicycles instead? Judging by Harley Davidson's (NYSE: HOG) news today, they just might! Noting a slowdown in motorcycle sales, Harley is closing plants and laying off 1,100 employees. The company's fourth quarter earnings fell 60%, and its shares shed 7% today as a result.

The Wall Street Journal reported that Pfizer (NYSE: PFE) is in talks to buy rival drug maker Wyeth (NYSE: WYE). Wyeth shares rocketed higher 12.6%, and even Pfizer's shares edged up on the news, something atypical of acquirers in merger deals... unless special "synergies" exist. Speaking of SYNERGY! Did you see 30 Rock last night? "Never bad mouth synergy!"