Mixed economic news leaves major market indices mixed as well Tuesday. The Dow (^DJI) gained 14.21 to a level of 9,882.17. The S&P 500 (^SPX) fell 3.54 points to 1,063.41. The Nasdaq (^IXIC) gave up 25.76 points, or 1.20 percent, to 2,116.09. Volume was moderate on the session with the NYSE trading 1.40 billion shares and the Naz turning over 2.40 billion shares. Market breadth was negative on the session by a 11-to-20 and 9-to-18 margin on the Big Board and Naz respectively.

The Dow managed to gain ground Tuesday thanks to gains in energy stocks, but the broader market, including tech stocks, continued to show losses. Oil prices rose only slightly, up 0.31 percent to $79.80, but oil related stocks rallied following a better than expected report from BP (BP). BP was able to easily surpass earnings expectations thanks in part to cost-cutting and this helped push the stock higher by 4.22 percent. BP hit a new 52-week high, closing the session at $57.82 after hitting an intraday high at $58.69. Both Chevron (CVX) and ExxonMobil (XOM) are set to report earnings later this week and their respective stocks rose 1.56 percent and 2.28 percent respectively.

Shares of Baidu.com (BIDU) tumbled 11.39 percent to a price of $383.66 Tuesday. The Chinese Internet search engine reported better than expected earnings, but warned that fourth-quarter revenues would fall short of estimates. Shares of Yahoo (YHOO) and Google (GOOG) fell on the session as well, with both stocks losing 1.07 percent.

The bulls got bad news this morning when the Conference Board stated that consumer confidence in October fell to 47.7 from 53.1. Economists were looking for a mild gain in the index to 54.0. Consumers are concerned about the jobs market with nearly half of those surveyed saying jobs are hard to get. Ironically, credit card providers American Express (AXP) and Visa (V) experienced gains on the session.

Visa announced earnings Tuesday that earnings per share were 2-cents higher than estimates. The company also beat on revenues and reaffirmed its FY10 guidance. Visa also announced that its Board has authorized a $1 billion share repurchase plan. Visa shares gained 1.54 percent on the session to close at $73.90. Shares of AXP continued their tear Tuesday, rising 3.07 percent to $35.95. The company announced strong earnings last week and has gained more than 70 percent since its March lows.

Traders got good news on the housing sector this morning when the Case-Shiller home price index rose for the third straight month. The report showed a 1.3 percent gain in its Composite 10 and a 1.2 percent gain in the Composite 20. This index has shown improvement of late, though the year on year decline for home prices remains in double digits at -10.6 percent. Traders will get more data on the housing market tomorrow when the new home sales data for September is released. Estimates are for a rise to 440,000 annualized units, up from 429,000 in August.

Jody Osborne
Senior Writer & Options Strategist
Optionetics.com ~ Your Options Education Site

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