Top 10 News Items 7/13-7/17: Bank Earnings Surprising to the Upside; Tech Earnings Just Behind; 'When Bears Turn Bull' Lifts Stocks

July 17, 2009 5:25 PM EDT

Here is a recap of the top news items from this week on Wall Street:

1. We are now in the heat of earnings season, with financial companies making the most profound impact this week. Goldman Sachs (NYSE: GS) kicked off the week on Tuesday by beating the Street's EPS estimates by $2.71, reporting $5.71, ex-items. The stock jumped more than 5%, also bringing with it the entire market. Next, JPMorgan (NYSE: JPM), on Thursday, reported Q2 EPS of $0.28, beat the Street estimate of $0.04 handily. Then Friday, both Bank of America (NYSE: BAC) and Citi (NYSE: C) reported their quarterly results, each reporting better-than-expected numbers on the EPS front. The Financial Select Sector SPDR ETF (NYSE: XLF), or commonly referred to as just "the XLF" finished this week 9% higher.

2. Tech also saw numerous big name earnings this week. Intel (Nasdaq: INTC), Google (Nasdaq: GOOG) and IBM (NYSE: IBM) all topped Wall Street's estimates. The Technology SPDR ETF (NYSE: XLK) jumped more than 8% this week.

3. As if numerous earnings reports from the stock market's largest companies didn't swing the market wildly enough, something we like to call "When Bears Turn Bullish" certainly added to volatility this week. First, long-time convicted bear, Meredith Whitney (who has correctly predicted a sharp slide in financial earnings for the last year), on Monday, slapped a Buy rating on shares of Goldman Sachs, instantly sending stocks higher. Then later in the week, it was heard that the even-more-bearish Nouriel Roubini, known as "Dr. Doom", had gotten bullish on stocks saying "the worst is behind us in terms of the economic and financial conditions". The broader markets once again began rising on the surprise development, but Roubini later issued a statement saying his comments were taken out of context. Still, as our editor put it best: "Whatever Mr. Roubini. It's about your tone sir. When you talk recovery and not doomsday it will be interpreted more positive, which we assume is your intention. You can't have it both ways."

4. A saga at commercial lender CIT Group (NYSE: CIT) unfolded this week, sending the stock tumbling below the $1 level. As has been known, liquidity issues have been plaguing the company recently, but the issue roared to a bubble this week as rumors of a government bailout filled the wires. Late Wednesday, hopes were shattered as the stock was halted and news hit after the close that the government slammed the door on such a possibility. Reopening Thursday, the stock had fallen more than 60%. But that's not the end. Late Friday, traders found out that the company is in talks with both JPMorgan Chase and Goldman Sachs related to short-term financing. On this news, shares of CIT jumped more than 70% by Friday's close.

5. Elsewhere in the earnings picture, General Electric (NYSE: GE) reported mixed Q2 earnings, sending shares falling about 6% on Friday. As has been the case over the last few quarters, performance in the company's Industrial unit held up, while results from GE Capital lagged.

6. Better-than-expected credit card data, released Wednesday, pushed stocks in this sector higher; Data from credit card leader American Express (NYSE: AXP) showed that on a managed basis net write-offs were 9.9% in June, down from 10% in May. 30-day delinquencies on a managed basis, which could lead to future write-offs, fell to 4.4% in June from 4.7% in May. Capital One's (NYSE: COF) net write-offs rose to 9.73% in June versus 9.41% in May, but 30-day delinquencies fell to 4.77% in June from 4.9% in May. Discover Financial's (NYSE: DFS) net write-offs fell to 8.75% to 8.91% and 30-day delinquencies fell to 5.27% from 5.32%, the second straight monthly decline. Shares of AXP finished this week about 20% higher.

7. The FOMC released its minutes for its June 23 and 24 meeting, with most officials calling the US economy "weak" and "vulnerable". The minutes also said that the unemployment rate could top 10% this year and that markets were "fragile" during the days of the meeting.

8. PPI for the month of June came in up 1.8%, versus the consensus of 0.9%, while CPI for the month came in up 0.7%, versus economists estimates of up 0.6%.

9. Following controversy related to the trading of "old GM" shares (GMGMQ) last week, and the eventual halt on Friday, FINRA flipped the switch this week, resuming trading of these assets under a new symbol MTLQQ. Shares of Motors Liquidation Company (OTC: MTLQQ), as its being called, finished this week at $0.459.

10. Former Treasury Secretary Hank Paulson was grilled -- just as BofA's Ken Lewis and Ben Bernanke were previously -- in Washington this week. Testifying in front of Congress, Paulson was asked similar questions as Lewis and Bernanke, and similarly to the two previous roastings, it seems nothing has come from this hearing.

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• JPMorgan
• Henry Paulson
• Ben S. Bernanke
• Citi
• Banc of America
• Federal Open Market Committee
• Meredith Whitney
• StreetInsider.com Top 10 News Items for the Week

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