Jan. 14 - Summary: JP Morgan, Wells Fargo beat forecasts; Retail sales rise; GM and Tesla see strong demand; Google's Nest deal lifts peers. Bobbi Rebell reports.
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U.S. stocks doing a 180 on Tuesday - moving higher, one day after S&P 500's biggest drop in two months. Behind the bounce, retail sales and earnings from JPMorgan and Wells Fargo.
The Dow, the S&P 500, and the Nasdaq all posting solid gains.
A couple of big banks' results beating forecast, but with a catch. JP Morgan's profits actually fell, hurt by higher legal expenses - $20 billion in 2013 - some linked to its settlement regarding its ties to Bernie Madoff. At Wells Fargo, profits jumped 11 percent, but mortgage financing was at its slowest in five years.
Both stocks were up on the news.
The big loser: Gamestop. It fell 20 percent, wiping out almost a billion dollars in market value, after it warned of lower profits, blaming sagging sales of older games
December retail sales came in ahead of expectations. The Commerce Department said that, excluding automobiles, gasoline, building materials and food services, the number increased 0.7 percent last month, better than in November 0.2 percent.
BNP Paribas' Yelena Shulyateva:
(SOUNDBITE) YELENA SHULYATEVA, U.S. ECONOMIST, BNP PARIBAS (ENGLISH) SAYING:
"I think the strength is broad based, especially, in the control group, in the core retail sales reading. We did see some disappointment in auto sales but that was already seen in the unit order sales numbers that were released earlier in the month, So, overall, you know, its a really solid reading in retail sales, consistent with solid growth in personal consumption.
That encouraging news also helped to boost stocks in Europe. The major indexes closing Tuesday's session higher.
General Motors' global sales grew 4 percent in 2013 on strong demand in the world's two largest auto markets, China and the United States. Shares of General Motors just a bit higher.
Tesla shares got a major jolt on what it's calling "reckless growth". The electric car maker said deliveries of its model S Sedan blew past its forecasts by 20 percent in the 4th quarter, at almost 6,900. Tesla plans to double its global sales and service locations, and is working "feverishly" on its Model X crossover vehicle.
Google's $3.2 billion deal for Nest Labs, a company that makes smart thermostats and smoke alarms, lifting other companies in the consumer appliance space on Tuesday, like Echelon. Shares of the maker of the transceivers that go into the thermostats jumping 35 percent. Also Control4 stock soaring. They make home theaters and automation controllers. Shares of Google got a bump on the news as well.
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