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Midday Market Update

Stocks Higher; European Data, Earnings in Focus

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U.S. Market    
Stocks were higher this morning after some better-than-expected earnings and European data.

German business confidence rose in February for the fourth straight month according to the closely-watched Ifo report. The optimistic report comes after disappointing euerozone PMI data from Markit on Thursday. Separately, the EU revised its growth estimates downward. They now expect eurozone GDP to contract by 0.3% in 2013 before rebounding 1.4% in 2013.

At midday the Dow and S&P 500 were each up 0.4% while the Nasdaq was 0.5% higher.

Stocks on the Move
Shares of  H-P (HPQ) rose over 10% after the firm released  better-than-expected fiscal-first quarter results late Thursday. HP's revenue fell 6% from the year-ago quarter to $28.4 billion, as sales declined across its four business groups. PC and printer-related revenue fell 7% year over year to $14.1 billion, as weak notebook demand and declines in printing supply and printer hardware revenue overwhelmed moderate growth in desktop PC revenue. Management is doing a good job of controlling expenses and staying disciplined with its capital allocation, and HP used a portion of the $2.1 billion in free cash flow generated this quarter to reduce its net debt position by $1.1 billion, to $4.7 billion.

 Nordstrom (JWN) announced  strong fourth-quarter earnings and its plans for 2013 after-the-bell Thursday, which included more details on capital spending and Rack format rollouts for this year and beyond. In the quarter, earnings per share came in at $1.40. This represented a 26% increase over the same period in 2011, and above the sales growth rate of 14%. Management's EPS guidance of $3.65-$3.80 for 2013 was below the average expectation of nearly $4.00, and management again discussed details of capital spending plans, forecast to total around $770 million in 2013.Nordstrom shares were down 1.4% at midday. 

Foreign Markets
European shares rose after the encouraging German business confidence report.  In late trading, the FTSE 100, Germany’s DAX and Paris CAC were up 0.7%, 1.0% and 2.2% respectively.

Asian markets were mixed on the day. The Shanghai Composite and Hang Seng were each down 0.5% while the Nikkei 225 was up 0.7%.

Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.