Ultimate Market Recap: Google Shares Rip Higher, Retail Sales Surprise

Friday’s Top Stories

Shares of Google (NASDAQ:GOOG) head nearly 8% higher in pre-market trading after the company announced strong earnings. Net income for Google Inc. rose to $2.73 billion ($8.33 per share) vs. $2.17 billion ($6.72 per share) in the same quarter a year earlier. This marks a rise of 25.9% from the year earlier quarter.  Bloomberg reports that the IRS is auditing Google and how it avoided taxes by shifting profits offshore.  Microsoft (NASDAQ:MSFT) and Yahoo (NASDAQ:YHOO) are also higher in early trading.

Investing Insights: Google Inc. Earnings Cheat Sheet: Increased Profit Helps Beat the Street.

Mattel Inc. (NASDAQ:MAT) is trading lower despite reporting that earnings rose 6.2% based on sales growth in all brands. The company also announced a $500 million stock repurchase program. The company competes with toy maker Hasbro, Inc. (NYSE:HAS).

Wal-Mart (NYSE:WMT) is attracting attention as US retail sales jumped 1.1% in September.  It is the first increase in seven months. Consumers are returning to more autos, clothing, and home furnishings. Despite the good news, Macy’s Inc (NYSE:M) is down .30% before the opening bell. Target (NYSE:TGT) and Costco (NASDAQ:COST) will also be on trading screens as a stronger consumer should bode well for the companies.

Early Morning Hot Stocks

S&P Rating Services (NYSE:MHPdowngraded Spain’s credit rating to AA-minus from AA and gave it a negative outlook. The company dropped Spain’s (NYSE:EWP) rating over increased worries of slow economic growth and the euro zone’s vulnerability of its larger economies dealing with the sovereign debt crisis.

In a statement by the ratings company, it said:

“Despite signs of resilience in economic performance during 2011, we see heightened risks to Spain’s growth prospects due to high unemployment, tighter financial conditions, the still-high level of private sector debt, and the likely economic slowdown in Spain’s main trading partners.”

Google (NASDAQ:GOOG) reported strong third quarter earnings on Thursday, surpassing analysts’ expectations. Its revenue rose 33 percent with net income up 26 percent. In pre-open trading, the stock is trading up 7 percent. Don’t Miss: Google Inc. Earnings Cheat Sheet: Increased Profit Helps Beat the Street.

Lines have already started forming at stores worldwide for Apple Inc’s (NASDAQ:AAPL) new iPhone 4S. It is available today in the U.S., Australia, Canada, France, Germany, Japan and the U.K.  The phone is projected to sell up to a record-breaking 4 million phones this weekend, surpassing the record sales of last year’s iPhone 4 at 1.7 million units in its first weekend of sales. Sprint (NYSE:S), AT&T (NYSE:T), and Verizon (NYSE:VZ) are all catching a bid from the Apple halo.

Investing Insights: Is There Room on the Rack for Gap?

German business software provider SAP AG (NYSE:SAP) reported a record-breaking third quarter as its operating profit more than doubled to $1.76 billion euro ($2.42 billion) vs. $716 million euro from September 2010. Total revenue increased 14 percent to $3.41 billion euro vs. $3.0 billion year over year. Software revenue jumped 28 percent to $841 million euro with software and software-related services revenue rising 16 percent to $2.69 billion euro.

American Airlines parent AMR Corp. (NYSE:AMR) and its pilots may reach a long-awaited labor deal this weekend. The two sides are meeting and may settle a five-year compensation dispute. The resolution should improve the company’s cost structure and its stock price.

Friday Afternoon’s Trending Stocks

The Dow Jones Industrial Average (NYSE:DIA) is trading at 11,588 and the S&P Index (NYSE:SPY) trades at 1,218. Here are shares of big companies feeling the action on Wall Street today:

  1. General Electric Company (NYSE:GE): Shares of General Electric Company are trading higher 2% today. Despite all the negative buzz surrounding the solar industry, GE announced plans to build a $600M facility in Colorado to manufacture thin-film solar panels, with commercial products shipping in 2013. General Electric Company is a diversified technology, media and financial services company. The Company offers products and services ranging from aircraft engines, power generation, and water processing technology to medical imaging, business and consumer financing, media content and industrial products. General Electric conducts operations globally.
  2. Sirius XM Radio Inc. (NASDAQ:SIRI): Shares of Sirius XM Radio Inc. are trading higher over 3% today. The technology sector is feeling the rising wave of the positive Google quarterly results issued yesterday evening. Sirius XM Radio Inc. broadcasts various channels of audio from its satellites. The Company provides its services throughout the continental United States for a monthly subscription fee. Sirius delivers various streams of commercial-free music in every genre, as well as streams of news, sports, weather, talk, comedy, and public radio.
  3. Telefonaktiebolaget LM Ericsson (NASDAQ:ERIC): Shares of Telefonaktiebolaget LM Ericsson are trading higher over 4% today as the company reported better-than-expected earnings for their 3rd quarter results. Telefonaktiebolaget LM Ericsson develops and manufactures products for wired and mobile communications in public and private networks. The Company produces mobile telephones through its Sony Ericsson joint venture. Ericsson manufactures and installs wired and wireless communications systems, wireless microwave links, call center equipment, microelectronics, and radar systems.
  4. Sprint Nextel Corporation (NYSE:S): Shares of Sprint Nextel Corporation are trading higher 2% today as the Apple (NASDAQ:AAPL) iPhone 4s is released on the Sprint mobile network for the first time in history today. Credit Suisse issued a bulled call on the company’s shares this morning. Sprint Nextel Corporation offers a range of wireless and wireline communications services to consumer, business, and government customers. The Company develops, engineers, and deploys various technologies, including two wireless networks offering mobile data services, instant national and international push-to-talk capabilities, and a global Tier 1 Internet backbone.
  5. Pfizer Inc. (NYSE:PFE): Shares of Pfizer Inc. are trading higher 1% today as the health care giants shares have been beaten down recently and value investors are snapping up shares paying a 4% plus dividend ahead of the weekend. Pfizer Inc. is a research-based, global pharmaceutical company that discovers, develops, manufactures, and markets medicines for humans and animals. The Company’s products include prescription pharmaceuticals, non-prescription self-medications, and animal health products such as anti-infective medicines and vaccines.
  6. Lloyds TSB Group plc (NYSE:LYG): Shares of Lloyds TSB Group plc are trading lower 3% today as Fitch downgraded the company. Lloyds Banking Group plc, through subsidiaries and associated companies, offers a range of banking and financial services. The Company provides retail banking, mortgages, pensions, asset management, insurance services, corporate banking, and treasury services.
  7. Mitsubishi UFJ Financial Group Inc (NYSE:MTU): Shares of Mitsubishi UFJ Financial Group Inc are trading lower over 1% today as the bank is still on investors’ skeptical side. Mitsubishi UFJ Financial Group, Inc. (MUFG) is a holding company established through the merger of Mitsubishi Tokyo Financial Group and UFJ Holdings. As a financial group, the Company provides a variety of financial and investment services including commercial banking, trust banking, international finance, and assets management services.
  8. China Unicom Limited (NYSE:CHU): Shares of China Unicom Limited are trading lower 4% today. China Unicom (Hong Kong) Limited, through its subsidiaries, provides telecommunications services in the People’s Republic of China. The Company’s services include cellular, paging, long distance, data, and Internet services.
  9. Bank of America Corp (NYSE:BAC): Shares of Bank of America Corp are trading lower 1% today ahead of next week’s much anticipated quarterly earnings release. Bank of America Corporation accepts deposits and offers banking, investing, asset management, and other financial and risk-management products and services. The Company has a mortgage lending subsidiary, and an investment banking and securities brokerage subsidiary.
  10. Mizuho Financial Group, Inc. (NYSE:MFG): Shares of Mizuho Financial Group, Inc. are trading roughly flat today. Mizuho Financial Group, Inc. provides comprehensive financial services through its subsidiaries. The Group provides variety of financial services such as general banking, securities brokerage, trust banking, and assets management.

Friday Market Recap

Markets closed up on Wall Street today: Dow +1.45%, S&P+1.75%, Nasdaq +1.82%, Oil +3.73%, Gold +0.74%.

On the commodities front, Oil (NYSE:USO) climbed to $87.37 a barrel. Precious metals were also up, with Gold (NYSE:GLD) climbing to $1,680.90 an ounce while Silver (NYSE:SLV) rose 1.67% to $32.20.

Hot Feature: Big Banks Can Agree on at Least One Thing

Today’s markets were up because:

1) Europe. European officials have begun to outline a rescue plan that could include steeper losses for investors in Greek bonds, higher capital requirements for banks, and increased firepower for bailouts and the International Monetary Fund. Finance ministers and central bankers from the Group of 20 began talks in Paris today, discussing how best to combat Europe’s spreading sovereign debt crisis. They may complete the plan at an October 23 summit and present it to a gathering of G-20 chiefs November 3-4.

2) Retail. U.S. retail sales rose more than forecast in September in their biggest monthly advance since February. The 1.1% advance last month followed a 0.3% gain in August that was higher than previously estimated, according to a Commerce Department report issued today in Washington.

3) Tech. Apple (NASDAQ:AAPL) is trading higher as the new iPhone 4S looks set to break all sales records set by previous iPhones. Most analysts are expecting 2 million to 3 million to be sold this weekend alone, while a few venture to say as many as 4 million will be sold. News that Comcast (NASDAQ:CMCSA), News Corp. (NASDAQ:NWSA), and Walt Disney (NYSE:DIS) will be holding onto their streaming video service, Hulu, gave each a boost. The media giants finally accepted what the public has known for some time — that the site’s strategic value outweighs any monetary benefits of a sale.

After Hours Radar Stocks

Despite an upgrade, shares of MGM Resorts International (NYSE:MGM) are
trading slightly lower after the closing bell. Fitch Ratings increased the company’s junk-level rating by two notches and revised its outlook to stable. Las Vegas Sands Corp. (NYSE:LVS) is also trading slightly lower.

With the official launch of the iPhone 4S, Apple (NASDAQ:AAPL) shares hit an all-time high on Friday. However, shares are edging lower in extended trading, as investors look to take profit before Apple’s earnings release on Tuesday. Verizon (NYSE:VZ) and AT&T are also trading down after the closing bell.

Don’t Miss: Apple Preps for iPhone 4S Revolution.

Citigroup (NYSE:C) appointed veteran banker Michael O’Neill to succeed Jerry Grundhofer as chairman of Citibank NA. O’neill had been CEO at Barclays (NYSE:BCS), resigning on his first day due to health reasons. He was also the CFO at Bank of America (NYSE:BAC). Shares are up about .10% in late trading.