FOX Business: The Power to Prosper

Wall Street delivered a mixed verdict on Friday as Google’s blockbuster results drove the Nasdaq Composite to new five-month highs, but reeling big banks like Bank of America barred the broader markets from joining the party.

Today’s Markets

The Dow Jones Industrial Average fell 31.79 points, or 0.29%, to 11062.78, the Standard & Poor's 500 gained 2.38 points, or 0.20%, to 1176.19 and the Nasdaq Composite jumped 33.39 points, or 1.37%, to 2468.77. The FOX 50 added 1.97 points, or 0.23%, to 843.96.

The mixed feelings on Wall Street were appropriate given the day’s conflicting storylines. On the bullish side, Fed chief Ben Bernanke threw his weight behind a second round of quantitative easing, Google’s (NASDAQ:GOOG) results blew expectations out of the water, retail sales jumped in September and a key manufacturing report unexpectedly soared in October. 

On the other hand, a new report showed consumer sentiment deteriorated last month, the dollar soared against the euro, General Electric (NYSE:GE) sold off on its revenue miss and big banks like Wells Fargo (NYSE:WFC) tumbled amid concerns about how the foreclosure crisis will impair their earnings. 

“Considering the pounding the financials took, I really don’t think this is a terrible showing,” NYSE trader Doreen Mogavero told FOX Business. “Mr. Bernanke gave us a boost this morning. But I think that’s a little bit of a double-edged sword. I’m not sure that if we need another round of help from the Fed that that’s a particularly good sign.”

By the closing bell, the majority of the 30 stocks on the Dow landed in the red, led by JPMorgan Chase (NYSE:JPM), GE and Bank of America (NYSE:BAC). The index's best performers were tech giants Cisco Systems (NASDAQ:CSCO) and Hewlett-Packard (NYSE:HPQ).

The Nasdaq Composite significantly outperformed the broader markets in the wake of Google's big beat. The search titan surged 11% after it wowed Wall Street with non-GAAP EPS of $7.64, compared with forecasts from analysts for just $6.69. Buying spilled into shares of other tech stocks like Amazon.com (NASDAQ:AMZN) and Seagate Technology (NYSE:STX), which rallied after revealing it has received preliminary interest in being taken private. 

Despite the choppy session, Wall Street managed to close slightly higher for the sixth time in seven weeks and remained near its highest levels of the entire year. 

Mixed Signals

Wall Street's hopes for more help from the Fed, dubbed "QE2" by the markets, were bolstered by Bernanke, who in a speech appeared to throw his weight behind the central bank buying more assets, likely longer-term Treasuries, to boost the disappointing recovery. Citing high unemployment and low inflation, Bernanke said, “there would appear -- all else being equal -- to be a case for further action.”

With that backdrop in mind, Wall Street received decidedly mixed economic headlines on Friday. The New York Fed said its Empire State Index surged to a 15.73 level in October, way up from 4.14 in September and blowing away forecasts for 6.50 from economists.Also, the Commerce Department said retail sales jumped 0.6% in September, solidly beating estimates for 0.4%. Excluding auto sales, retail sales were up 0.4%. 

However, Reuters/University of Michigan said its preliminary consumer sentiment unexpectedly tumbled to a 67.9 reading in September, down from 68.2 in September. Economists had expected a rise to 69.0. The Labor Department gave further evidence of low inflation, saying consumer prices rose just 0.1% last month, missing forecasts for 0.2%. Excluding food and energy, consumer inflation was unchanged, versus expectations for a rise of 0.1%.

Meanwhile, the bulls struggled to overcome a 1.6% slide in the financial sector that was driven by big banks like BofA and Citigroup (NYSE:C). The sector has been rocked this week by worries about how big banks' bottom lines will be impacted by probes into their foreclosure practices. BofA, which acquired Countrywide, then the largest U.S. originator of mortgages, tumbled nearly 6% and briefly fell to its lowest level since July 2009.

GE also put pressure on Wall Street, with its stock dropping 5% as its non-GAAP EPS of 29 cents only narrowly beat the Street and its revenue declined 5% to $35.9 billion, widely missing forecasts from analysts for $37.5 billion.

Commodities and industrial stocks took a hit as the euro gave up early gains and sank 0.72% to $1.3975. Equities and commodities tend to have an inverse relationship with the greenback. Crude oil sank $1.44 a barrel, or 1.74%, to $81.25. Gold backed away from all-time highs, dropping $5.60 a troy ounce, or 0.41%, to $1,371.10.

Corporate Movers

Seagate Technology (NYSE:STX) surged 22% after the data storage company revealed it has been approached about a possible buyout from a private-equity firm. Seagate said it has retained Morgan Stanley and Weinberg Partners to advise it on the matter. TPG is involved in the current discussions after talks between the private-equity fund and Silver Lake Partners recently collapsed, The Wall Street Journal reported.

Mattel’s (NASDAQ:MAT) stock slumped 6% after the maker of Barbie dolls said its sales rose just 2% to $1.83 billion, missing the Street’s view of $1.94 billion. The revenue miss overshadowed a 23% jump in third-quarter profits that translated to EPS of 77 cents. Analysts had expected EPS of 76 cents.

Gannett (NYSE:GCI) revealed its revenue stayed flat at $1.31 billion last quarter, coming in shy of the Street's view of $1.33 billion and driving its stock down more than 8%. The newspaper publisher and owner of USA Today topped estimates with non-GAAP EPS of 52 cents, but its U.S. newspaper ad revenue slid 3%.

Charles Schwab (NASDAQ:SCHW) reported a 38% decline in third-quarter profits, but its non-GAAP EPS of 10 cents exceeded estimates by a penny. The online brokerage also posted a 5% increase in revenue to $1.06 billion, matching forecasts and marking its first revenue rise in two years. 

Global Markets

The U.K.'s FTSE 100 lost 0.42% to 5703.37, France's CAC 40 gained 0.21% to 3827.37 and Germany's DAX rose 0.57% to 6492.30. 

In Asia, Tokyo's Nikkei 225 closed down 0.87% to 9500.25 and Hong Kong's Hang Seng lost 0.4% to 23757.60 and China's Shanghai Composite surged 3.2% to 2871.16.