Stocks were expected to open lower Monday after Bank of America (BAC), the U.S.'s largest bank, reported unexpectedly weak financial results. Several other firms also reported first quarter results, to start a major week of earnings news.
Bank of America posted earnings of 23 cents per share, vs. $1.16 a year ago, as revenue dropped 6.3%. The bank took a provision expenses of $6.01 billion, and reported trading-related losses of $1.31 billion. The company expected minimal economic growth in the second quarter, with a slight pickup in the second half of the year.
On Friday, the blue-chip Dow Jones industrial average finished higher by 228.87 points, or 1.81%, to 12,849.36. The broader S&P 500 index added 24.77 points, or 1.81%, to 1,390.33.
The tech-heavy Nasdaq composite index was the best performer among the major market benchmarks, climbing 61.14 points, or 2.61%, to 2,402.97.
On the New York Stock Exchange, 24 stocks were higher for ever seven lower in price. On the Nasdaq, the ratio was 21-8 positive.
In energy markets Monday, May West Texas Intermediate crude oil futures rose 77 cents to a record $117.46. Action Economics blamed the higher prices on "a weaker dollar, Nigerian supply outages and reports of an attack on a Japanese tanker near Yemen."
Among stocks in the news, Merck & Co. (MRK) posted earnings of $1.52 cents per share, vs. 78 cents a year ago, despite flat sales. The pharmaceuticals maker expects 2008 earnings of $2.84 to $4 per share.
Eli Lilly & Co. (LLY) reported earnings of 97 cents per share, vs. 47 cents a year ago, as sales rose 14%. The company says it saw encouraging sales growth for its drugs Cymbalta, Cialis, Alimta, Forteo and Humalog.
Mattel (MAT) reported a loss of 13 cents per share, vs. earnings of 3 cents a year ago. Sales fell 2.2%.
Hasbros (HAS) reported earnings of 25 cents per share, vs. 19 cents a year ago, as revenue rose 13%.
Hanesbrands (HBI) posted earnings of 38 cents per share, vs. 12 cents a year ago, despite a 5% drop in sales.
Halliburton (HAL) reported earnings of 64 cents per share, vs. 54 cents a year ago, as revenue rose 18%.
Alliance Data Systems (ADS) officially ended its acquisition deal with Blackstone Group (BX), and filed a lawsuit against Blackstone accusing the private equity firm of breaching its buyout agreement.
Major European indexes were lower Monday. In London, the FTSE 100 index fell 0.4% to 6,032. Paris' CAC 40 index lost 1.14% to 4,905.36, and Germany's DAX index dropped 1.03% to 6,772.33.
In Asia, Japan's Nikkei 225 rose 1.63% to 13,696.55, while Hong Kong's Hang Seng index was up 2.17% to 24,721.67.
Treasury market
Treasury prices were falling Monday, with the two-year note off 01/32 to 99-08/32 for a yield of 2.156%; the 10-year Treasury off 11/32 to 98 for a yield of 3.751%; and the 30-year bond down 18/32 to 97-15/32 for a yield of 4.535%.