Netflix and IBM reported better-than-expected results. Stocks recovered from early losses. Bobbi Rebell reports.
A comeback day for stocks on Tuesday, climbing back after being under pressure initially, reacting to the IMF cutting its global growth forecast. Netflix stock jumped in after hours after it beat earnings forecasts. Netflix added 4.3 million streaming subscribers in the past quarter. IBM reported better-than-expected overall results helped by increasing demand for its fast-growing cloud business. Oil fell again and both, Halliburton and Baker Hughes, warned a fall in drilling activity would hurt 2015 results. Among the earnings out, Johnson & Johnson. The stronger dollar cut into quarterly sales. And Morgan Stanley's quarterly earnings dropped and missed analysts forecasts. Like its peers, its fixed income and commodities revenue fell, partly hurt by the drop in oil prices. But S&P Dow Jones Indices Howard Silverblatt still likes the financial sector. SOUNDBITE: HOWARD SILVERBLATT, SENIOR INDEX ANALYST, S&P DOW JONES INDICES, (ENGLISH) SAYING: "That sector's outlook is a little bit better. What's hurting them and has hurt them in the fourth quarter so far looks like a lot of trading, which should hopefully pick up the M&A and IPO market, which should improve as we get into the year." Crude's fall boosted airline stocks, including Delta, which posted a quarterly loss but issued a positive outlook for this year. Shares of FXCM plummeted. The retail foreign exchange broker lost millions from a recent surge in the Swiss franc. Express shares dropped after Sycamore Partners said it was ending talks to buy the apparel retailer, saying it could not get financing. Gun maker Smith & Wesson raised its earnings forecast, citing positive trends in the firearms market. U.S. homebuilder sentiment fell slightly from December but managed to stay at a strong level. In Europe, stocks rose. Investors encouraged that the ECB would likely launch a stimulus program later this week.