Day Ahead: Facebook's Virtual Bet

 | Mar 26, 2014 | 8:39 AM EDT  | Comments
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Wall Street's mood was upbeat Wednesday morning after the market snapped a two-day losing streak in the previous session and was bolstered by hot news in the tech sector.

The biggest buzz surrounds Action Alerts PLUS holding Facebook's (FB) $2-billion acquisition of Oculus VR, a maker of virtual-reality gear that has investors dreaming of what CEO Mark Zuckerberg has in store for the social network. At Action Alerts PLUS, Stephanie Link wrote in an Alert that the team sees this move positively, and that the young company is growing in the right areas of technology.

And King Digital (KING), maker of the highly-addictive Candy Crush Saga videogame, is set to debut as a public company this morning, having priced 22.2 million shares at $22.50 apiece last night, the middle of its expected range.

On the data side, durable goods orders rose more than expected in February, swinging to a 2.2% gain compared with a 1% decline in January. Analysts had predicted manufacturing orders would rise by just 1%. Excluding transportation, the results trounced expectations by jumping 2% compared with a forecasted 0.3% lift.

Earlier, the Mortgage Bankers' Association said mortgage applications rose by 3% last week, but the boost failed to lift the year-over-year rate out of a 17% decline. Look for Markit's flash purchasing managers' services index later, at 9:45 a.m. ET.

Turning to earnings, PVH Corp. (PVH) bested net-income expectations by a penny per share late Tuesday but missed sales forecasts for the fourth quarter. The maker of Calvin Klein and Tommy Hilfiger clothing lines also offered full-year 2015 guidance that was below views. But Jim Cramer endorsed the company's CEO, Manny Chirico, and reiterated his belief that the stock is a buy.

And Five Below (FIVE) shares were soaring more than 15% in premarket trading after the discount retailer surpassed top- and bottom-line views last night while delivering guidance that was in line with expectations.

This morning, Movado Group (MOV) beat the Street's profit forecasts by a wide margin and fattened its dividend by 25%. Still to come after the close are reports from Paychex (PAYX) and H.B. Fuller (FUL).

In other company news, Japanese carmaker Toyota (TM) announced a $3.5 billion buyback program.

For Fed watchers, St. Louis Fed President James Bullard said in Hong Kong overnight that there's a "bit of ambiguity" surrounding the end date of the central bank's stimulus program. Separately, the Fed is expected to release its latest round of bank stress-test results.

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