Ben Bernanke told Congress on Wednesday the Federal Reserve still needs to continue its stimulus efforts to avoid endangering the economic recovery, despite recent improvement in the job market.
Bernanke warned against hitting the brakes too soon, adding that fed stimulus is still needed to help the economy.
Market professionals have been speculating in recent weeks that the Fed might be preparing to scale back its 85 billion dollar a month of bond purchases, but Bernanke said that premature tightening would endanger the recovery.
On the earnings front, Lowe's Companies, Inc. (NYSE: LOW) first-quarter net income 2.5 percent, but fell short of Wall Street's expectations as the retailer's results were in contrast to The Home Depot, Inc. (NYSE: HD) results reported on Tuesday. Home Depot booked an 18 percent net income increase.
Lowe’s CEO Robert A. Niblock said bad winter weather impacted the results, causing a delay in the spring selling season.
Also on Wednesday, Target Corporation (NYSE: TGT) first quarter earnings fell after the retailer was hit hard by the later than usual tax refunds, as well as spring weather. Target reported that the retailer earned $498 million, or 77 cents per share in the quarter, which is down from a profit of $697 million, or $1.04 per share in the first quarter of 2012. Revenue fell 1 percent to $16.71 billion, falling below the $16.78 billion estimate analysts were expecting. In addition, Target's same-store sales fell 0.6 percent in the first quarter.
Other earnings reports to watch for on Wednesday after the bell include Hewlett-Packard Company (NYSE: HPQ).
The company is expected to report a drop in revenues and earnings as analysts brace for the impact of a weakening PC market after Dell Inc. (NASDAQ: DELL) last week reported earnings fell 79 percent as sales of PCs faded.
Analysts polled by FactSet expect the company to report a profit of 81 cents a share, on revenue of $28.02 billion.
Retail earnings to watch Thursday include Ralph Lauren Corp (NYSE: RL), Sears Holdings Corp (NASDAQ: SHLD) and The Gap Inc. (NYSE: GPS).
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