Markets Up At Open Despite Weak Retail Sales

Suzanne O'Halloran explains why markets are up at today's opening bell.
3:00 | 12/13/11

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Transcript for Markets Up At Open Despite Weak Retail Sales
Capitalize on the CEO to CN sonics. Hello everyone I'm Stephanie sigh in New York Dow futures were up ahead of the bell following yesterday's loss of more than a 160 points. McNabb discuss all the business headlines is at this hour is Susanna how grant from Bloomberg TV's Suzanne good morning good to see you didn't see him aren't -- with retail sales which came out about an hour ago. They were weaker than expected up just point 2% when the prediction was point 6% is this a big deal -- -- actually you know that's the slowest gain in about five months and really. Economists kind of miss this -- -- talking about how great retail sales particularly around Black Friday work. -- didn't really translate into the whole -- so what it tells us is that consumers really aren't spending. As much as we initially spot and November wasn't as great as it was expected to be for retail sales also tells us that consumers are -- Their purchasing is closer to the holiday perhaps hoping for. More promotion ends. Or perhaps are not making those purchases at all because they're not working to certainly and not agree economic indicator and it does show us that these retailers are still struggling. Perhaps with consumers that don't wanna shop because maybe they don't have a job so surprising to hear especially after seeing all those Black Friday sales in the crazy Italians -- now you -- -- actually right. The same name best buy which is -- -- a big Black Friday -- they came out this morning with earnings apparently doing. Yet you know their earnings -- -- -- as luster was expecting and similar situation here best buy did a lot of promotional. That trends rather right around black -- Thanksgiving and Black Friday and they may have. Tee it may have attracting consumers to come into the stores but they just didn't stop until -- -- best buys their earnings were not as strong. I did hurt their margins because they are doing so many promotions -- this is where -- company like best buys really stuck because it's so competitive particularly for electronics. That consumers can really easy Internet and shop around for the best DL. But best -- is not getting the business in the stock is going to be a big losers today -- was indicated she -- Begin trading lower by about 8% some really tough for these electronics retailers. Such as best buy and even RadioShack companies like that in the same space. OK well -- -- is meeting today Suzanne and we're not expecting any rate changes at what are the market's looking for. You know it's interesting because there was a lot of talk among among economists that the economy is getting stronger as we're talking about this yesterday with some of the better economic data like retail sales but the retail sales data today. We'll probably give the -- More ties to really reevaluate the economy and say -- -- hey it's not growing. As fast as we would like it to -- and again unemployment is still too high to you. Bring down that unemployment rate as much as we needed to come down so it's likely we hear from the Fed today as you mentioned no change to interest rates it's likely they'll. Reiterate their stance to keep interest rates low. What we know from the Fed an empire communication is dangerously interest rates will stay low perhaps 32013. -- again we'll be looking for that the markets wanna hear perhaps confirmation that the economy as. Improving a little bit there have been better signs over the past couple of weeks of economic growth that'll be important what they say about your up. On the progress being made there and if they're really worried about perhaps a recession in Europe and how it may impact. The US and that of course. We want to fresh update. On their policy measures and it's likely we may not get that. Until the middle of next year will also be listening about a third round of stimulus doesn't -- need to do that. In August indicated that they were ready to do that still a so called QE3. That is going into the market and buying bonds. Has the economy improved -- not. That they need need to put that on hold and that's probably the most important thing that will be listening for OK some breaking news we want to get to -- Suzanne malveaux way. S airlines has just plays a huge order -- -- that's what can you tell us about this deal he yes and a fabulous year for Boeing on the they have really. This is -- their turnaround here -- well. Southwest is coming and they're buying out the -- yet which is really the fuel efficient jet this is very important because a lot of the US airlines are dealing her flying older planes they need to do you. An upgrade cycle and that is what we have seen with a lot of airlines including. Delta and American Airlines going to billing and or Airbus. To place their order said this is a very important. A deal for southwest are going to be upgrading their fleet to be more fuel efficient of course that's the -- -- the teacher. But for -- a really cements -- pedigree here this a stock that's up about 9% one of the best out members and I will mention Stephanie. Just yesterday -- increased its dividend. For the first time since 2000 -- that is very important because. The company doesn't feel confident about their future business or their balance sheet they're not -- get investors that extra pay out -- to have going to not yesterday it's really. Reinforces that business is actually very solid in even just yesterday the Tina Morgan Stanley came out said Boeing is a -- one island heading into next year 2012. Business is improving and again did it in is just an added bonus for investors to own shares of Boeing so while we're on the topic of airlines American and -- -- bankruptcy hearing today what's the importance of this first meeting. Yet you know it's it's important because even though AMR's in bankruptcy. They are going to head tried to restructure quickly come out of bankruptcy -- this particular hearing is very important because over the past couple weeks we have learned who's going to be involved. In a restructuring we have Wall Street firms interestingly enough -- for example is one of the -- it's going to be involved. Working with the pilot at the -- is another firm and what what we -- these bankruptcy hearings as we have the beginning of the process where. The air that pilots for example come in and say. Hey this is what we want the judge looks at what American Airlines is coming to bankruptcy -- they do have some cash so they'll be looking. To see how they can -- to play in and really give investors a sense. -- said American Airlines can come out of bankruptcy and really tackle the problems that drove them into bankruptcy for example the pilots refuse to sign a contract. Now a lot of its negotiating will be done. Around these bankruptcy hearings so it'll give -- think it's sense if the pilots and some of the other airline workers are going to be. More open to negotiating and what in negotiating and what -- Willie what they'll be willing to accept that. As -- airline does come out of bankruptcy and I'll give -- also better timetable we're expecting is going to take about a year. For the company to restructure but there is a chance it could work. And get this going a little bit faster and then they'll be back as a publicly traded company. Okay this a big week -- here Zynga. Sent to start trading on Friday and this morning jive software began trading on the NASDAQ in fact the company executives -- that. Opening bell there today tell about the start of trading for this company shots. Yet with hearing the stocks -- greater around 1045 and there was a way more demand for died then investors were expecting not his kidneys. To have an -- have more demand and a stock price at about twelve dollars it was. 38% more than initial target cell. We can look for the stock to see a big top at the -- -- -- question with all these companies in particular these social networking companies -- -- social networking software for businesses summit of the clients -- Nike for example. 89 Yum! Brands they do have some -- chip clients -- certainly important. But the question is this is still a start up. And they are losing money and that's very important and -- -- talk to -- -- say hey you know do you want to invest in the company that's losing money and normally today. Now out exactly. That this is a company that investors need be willing to cut some -- you for a couple of reasons other sales grew about 73%. Three -- last September of this year and it's pretty rapid growth. -- -- used the IPO that it paid out some loans in reinvest in the business that's important also its largest shareholders of -- capital and Kleiner Perkins they're big. Venture capital firms and since Silicon Valley area they're not going to be selling stock and that's also. Very important to that shows are gonna stick with the company as in this forward -- you know sometimes you gotta take a gamble a lot of these social networking companies. It's hard for -- to Begin when they come into the market and it's not an usual for company to be losing money particularly these tech companies. -- we really want to see more evidence for investors who want to get into long term but no question about it this is going to probably be. A high flying stock today. Just on the demand alone for the act PM captain earlier refrain we've been hearing that for weeks with other companies like -- to. Our -- apparently -- -- out right now Suzanne and it's up nineteen points at three quarters of a percent. -- thriving market. Yeah I think that we had a big selloff yesterday so I think investors are a little bit comfortable coming back into the market we did have some positive side news coming from Europe laugh as we talked about it -- say their day in and day out sometimes as positive sometimes is negative the F an economic data from Germany. That was pretty. Capitalizing on the sell -- yesterday and also I wouldn't be surprised to see the market. Media Peter off a little bit as we get closer to -- fifteen -- formally hear the statement from the Fed. That's usually how we -- on days like this. And we will of course be looking for the next catalyst order action from Ben Bernanke and company but clearly what we're seeing right now is investors coming in after yesterday's -- in. Getting some investing picking up perhaps a company like -- that -- -- -- -- -- that got pretty much ignored yesterday try. All right Suzanne know how to ramp Bloomberg TV thanks for the big picture good to see you heat --

This transcript has been automatically generated and may not be 100% accurate.

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