HP Beats Expectations

This is a transcript of the Market Update: Midday video report.

Hewlett-Packard boosted the tech sector on Tuesday. The computer maker said preliminary fourth-quarter earnings were higher than analysts expected. First-quarter guidance for 2009 was also above estimates. The strong report was a silver lining for a company that has suffered a tough year. HP is in the process of completing 24,000 layoffs.

HP was up 14%, while Dell (nasdaq: DELL - news - people ) and Apple (nasdaq: AAPL - news - people ) were up 1%.

In economic news, the Labor Department reported that the producer price index had a record one-month drop in October, as prices fell 2.8%. The slide was largely due to the slide in oil prices, as crude fell roughly 32% during the month.

On Capitol Hill, Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke are providing lawmakers an update on the financial rescue plan. Meanwhile, the auto execs are taking their case for federal aid to the Senate Banking Committee.

Blue-chip Home Depot (nyse: HD - news - people ) beat expectations with its latest profit report but did not offer future guidance. The home improvement retailer said full-year 2008 earnings are likely to be down 24%.

High-end retailer Saks (nyse: SKS - news - people ) had a shaky start, booking a wider than expected loss after same-store sales dropped more than 11% in the third quarter. Shares of Saks were down 3% in morning trading.

Yahoo! (nasdaq: YHOO - news - people ) was trading to the upside, after confirming that CEO Jerry Yang will step down from his post. Yang, one of Yahoo!'s founders, will return to his prior role as "Chief Yahoo!" No word yet on who will replace Yang.