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Yesterday the markets opened almost 1% in the red and were sent down even further after the Supreme Court's ruling. The ruling was a surprise, but the fact that the markets acted so volatile was certainly not.
The markets did rally at the end of the day on positive news from Europe and that momentum has carried over to today.
The surprising news out of the European Union summit was the announcement yesterday from European Union President Herman Van Rompuy that European leaders have agreed to spend 120 billion euros ($149 billion) to stimulate growth and create jobs.
The plan includes a 10 billion-euro capital increase for the European Investment Bank (EIB) as a centerpiece of the long-term growth plan, which includes infrastructure financing, tax-policy pledges and more focused use of EU funding.
"The growth agenda is a sign of our unrelenting commitment," EU President Herman Van Rompuy said in a press conference in Brussels on the first day of a two-day summit. "It brings together all concrete measures that we will swiftly take."
The capital stimulus contains a pledge to make sure EIB loans reach "the most vulnerable countries," according to draft conclusions circulated ahead of the meeting.
Van Rompuy called the agreement a "breakthrough" and many agree that far more was accomplished than originally expected.
The markets reacted strongly, on what is the last day of the quarter which could be helping this rally, with each index gaining more than 1% at the open following the reports of the EU plan.
Yet there are two companies making headlines in the stock market today that won't be helped by any positive news out of Europe.
Research in Motion Ltd. (Nasdaq: RIMM) must be stupid or have no other options.
After yesterday's closing bell it announced delays to the BlackBerry 10 phone release, plans to cut 5,000 jobs, and posted a quarterly loss that was five times bigger than anticipated.
RIMM reported a first-quarter net loss of 99 cents a share which was far lower than the 7-cent loss predicted by analysts and well off last year's profit of $1.33 a share for the same period. Many analysts think that RIMM has little chance of survival as a profitable company.
"They either sell, break up the company or die," Matt Thornton, an analyst at Avian Securities LLC in Boston told Bloomberg News. "It is just a question of when."
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The biggest negative coming out of the losses and layoffs is the delay of the BlackBerry 10. This new device was supposed to help BlackBerry stay competitive in the smartphone market. Now the BlackBerry 10 is not supposed to hit shelves until the first quarter of 2013, a year later than originally planned.
"The delay may just be the final nail in the coffin," Sameet Kanade, an analyst at Northern Securities in Toronto, told Bloomberg. "This is not just a disappointing quarter, but is a big question mark about the company going forward."
Shares of RIMM are down more than 17% in early trading Friday.
Nike Inc. (NYSE: NKE) missed quarterly earnings estimates for the first time in over two years after the world's largest sporting goods company reported its earnings after yesterday's closing bell.
Net income in the quarter ended May 31 declined 7.6% to $549 million, or $1.17 a share, from $594 million, or $1.24, a year earlier. Analysts had expected $1.37 a share.
Nike blamed the poor numbers on several factors including rising materials costs, a higher effective tax rate and increased marketing expenses for events like the Summer Olympics and soccer's European Championship.
Nike was also hurt by the Eurozone debt crisis. It generates a quarter of its revenue from the continent and this led to missed sales results as well.
Shares of NKE are down more than 10% in early trading.
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