U.S. MARKET AVERAGES

Bargain-hunting helped stocks recover from Friday’s biggest loss in three years with the Dow down 2% and the Nasdaq falling 2.4%. A strong earnings report, followed by an extensive restructuring announcement, released by Ford helped encourage buyers back into the market after the Dow Jones industrial drop of 213 points last Friday. The industrial average steadily advanced in the morning to post a gain of about 60 points, or 0.6%.

Ford Motor (F: chart) posted Q4 profit increase on strength in its finance arm and the sale of its rental car unit Hertz Corp. Quarterly results exceeded analyst estimates. The company announced it would cut up to 30,000 jobs as part of a restructuring effort.

The financial sector disappointed investors after Bank of America (BAC: chart), the No. 2 U.S. bank, posted Q4 2% decline in net profit, reflecting loan losses and weaker trading results. The quarterly results missed estimates.

Credit card and travel services company American Express Co. (AXP: chart), a Dow component, is scheduled to report results after market close.

The broker/dealer sector advanced steadily in the morning to rise by 1.8%. The disk drive sector was also strong, posting a gain of 1.9%. The semiconductor sector advanced in late morning to show an advance of about 1%.

A few stocks set new 52-week highs on deal news. Remington Oil and Gas (REM: chart) jumped to a fresh peak after it agreed to be acquired by Cal Dive (CDIS: chart). The Sports Authority (TSA: chart)also climbed to a new high after it agreed to be bought by a group that included the company's senior management.

Dow component Intel (INTC: chart) was the most notable decliner to reach a new 52-week low. Pilgrim's Pride (PPC: chart) dipped to a fresh low on quarterly results. Kohl's (KSS: chart) added to last-week weakness, moving to a new low.

In midday trading, the Dow rose 59.56, or 0.56%. The Standard & Poor's 500 index added rose 5.98, or 0.47%, and the Nasdaq composite index climbed 6.68, or 0.3%.

Bonds sold off as stocks rose, with the yield on the 10-year Treasury note rising to 4.39% from 4.35% late Friday.

MOVERS AND SHAKERS

Albertsons Inc. (ABS: chart) agreed to be acquired by a group including grocery store operator Supervalu Inc (SVU: chart) and drug store chain CVS Corp. (CVS: chart) for $17.4 billion in cash and stock. Albertson’s stockholders will receive $26.29 in cash. The company’s shares rose 4.4%.
YAHOO (YHOO: chart) was upgraded at Bear Stearns to outperform from peer perform. The stock gained 1.11%.

Citigroup (C: chart) was downgraded at UBS to neutral from buy. The stock gained 1.1%.

The Sports Authority Inc (TSA: chart) agreed to be acquired by private equity firm Leonard Green & Partners and members of the company''s senior management team for roughly $1.3 billion in cash and assumed debt. The deal values Sports Authority shares at $37.25 each and the transfer is expected to close in the second quarter. The company’s shares soared 20%.

Datawatch Corp (DWCH: chart) reported Q1 earnings of $64,000, or a penny a share, on revenue of $4.7 million, missing estimates of 3 cents a share. The company’s shares dropped 26.4%.

The U.S. Supreme Court rejected Research In Motion’s (RIMM: chart) appeal to reverse a lower-court ruling that found its BlackBerry wireless email device violated patents held by NTP Inc., a Virginia patent-holding firm. The case now moves to a federal district court in Virginia, where a judge will decide whether to reinstate an injunction against the U.S. sale of BlackBerries. RIM’s shares fell 2.6%.

INTERNATIONAL MARKETS NEWS

Asian-Pacific benchmarks fell across the region, reflecting an oil price rise to $69 a barrel and cautiousness following the steep declines on Wall Street. The Nikkei recovered from earlier lows to close down 1.2%. Among other regional markets, Taiwan’s Weighted index dropped 1.7%, Hong Kong’s Hang Seng slipped 1.4%, and South Korea’s Kospi fell 1%.

European stocks finished weak but off intraday lows, supported by the strong opening of U.S. markets. The German DAX 30 finished flat at 5,349, the French CAC 40 dropped 0.45%, and London’s FTSE 100 fell 0.2%.

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