The markets traded in what looked like a perfect “V” shape on Friday, again erasing midday losses.  The Dow Jones Industrial Average managed to finish up 0.84% to 8,281.22.  The Nasdaq and S&P 500 were able to climb 1.16% and 0.76% respectively to closing levels of 1,529.33 and 850.12.  After very poor earnings reports from Intel Corporation (INTC: 13.74, +0.45 (+3.39%)) and JPMorgan (JPM: 22.82, -1.52 (-6.24%)) the market was hit with more bad news on Friday but was able to shrug it off by the end of the session.

Circuit City Stores (CC: 0.10, 0.00 (0.00%)) announced that their plan to Chapter 11 bankruptcy in order to restructure or sell the company had failed and that they would be liquidating their remaining 567 stores effective immediately.  Circuity City currently employees more than 30,000 people, so this will have a large affect on next week’s numbers.  This announcement comes in the same week that Advance Micro Devices Inc. (AMD: 2.29, +0.03 (+1.33%)) and Wellpoint Inc. (WLP: 37.89, +0.04 (+0.11%)) also cut parts of their workforce.  The liquidation at Circuit City is also expected to affect Big Ticket Sales around the nation for a number of months as Circuit City sells these products are fire sale prices.

Citigroup (C: 3.50, -0.33 (-8.62%)) CEO Vikram Pandit formally announced that the remaining parts of the company will be broken up in to two parts.  This comes only a few days after Citigroup aggreed to a joint-venture with Morgan Stanley over their brokerage groups.  Many analysts are now suggesting that the reign of Citigroup is now over, and the stock price may be a leading indicator of what is to come.  Many people are wondering if Citigroup will need another round of TARP funding like Bank of American (BAC: 7.18, -1.14 (-13.70%)) did.

Please join us on Tuesday for the next market recap, Monday there is no trading session in honor of Dr. Martin Luther King.

- Charles W. Petredis

Disclosure: The mutual fund the author manages is long INTC and JPM.