Last Updated: January 29th, 2009: 12:00 PM ET---The pendulum swung back to the side of caution Thursday morning following a number of weak earnings reports and record unemployment numbers, causing the major US equity indices to selloff in morning trade. The indices are all trading at their session lows as financials lead the selloff following Wednesday's surge.

Ford (NYSE:F) reported a widened quarterly loss of $5.9 billion, or $2.46 per share, versus a loss of $2.8 billion, or $1.13 per share in the year-ago period. Excluding one-time items, the company reported a $1.37 loss for the quarter, missing consensus estimates of a loss of $1.30 per share. The company's full-year loss came in at $14.6 billion, surpassing its '06 loss of $12.6 billion, resulting in the company's cash reserves to fall from $18.9 billion to $13.4 billion currently. The downtrodden automaker also said that after its worst annual performance ever, a history that spans for 105 years, it will tap a revolving credit line. Despite reiterating the fact that it will not need to tap government allotted resources like General Motors (NYSE:GM) and Chrysler may do, the nation's second-largest automaker did revise its 2009 domestic sales range to 11.5 million-12.5 million from 12.2 million.

Another Dow component 3M (NYSE:MMM) reported fourth-quarter earnings of 97 cents per share, ex-items, beating consensus estimates of 93 cents per share. Revenues fell 11.2% year-over-year to $5.5 billion, less than the $5.7 billion consensus estimate. The company lowered 2009 EPS guidance to $4.30 - $4.70 per share, down from $4.50 - $4.95 per share and vs. analysts estimates of $4.42 per share. Eli Lilly (NYSE:LLY) reported Q4 earnings of $1.07 per share, excluding items, beating consensus estimates of $1.05 per share. Revenues rose 0.4% year-over-year to $5.21 billion, less than the $5.42 billion consensus estimate. Eli Lilly reiterated its 2009 guidance.

Following Wednesday's close, Starbucks (NASDAQ:SBUX) reported fiscal Q1 earnings of 15 cents per share, ex-items, less than the 17-cent consensus estimate. Revenues fell 6% vs. the year-ago period to $2.62 billion and below the $2.69 billion consensus. Starbucks also announced plans to shutdown 300 additional stores and eliminate 6,700 jobs. Qualcomm (NASDAQ:QCOM) printed first-quarter earnings at 31 cents, excluding one-time items, missing 47-cent estimates. Allstate (NYSE:ALL) came in well below analysts' expectations of $1.35 per share, with earnings of 97 cents per share, excluding one-time items.

The Labor Department released its weekly reading on jobless claims for the week ended January 17th showing the number of Americans seeking new jobless benefits rose slightly to a seasonally adjusted 588,000, compared to a revised 585,000 number the prior week. Economists, on average, were forecasting a 575,000 reading. The U.S. Commerce Department reported new homes sales plunged to a seasonally adjusted annual rate of 331,000 in December, falling short of the 400,000 consensus, and down 14.7% from Novembers revised annual rate of 388,000. Year-over-year, new home sales were down 44.8% when the annual rate was 600,000. December's new home sales reading was the lowest since reporting began in 1963. In other government news, the US Treasury agreed to give up to $60 billion, by use of its Federal Financing Bank, in an effort to shore up student loans and reduce illiquid assets on bank's balance sheets. The program will buy existing student loans from banks and then issue asset backed commercial paper.

At the time of this report, the Dow Jones Industrial Average is down 131 points to 8,244, the S&P 500 is trading 18 points lower to 856 and the Nasdaq is trading 32 points lower to 1,527.

Contact Chip Brian

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