The markets opened modestly higher following a flat retail sales report and a drop in jobless claims. The Dow added 20 points to 12,547 while Nasdaq surged 24 points to 2346.

On the upside

Wal-Mart (NYSE: WMT) raised its earnings outlook as the world's largest retailer adjusted its product mix for a slowing economy. Shares of Costco (Nasdaq: COST) edged higher as analysts expect discounters to do well this year.

Banc of America Securities upgraded semiconductor stocks including shares of Intel (Nasdaq: INTC) and Analog Devices (NYSE: ADI) which promptly rose.

Japan's Takeda Pharmaceutical offered $8.8 billion to buy Millenium Pharmaceuticals (Nasdaq: MLNM).

On the downside

Focus Media Holding (Nasdaq: FMCN) lowered its outlook for 2008 due to uncertainty surrounding text message rules in China.

GlobalStar (Nasdaq: GSAT) announced the pricing of $135 million in convertible notes.

Fitch Ratings downgraded investments held by First Marblehead (NYSE: FMD) following The Education Resource Institute's bankruptcy filing yesterday.

In the broad market, declining issues outpaced advancers by a margin of 5 to 4 on both the NYSE and Nasdaq. The Russell 2000 which tracks small cap stocks rose a fraction to 699.