Did I say gap lower? I meant gap up, drop to new lows, then regroup, rally hard but leave us wondering if the rally was anything but a short term technical rebound.
From Briefing.com: Close Dow +117.07 at 8425.12, S&P +15.38 at 893.40, Nasdaq +28.47 at 1292.31: The session started on a mildly favorable note in the wake of reaffirmations by LSI Logic (LSI +10.6%), and Texas Instruments (TXN +3.5%), a better performance from the dollar, European equity gains and some minor upgrades. The averages were unable to build on this move with choppy trading on both sides of unchanged dominating through the morning. A midday slide to a new 52-wk low in the semi sector (SOX +1.8%) pulled the market averages along for the ride but the losses were relatively modestly overall with a number of sectors maintaining a favorable posture (networking, computer-hardware, wireless, telecom, drug, homebuilding, broker/dealer). The semi sector began to stabilize shortly thereafter which emboldened bargain hunters to move back into the fray on the buy side in the wake of the recent breakdown. The above groups provided the leadership during the steady afternoon advance but the rally broadened considerably by the close. Market internals were firmly bullish with the A/D lines better than 2 to 1 while up volume outpaced down volume on the NYSE by a 3 to 1 margin with the ratio roughly 4 to 1 on the Nasdaq exchange. Early construction spending data for July was weaker than expected but it elicited limited reaction. Economic reports that will be a focus tomorrow include: Initial Claims, ISM Services and Factory Orders with the Intel (INTC +1.8%) Mid-Q update after the close. Friday we have the always key employment data. DJTA +2.7%, DJUA -0.4%, DOT +4.6%, Nasdaq 100 +2.3%, Russell 2000 +2.8%, SOX +1.8%, S&P Midcap 400 +2.2%, XOI +0.1%, NYSE Adv/Dec 2265/983, Nasdaq Adv/Dec 2094/1215
5:09PM Intersil updates guidance (ISIL) 16.22 +0.12: Company updates guidance for Q3 (Sep); nticipates "meeting our adjusted earnings per share goal of $0.18" -- current consensus estimate is for earnings of $0.18 per share. Intersil (ISIL +8.8%) stated that it anticipates meeting its EPS goal of $0.18 (consensus $0.18). Competitors include: AGR.A, ADI, LLTC.
1:58PM Fairchild Semi (FCS) 10.43 -0.06: As expected, FCS lowered Q3 revenue guidance to flat to slightly down from Q2 levels from flat to slightly up (seq qtrly rev growth) last night. Analysts remain upbeat on co's positioning (in power mgmt segment) but cautious near-term citing lower pricing outlook into next year. CSFB cuts their 2002/2003 EPS on sluggish back-to-school sales and lowered earnings outlook from RSH and BBY. Prudential reiterates their Hold rating and cuts their price target to $10 from $14. CIBC encourages investors to remain on the sidelines on lack of a near term catalyst.
12:17PM National Semi reports in line Q1 results (NSM) 14.68 -0.29: Reports Q1 EPS of $0.01, in line with the Multex consensus of $0.01; revs were $420.6 mln, vs consensus of $420.3 mln. For Q2, co sees revs flat to down 5% sequentially, which suggest revs of $399.57-420.6 mln (consensus $443.14 mln). "Early indications of consumer demand for the holiday season are not strong at this point..."
10:14AM Qualcomm gives upbeat presentation at Solly conference (QCOM) 27.35 +0.46: We are hearing that QCOM gave a positive presentation at Salomon Smith Barney's tech conference this morning; co reaffirmed their forecast for 80-85 mln chipsets this year, which is above Street ests, and said next qtr may not be seasonally weak; also, speculation among traders today that Samsung is going to make their own 1x chipsets is nothing new.
9:19AM Texas Instruments leaves Q3 outlook unchanged (TXN) 18.52: Reuters reports that company is maintaining its outlook for the 3rd qtr. The comments were made this morning at the Smith Barney technology conference.
8:00AM Cree upgraded at UBS (CREE) 12.51: UBS Warburg upgrades to HOLD from Reduce based on valuation as well as checks indicating healthy unit volume sales in coming qtrs; price target is $12.
7:12AM LSI Logic reaffirms Q3 guidance (LSI) 6.96: Confirms that it expects to meet Q3 revenue guidance of about 10% sequential growth. LSI expects to post a pro forma net loss of approx. $0.02 (Multex consensus -$0.02). Co initially provided Q3 guidance on July 24.
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