From Briefing.com: 4:35 pm : A drastically improved tone among participants caused stocks to climb quickly and sharply early on, but the S&P 500 spent the rest of the session trending alongside its 50-day moving average.
Strong overseas gains and pleasing data from abroad inspired buyers to return to the fold after an extended absence in recent weeks. Their bids even persisted in the face of the August ADP Employment Change report, which indicated that private payrolls fell by 10,000 last month, when an increase of 13,000 had been widely expected.
Stocks extended their advance with help from the August ISM Manufacturing Index, which came in at 56.3. Its increase from 55.5 from July flew in the face of calls for a decline to 52.9.
While this session's surge was underpinned by an improved mood among market participants, short covering augmented the move as many scrambled to cover bets they had made against the market ahead of the official nonfarm payrolls report on Friday. That report will likely play a pivotal part in this week's remaining sessions, given that it offers insight into the health of U.S. companies and it carries implications for the broader economy. Concerns about the pace and sustainability of the economic recovery have led to cautious trade in recent sessions.
Still, it was a bullish sign that more than 98% of the names in the S&P 500 staged gains. Some of the biggest moves were made by financials and industrial stocks. Coming off of monthly losses of approximately 7% and 8%, respectively, both sectors climbed 3.9%.
Despite such strength, the S&P 500 could not push past its 50-day moving average, which is in the 1080 zone. Still, the broad market measure made its best gain in nearly two months. That gain and those booked by overseas markets helped the Dow Jones World Index spike 2.7% in its best single-session move in three months.
With participants showing a willingness to hold riskier issues, the dollar dropped to a 0.9% loss, its worst single-session slide in a month. Treasuries also toppled to drive yields markedly higher. Meanwhile, the CRB Commodity Index rallied to a 1.6% gain, its best single-session move in more than a month, most of which was owed to a spike in oil prices.
Oil prices spiked 2.8% to $73.91 per barrel. The energy component had been as high as $74.48 per barrel.
Precious metals failed to find sustainable support this session. As such, gold prices climbed to a new two-month high of about $1255.30 per ounce, but inevitably slipped to a 0.2% loss at $1248.10 per ounce. In similar fashion, silver prices climbed to about $19.50 per ounce, a three-month high, before slipping to $19.39 per ounce to log a 0.2% loss.
Advancing Sectors: Industrials (+3.9%), Financials (+3.9%), Energy (+3.6%), Consumer Discretionary (+3.4%), Materials (+2.9%), Tech (+2.7%), Health Care (+2.3%), Utilities (+2.2%), Consumer Staples (+1.7%), Telecom (+1.6%)
Declining Sectors: (None)DJ30 +254.75 NASDAQ +62.81 NQ100 +3.0% R2K +3.8% SP400 +3.4% SP500 +30.96 NASDAQ Adv/Vol/Dec 2186/2.16 bln/475 NYSE Adv/Vol/Dec 2649/1.19 bln/422
4:00PM Maxim Integrated Signs Russian Distribution Agreement With the Symmetron Group (MXIM) 16.36 +0.49 : Co announced that it has added the Symmetron Group as a new franchised distributor in Russia, Ukraine, and Belarus, effective September 1, 2010. This agreement bolsters Maxim's presence in these markets, making it easier for system designers to benefit from Maxim's high-performance engineering solutions. Maxim's solutions address a wide range of consumer, computing, communications, industrial, medical, and automotive applications.
7:07AM LTX-Credence beats by $0.01, beats on revs; guides Q1 EPS in-line, revs in-line (LTXC) 2.15 : Reports Q4 (Jul) earnings of $0.11 per share, excluding non-recurring items, $0.01 better than the Thomson Reuters consensus of $0.10; revenues rose 108.0% year/year to $73.2 mln vs the $71.9 mln consensus. Co issues in-line guidance for Q1, sees EPS of $0.11-0.13, excluding non-recurring items, vs. $0.13 Thomson Reuters consensus; sees Q1 revs of $75-80 mln vs. $77.69 mln Thomson Reuters consensus. "We shipped a record number of Diamond systems in the quarter and expect to ship another record number of units in the current quarter."
07:21 am Cree resumed with a Hold at Kaufman Bros; tgt $58: . Kaufman Bros resumed coverage of CREE with a Hold and sets target price at $58 saying as a technology leader in the space and a pure-play on the growth in the LED market, they believe CREE deserves a premium multiple; however, they do not feel comfortable increasing the multiple to the high end of the range and would look to see earnings acceleration above their forecasts to become more constructive on the name.
07:19 am FormFactor target lowered to $12 at Oppenheimer following lowered guidance: . Oppenheimer noted, after the close Tuesday, FORM lowered Q3 (Sept.) rev guidance to $46-$48 mln from the mid-$50 mln range issued on 7/27. The co cited: 1) longer customer qualifying times for its Matrix products, 2) refusal to take on low-margin business, and 3) longer lead times. Though the process may be painful-cash burn is still high in Q3/Q4-mgmt is taking the necessary steps on the way to profitability, in its view. Though its 2010 ests aren't moving drastically, Opco is lowering its tgt to $12 from $22 as cash flow is becoming the focus due to forward investing in Matrix, stretching DSOs due to extended qualifications and lengthening lead times/lower inventory turns. |
