From Briefing.com: 4:30 pm : The S&P 500 had sported a gain of more than 5% only minutes before the toll of the closing bell, but some late selling pressure caused it to settle off of its session high. As a result, the stock market couldn't quite surpass what was achieved this past Tuesday, when the stock market swung 6% from its session low to its session high to score its best single-session gain since a 7% surge in March 2009.
The late flurry of selling came as some participants, fearful that ongoing volatility could send stocks sharply lower tomorrow, opted to capitalize on the bounce by liquidating their positions. After all, today's climb was really just a relief rally, rather than a surge driven by the improvement of fiscal and financial conditions among the eurozone countries and their banking institutions.
Participants did get some positive data, though. Initial jobless claims for the week ended August 6 totaled 395,000, which is down from the 402,000 claims filed in the prior week and less than the tally of 409,000 that had been widely anticipated. The latest tally marks the first time since early April that the initial claims count fell below 400,000. Still, traders remain mindful that more than one modest downtick in weekly jobless claims is needed to ramp up the economic recovery.
Nonetheless, stocks settled sharply higher, giving bargain hunters what they wanted. Financials led the action for the fourth straight session. The sector surged more than 6% in the latest round of action. The sector's surge came even though many analysts aren't yet willing to upgrade bank stocks for fear of undesirable loan exposure or, in some cases, uncertainty related to capital levels.
Several natural resource plays were upgraded, however. Chevron (CVX 94.07, +3.50) and Exxon Mobil (XOM 71.58, +3.55), along with US Steel (X 30.51, +1.65) and AK Steel (AKS 9.05, +0.81) all benefited from favorable analyst reviews. Cisco Systems (CSCO 15.92, +2.19) won an upgrade from analysts at Morgan Stanley after the Dow component posted an upside earnings surprise for the latest quarter. Shares of CSCO rallied hard in response.
Amid the stock market's climb, gold bugs took a breather from buying. That left the precious metal to slide 1.8% to $1751.50 per ounce for its first loss in five sessions.
Treasuries also turned lower, sending the yield on the 10-year Note back above 2.30%. Selling intensified in the wake of a 30-year Bond auction, which drew a bid-to-cover of 2.08, dollar demand of $33.3 billion, and an indirect bidder participation rate of only 12.2%. For comparison, the prior auction drew a bid-to-cover ratio of 2.80, dollar demand of $36.4 billion, and an indirect bidder rate of 37.8%.
Advancing Sectors: Telecom +2.5%, Consumer Staples +3.1%, Utilities +4.2%, Consumer Discretionary +4.5%, Tech +4.5%, Industrials +4.5%, Health Care +4.7%, Materials +4.9%, Energy +5.2%, Financials +6.3%
Declining Sectors: (None)DJ30 +423.37 NASDAQ +111.63 NQ100 +4.5% R2K +5.4% SP400 +1.8% SP500 +51.88 NASDAQ Adv/Vol/Dec 2217/3.13 bln/430 NYSE Adv/Vol/Dec 2869/1.88 bln/243
4:32PM Emulex beats by $0.06, beats on revs; guides Q1 EPS below consensus, revs below consensus (ELX) 7.25 +0.44 : Reports Q4 (Jun) earnings of $0.16 per share, excluding non-recurring items, $0.06 better than the Capital IQ Consensus Estimate of $0.10. Co issues downside guidance for Q1, sees EPS of $0.10-0.12, excluding non-recurring items, vs. $0.14 Capital IQ Consensus Estimate; sees Q1 revs of $114-118 mln vs. $123.49 mln Capital IQ Consensus Estimate.
4:26PM NVIDIA reports EPS in-line, beats on revs; guides Q3 revs above consensus (NVDA) 13.41 +1.07 : Reports Q2 (Jul) GAAP earnings of $0.25 per share, in-line with the Capital IQ Consensus Estimate consensus of GAAP $0.25; revenues rose 25.3% year/year to $1.02 bln vs the $1 bln consensus. Co issues upside guidance for Q3, sees Q3 revs +4-6% QoQ, which equates to ~$1.057-1.077 bln vs. $1.05 bln Capital IQ Consensus Estimate.
Microsemi Corporation (MSCC) announced it has relocated its corporate headquarters from 2381 Morse Avenue in Irvine, Calif. to One Enterprise Drive in Aliso Viejo, Calif.
6:31AM Integrated Device and Phison Electronics settle patent litigation (IDTI) 5.45 : In the settlement, the terms of which are confidential, IDT licensed certain patents to Phison and the companies agreed to dismiss all claims and counterclaims in the litigation.
09:40 am Nanometrics initiated with a Buy at Stifel Nicolaus; tgt $22: . Stifel Nicolaus initiates NANO with a Buy and price target of $22 saying they believe Nanometrics is among the best positioned companies to capitalize on the many changing process technology techniques (e.g., tri-gate transistors, 3D devices, advanced packaging, and high-k metal gates) occurring in the industry.
09:39 am SMSC initiated with a Buy at Wunderlich; tgt $36: . Wunderlich initiates SMSC with a Buy and price target of $36 saying the co has developed a core portfolio of computing and connectivity solutions with a leveragable business model marked by execution and margin expansion. While the consumer electronics segment should remain challenging in the near term, they believe it offers compelling growth opportunities over the long term, driven by proliferation of smartphone and tablet devices.
10:56 am Technology Sector Trading HIgher TodayTechnology Sector Trading HIgher Today (CSCO)
The tech sector is trading higher today, just ahead of the broader market. Semiconductors are showing strength in line with the tech space with the Philly Semi Index trading 3.2% higher. Among chips in the index, NXPI (+9.2%) and NETL (+8.7%) are notable leaders. Among other major indices, the S&P 500 is trading 2.6% higher, while the NASDAQ is trading 2.9% higher. The QQQ, meanwhile, is trading 3.2% higher. Among tech bellwethers, CSCO (+16.8%) is outpacing the rest after reporting strong results.
In earnings last night, CSCO (+16.8%) posted a beat and issued upside guidance. Also, OTEX (-16.3%) posted a miss. In news, AMSC (-7.0%) announced that it has reduced its global workforce by ~30 % and its annualized expenses by ~$30 million since March 31, 2011.
Among notable analyst upgrades this morning, CSCO (+16.8%) was upgraded at Stifel and Wunderlich, TI (+4.0%) was upgraded to Neutral at JP Morgan, ERTS (+8.5%) was upgraded to Outperform at Cowen, ALTR (+4.2%) was upgraded at Barclays, and ARMH (+5.5%) was added to Conviction Buy list at Goldman. In downgrades, Longbow downgraded LLTC (+1.9%), TXN (+2.3%), ISIL (+1.1%), and MXIM (+2.7%).
10:21 am Cisco Tops Fiscal Fourth Quarter Expectations (CSCO)
Cisco (CSCO $16.02 +2.29) reported fiscal fourth quarter earnings of $0.40 per share, $0.02 better than the Capital IQ Consensus Estimate of $0.38.
Revenues rose 3.7% year/year to $11.2 billion versus the $11 billion consensus.
"We've made significant progress on our comprehensive action plan to position ourselves for our next stage of growth and profitability, while delivering solid financial results in Q4... As we start our next fiscal year, you will see a very focused, agile, lean and aggressive company, that is laser focused on helping our customers use intelligent networks to transform their businesses." |
