From Briefing.com: 4:30 pm : A lack of leadership left stocks to roll over this morning, but buyers provided an afternoon lift that helped the major averages settle near session highs with solid gains.
The mood this morning was relatively mixed as market participants ruminated over the implications of a resignation by Greece Prime Minister Papandreou. Last week the Papandreou unnerved many officials, and markets for that matter, by proposing a referendum for the country's bailout package. It is expected that a new prime minister will be named tomorrow. The future of Italy's prime minister was questioned this morning.
Rumors about his possible resignation came amid concerns about the country's fiscal and financial conditions, which continue to drive yields on the Italian debt to new heights. Italy canceled an auction of short-term Notes that was scheduled for later this week.
Although the primary market averages of Italy and Greece scored gains of 1.3% and 1.7%, respectively, the rest of the region failed to find inspiration from those headlines. In turn, the EuroStoxx 50 fell 0.7% in its first session of the new week. For that matter, many of Asia's major averages were weak in overnight trade.
Despite the generally weak action abroad, domestic stocks attempted to trade higher in the opening minutes of trade. Energy issues offered early leadership, but it proved fleeting as the sector inevitably rolled over alongside the rest of the market.
There wasn't any specific headline that brought buyers back into the fold, but the rally by stocks began around the same time that the euro rebounded against the greenback. Even then there weren't any individual leaders, but the Dow still bounced almost 200 points from its low to its high. Meanwhile, the Nasdaq was able to offset a 1% loss.
Although the climb continued right up until the close, share volume was quite paltry, suggesting that there wasn't a great deal of conviction underlying the bidding. By day's end, less than 800 million shares had been traded on the NYSE. Outside of averages, 1 billion shares often makes for a convenient benchmark for share volume and participation.
Advancing Sectors: Health Care +1.2%, Telecom +0.8%, Materials +0.8%, Energy +0.7%, Consumer Staples +0.7%, Tech +0.7%, Utilities +0.6%, Consumer Discretionary +0.5%, Financials +0.4%, Industrials +0.2%
Declining Sectors: (None)DJ30 +85.15 NASDAQ +9.10 NQ100 +0.6% R2K -0.2% SP400 -0.1% SP500 +7.89 NASDAQ Adv/Vol/Dec 1091/1.71 bln/1437 NYSE Adv/Vol/Dec 1638/783 mln/1329
Cryptography Research, a division of Rambus (RMBS), and Keirex Technology announced they have signed a reseller agreement for CRI's DPA Workstation side channel analysis platform.
8:16AM OmniVision lowers Q3 rev guidance below consensus; announces $100 mln stock buyback (OVTI) 17.31 : Co lowers Q3 rev guidance to $212-217 mln from $255-275 mln vs $259.91 mln Capital IQ Consensus Estimate. This revised outlook reflects an unexpected cutback in orders for certain key projects that are currently in production. This has reduced the unit sales of OmniBSI and OmniPixel3-HS based products. The co expects the business environment to remain volatile, especially in consumer-oriented product markets. As such, the co is expecting a more cautionary outlook for its third fiscal quarter. Separately, towards the end of the second fiscal quarter, the co started to ship in very limited quantities the OV8830, the co's 8-megapixel OmniBSI-2 based product. The co will continue to promote this product to key customers, and successful engagement in new projects may in the longer term provide growth opportunities. Stock buy-back OmniVision today announced that its Board of Directors authorized a program to repurchase up to $100 mln of the co's outstanding common stock, effective immediately.
09:06 am Trina Solar downgraded to Hold at Brigantine: . Brigantine downgrades TSL to Hold from Buy saying while Trina continues to be one of the lowest cost producers of silicon solar modules, the sharp industry downturn driven by excess channel inventory, excess production capacity, and weak markets particularly in Europe continue to take a toll on even top-tier suppliers.
Trina Solar (TSL $7.76 -0.32) was downgraded to Sell from Buy at Maxim Group and the firm lowered their tgt to $5 from $22 saying while the stock's 44% gains since its Oct. 4th lows and resilience in the face of its recent guidance may belie it has hit bottom, they believe this is only a temporary short squeezed reprieve. The firm says as the outlook for EPS losses over the next four quarters is fully realized, they expect the stock to come under renewed pressure through year-end and ultimately retest its lows around $5/share.
10:46 am S&P Tech Sector Down Modestly; DRWI, ALU and TECD Downgraded (DRWI)
The tech sector is trading lower today along with losses in the broader market. Semiconductors are showing relative weakness in the tech space, however, with the Philly Semi Index trading 1.2% lower. WFR (-5.2%) is a notable laggard in the chip index. Among other major indices, the S&P 500 is trading 0.2% lower, while the NASDAQ is trading 0.6% lower and the QQQ is trading 0.4% lower on the session. Among tech bellwethers, ORCL (-1.7%) is a notable underperformer.
In earnings this morning, OVTI (-13.5%) lowered Q3 revenue guidance, while BSFT (-5.8%) posted a strong beat but guided below consensus.
In news, TKLC (+11.2%) announced today that it has entered into a definitive agreement to be acquired by a consortium led by Siris Capital Group for $11/share. EXAR (-2.9%) announced its CEO and President resigned and reduced component count in industrial and embedded PCs.
Among rumors, we are hearing ERIC (+0.9%) for CIEN (-3.1%) making the rounds.
Among notable analyst upgrades this morning, DRWI (+3.3%) was upgraded to Buy at Jefferies In downgrades, ALU (-7.4%) was downgraded at Citigroup and WestLB and TECD (-7.8%) was downgraded to Market Perform from Outperform at Raymond James.
RAX (-1.2%) is the notable name in tech set to report results today after the close.
Thanks for sharing Lakshman's comments. RtS |
