From Briefing.com: 4:20 pm : Equities started the day on a down note before staging a slow climb towards session highs. With thin volume and economic data largely in-line, today's action occurred mostly around the unchanged line. An afternoon push attempted to lift stocks to a higher close but the move lacked conviction. As a result, the Nasdaq ended higher by 0.5% while the S&P 500 and Dow finished flat.
Shares on the Nasdaq outperformed the broader market. Within the group, Akamai Tech (AKAM 36.80, +1.36) and Limelight (LLNW 2.60, +0.09) were up 3.8% and 3.6%, respectively. Both network companies rose on rumors which suggested AT&T (T 37.10, -0.15) will re-sell CDN services provided by either of the two companies. Both vendors are negotiating, with Akamai viewed as the favorite to win the contract.
Abercrombie & Fitch (ANF 35.23, +2.90) was a session leader after beating on earnings and revenues. Shares of the apparel producer jumped 9.0% in reaction to the results. Competitors Aeropostale (ARO 13.63, +0.40) and American Eagle (AEO 21.13, +0.29) got a lift from the positive Abercrombie & Fitch results. The two stocks gained 3.0% and 1.4%, respectively.
Two popular retailers saw contrasting performance following their earnings releases. Staples (SPLS 11.49, -1.96) plunged 14.6% after missing on earnings and revenues. Today's selling dropped the shares to levels not seen since October 2002. Meanwhile, Target (TGT 64.50, +1.12) advanced 1.8% after exceeding earnings estimates and reporting in-line revenues.
Energy was one of today's main laggards despite crude oil climbing 1.2% to $94.50 and testing levels last seen in mid-May. The spike in crude comes on renewed tensions between Israel and Iran.
Looking closer at the sector, Contango Oil & Gas (MCF 55.12, -4.76) slid 8.0% after announcing its Chairman and CEO, Kenneth Peak will be taking a medical leave of absence. Other energy names also showed significant losses despite the lack of news driving their declines. Alpha Natural Resources (ANR 6.61, -0.23) was down 3.4% while WPX Energy (WPX 14.58, -0.37) slipped 2.5%.
Gun makers Smith & Wesson (SWHC 8.60, -1.16) and Sturm Ruger (RGR 45.39, -2.69) were under pressure after receiving downgrades from KeyBanc Capital Markets. Smith & Wesson fell 11.9% after being downgraded from ‘buy' to ‘hold' while Sturm Ruger slumped 5.6% after being lowered from ‘hold' to ‘underweight.' The downgrades were handed down as analysts believe the industry is near its peak profitability.
With the majority of second quarter results already delivered, a handful of names remain on the earnings calendar. Cisco Systems (CSCO 17.35, +0.18) and Applied Materials (AMAT 11.80, +0.09) will report after today's close. Cisco is expected to earn $0.45 on $11.61 billion revenues while the consensus calls for Applied Materials to deliver earnings of $0.22 on revenues of $2.32 billion.
Retail names will headline tomorrow's reports before the bell. Analysts are expecting Dollar Tree (DLTR 50.00, -0.62) to earn $0.47 on revenues of $1.71 billion while retail giant Wal-Mart (WMT 74.45, +0.44) is expected to report earnings of $1.17 on $114.80 billion revenues.
The Housing Market Index for August registered a reading of 37. That was up from the prior month, and better than the reading of 35 that had been expected, on average, among economists polled by Briefing.com.
Separately, industrial production increased during July by 0.6%, which was in-line with expectations. The reading follows the revised 0.1% increase experienced in the prior month. Capacity utilization hit 79.3%, which was also in-line with expectations, and up from the prior month reading of 78.9%.
Consumer prices were unchanged during July, which was slightly cooler than the 0.2% increase that had been generally expected. Core prices increased by 0.1%, which fell short of the 0.2% increase expected by economists polled by Briefing.com.
Tomorrow's economic data will be focused on jobs data and housing. Housing starts, building permits, and initial and continuing claims will be reported at 8:30 AM ET. The monthly Philadelphia Fed survey will be released at 10 AM ET.DJ30 -7.36 NASDAQ +13.95 SP500 +1.60 NASDAQ Adv/Vol/Dec 1719/1.49 bln/768 NYSE Adv/Vol/Dec 1899/497.8 mln/1113
3:30 pm : Crude oil rallied into positive territory on better-than-expected inventory data that showed a draw of 3.699 mln barrels when a draw of 1.5 mln barrels was anticipated. The energy component advanced further and set a session high of $94.96 per barrel in afternoon action. It pulled-back slightly in the last hour of pit trade but still booked a 1.0% gain as it settled at $94.35 per barrel. It is worth noting that reports came out this morning suggesting that Israel is planning a strike on Iran's nuclear facilities before the November U.S. elections.
Natural gas, on the other hand, lost yesterday's momentum and tumbled deeper into negative territory. It settled 2.8% lower at $2.75 per MMBtu, just above its session low of $2.74 per MMBtu.
Gold came off its pit session low of $1596.30 per ounce and popped into positive territory in reaction to weaker-than-anticipated manufacturing data. The yellow metal continued to advance despite strength in the dollar. It touched a session high of $1608.80 per ounce and eventually settled the session with a 0.3% gain at $1606.60 per ounce.
Silver followed suit as it came off its session low of $27.54 per ounce and rallied into the black. It popped to a session high of $27.96 per ounce in morning action but was unable to hold the momentum. It pulled-back as the session progressed and settled with a 0.2% gain at $27.80 per ounce.DJ30 -5.59 NASDAQ +12.35 SP500 +1.68 NASDAQ Adv/Vol/Dec 1621/1244.6 mln/829 NYSE Adv/Vol/Dec 1805/335 mln/1146
4:20PM Applied Materials beats by $0.02, reports revs in-line; guides Q4 EPS, revs below consensus ( AMAT) 11.80 +0.09 : Reports Q3 (Jul) earnings of $0.24 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of $0.22; revenues fell 15.9% year/year to $2.34 bln vs the $2.32 bln consensus. "Economic uncertainty is weighing on top of a seasonal pullback to produce weaker near-term demand." Backlog decreased by $551 million to $1.82 billion. Gross margin was 41.6 percent on a non-GAAP basis, down from 42.1 percent, in line with the decrease in net sales. Co issues downside guidance for Q4, sees EPS of $0.00-0.06, excluding non-recurring items, vs. $0.12 Capital IQ Consensus Estimate; sees Q4 revs -25-40% QoQ to ~$1.40-1.76 bln vs. $1.94 bln Capital IQ Consensus Estimate.
4:11PM Cisco Systems beats by $0.02, reports revs in-line; raises quarterly dividend 75% to $0.14 ( CSCO) 17.35 +0.18 : Reports Q4 (Jul) earnings of $0.47 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of $0.45; revenues rose 4.4% year/year to $11.69 bln vs the $11.61 bln consensus. During Q4, Cisco repurchased 108 mln shares of common stock under the stock repurchase program at an average price of $16.62 per share for an aggregate purchase price of $1.8 bln. The remaining authorized amount for stock repurchases under this program is ~$5.9 bln with no termination date. Cash flows from operations were $3.1 bln for the fourth quarter of fiscal 2012, compared with $3.0 bln for the third quarter of fiscal 2012, and compared with $2.8 bln for the fourth quarter of fiscal 2011. Cash flows from operations were $11.5 bln for fiscal 2012, compared with $10.1 bln for fiscal 2011. Cash and cash equivalents and investments were $48.7 bln at the end of the fourth quarter of fiscal 2012, compared with $48.4 bln at the end of the third quarter of fiscal 2012, and compared with $44.6 bln at the end of 4Q11.
Co raises its quarterly dividend 75% to $0.14 (yield 3.2% at closing price). "Cisco has the financial strength and flexibility to effectively invest in our business, pursue strategic opportunities, such as acquisitions, as well as return a minimum of 50% of our free cash flow annually through dividends and share repurchases to our shareholders."
4:09PM Agilent misses by $0.04, misses on revs; guides Q4 EPS below consensus, revs below consensus ( A) 40.47 -0.01 : Reports Q3 (Jul) earnings of $0.79 per share, excluding non-recurring items, $0.04 worse than the Capital IQ Consensus Estimate of $0.83; revenues rose 1.9% year/year to $1.72 bln vs the $1.79 bln consensus. Co issues downside guidance for Q4, sees EPS of $0.80-0.82, excluding non-recurring items, vs. $0.93 Capital IQ Consensus Estimate; sees Q4 revs of $1.76-1.78 bln vs. $1.88 bln Capital IQ Consensus Estimate.
4:06PM Tessera Tech announces C. Richard Neely, Jr. has been named executive vice president and chief financial officer, effective immediately ( TSRA) 14.44 +0.04 : The Company also announced that its former CFO, Michael Anthofer, has resigned his position to pursue other interests and opportunities. Neely joins the Company from Livescribe, Inc., a privately held consumer electronics manufacturer and retailer of digital "Smartpens," which he joined in Feb. 2011 as CFO.
4:04PM NetApp beats by $0.04, misses on revs; guides Q2 EPS in-line, revs in-line ( NTAP) 31.75 +0.33 : Reports Q1 (Jul) earnings of $0.42 per share, excluding non-recurring items, $0.04 better than the Capital IQ Consensus Estimate of $0.38; revenues fell 0.9% year/year to $1.45 bln vs the $1.46 bln consensus. Co issues in-line guidance for Q2, sees EPS of $0.45-0.50, excluding non-recurring items, vs. $0.47 Capital IQ Consensus Estimate; sees Q2 revs of $1.5-1.6 bln vs. $1.54 bln Capital IQ Consensus Estimate.
9:49AM Intel a Dow laggard tests/stabilizes at support at its 50/200 sma at 26.19/26.17 -- session low 26.19 ( INTC) 26.34 -0.14 :
7:51AM Nokia comments on S&P's credit rating announcement; says 'decision on the co is limited' ( NOK) 2.49 : Timo Ihamuotila, Nokia's Executive Vice President and CFO, commented on today's rating decision from Standard & Poor's: "The impact of Standard & Poor's decision on the company is limited. As we continue our transition, we are applying a strong focus on cash conservation while simultaneously reducing our operating costs and making our operating model stronger and more agile. We ended the second quarter 2012 with gross and net cash both higher than a year earlier. With gross cash of EUR 9.4 billion and net cash of EUR 4.2 billion, we have a strong financial position and robust liquidity profile. We also have access to additional liquidity via a revolving credit facility of EUR 1.5 billion. This is entirely undrawn, available to us until March 2016, and comes without any financial covenants."
JDS Uniphase (JDSU $11.57 +0.89 ) reported fourth quarter earnings of $0.15 per share, excluding non-recurring items, $0.03 better than the Capital IQ consensus of $0.12, while revenues fell 6.9% year/year to $439.3 million versus the $423 million consensus. The company issued in-line guidance for the first quarter with revenues of $415-435 versus the $429.51 million consensus.
10:04 am Technology sector trading slightly higher along with gains in the broader market
The tech sector is trading higher today, just ahead of gains in the broader market. Semiconductors are showing relative strength with the SOX trading 0.5% higher. Within the chip index, SPRD (+4.5%) is a notable standout. Among other major indices, the SPY is trading 0.2% higher today, while the QQQ and the NASDAQ are trading 0.3% higher on the session. Among tech bellwethers, FB (+4.7%) is showing strength, while INTC (-0.6%) is showing weakness.
In tech earnings last night, JDSU (+8.5%) reported a better-than-expected quarter and guided inline. In news, LLNW (+6.3%) and AKAM (+3.2%) are trading higher on reports that T (-0.5%) is shutting down its Content Delivery Network, potentially re-selling AKAM or LLNW services.
Among notable analyst upgrades this morning in the tech space, JIVE (+3.0%) was upgraded to Outperform at Baird. In downgrades, VOD (-1.2%) was downgraded to Neutral at BofA/Merrill and OCZ (-6.6%) was downgraded to Neutral at Sterne Agee. A (-0.9%), AMAT (+1.1%), CSCO (+0.8%), and NTAP (+2.9%) is the only notable name in tech scheduled to report quarterly results today after the close.
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