From Briefing.com: 4:26 pm NVIDIA beats by $0.05, beats on revs; guides Q3 revs above consensus -- Strong launch of Pascal-based GPUs, growing demand for deep learning (NVDA) : Reports Q2 (Jul) non-GAAP earnings of $0.53 per share, $0.05 better than the Capital IQ Consensus of $0.48 (GAAP EPS $0.40 vs. 0.38 consensus); revenues rose 23.9% year/year to $1.43 bln vs the $1.35 bln Capital IQ Consensus.
Non-GAAP gross margin 58.1%vs. 57.5-58.5% guidance.
Co issues upside guidance for Q3, sees Q3 revs of ~$1.65-1.71 bln vs. $1.45 bln Capital IQ Consensus; non-GAAP gross margin 57.5-58.5%.
"Strong demand for our new Pascal-generation GPUs and surging interest in deep learning drove record results," said Jen-Hsun Huang, co-founder and chief executive officer, NVIDIA. "Our strategy to focus on creating the future where graphics, computer vision and artificial intelligence converge is fueling growth across our specialized platforms -- Gaming, Pro Visualization, Datacenter and Automotive." "We are more excited than ever about the impact of deep learning and AI, which will touch every industry and market. We have made significant investments over the past five years to evolve our entire GPU computing stack for deep learning. Now, we are well positioned to partner with researchers and developers all over the world to democratize this powerful technology and invent its future."4:23 pm Silicon Graphics beats by $0.07, beats on revs (Being acquired by Hewlett Packard Enterprise (HPE)) (SGI) :
Reports Q4 (Jun) earnings of $0.08 per share, $0.07 better than the two analyst estimate of $0.01; revenues fell 19.7% year/year to $122.71 mln vs the $120.67 mln Capital IQ Consensus.
As covered earlier, Hewlett Packard Enterprise (HPE) announced that it has signed a definitive agreement to acquire SGI for $7.75 per share in cash, a transaction valued at approximately $275 million, net of cash and debt. Due to the acquisition announcement, the previously scheduled conference call has been cancelled. 4:15 pm : The Dow Jones Industrial Average (+0.6%) finished ahead of the S&P 500 (+0.5%) and the Nasdaq Composite (+0.5%), but all three indices carved out new all-time closing highs. The benchmark index erased a modest weekly loss as stronger-than-expected earnings results from retail names and a reversal in crude oil spurred a risk rally in the broader market. Other focal points impacting today's trade included a rebound in the dollar and leadership from the heavily-weighted health care (+0.6%), industrial (+0.6%), and consumer discretionary (+1.0%) sectors.
The major averages began the day on a higher note as above-consensus bottom-line results from the likes of Alibaba (BABA 91.77, +4.44), Kohl's (KSS 44.19, +6.15) and Macy's (M 39.81, +5.81) improved investor sentiment. The three names bolstered the consumer discretionary space (+1.0%), which ended among the leaders. Additionally, a rebound in oil futures contributed to a positive bias at the start of today's session.
Crude oil was in focus as investors examined a mixed reading of the International Energy Agency's monthly report and responded to commentary from Saudi Oil Minister Khalid al-Falih. The IEA trimmed its 2017 global oil demand estimate to 1.2 million barrels per day (from 1.3 million barrels), but also stated that it expects the supply overhang to be gone by the end of 2016. Separately, the Saudi oil minister indicated that the current market situation and potential plans to stabilize oil prices would be discussed at the cartel's next meeting on September 26-28. Market participants likely took this news with a grain of salt, remaining skeptical of potential production cuts from the oil collective. Nevertheless, crude oil rallied 4.2% ($43.50/bbl; +$1.74) on the news, likely benefiting from a fair amount of short covering.
The S&P 500 (+0.5%) found resistance near the 2186/2187 price level in the final hour. Nine sectors finished in the green with industrials (+0.6%), health care (+0.6%), consumer discretionary (+1.0%), and energy (+1.3%) leading.
Retail names outperformed in the consumer discretionary space (+1.0%) as the group moved higher in sympathy with Kohl's (KSS 44.19, +6.15) and Macy's (M 39.81, +5.81). Fellow retail name Nordstrom (JWN 47.56, +3.33) rallied 7.5% ahead of this evening's quarterly report. Separately, Netflix (NFLX 95.89, +1.96) jumped 2.1% after a Director disclosed the purchase of 300,000 shares. The purchase is valued at approximately $28.3 million.
In the technology space (+0.5%), software names outperformed as Adobe Systems (ADBE 101.67, +1.05) and Salesforce.com (CRM 81.48, +1.24) moved higher by 1.0% and 1.6%, respectively. The high-beta chipmakers were able to shake early weakness as Cavium Networks (CAVM 50.50, +2.01) topped the PHLX Semiconductor Index (+0.5%).
The heavyweight health care sector (+0.6%) outperformed as biotechnology displayed relative strength. The iShares Nasdaq Biotechnology ETF (IBB 291.91, +3.10) gained 1.1%, narrowing its weekly loss to 1.7%. In the group, Dow component Merck (MRK 63.63, +0.99) gained 1.6%. On the flipside, Valeant Pharmaceuticals (VRX 24.49,- 2.83) underperformed after reports indicated that the Southern District of New York is investigating the company. The investigation allegedly involves the company's prior relationship with Philidor Rx Services.
The U.S. Dollar Index (95.91, +0.26) ended higher as the pound, euro, and yen each lost ground to the greenback. Cable declined by 0.4% (1.2959) while the single currency lost 0.4% against the buck (1.1139). Conversely, the dollar/Canadian dollar slipped 0.6% (1.2984) amid today's rebound in oil futures.
Treasuries settled near session lows as yields rose throughout the complex. The yield on the 10-yr note finished higher by seven basis points at 1.56%.
Today's participation was below the recent average as fewer than 761 million shares changed hands at the NYSE floor.
Today's economic data was limited to weekly initial claims and Import/Export Prices for July:
Initial claims for the week ending August 6 were 266,000 (Briefing.com consensus 266,000) versus a downwardly revised 267,000 (from 269,000) in the prior week.
There were no special factors influencing the initial claims reading, which was below 300,000 for the 75th consecutive week -- the longest streak since 1970
The four-week moving average increased to 262,750 from 259,750
Continuing claims for the week ending July 30 increased by 14,000 to 2.155 million
The four-week moving average is 2.143 million, up 500 from the prior week
Import prices for July increased 0.1% on top of a 0.6% increase in June.
The key difference is that the uptick in July was led by increasing nonfuel prices, which were up 0.3% after declining 0.2% in June.
Import prices fell 3.7% year-over-year and have not recorded a 12-month advance since two years ago when they rose 0.9% between July 2013 and July 2014
Import prices, excluding fuel, were up 0.3% after declining 0.2% in June
On a year-over-year basis, import prices, excluding fuel, are down 1.2%
Export prices for July were up 0.2% after increasing 0.8% in June, led by higher nonagricultural prices
Export prices declined 3.0% year-over-year and have not advanced on a year-over-year basis since August 2014
Excluding agriculture, export prices were up 0.3% on the heels of a 0.5% increase in June
On a year-over-year basis, export prices, excluding agriculture, are down 3.0%
Tomorrow's economic data will include July PPI (Briefing.com consensus 0.0%) and July Retail Sales (Briefing.com consensus +0.4%), which will each cross the wires at 8:30 ET. Separately, the preliminary reading of the Michigan Sentiment Index for August (Briefing.com 90.2) and Business Inventories for June (Briefing.com consensus +0.1%) will be released at 10:00 ET. DJ30 +117.86 NASDAQ +23.81 SP500 +10.30 NASDAQ Adv/Vol/Dec 1884/1.371 bln/1041 NYSE Adv/Vol/Dec 1862/760.9 mln/1140
3:30 pm :
The dollar index was up +0.2% around the 95.87 level, weighing on precious metals
Commodities, as measured by the Bloomberg Commodity Index, +0.9% around the 83.97 level
Crude oil ends near 4-week highs after comments from the Saudi oil minister that he is willing to help stabilize oil prices
September crude oil futures rose $1.74 (+4.2%) to $43.5/barrel
Baker Hughes rig count data will be released tomorrow at 1 pm ET
Next OPEC meeting will take place in Algeria on September 26-28
Natural gas drifted lower after EIA data showed a larger-than-expected build compared to Consensus
September natural gas closed $0.01 lower (-0.4%) at $2.55/MMBtu
In precious metals, gold ends nearly flat while silver trades lower
December gold ended today's session down $1.50 (-0.1%) to $1350.20/oz
September silver closed today's session $0.17 lower (-0.8%) at $20.02/oz
Base metal copper extends yesterday's gains
September copper closed $0.02 higher (+0.9%) at $2.19/lb
Today's session began on a higher note as investors weighed better-than-expected earnings results from the likes of Kohl's (KSS 44.21, +6.17 +16.22%) and Macy's (M 39.83, +5.83 +17.15%). The two department stores rallied in response, adding support to the retail sub-group and the broader market. A rebound in crude oil also buttressed today's move higher as oil shrugged off a mixed reading of the International Energy Agency's monthly report.
The IEA estimates that global oil demand growth will slow from 1.4 million barrels per day in 2016 to 1.2 million barrels per day in 2017. This compares to its prior outlook, which projected next year's global demand growth at 1.3 million barrels per day. The organization believes that the supply overhang will be gone by the end of this year.
Economic data today came in the form of initial claims which for the week ending August 6 were 266,000 versus a downwardly revised 267,000 (from 269,000) in the prior week. Continuing claims for the week ending July 30 increased by 14,000 to 2.155 million. Also, import prices for July increased 0.1% on top of a 0.6% increase in June. Lastly, export prices for July were up 0.2% after increasing 0.8% in June, led by higher nonagricultural prices.
Rebounding off yesterday's weakness, the broader market finished higher, albeit off HoDs as a last-minute sell-off toward the close took stocks modestly lower. Leading the advance, the Dow Jones Industrial Average added 117.86 points (+0.64%) to close 18613.52. The index's gains were helped along by a decent session in crude oil; September crude oil futures rose $1.74 (+4.2%) to $43.5/barrel. The S&P 500 was next, up 10.30 points (+0.47%) to 2185.79, and the Nasdaq Composite was higher by 23.81 points (+0.46%) to 5228.40. Top Dow components in the green today included NKE +2.9%, MRK +1.6%, CVX +1.3%, MMM +1.2% and AXP +1.1%.
Among the better performing sectors, Technology (XLK 47.19, +0.20 +0.43%) closed near highs on a start-to-finish positive affair. Component Yahoo! (YHOO 41.27, +1.34 +3.36%) was strong as its ties to Alibaba (BABA 91.77, +4.34 +4.96%), which reported a better than expected Q1 and took that stock higher about +5% today, aided the advance. Other sectors as measured by the S&P ended Thursday XLE +1.47%, XLY +1.00%, XLI +0.65%, XLV +0.58%, XLB +0.43%, XLU +0.24%, XLF +0.21%, XLP +0.00%, IYZ -0.51% with Energy leading the way higher and US Telecoms the lone laggard.
In the S&P 500 Information Technology (782.63, +2.71 +0.35%) sector, trading capped off the day barely off highs as a last minute decline ended the day. Component NVIDIA (NVDA 59.70, +1.19 +2.03%) was strong ahead of its quarterly report, which is scheduled for tonight after the bell. Other names in the space which out-performed today included CTXS +1.83%, NTAP +1.77%, SYMC +1.75%, MSI +1.67%, WDC +1.67%, MU +1.62%, AMAT +1.55%, CRM +1.55%, SWKS +1.51%.
Other notable news items among sector components:
First Solar's (FSLR 39.01, +0.35 +0.91%) Indian subsidiary First Solar Power India Pvt. Ltd. announced the successful commercial operation of 80 MWAC and 50 MWAC capacity in Andhra Pradesh and Telangana respectively. These projects are part of the 260MWAC project portfolio wholly owned by First Solar in India. FSLR also announced it has booked 160 Megawatts (MW)DC of photovoltaic (PV) module sales in Turkey in the first half of 2016. The orders were placed by Basariarge Enerji A.S. and Zorlu Enerji.
FIS (FIS 80.50, +0.65 +0.81%) announced it intends to make an offering, subject to market and other considerations, of senior notes in one or more tranches with intermediate maturities. FIS intends to use the net proceeds from this offering to repay all or a portion of the approximate $2.2 billion principal amount outstanding on its revolving credit facility (together with accrued interest thereon), with any remaining proceeds to be used for general corporate purposes.
Microsoft (MSFT 58.30, +0.28 +0.48%) acquired Beam interactive livestreaming service. No financial terms were disclosed.
Elsewhere in the tech space:
American Science & Engineering (ASEI 36.74, -0.43 -1.16%) disclosed that OSI Systems (OSIS 61.17, -0.04 -0.07%) voluntarily withdrew Notification and Report Form with the DOJ and refiled the Form on August 9 following informal discussions with the agency.
In addition to reporting quarterly results, MaxPoint Interactive (MXPT 10.73, -0.03 -0.28%) also announced strategic alliance with Adobe (ADBE 101.67, +1.05 +1.04%) Audience Manager, the data management platform within Adobe Marketing Cloud.
Cypress Semi (CY 10.92, -0.40 -3.53%) named Hassane El-Khoury as CEO; also, Chairman Ray Bingham was appointed Executive Chairman.
Ituran Location and Control (ITRN 23.77, -0.60 -2.44%) increased its quarterly dividend to $0.18 per share from $0.17 per share.
Spark Networks (LOV 1.62, -0.07 -4.14%) issued and sold an aggregate of 5 million shares of common stock at $1.55 per share to PEAK6 Investments, L.P.
In reaction to quarterly results:
CSRA (CSRA 26.50, +0.22 +0.84%) reported better than expected Q1 EPS of $0.51 on in-line revenues of $1.25 billion. CSRA also guided FY17 EPS and revenues in-line at $1.91-2.04 and $5.0-5.2 billion, respectively.
Himax Tech (HIMX 8.87, +0.74 +9.10%) reported Q2 EPS and revenues in-line with pre-announcement at $0.12 and $201.1 million, respectively. For Q3, the company sees in-line EPS and revenues of $0.10-0.12 and QoQ growth of about +5-10% to about $211.2-221.1 million.
Globant (GLOB 43.91, +1.58 +3.73%) reported better than expected Q2 EPS and revenues of $0.29 and $79.9 million, respectively. For Q3, the company guided EPS worse than expectations at $0.27-0.31 and revenues ahead of expectations at $80-82 million. For FY16, GLOB sees EPS in-line at $1.14-1.20 and revenues ahead of expectations at $318-322 million.
Materialise (MTLS 6.85, +0.01 +0.15%) reported an in-line Q2 loss per share of EUR0.01 on revenues which missed expectations at EUR27.6 million. For FY16, the company reaffirmed guidance for revenues of EUR115.0-120.0 million.
MaxPoint Interactive (MXPT) reported a worse than expected loss per share for Q2 of $0.87 on revenues of $23.2 million. The company also sees Q3 revenues in-line at $23.5-26.5 million. For FY16, MXPT expects revenues in-line at $93-97 million.
Companies scheduled to report quarterly results tonight: ACIA APDN AZPN ITRI LXFT NVDA SGI ANY UNXL UPLD VIAV
Analyst actions:
TU was upgraded to Buy from Hold at Desjardins;
LITE was downgraded to Underweight from Equal Weight at Morgan Stanley,
EPIQ was downgraded to Underperform from Mkt Perform at Barrington Research,
LRCX was downgraded to Neutral from Buy at Nomura,
WDDYF was downgraded to Hold from Buy at Jefferies;
TRUE and RATE were initiated with Hold ratings at Loop Capital
