From Briefing.com: 4:06 pm Finisar beats by $0.08, beats on revs; guides Q2 EPS above consensus, revs in-line (FNSR) :
Reports Q1 (Jul) earnings of $0.38 per share, excluding non-recurring items, $0.08 better than the Capital IQ Consensus of $0.30; revenues rose 8.7% year/year to $341.3 mln vs the $333.66 mln Capital IQ Consensus.
Sales of telecom products increased by $22.0 million, or 29.0%, compared to the preceding quarter. This increase was due to higher sales of wavelength selective switches, coherent receivers, and 100G transceivers, as well as a rebound in demand for other telecom products including amplifiers and 10G transceivers, both tunable and fixed wavelength.
Sales of datacom products increased by $0.5 million, or 0.2%, compared to the preceding quarter, primarily driven by growth in demand for 100G transceivers including CFP, CFP2, CFP4, and QSFP28 form factors, partially offset by a decline in sales of transceivers for wireless applications and 40G transceivers.
Datacom revenue, excluding transceivers for wireless applications, increased 3.1% over the preceding quarter. Sales of 100G transceivers for datacom applications increased 21.8% over the preceeding quarter, and 115.8% over the first quarter of the prior fiscal year.
Non-GAAP gross margin improved to 33.1% compared to 30.6% in the preceding quarter.
Co issues guidance for Q2, sees EPS of $0.44-0.50, excluding non-recurring items, vs. $0.32 Capital IQ
Consensus Estimate; sees Q2 revs of $355-375 mln vs. $344.28 mln Capital IQ Consensus Estimate.
Expects Q2 non-GAAP gross margin of approximately 34% & non-GAAP operating margin of approximately 14.3% to 15.3%4:15 pm : The stock market ended the Thursday affair modestly lower as the latest directive from the European Central Bank and commentary from ECB President Mario Draghi raised some concerns regarding the future of the central bank's asset purchase program. The Nasdaq Composite (-0.5%) finished behind the Dow Jones Industrial Average (-0.3%) and the S&P 500 (-0.2%).
The major averages began the day on a lower note as inaction from the European Central Bank weighed on European bourses. The central bank held its key interest rates at record lows and maintained the size and scope of its asset purchases. During his press conference, President Draghi noted that the central bank did not see a need to expand the asset purchase program at this time. However, the central bank did affirm plans to continue purchasing assets through March 2017 or beyond, if needed.
Equities retraced opening losses through the first half of trade, benefiting from a rally in crude oil futures. The energy component rallied throughout the session as investors pored over a better-than-expected reading of the Department of Energy's weekly inventory data. The EIA reported that crude oil stockpiles fell by 14.51 million barrels (consensus: +0.22 million) while gasoline inventories declined by 4.21 million barrels (consensus: -0.71 million). WTI crude ended the day higher by 4.8% ($47.66/bbl; +$2.18).
Sellers pressed the broader market shortly after midday as heavily-weighted consumer discretionary (-0.8%) and technology (-0.9%) weighed. The benchmark index managed to maintain technical support near the 2180/2175 price level, finishing the day above its 20-day simple moving average (2180.50). Seven sectors ended in the red with consumer staples (-0.5%), consumer discretionary (-0.8%), and technology (-0.9%) leading to the downside. Conversely, health care (+0.1%), utilities (+0.4%), and energy (+1.7%) topped the board.
The influential technology sector (-0.9%) lagged as top-weighted Apple (AAPL 105.52, -2.84) fell 2.6%. The Dow component was under pressure after announcing that it will no longer release iPhone pre-orders figures. However, the company did reaffirm its fourth-quarter guidance. Meanwhile, Hewlett Packard Enterprise (HPE 21.38, -0.71) declined by 3.2% after reporting a mixed quarter and issuing below-consensus guidance for the fourth quarter.
In the consumer discretionary space (-0.8%), department store names underperformed following the Goldman Sachs 23rd Global Annual Retailing Conference. Kohl's (KSS 43.01, -1.16) and Macy's (M 36.00, -1.19) ended lower by 2.7% and 3.2%, respectively. Elsewhere, Dow component Nike (NKE 56.17, -1.55) ended behind the price-weighted index, declining 2.7%. The stock was under pressure after being downgraded to "Neutral" from "Overweight" at Piper Jaffray.
Biotechnology demonstrated relative strength, evidenced by the 0.7% gain in the iShares Nasdaq Biotechnology ETF (IBB 288.03, +1.93). The sub-group finished ahead of the broader health care space (+0.1%) as Alexion Pharmaceuticals (ALXN 130.06, +4.97) outperformed. Meanwhile, Mylan Labs (MYL 40.57, +0.26) rebounded 0.7%. In the broader sector, Eli Lilly (LLY 79.89, +1.30) jumped 1.7% after being upgraded to "Overweight" at JP Morgan.
Treasuries ended sharply lower with the long end of the curve demonstrating relative weakness. The yield on the 10-yr note rose seven basis points (1.61%) while the yield on the 2-yr note ticked higher by three basis points (0.77%).
Today's participation was above the recent average as more than 818 million shares changed hands on the NYSE floor.
Today's economic data included weekly initial claims and Consumer Credit for July:
Initial claims for the week ending September 3 dipped by 4,000 to 259,000 (Briefing.com consensus 265,000).
The latest report marked the 79th straight week that initial claims have been below 300,000 and it dropped the four-week moving average for the series to 261,250 from 263,000.
Continuing claims for the week ending August 27 decreased by 7,000 to 2.144 million.
The four-week moving average for continuing claims fell to 2.154 million from 2.158 million.
Total outstanding consumer credit increased by $17.7 billion in July (Briefing.com consensus $16.0 billion) after increasing an upwardly revised $14.5 billion (from $12.3 billion) in June.
In the preceding 12-month period leading up to July, consumer credit had risen by an average of $17.3 billion.
For more on these economic releases, be sure to visit Briefing.com's Economic Calendar page.
Tomorrow's economic data will be limited to Wholesale Inventories for July (Briefing.com consensus 0.0%), which will cross the wires at 10:00 ET.
Russell 2000: +10.7% YTD
S&P 500: +6.7% YTD
Dow Jones: +6.1% YTD
Nasdaq: +5.0% YTD
DJ30 -46.23 NASDAQ -24.44 SP500 -4.86 NASDAQ Adv/Vol/Dec 1401/1.693 bln/1436 NYSE Adv/Vol/Dec 1342/818.1 mln/1610
3:30 pm :
Commodities, as measured by the Bloomberg Commodity Index, +1.5% around the 85.15 level
Crude oil surged & closed at session highs, extended this morning's post-API gains after EIA data reported notable draws in both crude oil & gasoline inventories
October crude oil futures rose $2.18 (+4.8%) to $47.66/barrel
Yesterday's API data showing an inventory draw of 12.08 mln barrels, compared to last week's build of 0.942 mln barrels and to expectations for a draw of ~100k barrels for the week ending Sept 2.
EIA petroleum inventory highlights:
Crude oil inventories had a draw of -14.513 mln (consensus called for a build of +0.23 mln barrels)
Gasoline inventories had a draw of -4.211 mln (consensus called for a draw of -0.17 mln barrels)
Distillate inventories had a build of +3.382 mln
Factors affecting the price of oil include:
Oil's recent rally was first sparked by API data yesterday evening which showed an inventory draw of 12.08 mln barrels, compared to last week's build of 0.942 mln barrels and to expectations for a draw of ~100k barrels for the week ending Sept 2. This was the largest single draw since 1999.
Gains were further exacerbated by EIA inventory data which showed a surprise large inventory draw in oil & gasoline inventories, a contributing factor to this anomaly is the recent shut downs near the Gulf of Mexico due to Hurricane Hermine as companies took precautions, disrupting production.
The next OPEC meeting will be held in Algiers, Algeria from Sept 26-28, oil prices will continue to see reactions from comments from OPEC & non-OPEC oil producers
Russia and Saudi Arabia agreed to form a coalition to track the oil markets and to provide recommendations, Russia & Saudi Arabia are the 2 largest oil producers in the world, responsible for 20% of global oil production
Natural gas erased yesterday's losses after EIA data showed a smaller-than-expected build compared to Consensus
October natural gas closed $0.13 higher (+4.9%) at $2.81/MMBtu
EIA natural gas inventory highlights:
Natural gas inventory showed a build of +36 bcf vs expectations for inventory to be a build of approximately +43 bcf.
Working gas in storage was 3,437 Bcf as of Friday, Sept 2, 2016, according to EIA estimates.
Stocks were 196 Bcf higher than last year at this time and 306 Bcf above the five-year average of 3,131 Bcf.
At 3,437 Bcf, total working gas is above the five-year historical range.
In precious metals, gold & silver extended the previous session's losses as the dollar traded nearly flat
December gold ended today's session down $7.70 (-0.6%) to $1341.30/oz
December silver closed today's session $0.17 lower (-0.9%) at $19.68/oz
DJ30 -44.55 NASDAQ -24.06 SP500 -4.29 NASDAQ Adv/Vol/Dec 1372/1445.41 mln/1446 NYSE Adv/Vol/Dec 1336/539.12 mln/1588
The stock market ended Thursday on a modestly lower note withthe Nasdaq Composite (-0.5%) leading the retreat amid relative weakness intechnology. For its part, the S&P 500 shed 0.2%.
Today's big event was the early-morning release of theSeptember policy statement from the European Central Bank. The statement itselfwas not a big surprise as the ECB elected to maintain its policy stance, butcomments from ECB President Mario Draghi were perceived as somewhat hawkish.Specifically, Mr. Draghi said that policymakers are not considering additionalstimulus measures at this time. These remarks were followed by a decline inglobal bonds and equities.
All in all, the weakness in stocks was contained for the mostpart as only two sectors lost more than 0.5%. The top-weightedtechnology space was among the laggards, surrendering 0.9%.
Apple (AAPL 105.52, -2.84) weighed on the sector and the broader market,falling 2.6%, after a downgrade at Wells Fargo. In addition, the company said itwill not comment on iPhone pre-orders, saying the metric is not representativeof consumer demand. Most other large cap sector components also struggled, but faredbetter than the top-weighted Apple.
Also of note, Twitter (TWTR 18.70, -1.17) plunged 5.9% after a morning report from CNBC hinted that cost cutting measures would be discussed at thecompany's Board of Directors meeting.
Taking a glance at other sectors: XLF -0.1%, XLV +0.1%, XLY -0.9%, XLI -0.1%, XLE +1.9%, XLP -0.6%, XLB -0.4%, XLU +0.3%, IYZ UNCH
Other news among sector components:
Apigee (APIC 17.41, +1.07) to be acquired by Alphabet for $17.40/share or $625 million
Microsoft (MSFT 57.43, -0.23) expected to introduce Surface All-In-One PC, according to The Verge Elsewhere in the tech space:
Immersion (IMMR 8.24, +0.39) appointed Nancy Erba as CFO
Logitech (LOGI 21.89, -0.02) approved annual dividend increase of 10.0% to CHF0.56 per share Yandex (YNDX 21.85, -0.16) terminated agreement to acquire Moscow headquarters, citing changing market conditions Intel (INTC 36.44, -0.02) confirms $4.20 billion deal with TPG to establish a jointly-owned cybersecurity company Accenture (ACN 112.30, -2.82) entered into an agreement to acquire New Energy Group, terms not disclosed In reaction to quarterly results:
Science Applications (SAIC 69.65, +3.95) beat earnings estimates
Bazaarvoice (BV 4.76, +0.44) beat earnings and revenue estimates Verint Systems (VRNT 38.10, +2.94) beat earnings expectations and guided below consensus Guidewire Software (GWRE 62.59, -1.31) beat earnings estimates, but guided below expectations Hewlett Packard Enterprise (HPE 21.38, -0.71) beat bottom-line expectations, but guided lower Analyst actions:
AAPL and HPE downgraded to Market Perform at Wells Fargo, SIGM downgraded to Sell at BWS Financial, and WU downgraded to Neutral at Monness Crespi & Hardt
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