From Briefing.com: 4:31 pm Interdigital Comm sees Q4 (Dec) revs of $95-99 mln vs. $99.86 mln Capital IQ Consensus Estimate (IDCC) : This revenue guidance is based primarily on royalty reports received to date, and does not include the potential impact of any new patent license, technology solutions or patent sale agreements that may be signed, or any arbitration or dispute resolutions that may occur, during the balance of fourth quarter 2016.
4:10 pm : The stock market began the week on a lower note as the major averages consolidated after their post-election run. The Nasdaq Composite (-0.6%) settled slightly behind the S&P 500 (-0.5%). The domestically-oriented Russell 2000 (-1.3%), however, snapped a 15 session win streak.
Participants favored a cautious approach at the start of the week as volatility from the oil pit and concerns out of Europe kept risk appetite in check. This also encouraged some profit-taking activity as investors assessed whether the broader market has risen too far, too fast. The benchmark index has gained 3.6% so far this month while the Russell 2000 has surged 11.6% over that time.
Crude oil began the day on a modestly lower note as investors reassessed the likelihood of an OPEC supply cap agreement. Saudi Arabia made headlines last week by opting out of a meeting between OPEC and non-OPEC members. The move cast doubts on the country's willingness to agree to joint supply measures. However, carryover selling interest faded when Iraq indicated that it was willing to cooperate with its fellow producers. WTI crude ended the day higher by 2.5% ($47.11/bbl; +$1.15) after sinking 3.2% in the prior session. The oil collective is scheduled to meet in an official capacity on Wednesday.
Developments in Italy were also in focus as investors eyed a downturn in the country's banking names. Banca Monte dei Paschi di Siena tumbled 13.8% after the bank initiated a debt-for-equity swap and stated that it could face up to EUR8 billion in fines. The name also saw pressure ahead of the country's constitutional referendum. Italian citizens will vote on December 4 on whether the powers of the Senate should be reduced. Prime Minister Matteo Renzi stated that if the referendum should fail, he will resign.
The benchmark index finished near its session low with seven sectors ending in negative territory. The financial (-1.4%), energy (-1.3%), and health care (-0.9%) spaces outpaced today's losses in the broader market while rate-sensitive utilities (+2.0%), telecom services (+0.8%), and real estate (+0.2%) gained amid declining market rates.
The heavily-weighted financial sector (-1.4%) moved lower in sympathy with European banking names. The SPDR S&P Bank ETF (KBE 40.28, -0.73, -1.8%) narrowed its monthly gain to 16.2%. This compares to an advance of 11.9% in the broader sector. Heavily-weighted Wells Fargo (WFC 51.58,- 1.04) finished lower by 2.0% after being downgraded to "Hold" from "Buy" at Jefferies.
Biotechnology demonstrated relative weakness in the health care sector (-0.9%), evidenced by the 1.6% loss in the iShares Nasdaq Biotechnology ETF (IBB 279.99, -4.47). The ETF narrowed its November gain to 9.1% as investors continued to walk back their initial post-election assessment. Eli Lilly (LLY 67.20, -1.92) ended down 2.8% after being removed from the "US 1 List" at Bank of America/Merrill Lynch.
In the consumer discretionary space (-0.8%), retail names underperformed as the SPDR S&P Retail ETF (XRT 46.07, -0.57) declined by 1.2%. The ETF was under pressure as investors examined data from Black Friday and speculated on results from Cyber Monday. Kohl's (KSS 54.05, -0.76), Macy's (M 43.13, -1.01), and Nordstrom (JWN 56.06, -1.79) declined between 1.4% and 3.1%.
Treasuries ended on a higher note as longer-dated issues outperformed. The yield on the 2-yr note finished down two basis points (1.10%) while the yield on the benchmark 10-yr note fell five basis points to 2.31%.
Today's trading volume was below the recent average of 1.0 billion as fewer than 847 million shares changed hands at the NYSE floor.
There was no economic data of note released today.
Tuesday's economic data will include the second estimate of Q3 GDP (Briefing.com consensus 3.0%) and the Q3 GDP Deflator (Briefing.com consensus 1.5%), which will each cross the wires at 8:30 ET. Separately, the Case-Shiller 20-city Index for September (Briefing.com consensus 5.2%) and November Consumer Confidence (Briefing.com consensus 100.0) will be released at 9:00 ET and 10:00 ET, respectively.
Russell 2000: +17.0% YTD
Dow Jones: +9.6% YTD
S&P 500: +7.7% YTD
Nasdaq Composite : +7.2% YTD
DJ30 -54.24 NASDAQ -30.11 SP500 -11.63 NASDAQ Adv/Vol/Dec 858/1.451 bln/2024 NYSE Adv/Vol/Dec 997/846.1 mln/1972
3:30 pm :
Crude oil reversed initial morning losses to end near its highest level of the session following comments from Iraq ahead of the Nov 30 OPEC meeting
Jan 2017 crude oil futures rose $1.15 (+2.5%) to $47.11/barrel
Color on recent price action in oil/OPEC update:
Crude oil futures for Jan 2017 delivery initially fell 0.5% in morning pit trading & were down as much as 2%, extending Friday's 4% drop after Saudi Arabia, the largest OPEC producer, decided not to attend today's scheduled meeting with non-OPEC producers. This comes ahead of Wednesday's (11/30) highly anticipated official OPEC meeting in Vienna, Austria.
The Saudis said that meeting with Russia and other non-OPEC producers before OPEC ministers have a clear decision within OPEC is pointless.
The Algerian oil minister traveled to Tehran on Sunday to present Iran with a fresh proposal consisting of a 1.1 mln barrel/day OPEC cut combined with a 600k barrel/day non-OPEC cut. The Iranian oil minister stated he will formally respond to the new proposition at the official OPEC meeting this coming Wed in Vienna, Austria.
Crude oil futures have since reversed direction and closed near session highs following headlines indicating that Iraq, OPEC's second largest producer, will cooperate with OPEC members to find an acceptable agreement.
Natural gas futures traded higher for the fifth consecutive session on updated colder weather forecasts ahead of Thursday's inventory number
Jan 2017 natural gas closed $0.12 higher (+3.8%) at $3.31/MMBtu
In precious metals, gold bounced off of Friday's 9-month low & closed near session highs as the dollar index gave up some ground
December gold ended today's session up $7.90 (+0.7) to $1190.60/oz
December silver closed today's session $0.09 higher (+0.6%) at $16.59/oz
The dollar index was -0.2% around the 101.35 level, helped to support precious metals
Commodities, as measured by the Bloomberg Commodity Index, were +1.2% around the 86.07 level
Base metal copper gave up this morning's initial gain & snapped its recent 4-session streak
December copper closed $0.01 lower (-0.4%) at $2.66/lb
The final week of November began with modest losses. Leading the negative bias today, the Nasdaq Composite fell about 30.11 points (-0.56%) today to 5368.81. The S&P 500 lost about 11.63 points (-0.53%) to 2201.72, and the Dow Jones Industrial Average closed 54.24 points lower (-0.28%) to 19097.90.
Equity indices slipped at the start of the session as volatility from the oil patch and some profit-taking activity had investors on their heels. Saudi Arabia made headlines late last week when the oil producer announced that it would not attend a meeting between OPEC and non-OPEC producers. The commentary dampened expectations for a supply cap deal and led to some carryover selling into today's session. However, the energy component erased an early loss after Iraq indicated that it will cooperate with its fellow producers as it looks to reach an acceptable agreement. Crude oil will likely see increased headline volatility as we head into Wednesday's OPEC meeting. Today, WTI crude ended higher by 2.5% ($47.11/bbl; +$1.15) after sinking 3.2% in the prior session.
A downturn in the economically-sensitive financial sector (-0.9%) has also helped keep a lid on things in the first half. The group is moving lower in sympathy with European banking names. Shares of Italian banks are under pressure amid rising uncertainty ahead of the country's constitutional referendum. Shares of Banca Monte dei Paschi di Siena fell 13.8% after the bank initiated a debt-for-equity swap. The name was also under pressure after stating that it would face up to EUR8 billion in fines. Italian citizens will vote on December 4 on whether the powers of the Senate should be reduced. Prime Minister Matteo Renzi stated that he will resign should the referendum fail.
As the session came to a closed, the Technology (XLK 48.04, +0.04 +0.08%) sector ended about middle of the ladder today as far as S&P sectors go. Component Cognizant Tech (CTSH 56.95, +3.70 +6.95%) was the best performer on the back of a letter from shareholder Elliott Management highlighting the plan for the company to achieve a value of $80-90+ per share by the end of 2017. Other sectors as measured by the S&P closed the session XLFS +2.19%, XLU +1.93%, XLRE +0.37%, IYZ +0.18%, XLP +0.18%, XLB -0.40%, XLI -0.69%, XLV -0.76%, XLY -0.80%, XLF -1.25%, XLE -1.43%.
In the S&P 500 Information Technology (803.83, -0.75 -0.09%) sector, trading ended just below flat lines as modest gains would not hold fading action in the space. Component MasterCard (MA 103.36, -2.37 -2.24%) was the worst performer today on no particular catalyst. Other names in the space which underperformed today included SYMC -1.66%, VRSN -1.34%, EBAY -1.31%, V -1.31%, WU -1.30%, AVGO -1.19%, AKAM -1.17%, ADS -1.13%, CRM -1.09%, FFIV -1.05%, FLIR -1.04%.
Notable news items among sector components:
Shareholder Elliott Management sent a letter to Cognizant's (CTSH) Board outlining a three-part Value-Enhancement Plan. The firm believes the plan can help the company achieve a value of $80-$90+ per share by the end of 2017.
Cogent Communications (CCOI 38.85, -0.25 -0.64%) commenced a tack-on offering of an additional $125 million of its 5.375% Senior Secured Notes due 2022.
According to Reuters, BlackBerry (BBRY 7.46, -0.03 -0.40%) is testing self-driving car technology in Canada.
Yingli Green Energy (YGE 3.21, -0.20 -5.87%) narrowed Q3 PV module shipments guidance in the range of 360MW to 370MW from of 300-400MW. The company also lowered gross margin guidance to 5-6% from 12.5-14%.
According to Reuters, Lattice Semi's (LSCC 7.09, -0.16 -2.21%) pending acquisition by Canyon Bridge Capital may in part be funded by the Chinese government, leading some to speculate the deal could face a harsher regulatory review.
According to CRN, Microsoft (MSFT 60.61, +0.08 +0.13%) could ultimately move to acquire Box (BOX 15.49, +0.15 +0.98%).
Analyst actions:
FNSR was upgraded to Strong Buy from Buy at Needham;
MENT was downgraded to Neutral from Outperform at Credit Suisse;
RHT was initiated with a Buy at Rosenblatt,
SSNI was initiated with a Buy at Williams Capital,
YY was initiated with a Buy at BofA/Merrill
