From Briefing.com: The Technology Sector is weighing on the broader market today. Shares of Apple (AAPL 114.63, -3.81 -3.22%) ended notably lower today, furthering the distance from the 200 day simple moving average with every minute of trade. AAPL's losses today bring the stock back to late-January 2015 levels, and about 14.79% lower than the all-time high from late-April of $134.54. In relation, AAPL supplier Skyworks (SWKS 88.56, -3.96) is among the weakest performers of the day, on no particular news-related action. SWKS, like AAPL crossed its 200 day simple moving average, and closed below it, at -4.28% on the day.
While AAPL and SWKS were lower on the day, Netflix (NFLX 121.03 +8.47) enjoyed a day of gains. The movie and TV show streaming giant finished Tuesday trade higher by +7.52%. The company was initiated with a Buy rating at Guggenheim, accompanied by a $160 target, about 32.20% higher from the closing price. Today's high of $122.79 also represented a new all-time high for the roughly 18 year old company, split-adjusted.
The weakness is not confined to the technology sector today, though, as almost every other sector (except Basic Materials, Cyclical Goods, and Non-Cyclical Goods) closed in the red. The S&P 500 2093.33, Dow Jones 17550.69, and Nasdaq 5105.55 all closed lower -- 0.22%, 0.27%, 0.19% respectively. The markets began the day higher, but by 11 a.m. ET, we were in the red. The pressure continues as all three major indices have finished the day lower in each of the past three trading session.
The S&P 500 Information Technology sector (703.68, -5.01 -0.71%) was also dragged down by top-weighted AAPL, but the technology giant was not the only tech name which closed lower on the session. FSLR +1.85%, ADSK +1.59%, MSFT +1.56%, YHOO +1.17%, EA +1.17%, TSS +1.14%, RHT +0.96%, ADS +0.88%, ADBE +0.81% were among the top leaders in the sector today, while QRVO -4.28%, SWKS -4.14%, LRCX -3.50%, AAPL -3.21%, AMAT -1.92%, AVGO -1.85%, WDC -1.70%, QCOM -1.52% were the top laggards.
Other notable news among sector components:
CA Tech (CA 29.03, +0.11 +0.38%) acquired ID management solutions provider, Xceedium, Inc; terms of the transaction were not disclosed, with closure expected this quarter.
Accenture (ACN 103.42, +0.21 +0.20%) acquired FusionX; financial terms of the transaction were not disclosed. The acquisition is expected to strengthen Accenture's Security practice and help clients accurately assess their ability to protect against, detect and, where necessary, respond to sophisticated and sustained cyber-attacks.
PayPal (PYPL 38.95, -0.44 -1.12%) named former United Continental's (UAL 58.95, +0.63 +1.08%) John Rainey as CFO, effective August 24, 2015.
Microchip (MCHP 42.79, +0.005 +0.01%) in addition to reporting earnings, announced the completion of the company's acquisition of Micrel (formerly MCRL).
Elsewhere in the technology space:
eLong (LONG 17.10, +2.88 +20.25%) announced that its Board of Directors has received a preliminary non-binding proposal letter, dated August 3rd, 2015, from Tencent Holdings (TCEHY 18.42, +0.12 +0.66%), proposing a "going-private" transaction to acquire all outstanding ordinary shares of eLong, not already beneficially owned by TCH Sapphire Limited which is a wholly owned subsidiary of Tencent, the major shareholders in the Company accounting for at least 70% in voting power of the Company and certain members of Company management, for $18 in cash per American depositary share.
Ultra Clean Holdings (UCTT 8.02, +0.42 +5.53%) will acquire Miconex s.r.o., and expects the acquisition to be immediately accretive by about $0.01 to $0.02 to non-GAAP EPS for Q3 2015.
Sprint (S 3.49, +0.15 +4.49%) appointed Tarek Robbiati as CFO, Gnther Ottendorfer to Chief Operating Officer, Technology, and John Saw as Chief Technology Officer.
Digital Ally (DGLY 10.19, +0.39 +3.98%) received an order for 300 FirstVu HD body-worn video cameras from the Southeastern Pennsylvania Transportation Authority, along with FirstVU HD orders from other agencies, during the month of July.
Marvell (MRVL 12.25, -0.23 -1.84%) confirmed the mixed ruling in its case against Carnegie Mellon; award reduced by more than $1.25 billion.
Zillow (Z 74.20, -2.30 -3.01%) named COO Kathleen Philips as CFO, promotes Chief Marketing Officer Amy Bohutinsky to Chief Operating Officer.
DragonWave (DRWI 0.26, -0.02 -8.47%) announced an agreement with Nokia (NOK 6.87, -0.06 -0.87%) to address the impact of reduced demand being experienced through this channel in the first half of FY16 including temporary cash flow measures as well as a new commercial arrangement for Support and Maintenance services. On the Q1 earnings call indicated it anticipated revenue growth of between 30% and 60% in Q2 relative to Q1. Co believes it will be within this guidance but at the lower end of the range given lower revenue than expected from India.
Notable earnings in the technology space:
Rudolph Tech (RTEC 12.84, +1.88 +17.15%) reported Q2 (Jun) earnings of $0.23 per share on revenues which rose 38.2% year/year to $59.47 million.
Benefitfocus (BNFT 40.24, +3.92 +10.79%) reported Q2 (Jun) loss of $0.53 per share on revenues which rose 32.1% year/year to $42.7 million.
Sprint (S 3.49, +0.15 +4.49%) reported Q2 (Jun) loss of $0.01 per share on revenues which fell 8.7% year/year to $8.03 bln vs the $8.33 bln consensus.
Microchip (MCHP 42.79, +0.005 +0.01%) reported Q1 (Jun) earnings of $0.69 per share on non-GAAP revenues which rose 0.5% year/year to $534.0 million. The company also issued downside guidance for Q2 (Sep), sees EPS in the range of $0.58-0.66 on Q2 revenues non-GAAP revs of $532-569 million.
TriNet Group (TNET 16.33, -10.36 -38.82%) reported Q2 (Jun) earnings of $0.14 per share on revenues which rose 21.9% year/year to $640 million.
Companies reporting tonight/tomorrow morning: ATVI, ACLS, ECOM, CVG, EPAM, EXAR, G, GLUU, INAP, INVN, XXIA, JCOM, JIVE, MRCY, MB, NEWP, OCLR, PAYC, PCTI, RNET, SMCI, SYNC, TTGT, TRMB, UNXL, UNTD, ZEN, Z/ANSS, AVT, CTSH, GSIG, INXN, LDOS, LIOX, MSI, SPNS, WIX
Analyst Actions:
RTEC was upgraded at Barrington Research and Credit Suisse, BBOX was upgraded to Buy from Neutral at Sidoti, MSTR was upgraded to Buy from Neutral at Sun Trust Rbsn Humphrey, SSYS was upgraded to Overweight from Neutral at JP Morgan;
ON was downgraded to Neutral from Outperform at Wedbush, XOOM was downgraded to Equal Weight from Overweight at Barclays
4:35 pm Exar misses by $0.01, misses on revs; guides Q2 EPS below consensus, revs below consensus (EXAR) : Reports Q1 (Jun) earnings of $0.10 per share, excluding non-recurring items, $0.01 worse than the Capital IQ Consensus Estimate of $0.11; revenues rose 31.6% year/year to $40.42 mln vs the $41.8 mln consensus.
On a non-GAAP basis, gross margin was 49.5%, and operating income was $5.3 million, or 13.0% of revenue."Clearly the semiconductor industry was impacted in the June quarter by a weakening demand environment and resulting inventory correction, however we were able to meet our expectations for the quarter. While the near-term will likely be impacted by global uncertainties, we are confident in what we have achieved with new product development and innovative mixed signal solutions."Co issues downside guidance for Q2, sees EPS of $0.06-0.09, excluding non-recurring items, vs. $0.13 Capital IQ Consensus Estimate; sees Q2 revs of -5% to -9% sequentially (~$-36.9-38.4 mln) vs. $44.40 mln Capital IQ Consensus Estimate.
"While we see modest growth in end customer demand, our outlook in the near term reflects the macro economic uncertainties and resulting inventory correction."
4:31 pm Super Micro Computer beats by $0.01, beats on revs; guides Q1 EPS in-line, revs in-line (SMCI) : Reports Q4 (Jun) earnings of $0.57 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.56; revenues rose 34.0% year/year to $573.6 mln vs the $524.37 mln consensus.
Co issues in-line guidance for Q1, sees EPS of $0.49-0.59, excluding non-recurring items, vs. $0.56 Capital IQ Consensus Estimate; sees Q1 revs of $520-580 mln vs. $524.72 mln Capital IQ Consensus Estimate.
4:24 pm Ixia beats by $0.09, beats on revs (XXIA) : Reports Q2 (Jun) earnings of $0.19 per share, excluding non-recurring items, $0.09 better than the Capital IQ Consensus Estimate of $0.10; revenues rose 20.2% year/year to $131.6 mln vs the $119.82 mln consensus.
4:14 pm Axcelis Tech beats by $0.02, beats on revs; guides Q3 EPS in-line, revs above consensus (ACLS) :
Reports Q2 (Jun) earnings of $0.05 per share, $0.02 better than the Capital IQ Consensus Estimate of $0.03; revenues rose 90.3% year/year to $78.4 mln vs the $71.2 mln consensus. Co issues guidance for Q3, sees EPS of $0.03-0.05 vs. $0.04 Capital IQ Consensus Estimate; sees Q3 revs of $75-80 mln vs. $70.28 mln Capital IQ Consensus Estimate.
4:14 pm First Solar beats by $0.85, beats on revs; guides FY15 EPS above consensus, revs above consensus (FSLR) : Reports Q2 (Jun) earnings of $0.93 per share, $0.85 better than the Capital IQ Consensus Estimate of $0.08. The sequential increase in net income was due to higher systems project revenue, project cost improvements and a discrete tax benefit in the second quarter of approximately $42 million. ; revenues rose 64.6% year/year to $896 mln vs the $788.3 mln consensus. The increase in net sales from the prior quarter resulted from increased revenue recognition on the Silver State South project and the sale of majority interests in the North Star and Lost Hills-Blackwell projects.
Q1 bookings were 537MW compared to 593 MW in Q1;Year-to-date bookings of 1.4GWdc Co issues upside guidance for FY15, sees EPS of $3.30-3.60, excluding non-recurring items (Includes $0.16 of equity in earnings, primarily related to ownership interest in 8point3), vs. $2.27 Capital IQ Consensus Estimate; sees FY15 revs of $3.5-3.6 bln vs. $3.42 bln Capital IQ Consensus Estimate.
Gross Margin- 21% to 22% Operating Expenses $415M to $425M Operating Income $330M to $370M Effective Tax Rate 2% to 5% Net Cash Balance $1.2B to $1.4B Capital Expenditures $175M to $200M Working Capital $1.1B to $1.3B Shipments 2.8GW to 2.9GW
4:10 pm : The stock market registered its third consecutive decline on Tuesday with the S&P 500 shedding 0.2% while the Dow Jones Industrial Average (-0.3%) underperformed.
Equity indices spent the first half of the trading day near their flat lines with the S&P 500 bouncing inside a six-point range. The benchmark index made a brief appearance in the green, but could not build on that momentary gain as the top-weighted technology sector (-0.7%) weighed. Specifically, Apple (AAPL 114.64, -3.80) was down as much as 4.4% in the early going, which kept a lid on the market. The tech heavyweight narrowed its loss to 3.2% by the close, ending near levels last seen in late January.
Similar to Apple, most large cap tech components registered losses while chipmakers also underperformed with the PHLX Semiconductor Index falling 1.1%. Including today's decline, the SOX index is down 7.2% in 2015.
Unlike technology, most other cyclical sectors traded in the green early on, but their gains faded during the afternoon. The S&P 500 marked a session low during afternoon action after Atlanta Fed President and FOMC voting member Dennis Lockhart said that, barring significant deterioration in economic data, the economy will be ready for a rate hike in September. The stock market recovered rather quickly from the move that occurred after Mr. Lockhart's comments while Treasuries settled near their lows with the 10-yr yield rising six basis points to 2.21%. On a related note, the Dollar Index (97.91, +0.41) charged to a fresh high, climbing 0.4%. The USD/CAD pair was in focus as continued weakness in the Canadian dollar drove the pair to a fresh 11-year high.
Although the S&P 500 returned to its intraday range, it could not push into the green as only two sectors-consumer discretionary (+0.3%) and materials (+0.4%)-registered gains. The discretionary sector was underpinned by retailers, evidenced by a 0.7% gain in SPDR S&P Retail ETF (XRT 97.89, +0.67). On the earnings front, Coach (COH 31.40, +0.97) spiked 3.2% after beating earnings and revenue estimates.
On the downside, the energy sector (-0.5%) struggled even as crude oil rose 1.1% to $45.76/bbl. Similarly, telecom services (-0.5%) and utilities (-1.7%) ended the day behind the broader market. The utilities sector ended at the bottom of the leaderboard, snapping its seven-day streak as higher market rates took some shine of the high-yielding sector.
Today's participation was in-line with average as roughly 790 million shares changed hands at the NYSE floor.
Economic data was limited to the Factory Orders report for June, which increased an in-line 1.8%. Durable goods orders increased 3.4% in June, which was unrevised from the advance durable goods report. These orders declined 2.3% in May.
As the advance report already showed, a majority of the increase in orders was the result of a 56.0% increase in defense and nondefense aircraft orders. Excluding transportation, durable goods orders were revised down from a 0.8% gain in the advance report to an increase of 0.6%.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while ADP Employment Change for July (Briefing.com consensus 220K) will be announced at 8:15 ET. The Trade Balance for June (consensus -$42.70 billion) will cross the wires at 8:30 ET while the ISM Services Index for July (expected 56.3) will be reported at 10:00 ET.
Nasdaq Composite +7.8% YTD
S&P 500 +1.7% YTD
Russell 2000 +1.9% YTD
Dow Jones Industrial Average -1.5% YTD
DJ30 -47.51 NASDAQ -9.84 SP500 -4.72 NASDAQ Adv/Vol/Dec 1395/1.64 bln/1445 NYSE Adv/Vol/Dec 1371/795.3 mln/1675 3:40 pm :
The dollar index rallied off its morning lows, which helped weigh on select commodities such as precious metals
Energy held some gains with Sept crude oil closing $0.51 higher at $45.76/barrel and Sept natural gas ending $0.06 higher to finish at $2.81/MMBtu
Precious metals finished the day mostly flat
Dec gold rose $1.40 in floor trading today to $1090.70/oz, while Sept silver rose $0.04 to $14.55/oz
Copper gained 0.8% to $2.36/lb
11:44 am Stocks/ETFs that traded to new 52 week highs/lows this session - New lows (206) outpacing new highs (162) (:SCANX) : Stocks that traded to 52 week highs: AAP, ABCB, ABMD, ACN, ACRE, ADPT, AF, AFSI, AIZ, ALK, AMRB, ANSS, ARL, ARMK, ASR, ATRC, AYI, AYN, BDX, BEAT, BF.A, BF.B, BFAM, BKFS, BLDR, BNCN, BOH, BUFF, BXLT, CARA, CASY, CBM, CBPO, CDW, CFNL, CHD, CHDN, CHE, CLX, CMG, CMRX, CPB, CRVP, CSFL, DCM, DHR, DIS, DORM, DSGX, DVAX, EFSC, EFX, EL, ELLI, ELNK, ELS, EVER, EVHC, EXEL, EXPE, EXPR, EXR, FAF, FBC, FCFP, FCSC, FFBC, FIX, FL, FNF, FNFG, FOLD, FSV, GIS, GLPG, GNC, GWB, HIFR, HIG, HPY, HRG, HRL, HSKA, HTBI, HTBK, HTLF, HW, IBCP, ICLR, INBK, INGR, INTG, IPCM, IRL, IRMD, IT, JHX, JLL, KAR, LION, LMNS, LXRX, MBTF, MD, MDLZ, MHLD, MKC, MMI, MRNS, MSTR, NBTB, NDRM, NEOS, NEOT, NFLX, NUVA, OCR, OGEN, PAC, PFBC, PFS, PLL, PRE, PRMW, PSA, QGEN, QLTY, QTS, RAI, RDY, REGN, RENX, ROL, RRGB, SABR, SEIC, SIGI, SKX, SKYW, SPP, SPR, SSNC, STNR, TAST, TDOC, THG, TMUS, TOWN, TREE, TWC, UHAL, USG, VGR, VLRS, VNTV, VRTX, WETF, WSM, WTM, WWAV, WWE, XL
Stocks that traded to 52 week lows: AAC, AAU, ABGB, ADAT, ADRO, AEZS, AGZD, AMAT, AMBC, AMCO, ANF, APIC, ARCW, AREX, ARII, ASTI, ASX, ATE, ATW, AU, AXON, BBD, BBG, BCEI, BEN, BKD, BONT, BOX, BOXC, BPI, BRKS, BRS, CADC, CAFD, CAP, CCD, CCM, CDE, CFD, CGG, CGNX, CIO, CKH, CKP, CLCD, CLD, CLNT, CMLP, CNAT, CNIT, CNX, COHU, CRAY, CRK, CRT, CTCM, CVX, DDD, DLNG, DNOW, DNR, DSCO, DTEA, DWSN, EARN, ECA, ECR, EEP, EGIF, EGL, ENLC, ENLK, ENPH, ENRJ, ERA, EROC, ETR, EXAR, FCEL, FELP, FOSL, FREE, FSTR, GFN, GLRE, GLT, GPS, GRAM, GRMN, GST, GULTU, H, HART, HCLP, HELI, HERO, HIIQ, HMY, HNRG, HOV, HTGM, ICL, ICON, IDSY, IIIN, INVE, IRR, ISIL, JGH, JONE, KBIO, KIN, KLIC, KNOP, KOOL, KORS, LC, LHO, LRE, LSCC, MAT, MDM, MDU, MDVX, MEIP, MGH, MGT, MMYT, MRIN, MVO, NAO, NAV, NBG, NDRO, NE, NEM, NFG, NGLS, NIHD, NL, NNVC, NRG, NSLP, NVTA, NYLD, NYLD.A, OIBR, OIBR.C, OKE, ONDK, ONVO, ORIG, PG, PKOH, PNX, PQ, PSEC, QRHC, RATE, REN, REX, RNET, RNWK, ROVI, ROYT, RPD, SBGL, SBR, SCM, SEMI, SGI, SHLD, SINO, SMTC, SPRT, SSYS, STXS, SWC, SWN, SYX, TAC, TECU, TGH, TINY, TK, TNET, TNGO, TORM, TRS, TTF, TWIN, UIS, UNIS, UNT, USAP, VECO, VPCO, VSH, WHZ, WPZ, WSTC, WTI, XOM, YDIV, YLCO, Z
ETFs that traded to 52 week highs: none
ETFs that traded to 52 week lows: PPLT, SGG, VXX, VXZ
6:58 am Kulicke & Soffa reports Q3 (Jun) results, misses on revs; guides Q4 revs below consensus (KLIC) : Reports Q3 (Jun) earnings of $0.33 per share, including favorable tax benefits totaling $13.7 mln or $0.18 per share, may not be comparable to the Capital IQ Consensus Estimate of $0.17; revenues fell 8.8% year/year to $164.6 mln vs the $166.25 mln consensus.
Co issues downside guidance for Q4, sees Q4 revs of $135-145 mln vs. $187.93 mln Capital IQ Consensus Estimate. "The lower level of guidance largely stems from higher inventory levels throughout the semiconductor value chain and expectations for muted semiconductor unit growth. Ultimately, these broad industry conditions reduce the near-term necessity for capacity additions to the install base. Our exposure to new market opportunities combined with a relentless focus on operational efficiency are anticipated to drive fundamental business improvements and further enhance our ability to perform throughout the cycle. Our recent and aggressive efforts to return capital to investors further extends our ability to create and deliver ongoing, meaningful and sustainable value to shareholders."
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