AI
Friday, August 29, 2008 6:51:46 PM
Market Update 080829
http://biz.yahoo.com/mu/update.html
4:35 pm : Losses were steep and widespread Friday as all ten of the economic sectors finished lower. The downturn was most apparent in the technology sector, which faltered after a key player issued a disappointing announcement. Government data did little to spur buying in another low volume session.
Stocks struggled from the start of the session as Dell (DELL 21.73, -3.48) announced earnings per share results that missed the consensus estimate, then compounded matters by warning of a slowdown in IT spending. That outlook cast a shadow over fellow large-cap tech stocks, like Microsoft (MSFT 27.29, -0.35). Microsoft was pushed out of favor, despite picking up a German price comparison and shopping site to add to its online portfolio. It is paying $486 million for the site's parent. The Nasdaq 100 closed with a 2.2% loss.
Fellow tech player Marvell Technology (MRVL 14.11, -0.65) also finished lower despite announcing better-than-expected earnings per share and solid revenue growth. The general sense of pessimism pervading trade proved too much for the firm's upside surprise. The tech sector, the largest in the S&P 500, finished 2.5% lower, more than any other sector. Its loss was felt in the broader market.
Economic data did little to motivate buyers. July personal income fell 0.7%, due largely to the lower amount of fiscal stimulus checks compared with June and May. Excluding the impact from the stimulus, real disposable personal income was up 0.5% in July, which is more than June and May. Personal consumption expenditures (PCE) for July increased 0.2%, as expected. The PCE deflator was up 0.6%, reflecting higher gas prices. Core PCE was up 0.3% for the second month in a row and also in-line with expectations.
Oil prices climbed as much as 2.7% during the session, but retreated to finish virtually unchanged near $115.65 per barrel. Oil concluded the week 0.9% higher. The recent fluctuation in oil remains hinged up concern Hurricane Gustav will pinch oil production capacity in the Gulf of Mexico.
Even the retreat in oil failed to induce buyers to enter the ring ahead of the long weekend. Volume on the NYSE has been trending at its lowest level of the entire year during recent sessions. Shares exchanged failed to break 1 billion for the 10th straight session.
At their best levels, the Dow traded just below the unchanged mark, while the Nasdaq was showing a loss of 0.8% at its session high. The S&P 500 was showing a loss of 0.2% at its best level, but finished at a session low.DJ30 -171.22 NASDAQ -44.12 NQ100 -2.2% R2K -1.1% SP400 -1.1% SP500 -17.85 NASDAQ Adv/Vol/Dec 1034/1.58 bln/1789 NYSE Adv/Vol/Dec 1140/959 mln/1932
3:30 pm : Stocks have descended in the last half hour. Without any discernible leadership the stock market has been unable to break out of its funk.
Financials, which typically provide a strong source of influence, reversed earlier declines to climb as much as 0.4%. However, the other sectors failed to follow suit. Without any conviction or persistent support financials retreated and now trade with a 0.5% declline.
Even the relatively defensive consumer staples sector (-1.0%) has fallen to a new session low. Consumer discretionary stocks typically benefit from a reduction in oil prices, which are currently trading near the unchanged mark, but broad-based pessimism has sent the sector out of favor.DJ30 -145.90 NASDAQ -40.63 SP500 -14.81 NASDAQ Adv/Vol/Dec 1001/1.23 bln/1803 NYSE Adv/Vol/Dec 1126/550 mln/1928
3:00 pm : Stocks are off their worst levels, but continue to post steep losses. Within the S&P 500, 73% of stocks are trading lower. The worst-performing sector, tech (-2.1%), has 96% of its components trading with a loss, while the best performing sector, financials (unch), has 51% of its components posting a gain.
Trading volume is very low on the NYSE, as has been the case throughout the week. The NYSE averaged 875 million shares during the past four sessions. By comparison, the average volume this year is 1.5 billion.
The current NYSE volume is at 497 million shares, on pace to be the lowest of 2008 as traders take the day off ahead of the long weekend.DJ30 -112.76 NASDAQ -34.96 SP500 -10.52 NASDAQ Adv/Vol/Dec 1031/1.11 bln/1720 NYSE Adv/Vol/Dec 1242/497 mln/1789
2:30 pm : The stock market is holding on to sizeable losses as the S&P 500 is challenged to break above 1290.
However, the financial sector has reversed course to trade with a gain. It is up 0.4% currently, but was down as much as 1.5% earlier. Showing relative strength throughout the session were regional banks (+2.4%). Some of the better performers in the industry include Fifth Third (FITB 15.99, +0.64) and BB&T (BBT 30.12, +0.90).
The reversal in the financial sector hasn't done enough to help the broader market. The largest economic sector, technology, continues to trade 2% lower. Its weakness is attributable to large-cap tech names.DJ30 -111.79 NASDAQ -35.12 SP500 -10.64 NASDAQ Adv/Vol/Dec 1021/1.04 bln/1716 NYSE Adv/Vol/Dec 1221/461 mln/1801
2:00 pm : Losses among stocks remain widespread. Although, the major indices remain off their session lows.
The dollar has rallied its way out of negative territory to trade with relative strength. The greenback is up 0.3% when compared with a basket of major foreign currencies.
The dollar has made an impressive run in recent months. Quarter-to-date it is up 5.7%, according to the Dollar Index. Year-to-date, the Dollar Index is up just 0.9%.
The dollar's climb marks a telling change in global sentiment; the dollar had been shunned in recent years, shedding more than 20% during the past five years, according to the Dollar Index. Recent strength is owed to the resilience of the U.S. economy, which is postulated to be a better parking place for investors as global growth wanes.DJ30 -120.09 NASDAQ -38.79 SP500 -11.87 NASDAQ Adv/Vol/Dec 960/967 mln/1757 NYSE Adv/Vol/Dec 1154/427 mln/1851
1:30 pm : Crude prices have retreated back to the unchanged mark. Oil futures were up 2.7% early on, and remain up 0.9% for the week. During the previous session oil had made a run-up of roughly 2%, but ended the session with a 2% downturn.
Oil's volatility this week has hinged upon concern that Hurricane Gustav will force oil production in the Gulf of Mexico to come to a halt. When Hurricane Katrina wreaked havoc on production and refining capacity in August 2005, oil prices spiked from the mid-$60 range to move above $70 per barrel.
Crude's retreat this session has helped ease losses among stocks. Each of the major indices are at their best levels since midmorning.DJ30 -104.95 NASDAQ -34.82 SP500 -10.36 NASDAQ Adv/Vol/Dec 925/889 mln/1770 NYSE Adv/Vol/Dec 1149/391 mln/1835
1:00 pm : Stocks have pulled upward, but continue to struggle. The session's tone has been pessimistic from the start.
At their best levels, the Dow traded just below the unchanged mark, while the S&P 500 was showing a loss of 0.2%. The Nasdaq, which is lagging its two counterparts, is currently down 1.8% after showing a loss of 0.8% at its session high. The Nasdaq's relative underperformance is primarily due to large-cap tech names, exemplified by the 2.1% downturn in the Nasdaq 100.
Even small and mid-cap stocks are struggling as U.S. investors push equities lower. The Russell 2000 is off by 1.1%. The S&P 400 shows mid-caps are down roughly 0.9%.
Despite widespread losses among U.S. indices, stocks are performing well on the world stage. The Dow Jones World Index, excluding the U.S., is up 0.6%.DJ30 -139.80 NASDAQ -43.55 SP500 -13.45 NASDAQ Adv/Vol/Dec 847/806 mln/1841 NYSE Adv/Vol/Dec 1017/352 mln/1957
12:30 pm : Stocks have moved another leg lower, now trading at their lowest level this session. All ten sectors are in the red. Six of the sectors are down in excess of 1%.
Despite the lack of interest in equities, Treasury securities are also out of favor. The 10-year Note is down 14 ticks and the 30-year Bond has fallen 23 ticks.DJ30 -167.64 NASDAQ -47.98 SP500 -15.68 NASDAQ Adv/Vol/Dec 803/747 mln/1853 NYSE Adv/Vol/Dec 963/324 mln/2005
12:00 pm : Stocks have struggled to make headway Friday. The major indices remain depressed as the weight of the tech sector drags on the broader market. Uninspiring economic data hasn't helped.
Dell (DELL 22.01, -3.20) missed the consensus earnings per share estimate for its latest quarter, despite strong revenue growth. It also warned of a slowdown in IT spending.
The warning has affected other large-cap tech stocks, causing the sector to underperform. Technology is the largest economic sector in the S&P 500. It is currently down 2.5%, more than any other sector, and weighing on the broader market.
Microsoft (MSFT 27.47, -0.47) is also a laggard, despite announcing efforts to expand its presence in the online marketplace. Microsoft announced it is adding a leading German price comparison and shopping site to its online portfolio. The site's parent, Greenfield Online, will be purchased for $486 million.
Meanwhile, communications equipment company Qualcomm (QCOM 52.44, -1.53) has found itself in a bit of trouble. The company announced a federal judge found it in contempt of an injunction ordered last December, which was designed to prevent the firm from continued infringement of three Broadcom (BRCM 23.97, -0.94) patents.
The news out of the tech sector is not entirely negative. Marvell Technology (MRVL 13.92, -0.84) posted better-than-expected earnings per share and solid revenue growth. However, its shares have fallen due to the general sense of pessimism governing trade.
The latest batch of economic data has failed to spur buying in stocks, given the unsurprising nature of the reports. July personal income fell 0.7%. The decline was due largely to the lower amount of fiscal stimulus checks as compared to June and May. Excluding the impact from the fiscal stimulus, real disposable personal income was up 0.5% in July, which is more than June and May.
Personal consumption expenditures (PCE) were up 0.2% for July, meeting expectations. The PCE deflator was up 0.6%, reflecting higher gas prices, but that will not stir concern since gas prices are trending lower for August. Core PCE was up 0.3% for the second month in a row and in-line with expectations.
Oil prices remain elevated, though off their session highs. Crude is currently up 1.3%, near $117 per barrel. It was up as much as 2.7% earlier as concerns related to Hurricane Gustav persist. The advance in oil prices is chipping into yesterday's retreat. Week-to-date, oil is up 2.1%.DJ30 -113.01 NASDAQ -43.94 SP500 -11.86 NASDAQ Adv/Vol/Dec 803/655 mln/1808 NYSE Adv/Vol/Dec 1020/285 mln/1919
11:30 am : Stocks continue to flounder amid broad-based declines. All three of the indices are trading substantially lower, though off their session lows.
AT&T (T 32.58, +0.35) is the only Dow component currently trading with a gain. That comes in stark contrast to the previous session when all but one component traded higher. Coca Cola (KO 52.46, -0.66) was yesterday's lagging Dow component after it was downgraded to Neutral from Outperform at Credit Suisse.
Telecom (+0.4%) has found support among buyers. The sector's relative defensiveness is appealing amid investor skepiticism. DJ30 -106.66 NASDAQ -42.21 SP500 -12.23 NASDAQ Adv/Vol/Dec 799/571 mln/1773 NYSE Adv/Vol/Dec 960/247 mln/1961
11:00 am : Stocks continue to trade near their session low as participants focus on negative news items.
Oil prices continue to trade 2% higher on persistent concerns that Hurricane Gustav will force a production halt in the Gulf. Contracts are currently trading for nearly $118 per barrel.
The financial sector (-1.3%) is being hit again as shares of Freddie Mac (FRE 4.55, -0.73) and Fannie Mae (FNM 6.95, -1.00) are moving sharply lower. Freddie announced it will auction $1 billion worth of bills carrying a 3-month maturity and $1 billion worth of 6-month bills. Meanwhile, Financial Times reported that the Bank of China has cut the percentage of FNM and FRE securities in its portfolio by 25% since June, reflecting investor dissatisfaction.DJ30 -112.28 NASDAQ -44.03 SP500 -12.70 NASDAQ Adv/Vol/Dec 706/439 mln/1799 NYSE Adv/Vol/Dec 866/171 mln/1927
10:30 am : Stocks extend their losses as pessimists prevail in leading the major indices lower. 70% of the S&P 500 components are in the red.
In business news Fortune Brands (FO 59.03, -0.90) announced it will receive $230 million in cash as compensation for the early termination of a distribution agreement with Pernod Ricard. Fortune, however, will pay Pernod Ricard $100 million to acquire the Cruzan Rum brand. Fortune already owns rights to several brands of whiskeys and spirits, along with several home and hardware brands and golf brands.
In a separate transaction Microsoft (MSFT 27.56, -0.39) announced it will acquire a leading German price comparison and shopping site and its parent company, Greenfield Online, for $486 million in cash. The move expands Microsoft's presence in the online market, helping augment its online advertising revenue base.DJ30 -88.01 NASDAQ -33.01 SP500 -9.99 NASDAQ Adv/Vol/Dec 785/295 mln/1575 NYSE Adv/Vol/Dec 981/115 mln/1701
10:00 am : The stock market opened with meaningful losses, but made a brief uptick on word that the Chicago Purchasing Manager Index for August came in at a better-than-expected 57.9, which is also an improvement from the prior reading of 50.8. The report remains a regional survey and does not represent hard data for the national picture.
The University of Michigan consumer confidence survey for August was also better than expected. It came in at 63.0 after a previous reading of 61.7. Economists expected the index to total 62.0.
Losses remain broad-based. Only one economic sector, telecom (+0.6%), is trading higher.DJ30 -46.98 NASDAQ -22.20 SP500 -5.26 NASDAQ Adv/Vol/Dec 747/139 mln/1419 NYSE Adv/Vol/Dec 919/45 mln/1586
09:45 am : Stocks opened markedly lower, but are quickly improving their position. Still, all three indices are trading with losses.
Losses are steepest in the Nasdaq, thanks to weaker-than-expected earnings per share results and a dour outlook on IT spending from Dell (DELL 22.18, -3.03). The decline in shares of DELL take them to their lowest level in over a month and are causing a drag on the tech-rich index.DJ30 -37.04 NASDAQ -24.16 SP500 -5.28
09:17 am : S&P futures vs fair value: -6.7. Nasdaq futures vs fair value: -18.3. Trading Friday will likely open in downward fashion as stock futures lag fair value just minutes before opening bell. With oil prices higher and a warning of lower IT spending from Dell (DELL) the early morning tone has been generally pessimistic.
09:00 am : S&P futures vs fair value: -6.7. Nasdaq futures vs fair value: -18.3. Stock futures continue to portend a pessimistic tone to action Friday. Reuters has reported that Starbucks (SBUX) will offer more promotions and discounts at its coffee shops. The company has been looking for ways to appeal to new customers and existing patrons as its combats adverse trends. Faltering sales have already led Starbucks to scale back the number of new locations it plans to open.
08:30 am : S&P futures vs fair value: -5.7. Nasdaq futures vs fair value: -15.5. Stock futures are oscillating as the latest batch of economic data hits the wires. Personal income decreased 0.7% during July, but personal spending was up 0.2% during the same month. Consumption accounts for more than two-thirds of economic activity, making the figure key in assessing growth. The consensus forecast called for income to slip 0.2% and consumption to increase 0.2%. The June readings were unrevised with income coming in at a 0.1% increase and spending coming in at a 0.6% increase. The personal consumption expenditure (PCE) deflator was up 4.5% year-over-year, which is even with economists expectations and above the downwardly revised previous reading of 4.0%. Core PCE was up 2.4% year-over-year, which was expected, though the previous reading was unchanged at 2.3%.
08:00 am : S&P futures vs fair value: -3.2. Nasdaq futures vs fair value: -11.5. Stock futures currently indicate a downward start to trading. Dell (DELL) missed the consensus earnings per share estimate for its latest quarter, despite strong revenue growth. Meanwhile, Marvell Technology (MRVL) posted better-than-expected earnings per share results after yesterday's close. Oil futures are trading higher in early action. The move partially offsets yesterday's retreat.
06:25 am : S&P futures vs fair value: -3.8. Nasdaq futures vs fair value: -15.5.
06:18 am : FTSE...5622.80...+21.60...+0.4%. DAX...6426.76...+6.22...+0.1%.
06:18 am : Nikkei...13072.87...+304.62...+2.4%. Hang Seng...21261.89...+289.60...+1.4%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
http://biz.yahoo.com/mu/update.html
4:35 pm : Losses were steep and widespread Friday as all ten of the economic sectors finished lower. The downturn was most apparent in the technology sector, which faltered after a key player issued a disappointing announcement. Government data did little to spur buying in another low volume session.
Stocks struggled from the start of the session as Dell (DELL 21.73, -3.48) announced earnings per share results that missed the consensus estimate, then compounded matters by warning of a slowdown in IT spending. That outlook cast a shadow over fellow large-cap tech stocks, like Microsoft (MSFT 27.29, -0.35). Microsoft was pushed out of favor, despite picking up a German price comparison and shopping site to add to its online portfolio. It is paying $486 million for the site's parent. The Nasdaq 100 closed with a 2.2% loss.
Fellow tech player Marvell Technology (MRVL 14.11, -0.65) also finished lower despite announcing better-than-expected earnings per share and solid revenue growth. The general sense of pessimism pervading trade proved too much for the firm's upside surprise. The tech sector, the largest in the S&P 500, finished 2.5% lower, more than any other sector. Its loss was felt in the broader market.
Economic data did little to motivate buyers. July personal income fell 0.7%, due largely to the lower amount of fiscal stimulus checks compared with June and May. Excluding the impact from the stimulus, real disposable personal income was up 0.5% in July, which is more than June and May. Personal consumption expenditures (PCE) for July increased 0.2%, as expected. The PCE deflator was up 0.6%, reflecting higher gas prices. Core PCE was up 0.3% for the second month in a row and also in-line with expectations.
Oil prices climbed as much as 2.7% during the session, but retreated to finish virtually unchanged near $115.65 per barrel. Oil concluded the week 0.9% higher. The recent fluctuation in oil remains hinged up concern Hurricane Gustav will pinch oil production capacity in the Gulf of Mexico.
Even the retreat in oil failed to induce buyers to enter the ring ahead of the long weekend. Volume on the NYSE has been trending at its lowest level of the entire year during recent sessions. Shares exchanged failed to break 1 billion for the 10th straight session.
At their best levels, the Dow traded just below the unchanged mark, while the Nasdaq was showing a loss of 0.8% at its session high. The S&P 500 was showing a loss of 0.2% at its best level, but finished at a session low.DJ30 -171.22 NASDAQ -44.12 NQ100 -2.2% R2K -1.1% SP400 -1.1% SP500 -17.85 NASDAQ Adv/Vol/Dec 1034/1.58 bln/1789 NYSE Adv/Vol/Dec 1140/959 mln/1932
3:30 pm : Stocks have descended in the last half hour. Without any discernible leadership the stock market has been unable to break out of its funk.
Financials, which typically provide a strong source of influence, reversed earlier declines to climb as much as 0.4%. However, the other sectors failed to follow suit. Without any conviction or persistent support financials retreated and now trade with a 0.5% declline.
Even the relatively defensive consumer staples sector (-1.0%) has fallen to a new session low. Consumer discretionary stocks typically benefit from a reduction in oil prices, which are currently trading near the unchanged mark, but broad-based pessimism has sent the sector out of favor.DJ30 -145.90 NASDAQ -40.63 SP500 -14.81 NASDAQ Adv/Vol/Dec 1001/1.23 bln/1803 NYSE Adv/Vol/Dec 1126/550 mln/1928
3:00 pm : Stocks are off their worst levels, but continue to post steep losses. Within the S&P 500, 73% of stocks are trading lower. The worst-performing sector, tech (-2.1%), has 96% of its components trading with a loss, while the best performing sector, financials (unch), has 51% of its components posting a gain.
Trading volume is very low on the NYSE, as has been the case throughout the week. The NYSE averaged 875 million shares during the past four sessions. By comparison, the average volume this year is 1.5 billion.
The current NYSE volume is at 497 million shares, on pace to be the lowest of 2008 as traders take the day off ahead of the long weekend.DJ30 -112.76 NASDAQ -34.96 SP500 -10.52 NASDAQ Adv/Vol/Dec 1031/1.11 bln/1720 NYSE Adv/Vol/Dec 1242/497 mln/1789
2:30 pm : The stock market is holding on to sizeable losses as the S&P 500 is challenged to break above 1290.
However, the financial sector has reversed course to trade with a gain. It is up 0.4% currently, but was down as much as 1.5% earlier. Showing relative strength throughout the session were regional banks (+2.4%). Some of the better performers in the industry include Fifth Third (FITB 15.99, +0.64) and BB&T (BBT 30.12, +0.90).
The reversal in the financial sector hasn't done enough to help the broader market. The largest economic sector, technology, continues to trade 2% lower. Its weakness is attributable to large-cap tech names.DJ30 -111.79 NASDAQ -35.12 SP500 -10.64 NASDAQ Adv/Vol/Dec 1021/1.04 bln/1716 NYSE Adv/Vol/Dec 1221/461 mln/1801
2:00 pm : Losses among stocks remain widespread. Although, the major indices remain off their session lows.
The dollar has rallied its way out of negative territory to trade with relative strength. The greenback is up 0.3% when compared with a basket of major foreign currencies.
The dollar has made an impressive run in recent months. Quarter-to-date it is up 5.7%, according to the Dollar Index. Year-to-date, the Dollar Index is up just 0.9%.
The dollar's climb marks a telling change in global sentiment; the dollar had been shunned in recent years, shedding more than 20% during the past five years, according to the Dollar Index. Recent strength is owed to the resilience of the U.S. economy, which is postulated to be a better parking place for investors as global growth wanes.DJ30 -120.09 NASDAQ -38.79 SP500 -11.87 NASDAQ Adv/Vol/Dec 960/967 mln/1757 NYSE Adv/Vol/Dec 1154/427 mln/1851
1:30 pm : Crude prices have retreated back to the unchanged mark. Oil futures were up 2.7% early on, and remain up 0.9% for the week. During the previous session oil had made a run-up of roughly 2%, but ended the session with a 2% downturn.
Oil's volatility this week has hinged upon concern that Hurricane Gustav will force oil production in the Gulf of Mexico to come to a halt. When Hurricane Katrina wreaked havoc on production and refining capacity in August 2005, oil prices spiked from the mid-$60 range to move above $70 per barrel.
Crude's retreat this session has helped ease losses among stocks. Each of the major indices are at their best levels since midmorning.DJ30 -104.95 NASDAQ -34.82 SP500 -10.36 NASDAQ Adv/Vol/Dec 925/889 mln/1770 NYSE Adv/Vol/Dec 1149/391 mln/1835
1:00 pm : Stocks have pulled upward, but continue to struggle. The session's tone has been pessimistic from the start.
At their best levels, the Dow traded just below the unchanged mark, while the S&P 500 was showing a loss of 0.2%. The Nasdaq, which is lagging its two counterparts, is currently down 1.8% after showing a loss of 0.8% at its session high. The Nasdaq's relative underperformance is primarily due to large-cap tech names, exemplified by the 2.1% downturn in the Nasdaq 100.
Even small and mid-cap stocks are struggling as U.S. investors push equities lower. The Russell 2000 is off by 1.1%. The S&P 400 shows mid-caps are down roughly 0.9%.
Despite widespread losses among U.S. indices, stocks are performing well on the world stage. The Dow Jones World Index, excluding the U.S., is up 0.6%.DJ30 -139.80 NASDAQ -43.55 SP500 -13.45 NASDAQ Adv/Vol/Dec 847/806 mln/1841 NYSE Adv/Vol/Dec 1017/352 mln/1957
12:30 pm : Stocks have moved another leg lower, now trading at their lowest level this session. All ten sectors are in the red. Six of the sectors are down in excess of 1%.
Despite the lack of interest in equities, Treasury securities are also out of favor. The 10-year Note is down 14 ticks and the 30-year Bond has fallen 23 ticks.DJ30 -167.64 NASDAQ -47.98 SP500 -15.68 NASDAQ Adv/Vol/Dec 803/747 mln/1853 NYSE Adv/Vol/Dec 963/324 mln/2005
12:00 pm : Stocks have struggled to make headway Friday. The major indices remain depressed as the weight of the tech sector drags on the broader market. Uninspiring economic data hasn't helped.
Dell (DELL 22.01, -3.20) missed the consensus earnings per share estimate for its latest quarter, despite strong revenue growth. It also warned of a slowdown in IT spending.
The warning has affected other large-cap tech stocks, causing the sector to underperform. Technology is the largest economic sector in the S&P 500. It is currently down 2.5%, more than any other sector, and weighing on the broader market.
Microsoft (MSFT 27.47, -0.47) is also a laggard, despite announcing efforts to expand its presence in the online marketplace. Microsoft announced it is adding a leading German price comparison and shopping site to its online portfolio. The site's parent, Greenfield Online, will be purchased for $486 million.
Meanwhile, communications equipment company Qualcomm (QCOM 52.44, -1.53) has found itself in a bit of trouble. The company announced a federal judge found it in contempt of an injunction ordered last December, which was designed to prevent the firm from continued infringement of three Broadcom (BRCM 23.97, -0.94) patents.
The news out of the tech sector is not entirely negative. Marvell Technology (MRVL 13.92, -0.84) posted better-than-expected earnings per share and solid revenue growth. However, its shares have fallen due to the general sense of pessimism governing trade.
The latest batch of economic data has failed to spur buying in stocks, given the unsurprising nature of the reports. July personal income fell 0.7%. The decline was due largely to the lower amount of fiscal stimulus checks as compared to June and May. Excluding the impact from the fiscal stimulus, real disposable personal income was up 0.5% in July, which is more than June and May.
Personal consumption expenditures (PCE) were up 0.2% for July, meeting expectations. The PCE deflator was up 0.6%, reflecting higher gas prices, but that will not stir concern since gas prices are trending lower for August. Core PCE was up 0.3% for the second month in a row and in-line with expectations.
Oil prices remain elevated, though off their session highs. Crude is currently up 1.3%, near $117 per barrel. It was up as much as 2.7% earlier as concerns related to Hurricane Gustav persist. The advance in oil prices is chipping into yesterday's retreat. Week-to-date, oil is up 2.1%.DJ30 -113.01 NASDAQ -43.94 SP500 -11.86 NASDAQ Adv/Vol/Dec 803/655 mln/1808 NYSE Adv/Vol/Dec 1020/285 mln/1919
11:30 am : Stocks continue to flounder amid broad-based declines. All three of the indices are trading substantially lower, though off their session lows.
AT&T (T 32.58, +0.35) is the only Dow component currently trading with a gain. That comes in stark contrast to the previous session when all but one component traded higher. Coca Cola (KO 52.46, -0.66) was yesterday's lagging Dow component after it was downgraded to Neutral from Outperform at Credit Suisse.
Telecom (+0.4%) has found support among buyers. The sector's relative defensiveness is appealing amid investor skepiticism. DJ30 -106.66 NASDAQ -42.21 SP500 -12.23 NASDAQ Adv/Vol/Dec 799/571 mln/1773 NYSE Adv/Vol/Dec 960/247 mln/1961
11:00 am : Stocks continue to trade near their session low as participants focus on negative news items.
Oil prices continue to trade 2% higher on persistent concerns that Hurricane Gustav will force a production halt in the Gulf. Contracts are currently trading for nearly $118 per barrel.
The financial sector (-1.3%) is being hit again as shares of Freddie Mac (FRE 4.55, -0.73) and Fannie Mae (FNM 6.95, -1.00) are moving sharply lower. Freddie announced it will auction $1 billion worth of bills carrying a 3-month maturity and $1 billion worth of 6-month bills. Meanwhile, Financial Times reported that the Bank of China has cut the percentage of FNM and FRE securities in its portfolio by 25% since June, reflecting investor dissatisfaction.DJ30 -112.28 NASDAQ -44.03 SP500 -12.70 NASDAQ Adv/Vol/Dec 706/439 mln/1799 NYSE Adv/Vol/Dec 866/171 mln/1927
10:30 am : Stocks extend their losses as pessimists prevail in leading the major indices lower. 70% of the S&P 500 components are in the red.
In business news Fortune Brands (FO 59.03, -0.90) announced it will receive $230 million in cash as compensation for the early termination of a distribution agreement with Pernod Ricard. Fortune, however, will pay Pernod Ricard $100 million to acquire the Cruzan Rum brand. Fortune already owns rights to several brands of whiskeys and spirits, along with several home and hardware brands and golf brands.
In a separate transaction Microsoft (MSFT 27.56, -0.39) announced it will acquire a leading German price comparison and shopping site and its parent company, Greenfield Online, for $486 million in cash. The move expands Microsoft's presence in the online market, helping augment its online advertising revenue base.DJ30 -88.01 NASDAQ -33.01 SP500 -9.99 NASDAQ Adv/Vol/Dec 785/295 mln/1575 NYSE Adv/Vol/Dec 981/115 mln/1701
10:00 am : The stock market opened with meaningful losses, but made a brief uptick on word that the Chicago Purchasing Manager Index for August came in at a better-than-expected 57.9, which is also an improvement from the prior reading of 50.8. The report remains a regional survey and does not represent hard data for the national picture.
The University of Michigan consumer confidence survey for August was also better than expected. It came in at 63.0 after a previous reading of 61.7. Economists expected the index to total 62.0.
Losses remain broad-based. Only one economic sector, telecom (+0.6%), is trading higher.DJ30 -46.98 NASDAQ -22.20 SP500 -5.26 NASDAQ Adv/Vol/Dec 747/139 mln/1419 NYSE Adv/Vol/Dec 919/45 mln/1586
09:45 am : Stocks opened markedly lower, but are quickly improving their position. Still, all three indices are trading with losses.
Losses are steepest in the Nasdaq, thanks to weaker-than-expected earnings per share results and a dour outlook on IT spending from Dell (DELL 22.18, -3.03). The decline in shares of DELL take them to their lowest level in over a month and are causing a drag on the tech-rich index.DJ30 -37.04 NASDAQ -24.16 SP500 -5.28
09:17 am : S&P futures vs fair value: -6.7. Nasdaq futures vs fair value: -18.3. Trading Friday will likely open in downward fashion as stock futures lag fair value just minutes before opening bell. With oil prices higher and a warning of lower IT spending from Dell (DELL) the early morning tone has been generally pessimistic.
09:00 am : S&P futures vs fair value: -6.7. Nasdaq futures vs fair value: -18.3. Stock futures continue to portend a pessimistic tone to action Friday. Reuters has reported that Starbucks (SBUX) will offer more promotions and discounts at its coffee shops. The company has been looking for ways to appeal to new customers and existing patrons as its combats adverse trends. Faltering sales have already led Starbucks to scale back the number of new locations it plans to open.
08:30 am : S&P futures vs fair value: -5.7. Nasdaq futures vs fair value: -15.5. Stock futures are oscillating as the latest batch of economic data hits the wires. Personal income decreased 0.7% during July, but personal spending was up 0.2% during the same month. Consumption accounts for more than two-thirds of economic activity, making the figure key in assessing growth. The consensus forecast called for income to slip 0.2% and consumption to increase 0.2%. The June readings were unrevised with income coming in at a 0.1% increase and spending coming in at a 0.6% increase. The personal consumption expenditure (PCE) deflator was up 4.5% year-over-year, which is even with economists expectations and above the downwardly revised previous reading of 4.0%. Core PCE was up 2.4% year-over-year, which was expected, though the previous reading was unchanged at 2.3%.
08:00 am : S&P futures vs fair value: -3.2. Nasdaq futures vs fair value: -11.5. Stock futures currently indicate a downward start to trading. Dell (DELL) missed the consensus earnings per share estimate for its latest quarter, despite strong revenue growth. Meanwhile, Marvell Technology (MRVL) posted better-than-expected earnings per share results after yesterday's close. Oil futures are trading higher in early action. The move partially offsets yesterday's retreat.
06:25 am : S&P futures vs fair value: -3.8. Nasdaq futures vs fair value: -15.5.
06:18 am : FTSE...5622.80...+21.60...+0.4%. DAX...6426.76...+6.22...+0.1%.
06:18 am : Nikkei...13072.87...+304.62...+2.4%. Hang Seng...21261.89...+289.60...+1.4%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
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