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From Briefing.com: Weekly Recap - Week ending 28-Aug-09The stock market logged another winning week -- albeit a slight one -- as a solid gain in financials was offset by losses in six of the ten economic sectors. Overall it was a relatively slow news week with very few earnings reports, though participants did have some economic and banking data to digest.

In the end, the S&P 500 rose 0.3%, hitting fresh highs for 2009. The financial sector led the way, advancing 0.7%, followed by the tech sector (+0.3%) which benefited from better-than-expected earnings and guidance from two bellwethers. Defensive sectors underperformed, with utilities shedding 0.7% and health care giving up 0.9%.

Economic data was mostly better-than-expected, though it failed to provide a sustainable lift for the market. Housing was in focus with two more reports coming out ahead of estimates, though from depressed levels.

New home sales for July rose at a 9.6% annualized rate to 433,000 units, which is well above the 390,000 that had been expected -- the sharpest percent rise since 2005. That helped bring inventory down to a 7.5 month supply from an 8.5 month supply. The new home sales increase comes on the heels of multiple positive reports in the housing market, signaling that the bottoming of the housing market may be near. The Case-Shiller 20-city home price index rose on a month-month basis, and the year-over-year drop impred to 15.4%. This was better than the 16.4% year-over-year drop that economists had forecasted.

The preliminary Q2 GDP reading was unchanged from the advance reading at a 1.0% annualized decline, better than the 1.5% drop that was expected. The reading benefited from a smaller-than-expected drop in consumer spending.

The latest weekly jobless claims data continue to reflect a challenging employment environment. There were 570,000 new unemployment claims, down 10,000 from the previous week but slightly higher than expectations. Continuing claims fell by 121,000 to 6.133 million. However, the downward trend of continuing claims should not be confused with a strengthening of the labor market. Jobs are not plentiful and the drop-off is due to workers losing their unemployment benefits.

August consumer confidence rose to 54.1 from 47.4, which was well above the 47.9 consumer confidence. Likewise, the revised University of Michigan consumer sentiment survey for august came in at 65.7, ahead of the 64.3 consensus.

Finally, the June personal income and spending report illustrated the weak economic conditions. Income was flat after falling 1.1% in June, worse then the expected rise of 0.1%. Meanwhile, real personal spending rose 0.2%, in-line with expectation. The gain was primarily due to the jump in auto sales due to the Cash for Clunkers package.

Banks were in focus following the release of second quarter statistics from the FDIC. The FDIC list of problem banks expand to a 15-year high to 416 problem institutions from 305. Although this is certainly a negative, most of the banks on the list are smaller firms as the combined assets of the problem institutions total $299.8 billion (to put this in perspective, the two largest bank holding companies -- JPMorgan Chase and Bank of America -- have more than $4 trillion in assets). Meanwhile, noncurrent loans and leases increased for the 13th consecutive quarter, though loans between 30-80 days past due declined. The FDIC said it is running low on funds and may need to borrow from the Treasury. We expect banks to continue to face challenges, especially regional banks that have high exposure to commercial real estate.

In other financial regulation news, Fed Chairman Ben Bernanke was nominated by President Obama for a second term, as was widely expected.

In corporate news, Boeing (BA) said it plans to deliver the highly-anticipated and several-times delayed 787 Dreamliner aircraft in late 2010. Boeing expects to incur a noncash charge of roughly $2.5 billion in the third quarter.

Technology bellwether Intel (INTC) raised its Q3 revenue guidance to $9 billon, plus or minus $200 million, citing stronger-than-expected demand for microprocessors and chipsets. The company's prior guidance was for revenue of $8.5 billion, plus or minus $400 million.

Fellow tech company Dell (DELL) reported a 23% drop in Q2 profit to $0.28 per share, but that was better than the consensus of $0.23. Dell also said it expects improved IT spending in 2010, though that is not a real surprise given depressed spending in 2009.

Year-to-date, the S&P 500 is now up 13.9%, the Dow is up 8.7% and the Nasdaq is leading the way with a 28.6% gain.

 
 Index      Started Week Ended Week Change % Change YTD % 
 DJIA	      9505.96	 9544.22   38.26     0.4   8.7 
 Nasdaq	      2020.90	 2028.77    7.87     0.4  28.6 
 S&P 500	      1026.13	 1028.93    2.80     0.3  13.9 
 Russell 2000   581.51	  579.86   -1.65    -0.3  16.1

5:00PM Tessera Tech announced the Administrative Law Judge in the ITC issued an Initial Determination finding Tessera's asserted patents are valid, but not infringed by the respondents (TSRA) 25.06 -0.25 : Co announced the Administrative Law Judge (ALJ) in the International Trade Commission (ITC) action brought by Tessera against certain DRAM manufacturers issued an Initial Determination finding Tessera's asserted patents are valid, but not infringed by the respondents. The action is Investigation No. 337-TA-630 (DRAM ITC action). The ALJ's decision, termed an "Initial Determination," is subject to review by the full Commission. Within 120 days of the issued Initial Determination, the Commission can affirm, modify or reverse the ALJ's decision in developing the ITC's final determination. "We intend to once again seek review of the Initial Determination by the full Commission," said Henry R. Nothhaft, president and CEO of Tessera. "The Commission previously agreed in our Wireless ITC Action that our technology was valid and that we had proven infringement at trial. We hope that it will again reverse the ALJ's Initial Determination. Furthermore, we have not taken into account any revenue based on the outcome of this ITC action in preparing our financial guidance. We remain focused on developing innovative technologies and are confident in the future of our business."

3:05PM China Sunergy to enter into renegotiation with REC for the long term supply contract (CSUN) 4.58 -0.06 : Co announces that it has entered into the renegotiation with the counterparty regarding to a June, 2008 supply agreement signed with REC SiTech AS. On June 25, 2008, China Sunergy entered into a Standard Agreement for the Supply of Monocrystalline Silicon Ingots and/or Wafers with the European wafer provider REC SiTech As for the supply of monocrystalline 156- millimeter wafers for seven years from 2009 through 2015. It has been revealed that REC SiTech As now is dissolved as a result of a merger early this year. As the polysilicon supply market has changed dramatically since the fourth quarter of 2008, key raw material suppliers such as REC have indicated the renegotiation of supply agreements with their respective customers and against this background, China Sunergy has entered into the renegotiation with its counterparty in respect to the overall arrangement of the supply agreement, with the good faith to reach a mutually beneficial agreement between both parties.

3:00PM Weekly Insider Trading Summary: Notable Purchases -- STX, FLO, PRE, VRX, TBSI, CPN, DK, HGT, INT; Notable Sales -- ITW, HNZ, PSA, DLTR, CBSH, SYK, LL, CSCO, ITWO (INSID) : Over the past week we've seen notable insider buying in the following stocks: Seagate (STX) CEO bought 100,000 shares at $12.19-12.38 on 8/25... Flower Foods (FLO) Chairman Emeritus and Director bought 7,020 shares at $23.66-23.69 on 8/24-8/25... ParterRe (PRE) Director bought 2,800 shares at $71.93 on 8/21... Valeant Pharmaceuticals (VRX) COO bought 9,007 shares at $24.98 on 8/24... TBS International (TBSI) CEO and EVP bought 90,000 shares at $6.99-7.48 on 8/21-8/25... Calpine (CPN) 10% owner Harbinger Capital Partners bought 328,046 shares at $11.98-12.52 on 8/14-8/20... Delek US Holdings (DK) 10% Owner Delek Petroleum bought 65,798 shares at $7.73-7.85 on 8/20-8/21... Hugoton Royalty Trust (HGT) Director bought 287,138 shares at $13.79-14.40 on 8/25-8/27... World Fuel Services (INT) President bought 10,101 shares at $46.40-47.50 on 8/25-8/26... We've seen notable insider selling in the following stocks: Illinois Tool Works (ITW) Director sold 200,000 shares at $42.40-42.52 on 8/24... Heinz (HNZ) Director Nelson Peltz's Trian Fund Management sold 650,000 shares at $38.91-39.32 on 8/24-8/25... Public Storage (PSA) Chairman sold 1,000,000 shares at $70.58-71.00 on 8/26... Dollar Tree (DLTR) Chairman (pursuant to a Rule 10b5-1 plan) sold 150,000 shares at $50.34 on 8/26... Commerce Bancshares (CBSH) CEO and Vice Chairman sold 211,633 shares at $38.00-38.92 on 8/24-8/26... Stryker (SYK) Director sold 240,000 shares at $41.37-41.81 on 8/21-8/26... Lumber Liquidators (LL) Chairman (pursuant to a Rule 10b5-1 trading plan) sold 775,000 shares at $21.20-22.65 on 8/21-8/25... Cisco (CSCO) CEO (pursuant to a Rule 10b5-1 plan) sold 400,000 shares at $22.50-22.51 on 8/24... I2 Technologies (ITWO) 10% Owner S. Sidhu sold 1.0 mln shares at $15.27 on 8/25... All sales exclude option sell offs... For regular updates on our insider summaries and commentary, please add Briefing ticker INSID to ticker alerts.

Chinese solar co LDK Solar (LDK 9.25 +0.13) saw a pickup in volume as takeover rumors circulated...

9:32AM NVIDIA: Already strong after Dell's better than expected results, jumps further after INTC raises revenue guidance, citing stronger than expected demand (NVDA) 14.75 +0.74 :

9:01AM Intel raises Q3 revenue guidance to $9 bln, plus or minus $200 mln, above $8.55 bln consensus; raises gross margin expectations (INTC) 19.47 : Co raises guidance for Q3, sees revenue of $9 bln, plus or minus $200 mln, vs. $8.55 bln consensus, compared to prior guidance of $8.5 bln, plus or minus $400 mln. Co cites stronger than expected demand for microprocessors and chipsets. The gross margin percentage for the third quarter is expected to be in the upper half of the previous range of 53%, plus or minus two percentage points (consensus for Q3 gross margins is 53.2%). All other expectations are unchanged.

09:32 am Intel (INTC)

Intel (INTC 20.26, +0.79) raised its third quarter revenue expectations Friday morning, driven by stronger-than-expected demand for microprocessors and chipsets. The news, which came out about 30 minutes ahead of the opening bell, gave a boost to shares of INTC and equity futures.

Intel said that it now expects third quarter revenue of $9 billion, plus or minus $200 million. The company's prior guidance was for revenue of $8.5 billion, plus or minus $400 million. The updated forecasts surpasses the current consensus estimate of $8.55 billion.

Intel also expects gross margins for the third quarter to be in the upper half of the previous range of 53%, plus or minus two percentage points. The consensus for Q3 gross margins stands at 53.2%.

Intel said all other expectations are unchanged.

09:15 am Marvell Technology (MRVL)

Marvell Technology Group (MRVL 14.57) posted better-than-expected second quarter earnings and issued an upside forecast that has shares of the chipmaker spiking more than 7.5% in Friday's premarket action.

Marvell reported second quarter earnings of $0.18 per share, excluding nonrecurring items, $0.04 better than the First Call consensus of $0.14.

Revenues fell 24.0% year-over-year to $640.6 million, topping the $619.8 million consensus.

Gross margins for the quarter came in at 55.3%, well ahead of Wall Street expectations of approximately 52.15%.

"We are pleased with the results reported for the second quarter of fiscal 2010," said CEO Dr. Sehat Sutardja. "Our sequential revenue growth reflects both an improving economy and the acceptance by customers of our new and existing products. Additionally, the financial discipline we have adopted continued to deliver positive benefits during the second quarter, allowing us to achieve our long-term profitability and cash flow targets well ahead of schedule."

For the third quarter Marvell sees earnings between $0.18 and $0.26 per share; the current First Call consensus calls for $0.17. Marvell forecast third quarter revenues between $680 million and $730 million, well ahead of the $648.39 First Call consensus.

Shares of MRVL have advanced more than 119% year-to-date.

08:38 am Dell (DELL)

Dell (DELL 15.65) reported earnings that topped the consensus estimate and issued an upbeat outlook, saying it expects an improvement in IT spending in 2010.

Dell reported second quarter earnings of $0.28 per share, excluding pretax expenses of $87 million, or $0.04 per share, for organizational effectiveness actions. The results were $0.04 better than the First Call consensus of $0.23. Net income fell 23% year-over-year to $472 million.

Revenues were down 22% year-over-year to $12.76 billion; the consensus expected $12.59 billion. Dell did show sequential improvement, with shipments up 10% from the first quarter and revenue up 3%.

Gross margins for the quarter came in at 18.7%, better than the consensus estimate of 17.7% and improved from the 17.6% registered in the first quarter. Dell said "strong improvement in cost of goods sold, disciplined pricing, a sequential increase in sales from enterprise products, and a $69 million buyout of a revenue-sharing agreement by a vendor offset previously highlighted pressure from component costs, competitive pricing and revenue mix in client systems."

Dell said it expects seasonal demand improvements from the consumer and U.S. federal government businesses in the third quarter, but the quarter is also generally a period of slower demand from large commercial customers in the U.S. and Europe. Dell said it believes a refresh cycle in commercial accounts is more likely to occur in 2010, with IT spending improving first in the U.S.

"We have been reducing complexity in our organization and significantly lowering operating costs, in anticipation of improvement in the global economy and IT spending," said CEO Michael Dell. "If current demand trends continue, we expect revenue for the second half of the year to be stronger than the first half."

Shares of DELL are about 4.5% higher an hour ahead of Friday's opening bell.