From Briefing.com: 4:15 pm : Last Friday's mixed finish was extended into this session's early action as a lack of market-moving headlines left participants with few cues for trade. That left the day's direction to be largely determined by the U.S. dollar, which came into closer focus amid comments from Fed Chairman Bernanke.
In a speech before the Economic Club of Washington D.C., Fed Chairman Bernanke indicated that the FOMC is looking to keep interest rates low for an extended period of time. The comment is consistent with the Fed's previous statements, but it helped quell concern that the better-than-expected November jobs figures released on Friday would lead the Fed to raise interest rates sooner than later. Such concern had caused some profit taking on Friday.
Bernanke's comments helped drive the greenback from a one-month high against competing currencies to a 0.6% loss. Stocks responded with a climb to afternoon highs, where they traded with modest gains.
However, stocks were unable to extend their upturn beyond morning highs and eventually rolled over. Their downturn also came in conjunction with greenback's move off of its lows -- the Dollar Index finished with a 0.2% loss. The broader equity market settled above its session low with a modest loss.
Financials felt considerable weakness for most of the session; they fell to a 1.6% loss. The financial sector was weighed down by weakness in shares of banks (-1.6%) and diversified financial services outfits (-1.8%). Citigroup (C 4.03, -0.03) was unable to win favor for the sector's many players after news reports said the company has asked to repay $20 billion of its bailout funds. Last week's news that Bank of America (BAC 15.89, -0.39) plans to repay its $45 billion TARP loan helped win temporary favor for financials.
On a related note, The Wall Street Journal reported that the total cost of TARP could be cut by $200 billion.
Telecom was the best performing sector this session. The sector booked a 1.8% gain, which added to its gains from last week. Telecom stocks have gained 4.2% during the last six sessions. That's second only to utilities, which gained 4.6% during that time.
Commodities finished in mixed fashion. Gold prices settled 0.5% lower at $1164 per ounce, while contract prices for oil closed 2.0% lower at $73.94 per barrel. However, natural gas prices surged 8.7% to $4.98 per contract amid reports of the return of cold weather. Strength in natural gas gave the CRB Commodity Index a modest 0.1% gain. That put an end to its three consecutive advances.
There was only a small dose of data this session, but it caused little reaction among market participants. As expected, consumer credit declined for the ninth consecutive month in October, but the drop far less than expected. The consensus called for a $9.4 billion decline, but the actual drop was only $3.5 billion. September's drop in consumer credit was revised upward to reflect a $8.8 billion decline. The positive surprise for October and the upward revision to September's figures suggest that consumer demand for additional funding has not been wiped out as consumers deleverage themselves. In fact, if the recent trends continue, growth in consumer credit could actually occur by year's end.
Advancing Sectors: Telecom (+1.8%), Utilities (+0.7%), Consumer Discretionary (+0.5%), Consumer Staples (+0.1%), Materials (+0.1%)
Declining Sectors: Financials (-1.6%), Tech (-0.5%), Energy (-0.3%), Health Care (-0.2%), Industrials (-0.1%)DJ30 +1.21 NASDAQ -4.74 NQ100 -0.5% R2K +0.1% SP400 -0.1% SP500 -2.73 NASDAQ Adv/Vol/Dec 1381/1.88 bln/1329 NYSE Adv/Vol/Dec 1630/941 mln/1402
8:31AM Zilog: IXYS announces acquisition of Zilog for ~$3.59 a share (ZILG) 2.96 : IXYS announces that it has entered into a definitive agreement to acquire Zilog. Under the terms of the agreement, IXYS will acquire all of Zilog's outstanding common shares for $3.5858 per share in cash, or approximately $62.4 million. The acquisition is subject to the approval of Zilog shareholders and other customary closing conditions. The transaction is expected to be completed during the quarter ended March 31, 2010. The combination of the two companies with complementing technologies will allow IXYS and Zilog to leverage analog power management with digital control. Zilog has a focused MCU business with technologies that will complement IXYS' product portfolio. IXYS has a broad based and diversified range of products geared toward industrial, telecommunications, medical, automotive, alternative energy and consumer applications. By introducing MCUs that enable digital power management and embedded control, IXYS will be able to create more cost-effective system integration solutions for its diversified customer base.
QLogic (QLGC) announces that QLogic 5802V 8Gb Fibre Channel switches and iSR6250 10GbE Intelligent Storage Routers are now available from Hitachi Data Systems, a wholly owned subsidiary of Hitachi (HIT), and over 500 authorized Hitachi Data Systems resellers worldwide...
10:35 am Research In Motion (RIMM)
Research In Motion (RIMM 60.38, +1.63) said Monday that it has reached an agreement with Digital China Holdings Ltd. to distribute its BlackBerry handsets in China.
"Digital China's extensive knowledge and market presence will further expand the opportunity for RIM in China," said Jim Balsillie, co-CEO of Research In Motion.
Digital China is the largest IT services provider in China, with regional centers in 19 major cities across the country.
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