From Briefing.com: 4:30 pm : The S&P 500 gapped down in the early going and traded with a 1.7% loss at its session low, but a downturn by the dollar caused stocks to rally into the afternoon. The major indices were able to reverse nearly all of their losses and finish near session highs.
Stocks looked like they were headed for a dismal session as all 10 of the major sectors in the S&P 500 dropped to losses in excess of 1% in the early going. Pessimism among participants was rooted in a disappointing batch of economic data and moderate strength in the dollar.
According to the latest weekly jobless claims figures, initial claims climbed for the week ended Feb. 20 totaled 496,000, up 22,000 week-over-week. Not only was that worse than expected, it was the highest initial claims count since November. Continuing claims were worse than expected; they totaled 4.62 million.
Durable goods orders failed to temper the negative reaction to the jobless claims numbers. Specifically, durable goods orders increased a stronger-than-expected 3.0% in January, but orders less transportation made a surprise 0.6% decline.
Housing prices for December made a 1.6% monthly decline. They had been expected to increase 0.4%.
Fed Chairman Bernanke testified on monetary policy and economy conditions before the Senate Banking Committee this morning, but his comments reflected those that he offered to the House Financial Services Committee yesterday. In turn, the testimony was generally a non-factor.
In addition to a disappointing lot of data, participants had to grapple with gains by the greenback. The dollar garnered support amid news that Moody's believes ratings on Greece hinge on the country's fiscal reform follow through. Though that comment didn't offer anything new, it had substance in the sense that Moody's is the last ratings agency to have an 'A' rating on Greek sovereign debt. An 'A' rating is required of a country to exchange its bonds with the European Central Bank as collateral for loans under rules that will go into effect at the end of this year. Failure to maintain such a rating could prove problematic as Greece attempts to remedy its fiscal woes.
Despite such consideration, the euro eventually bounced back and pressured the dollar, which finished the session with a 0.1% loss against a basket of foreign currencies. The dollar's reversal helped the stock market break free from range-bound trade near session lows.
Materials stocks were among the primary beneficiaries. The sector had been down more than 2% at its session low, but settled with a modest 0.2% loss. Newmont Mining (NEM 49.02, +2.54) was a primary leader, thanks to better-than-expected earnings for its latest quarter.
Better-than-expected earnings from Limited Brands (LTD 22.15, +0.61) and Kohls (KSS 54.08, +2.49) helped retailers outperform the broader market for the third straight session. Retailers finished with a 0.4% gain, collectively, which helped the consumer discretionary sector settle with a fractional loss. That made it the best performing sector in the broader market.
One of the session's strongest gains was made by Coca-Cola Enterprises (CCE 25.48, +6.30), which surged amid news that its North American bottling business will be acquired by Coca-Cola (KO 53.12, -2.04).
Though the stock market was able to rally amid the greenback's pullback, commodities had a mixed response as the CRB Commodity Index stayed stuck near its session low. It finished with a 1.4% loss. Oil prices gradually made their way off of session lows, but still settled pit trade with a 2.3% loss at $78.17 per barrel. Meanwhile, gold closed with a 1.0% gain at $1108.50 per ounce.
Treasuries traded with moderate strength. They were partly supported by strong results from an at-record $32 billion auction of 7-year Notes. The auction attracted a yield of 3.08%, which was a bit below what had been expected, and a bid-to-cover ratio of 2.98, which was above the recent average of 2.75. However, the indirect bid hit 40.3%, which was below the recent average of 54.4%.
Advancing Sectors: (None)
Declining Sectors: Telecom (-0.4%), Utilities (-0.3%), Financials (-0.3%), Industrials (-0.3%), Tech (-0.2%), Materials (-0.2%), Energy (-0.2%), Consumer Staples (-0.1%), Health Care (-0.1%), Consumer Discretionary (-0.1%)DJ30 -53.13 NASDAQ -1.68 NQ100 +0.00% R2K +0.1% SP400 +0.0% SP500 -2.30 NASDAQ Adv/Vol/Dec 1121/2.27 bln/1500 NYSE Adv/Vol/Dec 1512/1.15 bln/1504
5:56PM Rambus announced that its board of directors approved a new share repurchase program authorizing the repurchase of up to 12.5 mln shares (RMBS) 21.48 -0.09 :
4:22PM OmniVision beats by $0.01, beats on revs; guides Q4 EPS in-line, revs in-line (OVTI) 14.22 +0.08 : Reports Q3 (Jan) earnings of $0.20 per share, excluding non-recurring items, $0.01 better than the First Call consensus of $0.19; revenues fell 14.4% year/year to $156.9 mln vs the $154.8 mln consensus. Co issues in-line guidance for Q4, sees EPS of $0.11-0.21, excluding non-recurring items, vs. $0.16 consensus; sees Q4 revs of $145-160 mln vs. $157.61 mln consensus. Gross margin for the third quarter of fiscal 2010 was 24.6% as compared to 24.0% for the second quarter of fiscal 2010 and 22.4% for the third quarter of fiscal 2009. The sequential increase in gross margin reflected a slightly improved product mix and a reduced inventory valuation exposure due to the improving business outlook.
4:18PM Kopin reports Q4 results; issues in-line guidance for FY10 (KOPN) 4.03 -0.02 : Kopin reports Q4 earnings of $0.08 vs $0.03 First Call consensus; revs increased 14% year/year to $33 mln vs $27.50 mln First Call consensus. Co issues guidance, sees FY10 revs of $120 mln to $130 mln vs $130 mln First Call consensus. "Anchored by a strong balance sheet, manufacturing know-how and technology expertise, we are well positioned to generate sustained growth,"..."Innovation is an integral part of our history and strategy. While other companies have struggled during the economic downturn, we have capitalized on the opportunity by expanding our technology and product portfolios. We have continued to enhance our manufacturing capabilities and capacity, add new management and scientific talents, patent new technologies and develop the advanced new display systems and III-V structures that we believe will become growth engines for the Company in the coming years."
4:13PM Novatel Wireless reports Q4 (Dec) results, misses on revs; guides Q1 below consensus (NVTL) 7.35 +0.23 : Reports Q4 (Dec) earnings of $0.03 per share, may not be comparable to the First Call consensus of $0.07; revenues rose 36.1% year/year to $88.6 mln vs the $91 mln consensus. Co issues downside guidance for Q1, sees EPS of ($0.14) vs. $0.05 consensus; sees Q1 revs of $70 mln vs. $83.76 mln consensus. The Company currently expects first quarter 2010 revenues to be approximately flat compared to the year ago period and lower than the fourth quarter of 2009, with decreased revenues attributed to core products due to lower average selling prices (ASP) and lower seasonal sales volumes. The Company currently expects sales in the first quarter of 2010 from its MiFi Intelligent Mobile Hotspot products to increase compared to the fourth quarter of 2009, despite the impact of a $3 million reduction in revenues related to MiFi marketing and promotional campaigns with certain operator customers. "While revenues decreased from the third quarter, they increased 36% year-over-year due to steady demand for our core USB modems and revolutionary MiFi Intelligent Mobile Hotspot products, which have now launched commercially with 17 operators around the globe... Fourth quarter revenues hit the mid-point of our guidance and GAAP and non-GAAP gross margins of 26.2% and 26.4%, respectively, were impacted by product mix."
11:00AM Microsoft enters intellectual property licensing agreement with Panasonic (MSFT) 28.15 -0.48 : Co has entered into an intellectual property licensing agreement with Panasonic (PC) to provide it with access to Microsoft's Extended File Allocation Table (exFAT) technology, the latest generation of Microsoft's file system. Panasonic is one of the latest companies to adopt exFAT technology through Microsoft's new licensing program, enabling it to deliver a rich, integrated media experience for its customers.
9:10AM LTX-Credence beats by $0.02, beats on revs; guides Q3 EPS and revs above consensus (LTXC) 2.72 : Reports Q2 (Jan) earnings of $0.03 per share, excluding non-recurring items, $0.02 better than the First Call consensus of $0.01; revenues rose 57.9% year/year to $48 mln vs the $47.3 mln consensus. Co issues upside guidance for Q3, sees EPS of $0.04-0.05, excluding non-recurring items, vs. $0.03 consensus; sees Q3 revs of $53-55 mln vs. $52.54 mln consensus. "We returned to profitability and generated positive net cash in the second fiscal quarter, two important milestones for the Company. The business model is performing as expected, and our focus continues to be about growing top line revenue. We saw strong growth in several key market areas, indicating to us that the aggressive growth strategies we have in place are starting to pay off. Since hitting the industry trough last year, our product revenues have recovered faster than the competition resulting in market share gains."
RFMD (RFMD) announces the extension of their collaboration to develop high frequency GaAs MMIC solutions focused on SELEX Galileo's next generation of electronically-scanned phased array radar systems...
Magma Design Automation (LAVA) announces the recent opening of a joint IC design lab. The lab will provide local designers with access to Magma's advanced analog and digital IC design software and comprehensive training programs...
7:46AM GT Solar announces new DSS orders totaling ~$200 mln (SOLR) 5.60 : Co announced it has signed new contracts totaling ~$200 mln for its DSS450 ingot growth furnaces and ancillary equipment and services. This includes a $137 mln follow-on order from a large Chinese customer, as well as orders from Tianwei New Energy Holdings, Phoenix Photovoltaic Technology, Yingli Green Energy Holding, JA Solar Holding, Taiwan-based Sino-American Silicon Products (SAS), and one other customer. The orders were booked in GT Solar's current fourth fiscal quarter and revenue for these orders is expected to be recognized in periods subsequent to the current fiscal year.
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