From Briefing.com: 4:15 pm : The stock market surged more than 2% to its best single-session gain in three months on solid volume as market participants shrugged off risk and engaged in a concerted buying effort.
The S&P 500 gapped up to the 1200 line in the opening minutes of trade as market participants responded to big gains by Europe's major bourses, which were helped by solid manufacturing data from both Europe and China, along with comments from European Central Bank President Trichet about support for the eurozone financial system. Trichet also made hints of increased bond purchases.
Although the report was later contradicted in the financial media, a midday story that the U.S. was willing to participate in a rescue fund for Europe helped the major equity averages move another leg higher. They spent most of the session consolidating gains along session highs that are near the upper end of a near-term resistance zone.
The strongest collective move was made by the energy sector, which swung to a 2.9% gain. In addition to broader market support, the sector was helped by crude oil's 3.1% spike to $86.75 per barrel.
Not to be ignored, the materials sector and industrials sector posted gains of 2.8% and 2.6%, respectively. Metals issues were among the biggest drivers of the materials sector's gain while building products plays provided leadership to the industrial space. Deere & Co. (DE 76.14, +1.44) was a laggard in the industrial sector, despite news of its dividend hike to $0.35 from $0.30 per share.
Not only were this session's gains rich, they were also broad as about 96% of the stocks in the S&P 500 advanced. Perhaps more impressive is that such a broad-based surge came on solid share volume as some 1.1 billion shares were traded on the NYSE.
With contagion concerns cooled and stocks in such strong shape, market participants dumped safe havens like the dollar and Treasuries. At the close of trade the dollar was down about 0.8% against competing currencies and the benchmark 10-year Note was off by more than a full point. The yield on the Note never broke above 3.00%, but it did set a four-month high of almost 2.99%.
Volatility cooled considerably. As such, the Volatility Index was down about 10% at the close.
The latest lot of data proved solid and, as such, only seemed to support this session's return to risk. A precursor to the official monthly nonfarm payrolls report on Friday, the latest ADP Employment Change data indicated that private payrolls expanded by 93,000 in November. Not only is that total greater than the 58,000 additions that had been expected, on average, among economists polled by Briefing.com, but it also marks the best ADP reading in three years.
The ISM Manufacturing Index for November eased to 56.6 after a reading of 56.9 in the prior month, but that was still in stride with the expected reading of 56.5.
Construction spending in October increased 0.7%, just as it did the month before. The consensus among economists polled by Briefing.com called for a 0.5% decline.
Nonfarm productivity for the third quarter increased 2.3%, which is up from the 1.9% increase recorded in the preliminary reading, but still not quite as strong as the 2.4% increase that had been widely expected.
No real response was made to the Fed's latest Beige Book since it was without surprise. It indicates that the economy continued to improve, on balance, that lending activity is stable, and that credit quality has been steady to improving.
Advancing Sectors: Energy (+2.9%), Materials (+2.8%), Industrials (+2.6%), Tech (+2.2%), Consumer Discretionary (+2.1%), Financials (+2.1%), Health Care (+1.9%), Consumer Staples (+1.6%), Telecom (+1.5%), Utilities (+1.1%)
Declining Sectors: (None)DJ30 +249.76 NASDAQ +51.20 NQ100 +2.2% R2K +2.2% SP400 +2.1% SP500 +25.52 NASDAQ Adv/Vol/Dec 1926/2.11 bln/751 NYSE Adv/Vol/Dec 2353/1.11 bln/682
6:14PM Finisar beats by $0.06, beats on revs; guides Q3 EPS above consensus, revs above consensus (FNSR) 19.77 +0.68 : Reports Q2 (Oct) earnings of $0.44 per share, excluding non-recurring items, $0.06 better than the Thomson Reuters consensus of $0.38; revenues rose 65.3% year/year to $240.9 mln vs the $229.7 mln consensus. Co issues upside guidance for Q3, sees EPS of $0.45-0.47, excluding non-recurring items, vs. $0.41 Thomson Reuters consensus; sees Q3 revs of $247-262 mln vs. $240.46 mln Thomson Reuters consensus.
4:32PM Semtech beats by $0.02, reports revs in-line; guides Q4 EPS in-line, revs below consensus (SMTC) 24.03 +0.64 : Reports Q3 (Oct) earnings of $0.48 per share, excluding non-recurring items, $0.02 better than the Thomson Reuters consensus of $0.46; revenues rose 63.9% year/year to $123.1 mln vs the $122.1 mln consensus. Co issues mixed guidance for Q4, sees EPS of $0.39-0.43, excluding non-recurring items, vs. $0.42 Thomson Reuters consensus; sees Q4 revs of $110-116 mln vs. $116.66 mln Thomson Reuters consensus.
4:04PM Sigma Designs beats by $0.04, beats on revs (SIGM) 12.12 +0.12 : Reports Q3 (Oct) earnings of $0.41 per share, excluding non-recurring items, $0.04 better than the Thomson Reuters consensus of $0.37; revenues rose 119.2% year/year to $77.8 mln vs the $73.6 mln consensus.
11:27AM Semiconductor Hldrs continues to outperform, notches new session/52-wk high of 32.02 (SMH) 32.00 +0.95 : Initial resistance from here is in the 32.10/32.20 zone. Semi related names helping pace the way are: LRCX +4.8%, KLAC +4.7%, ALTR +4.6%, NVDA +4.2%, MRVL +3.7%, BRCM +3.1%, AMAT +3.1%, MCHP +2.9%, XLNX +2.9%, LLTC +2.4%.
7:25AM Ixia announces proposed offering of $125 million of convertible senior notes due 2015 (XXIA) 15.86 : Co announces that it intends to sell $125 million principal amount of Convertible Senior Notes due 2015. The Notes are being offered only to qualified institutional buyers pursuant. The Notes will be convertible into Ixia's common stock.
10:10 am OVTI Guides Q3 Above Consensus (OVTI)
OmniVision (OVTI 30.83 +2.54) reported second quarter earnings of $0.58 per share, excluding non-recurring items, $0.05 better than the Thomson Reuters consensus of $0.53.
Revenues rose 30.7% year-over-year to $239.5 million versus the $232.3 million consensus.
For the third quarter, the company expects earnings to be in the range of $0.50 to $0.63, excluding non-recurring items, better than the $0.41 Thomson Reuters consensus. On the top line, the company expects revenues to be $230 million to $250 million, well above the $209.64 million Thomson Reuters consensus.
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