From Briefing.com: 4:30 pm : The stock market scored a strong gain and locked in its first positive finish for January since 2007 with help from the energy sector, which climbed sharply in response to a spike in oil prices.
Oil prices extended their recent climb to a two-year high of $92.84 per barrel before they settled with a 3.2% gain at $92.19 per barrel. That price spike pulled buyers into oil and gas equipment stocks (+2.6%), exploration issues (+4.4%), and drillers (+2.4%). In turn, the overall energy sector advanced 2.6%.
Massey Energy (MEE 62.86, +5.63) was a standout in the energy sector. It surged close to 10% in response to news that Alpha Natural Resources (ANR 53.73, -4.15) will acquire MEE for $69.33 per share in a mix of cash and stock. Exxon Mobil (XOM 80.68, +1.69) advanced more than 2%, but more of that is owed to a strong sector performance than the oil giant's upside earnings surprise.
Investor appetite for natural resource plays spread to the basic materials stocks, which collectively climbed 1.6%. Materials made up the second best performing sector of the session.
As a group financials advanced 1.0%, but Deutsche Bank (DB 58.55, -0.35) faltered following an earnings forecast that failed to meet what Wall Street had already projected.
Intel (INTC 21.46, +0.00) finished flat after participants assessed news that the firm discovered a chipset error. Although the error will adversely impact the firm's revenue, it wasn't enough to stop Intel from increasing its overall revenue forecast.
Defensive-oriented issues generally lagged, but consumer staples stocks made up the only major sector that suffered a loss. They fell 0.3%.
While energy plays provided leadership, generally broad market strength helped the S&P 500 settle into a 2.3% monthly gain for January. The benchmark Index hasn't booked a January gain in four years.
Amid an increased appetite for risk, the dollar turned lower in today's trade. By the time of the closing bell, the greenback lagged a collection of competing currencies by 0.5%. Most of its slide came against the British pound and the euro, which was helped by higher eurozone inflation readings. Reduced concern about the likelihood of social unrest in Egypt spilling over into other country's also convinced some to rotate out of the dollar. The dollar's loss today locked it in for a 1.6% monthly loss.
The latest dose of data failed to act as any kind of a catalyst. Personal income for December increased 0.4%, which is slightly less than the 0.5% increase that had been expected. Personal spending during December increased 0.7%, which is greater than the 0.6% increase that had been widely anticipated. However, core personal consumption expenditures were flat when a 0.1% increase had been expected by a broad span of economists.
The Chicago PMI came in at 68.8 for December. That represents its best reading since 1988.
Advancing Sectors: Energy (+2.6%), Materials (+1.6%), Financials (+1.0%), Industrials (+0.9%), Tech (+0.7%), Health Care (+0.1%), Consumer Discretionary (+0.1%), Telecom (+0.1%), Utilities (+0.1%)
Declining Sectors: Consumer Staples (-0.3%)DJ30 +68.23 NASDAQ +13.19 NQ100 +0.5% R2K +0.8% SP400 +0.8% SP500 +9.78 NASDAQ Adv/Vol/Dec 1536/1.98 bln/1088 NYSE Adv/Vol/Dec 2054/1.19 bln/915
6:10PM Silicon Motion beats by $0.09, beats on revs; guides Q1 revs above consensus; guides FY11 revs above consensus (SIMO) 5.56 +0.26 : Reports Q4 (Dec) earnings of $0.18 per share, excluding non-recurring items, $0.09 better than the Thomson Reuters consensus of $0.09; revenues rose 77.8% year/year to $40 mln vs the $34.5 mln consensus. Co issues upside guidance for Q1, sees Q1 revs flat to down 10% sequentially, which calculates to ~$36-40 mln vs. $31.33 mln Thomson Reuters consensus. Co issues upside guidance for FY11, sees FY11 revs growth of 20-30%, which calculates to ~$158.9-172.1 mln vs. $142.60 mln Thomson Reuters consensus.
5:23PM Corning Incorporated to acquire MobileAccess (GLW) 22.21 +0.41 : Co announced that it has signed an agreement to acquire MobileAccess, a leading provider of wireless network solutions. The terms of the agreement are not being disclosed. Pending regulatory approval, the acquisition is expected to be completed by the end of the first quarter in 2011.
4:08PM Novellus beats by $0.09, beats on revs (NVLS) 36.07 +0.29 : Reports Q4 (Dec) earnings of $1.03 per share, excluding non-recurring items, $0.09 better than the Thomson Reuters consensus of $0.94; revenues rose 57.4% year/year to $384.4 mln vs the $377.8 mln consensus.
4:08PM Novellus beats by $0.09, beats on revs (NVLS) 36.07 +0.29 : Reports Q4 (Dec) earnings of $1.03 per share, excluding non-recurring items, $0.09 better than the Thomson Reuters consensus of $0.94; revenues rose 57.4% year/year to $384.4 mln vs the $377.8 mln consensus.
4:03PM Intl Rectifier beats by $0.14, reports revs in-line; guides Q3 revs above consensus (IRF) 32.03 +0.75 : Reports Q2 (Dec) earnings of $0.62 per share, $0.14 better than the Thomson Reuters consensus of $0.48; revenues rose 34.0% year/year to $281.7 mln vs the $281.5 mln consensus. Co issues upside guidance for Q3, sees Q3 revs of $285-295 mln vs. $275.47 mln Thomson Reuters consensus.
4:03PM Integrated Device beats by $0.01, reports revs in-line (IDTI) 6.55 +0.27 : Reports Q3 (Dec) earnings of $0.15 per share, $0.01 better than the Thomson Reuters consensus of $0.14; revenues rose 7.5% year/year to $153.2 mln vs the $153.1 mln consensus.
10:46AM General Electric signs wind services agreement in Europe with Cobra Energia (GE) 20.24 +0.04 : Co has signed a 10-year contract with Spanish wind developer Cobra Energia to provide advanced services for 178 GE wind turbines installed at eight wind farms across Spain. The agreement is GE's largest wind energy services contract in Europe and reinforces the company's position in Europe's highly competitive wind turbine services sector.
10:16AM Intel announces chipset design error, co raises Q1 and FY11 rev guidance to incorporate Infineon acq.; lowers gross margin guidance (INTC) 21.45 -0.00 : Co has discovered a design issue in a recently released support chip, the Intel 6 Series, code-named Cougar Point, and has implemented a silicon fix. Co expects this chipset issue to reduce revenue by ~$300 mln as the co discontinues production of the current version of the chipset and begins manufacturing the new version. FY11 rev is not expected to be materially affected by the issue. Co raises guidance to incorporate Infineon acquisition. Co raises Q1 rev guidance to $11.3-12.1 bln from $11.1-11.9 bln vs $11.46 bln Thomson Reuters consensus. Co raises FY11 rev growth guidance to be in the mid-to high teens, compared to the co's prior expectation of ~10% vs the +8.0% consensus. Co lowers Q1 non-GAAP gross margin consensus to ~62% from ~64% (consensus 64.1%); FY11 to 64% from 65% (cons: 64.9%). "In some cases, the Serial-ATA ports within the chipsets may degrade over time, potentially impacting the performance or functionality of SATA-linked devices such as hard disk drives and DVD-drives. The chipset is utilized in PCs with Intel's latest Second Generation Intel Core processors, code-named Sandy Bridge. Intel has stopped shipment of the affected support chip from its factories. Intel has corrected the design issue, and has begun manufacturing a new version of the support chip which will resolve the issue. The Sandy Bridge microprocessor is unaffected and no other products are affected by this issue. The co expects to begin delivering the updated version of the chipset to customers in late February and expects full volume recovery in April... For computer makers and other Intel customers that have bought potentially affected chipsets or systems, Intel will work with its OEM partners to accept the return of the affected chipsets, and plans to support modifications or replacements needed on motherboards or systems."
8:01AM Chipmos Technology announces early repayment of its syndication loan; completes transaction with Spil (IMOS) 1.63 : Co announces its early repayment in full, through its free cash flow, of its $74.5 mln syndication loan. Separately, ChipMOS Taiwan made its final payment to Siliconware Precision Industries Co. of $16.8 mln on Jan 4, 2011, in connection with the Equipment Purchase Agreement between ChipMOS Taiwan and S.P.I.L with the U.S. Securities and Exchange Commission. In turn, S.P.I.L. paid $16.8 mln to the company on January 10, 2011 to purchase the last tranche of ChipMOS Taiwan's common shares pursuant to the Share Purchase Agreement between company and S.P.I.L. dated Feb. 26, 2010. Post completion of the share purchase transaction, S.P.I.L. holds approximately 15.8% of the total number of ChipMOS Taiwan's outstanding shares and the company holds approximately 84.2% of the total number of ChipMOS Taiwan's outstanding shares.
IBM (IBM) announced that it has been selected by the City of New York to build a more efficient, smarter technology platform for CITIServ, the City's IT infrastructure modernization program.
7:01AM DSP Group reports EPS in-line, beats on revs; guides FY11 revs in-line (DSPG) 7.56 : Reports Q4 (Dec) loss of $0.17 per share, in-line with the Thomson Reuters consensus of ($0.17); revenues fell 20.7% year/year to $43.4 mln vs the $42 mln consensus. Co issues in-line guidance for FY11, sees FY11 revs of $227-245 mln vs. $236.15 mln Thomson Reuters consensus. "Despite the overhang and depletion of excess inventory at several ODM and OEM customers during the fourth quarter, we were able to execute and deliver on our 2010 business plan as reflected in the year-on-year improvements in all of our annual financial metrics. In addition, we generated $17 million of free cash flow during the year and ended the year with a strong cash position of approximately $140 million in cash and cash equivalents."
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