From Briefing.com: 4:30 pm : Stocks started the session without much direction, but they gradually chopped their way higher to settle with solid gains at their best levels in more than two years.
Early participants were hesitant to buy, but given the stock market's uptrend many were also unwilling to sell. In turn, only a modest reaction was made to news that China added 25 basis points to its one-year deposit rate and lending rate, even though there is concern that higher rates in China could curtail the country's ability to drive a global economic recovery.
It took a while to get things going, but stocks eventually staged a gradual climb. The effort was broad based in that only energy stocks (-0.5%) and utilities stocks (-0.1%) failed to find higher ground.
Consumer discretionary stocks scored the strongest gains. As a group they advanced 1.2%. Retailers led the way with a 1.5% gain.
McDonald's (MCD 75.36, +1.91) was a leader among blue chips. The stock pulled back a bit when it failed to push past its 50-day average, but it still scored its strongest single-session gain in nine months amid news of a 5.3% increase in January global sales.
It mattered little to the broader market, but the latest round of earnings was largely lackluster. Teva (TEVA 52.02, -2.96) reported worse-than-expected results, which overshadowed news that it has hiked its quarterly dividend by 14%. Avon Products (AVP 28.47, -0.88), Beazer Homes (BZH 5.59, +0.14), and Principal Financial Group (PFG 32.24, -1.46) both posted disappointing results, too. Coventry Health Care (CVH 29.78, -1.56) posted an upside surprise, but issued downside guidance. Becton Dickinson (BDX 81.03, -4.61) had a better-than-expected bottom line, but its top line was lighter than what had been widely expected.
An absence of trading catalysts made for moderate share volume. In turn, the share tally on the NYSE came in at an unimpressive 885 million. That makes for the lowest total of 2011 and the fifth straight session in which trading volume has failed to eclipse 1 billion shares on the Big Board.
Treasuries resumed their descent by selling off in the wake of the latest 3-year Note auction. The auction produced a bid-to-cover of 3.01 and dollar demand of $96.3 billion. The indirect bidder participation rate came in at 27.6%. Selling sent the yield on the benchmark 10-year Note comfortably above 3.70% for the first time since May.
Advancing Sectors: Consumer Discretionary (+1.2%), Financials (+0.7%), Industrials (+0.7%), Consumer Staples (+0.6%), Tech (+0.4%), Telecom (+0.3%), Materials (+0.3%), Health Care (+0.3%)
Declining Sectors: Utilities (-0.1%), Energy (-0.5%)DJ30 +71.52 NASDAQ +13.06 NQ100 +0.6% R2K +0.7% SP400 +0.5% SP500 +5.52 NASDAQ Adv/Vol/Dec 1526/1.81 bln/1109 NYSE Adv/Vol/Dec 1914/885 mln/1073
4:18PM BCD Semiconductor reports Q4 YoY net income growth of 8.6% to $3.8 mln; revs rose 14.1% to $31.6 mln (BCDS) 11.62 +0.37 : Revenue for Q1 of fiscal year 2011 is expected to be in the range of $30 to $31 million, representing growth of ~5% to 8% when compared to Q1 2010. Gross margin is expected to be in the range of 29.5% to 30.5% for the first quarter of fiscal year 2011.
4:17PM TranSwitch misses by $0.01, misses on revs; planning a restructuring including a workforce reduction (TXCC) 2.19 +0.05 : Reports Q4 (Dec) loss of $0.05 per share, $0.01 worse than the Thomson Reuters consensus of ($0.04); revenues fell 16.5% year/year to $10.1 mln vs the $10.5 mln consensus. In addition, TranSwitch also announced that it is planning a restructuring including a workforce reduction to be implemented and concluded during the first quarter of 2011. The actions are meant to continue to further reshape the company consistent with its increased focus on video and voice-over-IP. TranSwitch expects that these restructuring actions will result in annual savings of approximately $2 million, and that these savings will begin to be recognized in the second quarter of 2011. In connection with the restructuring, TranSwitch expects to incur pre-tax restructuring charges of approximately $500,000. The Company expects these charges to be recorded in the first quarter of 2011.
8:56AM Zoran urges stockholders to reject Ramius' efforts to take control of the Board of Directors and co through its consent solicitation and to disregard Ramius' consent efforts and discard any materials sent by Ramius (ZRAN) 9.34 : Co states in letter to shareholders that it believes that its DTV breakeven revenue threshold of $140 million in 2012 is achievable... expects its cost reduction initiatives to culminate in Q3 2011, resulting in a run-rate of $55-$60 million of annual non-GAAP operating expenses, rather than $78.5 million per Ramius, which, when combined with co's expected non-GAAP gross margin in the DTV business, is expected to generate breakeven profitability. Co believes it can achieve $140 million of revenues in 2012, under a streamlined cost structure, is attainable and will enable DTV to be profitable for 2012 and beyond.
Sanmina-SCI Corporation (SANM) earned Nadcap certification at its Singapore PCB location.
Altera (ALTR) announced it successfully completed interoperability testing between its Stratix IV GT FPGA and the Bandwidth Engine device from MoSys in a serial memory application.
8:02AM Vishay beats by $0.04, beats on revs; guides Q1 revs above consensus (VSH) 17.18 : Reports Q4 (Dec) earnings of $0.48 per share, excluding non-recurring items, $0.04 better than the Thomson Reuters consensus of $0.44; revenues rose 13.4% year/year to $688.6 mln vs the $669.5 mln consensus. Co issues upside guidance for Q1, sees Q1 revs of $675-715 mln vs. $662.17 mln Thomson Reuters consensus. "During the fourth quarter, we completed a repurchase of 21.7 million shares of our common stock, demonstrating our confidence in the long-term prospects of Vishay and our commitment to creating long-term value for our stockholders. Our healthy balance sheet and strong cash flow generation allowed us to use a low-coupon convertible debenture offering to finance the buy-back, which was more efficient than using our cash, most of which is off-shore."
Veeco Instruments (VECO) announced that Shanghai Epilight Technology placed a large multi-tool order for Veeco TurboDisc K465i Metal Organic Chemical Vapor Deposition (MOCVD) systems during the fourth quarter of 2010.
09:46 am VECO Guides Q1 Below Consensus (VECO)
Veeco (VECO $46.52 +1.38) reported fourth quarter earnings of $1.62 per share, $0.01 better than the Thomson Reuters consensus of $1.61.
Revenues rose 151.9% year-over-year to $300 million versus the $302.2 million consensus.
Reports fourth quarter gross margins of 50.2% versus 50.3% consensus. Co issues downside guidance for first quarter, sees EPS of $1.02-1.39 vs. $1.45 Thomson Reuters consensus; sees first quarter revs of $215-265 million versus the $292.56 million Thomson Reuters consensus.
In fiscal year 2011, the company expects earnings of greater than $5.00 versus $4.96 Thomson Reuters consensus; sees FY11 revs of greater than $1 bln vs. $1.09 bln Thomson Reuters consensus.
"First quarter 2011 revenues will be lower than Q4 2010 because we are planning to ship 12-20 MOCVD reactors in the new MaxBright "cluster" format, and will not be recording any revenue on these systems in the first quarter.
Timing of revenue is also being impacted by the longer order-to-revenue cycle times associated with the high percentage of business currently coming from China, primarily due to customer facility readiness. The average time to convert orders to revenue is currently several months longer in China than in other regions."
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