Sector Investing

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From Briefing.com: 4:30 pm : Stocks settled in relatively mixed fashion after failing to extend an early advance through initial resistance levels.

The stock market climbed from the flat line to a gain of almost 1% in the early going. The effort came as buyers pushed in after their efforts had waned ahead of the open. The move gained momentum with the release of the Consumer Confidence Index for November, which spiked to 56.0 from 39.8 in the prior month. It had been expected to improve to just 42.5.

Although things had been looking up for stocks, buyers' conviction was tested once the S&P 500 ran into resistance just beneath its 50-day moving average around the 1205 region. The inability to build on gains left stocks to oscillate for the rest of the session.

The Nasdaq never really regained its strength. It was weighed down by weakness among large-cap tech plays, which have dragged down the overall tech sector to a 0.7% loss. Amazon.com (AMZN 188.39, -5.76) and eBay (EBAY 28.75, -0.91) were also sources of weakness.

Tiffany & Co. (TIF 67.22, -6.40) was one of the weaker performers after the company issued a disappointing forecast that overshadowed an upside earnings surprise. The stock set a one-month low in the early going.

AMR Corp (AMR 0.26, -1.36) dove more than 80% after the company announced that it has filed for Chapter 11 reorganization rights. Other air carriers ascended in response to the belief that they will benefit from reduced competition.

Energy plays showed strength in the face of lackluster broad market action. The sector climbed 1.5% with help from crude oil, which closed pit trade 1.6% higher at $99.79 per barrel.

Advancing Sectors: Energy +1.5%, Utilities +1.1%, Consumer Staples +1.0%, Telecom +0.7%, Health Care +0.4%, Consumer Discretionary +0.2%, Materials +0.2%
Declining Sectors: Industrials -0.1%, Financials -0.6%, Tech -0.7%DJ30 +32.62 NASDAQ -11.83 NQ100 -0.6% R2K -0.3% SP400 +0.1% SP500 +2.64 NASDAQ Adv/Vol/Dec 966/1.60 bln/1566 NYSE Adv/Vol/Dec 1469/918 mln/1548

4:21PM OmniVision beats by $0.16, beats on revs; guides Q3 EPS below consensus, revs below consensus (OVTI) 11.19 -0.53 : Reports Q2 (Oct) earnings of $0.48 per share, $0.16 better than the Capital IQ Consensus Estimate of $0.32; revenues fell 9.0% year/year to $217.9 mln vs the $214.56 mln consensus. Co issues downside guidance for Q3, sees EPS of $0.05-0.17 vs. $0.26 Capital IQ Consensus Estimate; sees Q3 revs of $160-180 mln vs. $201.43 mln Capital IQ Consensus Estimate. (Stock is halted)

2:14PM Hewlett-Packard refutes inaccurate claims; clarifies on printer security (HPQ) 27.03 +0.50 : Co says "there has been sensational and inaccurate reporting regarding a potential security vulnerability with some HP LaserJet printers. No customer has reported unauthorized access. Speculation regarding potential for devices to catch fire due to a firmware change is false." While HP has identified a potential security vulnerability with some HP LaserJet printers, no customer has reported unauthorized access. The specific vulnerability exists for some HP LaserJet devices if placed on a public internet without a firewall. In a private network, some printers may be vulnerable if a malicious effort is made to modify the firmware of the device by a trusted party on the network. In some Linux or Mac environments, it may be possible for a specially formatted corrupt print job to trigger a firmware upgrade.

Magma Design Automation (LAVA) announced that since its release 18 months ago, Tekton has grown its customer base to more than 25 companies, achieving the fastest adoption rate of any tool in the company's history.

Seagate Tech (STX $16.93 +0.94) continues to believe that, due to the industry impacts caused by the extensive flooding in Thailand, hard disk drive supply will be significantly constrained for several quarters. For the December 2011 quarter, the company believes the industry will ship between 110-120 million units. The company's component and disk drive factories in Thailand have not been directly affected by the flood; however, the company's ability to manufacture hard disk drives has been impacted due to external component supply constraints as first disclosed on October 12, 2011. For the December 2011 quarter, the company now expects unit shipments of approximately 43 million units and revenue of approximately $2.8 billion (versus $2.65 billion consensus). Gross margin as a percent of revenue is expected to be 150-300 basis points above the high-end of the company's long-term, targeted gross margin range of 22-26%.

Corning (GLW $13.38 -1.47) expects fourth quarter SCP's LCD glass volume to be up 5% to 10% sequentially versus original guidance of more than 20% volume growth. The company's combined LCD glass volume, which includes both its wholly owned business and SCP, is now expected to be up slightly sequentially versus previous guidance of up more than 10%. Additionally, he will explain that LCD glass price declines are expected to be more significant in Q4. As a result, consolidated equity earnings are expected to be down 30% versus original guidance of down 5%.

11:54 am Technology Sector Traidng Nearly Flat Today (RIMM)

The tech sector is trading flat today, trailing gains in the broader market. Semiconductors are trading roughly in line with the tech space with the Philly Semi Index trading 0.1% higher. CRUS (+3.4%) is a notable leader in the chip index.

Among other major indices, the S&P 500 is trading 0.7% higher, while the NASDAQ is trading 0.1% higher and the QQQ is flat on the session. Among tech bellwethers, INTC (+1.3%) and VZ (+1.4%) are notable underperformers. In earnings last night, STX (+4.2%) guided Q2 and Q3 revenues above consensus.

This morning, PAY (-1.6%) offered Q4 rev guidance above consensus and issued mixed guidance for FY12. In news, GLW (-11.8TLEO %) lowered its LCD glass volume and capacity guidance at a Credit Suisse Conference. Also, reports indicated that private equity firm THL may be interested in a buyout of YHOO's (+3.7%) US business. Among rumors, we are hearing TLEO (+1.7%) takeover chatter making the rounds.

Among notable analyst upgrades this morning, RIMM (+7.7%) was upgraded to Market Perform at Bernstein, HPQ (+3.1%) was upgraded to Outperform at RBC Capital, and SONS (+8.5%) was upgraded to Outperform at Northland. There were no notable downgrades in the space this morning.

There are no notable names in tech scheduled to report results today after the close.