From Briefing.com: 4:30 pm : Leadership from financials helped give the broad market a modest gain after market participants weighed the troubles of Europe against the latest dose of domestic data.
The same old concerns about financial and economic conditions in Europe took yields on sovereign debt in the country higher today and kept constant pressure on the euro, which descended more than 1% to a 15-month low just beneath $1.280. News that many of Europe's financial institutions still prefer to park their cash at the European Central Bank was also regarded as a sign of diffidence in the region.
Negativity stemming from those themes was temporarily tempered prior to the open by the latest ADP Employment Change, which offered an encouraging glimpse into the official nonfarm payrolls report due tomorrow by suggesting that private payrolls increased by 325,000 during December. The jump in payrolls far exceeded the increase of 180,000 that had been expected, on average, by economists polled by Briefing.com.
The latest weekly initial jobless claims count declined by 15,000 week-over-week to 372,000, which is on par with the 375,000 initial claims that had been widely anticipated, but that report received less attention since it was hardly surprising.
The latest ISM Services Index, which was released shortly after the open, didn't garner a great deal of attention either. It came in at 52.6 for December, up from 52.0 in the prior month, but still slightly less than the 53.0 that had actually been broadly forecasted.
Although data was regarded as in-line to positive, stocks still slumped to a marked loss in morning trade. However, once initial support levels held stocks were able to begin working their way higher. In contrast to the prior session, though, the broad market was able to push into positive territory, rather than be rebuffed at the flat line.
Financials were primary driver in the stock market's effort to trade higher. The sector scored a 1.4% gain with help from bank stocks, which collectively climbed almost 2%, as measured by the KBW Bank Index.
Agricultural plays Monsanto (MON 76.68, +4.01) and Mosaic (MOS 53.30, +1.00) were among the top individual performers of the session, thanks to better-than-expected earnings results. Despite their strength, the rest of the materials sector scored a gain of only 0.3%.
The consumer discretionary sector was able to put together a 0.7% gain despite early weakness among retailers, which were initially weighed down by an underwhelming round of same-store sales results for December.
Advancing Sectors: Financials +1.4%, Consumer Discretionary +0.7%, Tech +0.5%, Materials +0.3%, Health Care +0.2%, Utilities +0.2%
Unchanged: Industrials
Declining Sectors: Consumer Staples -0.2%, Telecom -0.5%, Energy -0.6%DJ30 -2.72 NASDAQ +21.50 NQ100 +0.8% R2K +0.7% SP400 +0.7% SP500 +3.76 NASDAQ Adv/Vol/Dec 1537/1.85 bln/977 NYSE Adv/Vol/Dec 1839/829 mln/1186
4:02PM RF Micro Device sees Q3 revenues of $225 mln; Capital IQ consensus $250 mln (RFMD) 5.64 +0.17 : RFMD's revenue for the December 2011 quarter was approximately $225 million (Capital IQ consensus $250 mln). In RFMD's Cellular Products Group (CPG), revenue was approximately $179 million, as sales of 2G components to China-based customers for entry-level handsets were below expectations. In RFMD's Multi-Market Products Group (MPG), revenue was approximately $46 million, reflecting broad weakness in MPG's end markets. The Company noted customer demand softened during the December quarter, with end-of-quarter 2G demand significantly below customer forecasts. RFMD expects gross margin for the December 2011 quarter will decline approximately 9 points sequentially, due to the lower revenue, lower factory utilization, and inventory reserves. Sales of RFMD's components for 3G/4G smartphones increased sequentially approximately 16% during the December 2011 quarter. Bob Bruggeworth, president and CEO of RFMD, said, "RFMD is navigating broadly lower demand in 2G handsets and softness across MPG's markets. Despite this challenging macro environment, RFMD is winning new business with industry-leading products and technologies, and we fully expect to grow in fiscal 2013, supported by market share gains, new product launches, and expanding relationships with both channel partners and customers." In the March 2012 quarter, RFMD anticipates normal seasonality in the handset industry and in MPG's end markets.
4:02PM SMTC Corp adopts shareholder friendly policies, announces standstill agreement with Red Oak Partners (SMTX) 2.75 +0.11 : Co announces changes to its Charter and Bylaws aimed at improving shareholder rights, and an agreement with its largest shareholder, Red Oak Partners, LLC to limit its voting rights in certain circumstances. The Charter and Bylaw Changes include "After retaining a leading provider of shareholder corporate governance solutions to recommend ways to make its policies more shareholder friendly, SMTC's Board of Directors adopted changes to its Charter and Bylaws including: Special meetings may now be called up to twice per year by holders of 10% or more of shares outstanding. Previously, shareholders were unable to call special meetings; Shareholders are no longer limited to the number of Directors they may nominate for election to the Board. Previously, shareholders were limited to nominating three Directors; SMTC's Tax benefits preservation shareholder rights plan ("Net Operating Loss Plan," or "NOL plan") may no longer be extended at the Board's discretion - in the future an extension will require sha Removal of a stakeholder clause considered poor policy by governance experts and which impeded SMTC's singular focus on shareholder value."
8:12AM Marvell says Foresight Platformdesigned into Google TV (MRVL) 14.50 : Marvell (MRVL) announced that the new Foresight Platform, powered by the Marvell ARMADA 1500 HD Media System-on-a-Chip, has been designed into the next generation of Google (GOOG) TVs debuting at CES 2012.
Microsemi (MSCC) announced the company's RF Integrated Solutions facility in Folsom, Calif. achieved compliance with new AS9100:2009 quality system requirements for aviation, space and defense markets.
TranSwitch (TXCC) announced that the Company's TXC-44144 HDplay transceiver integrated circuit has been selected by Universal Microelectronics for the U-HD1080S video switch product.
11:15 am S&P Tech Sector Down Modestly, Outperforming The S&P 500
The tech sector is trading slightly lower today, ahead of losses in the broader market. Semiconductors are showing relative strength in the tech space, however, with the Philly Semi Index trading 0.3% higher. MRVL (+4.7%) is a standout in the chip index. Among other major indices, the S&P 500 is trading 0.7% lower, while the NASDAQ is trading 0.3% lower and the QQQ is 0.2% lower on the session. Among tech bellwethers, ORCL (+0.6%) is showing strength, while CSCO (-1.3%) is a notable underperformer.
In earnings last night, STX (+5.7%) and OCLR (+14.0%) issued upside guidance. WDC (+4.6%) is higher in sympathy with STX. This morning, PLXS (+6.3%) narrowed guidance above consensus, while ROG (-4.9%) and MSPD (+2.1%) lowered guidance.
In news, MRVL (+4.5%) announced its the new Foresight Platform has been designed into the next generation of GOOG (-1.2%) TVs.
Among rumors, we are hearing IBM (-1.2%) for RHT (+0.8%) takeover chatter making the rounds.
Among notable analyst upgrades this morning, NOK (+4.2%) was upgraded to Outperform at Credit Suisse, LSI (+5.6%) was upgraded to Outperform at Wedbush, and APKT (+2.9%) was upgraded to Strong Buy at Raymond James.
Among downgrades, The Benchmark Company downgraded GOOG (-1.2%) to Hold and YHOO (-1.6%) was downgraded to Hold at Jefferies.
GPN (-1.1%) is the notable name in tech scheduled to report results today after the close.
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