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From Briefing.com: Weekly Recap - Week ending 06-Jan-12Although the stock market was able to come back from an early slide, its inability to push into positive territory left it to chop its way into the close for a lackluster finish.

The December payrolls report initially provided a lift to premarket sentiment. It featured a headline unemployment rate of 8.5%, which is down from the 8.6% in the prior month and less than the 8.7% that had been widely anticipated. Moreover, nonfarm payrolls climbed by 200,000, which exceeds the increase of 150,000 that had been expected. Private payrolls increased by 212,000 to exceed the consensus call for an increase of 170,000.

However, stocks were hit with selling pressure once the session opened. As was the case in the two previous sessions, stocks were able to stabilize and gradually work their way higher, but a lack of leadership prevented the broad market from overcoming resistance at the flat line.

Although the stock market was unable to close the week on a positive note, it displayed resilience in the face of a weaker euro, which fell about 0.6% to what is basically a new 16-month low of $1.27.

Recent market action may not have been all that exciting, but a strong gain on Tuesday helped the stock market book a weekly gain of 1.6%. For some prognosticators, that makes for a promising start to 2012, which many believe will still be driven by global financial and economic conditions, especially those in Europe. The Presidential election is also in the mix, as are corporate earnings. Earnings season gets its unofficial start early next week.

Trade this week began on Tuesday since domestic markets were closed on Monday in observance of New Year's Day. Stocks put together their best performance of the week by advancing about 1.6%, but the S&P 500 was unable to overcome resistance at its multi-month closing high of 1285.

Manufacturing data from China, India, a couple of corners of Europe provided encouragement to buyers. Even domestic manufacturing proved pleasing -- the December ISM Manufacturing Index improved to 53.9 from 52.7 in November so that it exceeded the reading of 53.4 that had been widely expected.

Construction spending for November increased by 1.2%, which bested the 0.5% increase that had been generally expected after a downwardly revised 0.2% decline during October.

Minutes from the most recent FOMC meeting proved unsurprising by stating only that domestic economic activity recently expanded moderately. Although the pace economic activity is expected to pick up, some committee members communicated that current and prospective conditions could warrant additional policy accommodation.

Trade on Wednesday had a flat finish as concerns about financial conditions in Spain and uncertainty over the financial flexibility of Hungary brought the negative themes of 2011 back into focus. Also in the mix were cautious comments from officials in China regarding the country's economic outlook.

On Thursday the Nasdaq made a nice gain, but the broad market mustered only a modest gain after working its way up from a marked loss in morning trade. A weaker euro and rising debt yields in Europe -- signs of the same old concerns about financial and economic conditions there -- dampened the mood of many traders, but the negativity was partly tempered by an ADP Employment Change that reported private payrolls increased by 325,000 during December. An increase of 180,000 had been generally expected.

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. The ISM Services Index for December did little to surprise by coming in at 52.6, which is only slightly less than the 53.0 that had been broadly forecasted. December same-store sales were also of little influence, due to their underwhelming results.

4:52PM Motorola Mobility sees Q4 revs of $3.4 bln vs. $3.9 bln CIQ Estimates with modest profitability on a non-GAAP basis (MMI) 38.46 -0.15 : Co announced preliminary results for Q4 2011. Although the co has not finalized its financial results for Q4, it estimates sales of $3.4 billion with modest profitability on a non-GAAP basis. These estimates include shipments of ~10.5 mln mobile devices, of which ~5.3 mln were smartphones. MMI's Q4 results were impacted by the increased competitive environment in the Mobile Device business and higher legal costs associated with ongoing Intellectual Property litigations. The co estimates sales of $900 mln for the Home business in Q4. MMIwill issue its Q4 2011 earnings results at ~3:00 p.m. U.S. Central Time on Thursday, January 26, 2012. As previously announced on August 15, 2011, MMI and Google (GOOG) entered into a definitive agreement for Google to acquire Motorola Mobility for $40.00 per share in cash.

4:25PM TranSwitch lowers Q4 revs guidance to roughly $6.3 mln vs. 7.0 mln CIQ Est, down from prior guidance of $7.0 mln (TXCC) 3.51 -0.05 : Co lowers Q4 2011 revenue guidance to be roughly $6.3 mln compared to the guidance provided on November 1, 2011 of roughly $7 million principally due to a contractual dispute on a service agreement with a North America customer. The co expects to report complete Q4 and full year 2011 financial results in early February 2012 and will announce details when they are available. "We continue to make progress on our strategic plan of creating value through innovative products for HD multimedia connectivity and processing," said Dr. M. Ali Khatibzadeh, President & CEO of TranSwitch. "With the introduction of HDwire), the fastest video transport technology for flat-panel displays, TranSwitch substantially increases its addressable market.

09:06 am RF Micro Device downgraded to Perform at Oppenheimer: . Oppenheimer downgrades RFMD to Perform from Outperform and removing their $9 tgt. RFMD cut Dec.-quarter guidance, pointing to stronger than earlier expected weakness in China and MPG. They expect RFMD to be weak as expectations and ests reset lower and mgm't works to rebuild investor confidence. While they still see positives in its new products and diversification strategy, it's difficult to assess the timetable needed for this to come to fruition and to fill the current China sales gap (which comes shortly after the NOK gap). Until they get a better feel for this and that RFMD's issues don't run deeper than communicated, they're stepping to the sidelines.

09:06 am Intel downgraded to Neutral at Sterne Agee; tgt $26: . Sterne Agee downgrades INTC to Neutral from Buy and sets target price at $26. The firm believes 2012-2014 could see headwinds in its core PC market with ARM/Win8 and lower ASPs. They believe 1) Major PC OEMs are moving 10-15% of mix to ARM PC platforms in 2012-13 away from x86 and Smartphone-Medfield is not material enough. They believe QCOM offers a better opportunity as it is best positioned to capitalize on Smartphone growth and incremental PC TAM with Win8 PC.

10:29 am S&P Tech Sector Down Modestly
The tech sector is trading slightly lower today, but ahead of losses in the broader market. Semiconductors are showing relative weakness in the tech space, however, with the Philly Semi Index trading 0.3% lower. NXPI (-3.0%) is a notable laggard in the chip index. Among other major indices, the S&P 500 is trading 0.4% lower, while the NASDAQ is trading 0.2% lower and the QQQ is 0.1% lower on the session. Among tech bellwethers, ORCL (+0.7%) is showing strength, while GOOG (-1.0%) is a notable underperformer.

In earnings last night, RFMD (-20.6%) lowered Q3 rev guidance below consensus and GPN (-2.8%) posted a mixed Q2 and raised guidance. This morning, KITD (+5.8%) raised its 2012 outlook.
Among rumors, we are hearing renewed CREE (+0.1%) takeover chatter making the rounds.
Among notable analyst upgrades this morning, SNDK (+2.6%) was upgraded to Buy at Sterne Agee and VOD (-0.2%) was upgraded to Buy at Goldman. Among downgrades, Sterne Agee downgraded INTC (-0.8%) to Neutral, Oppenheimer downgraded RFMD (-20.6%) to Perform, and MOTR (-10.0%) was downgraded to Neutral at JP Morgan.

10:18 am RF Micro Device Down 21% After Q4 Sales Miss Expectations (RFMD)
RF Micro Device (RFMD $4.47 -1.17) is trading 21% lower after reporting that revenue fell short of expectations late yesterday.

After the close yesterday, the company reported that 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.

10:55 am Best Buy Showing Gains After Reporting Comps and Reaffirming Guidance (BBY)
Best Buy (BBY $23.95 +0.51) is trading almost 3% higher this morning despite reporting negative December comps. The company reaffirmed fiscal year 2012 guidance this morning as well.

Earlier, the company reaffirmed fiscal year 2012 earnings of $3.35 to $3.65 per share versus the $3.40 Capital IQ Consensus Estimate as it announces Dec rev flat YoY at $8.4 bln, with comps -1.2%.

The company's Domestic segment generated $6.5 bln in revenue for fiscal December, an increase of 0.4 percent when compared with the prior-year period, with comps -0.4% (internatinal comps -1.7%). Domestic segment areas of comparable store sales growth included tablets and mobile phones within the Computing & Mobile Phones revenue category, eReaders within the Consumer Electronics revenue category, and the Appliances revenue category. Tablets and eReaders each delivered low triple-digit comparable store sales gains during the month. Mobile phones had a 20 percent comparable store sales increase during the month, driven by strong smart phone sales.

These increases were more than offset by comparable store sales declines in other areas, including gaming within the Entertainment revenue category and digital imaging within the Consumer Electronics revenue category. Gaming and digital imaging both experienced low double-digit declines in comparable store sales. The co noted that televisions experienced a mid single-digit comparable store sales decline within the Consumer Electronics revenue category. The co also noted that overall Domestic segment inventory levels finished fiscal December in line with its expectations.

"Based on our performance in December we continue to expect to achieve our annual guidance, despite customer traffic that was lower than expected until the last week before Christmas, which resulted in December rev that was slightly lower than our expectations."