From Briefing.com: 4:15 pm : Stocks remained in a tight range throughout the day before settling on their session lows. Market action was similar to that observed yesterday as the major indices hovered around their respective unchanged levels for most of the session. Low volume and in-line economic data contributed to an uneventful session as investors await tomorrow's comments from the Federal Reserve and Thursday's European Central Bank rate decision.
Personal income increased by 0.5% in June, which was slightly greater than the 0.4% expected increase. Personal spending was unchanged, instead of increasing by 0.1% as had been broadly anticipated. Core personal consumption expenditures ticked up 0.2% month over month, in-line with expectations. Additionally, consumer confidence came in at 65.9 on expectations of a 61.0 reading.
Summer vacations and the on-going Olympics are some of the possible reasons for today's lackluster market action. Weak volume headlined the day before late-day selling pushed the total number of traded shares closer to the 50-day average.
As equities traded without direction, the dollar index ended down 0.2%. At 1.2305, the euro maintained its 0.4% advance versus the dollar after choppy morning trade.
Fueled by a positive earnings surprise and better-than-expected revenue growth, United States Steel (X 20.65, +1.73) was one of the day's best performers, finishing up 9%.
Energy was the worst performing sector today. Down 5%, Nabors Industries (NBR 13.84, -0.74) was the main laggard. Today's sell-off coincided with the stock testing $14.60 resistance which has held for the past six months.
With more than 100 companies set to report earnings after hours, competitors Electronic Arts (EA 11.02, -0.21) and Take-Two Interactive (TTWO 8.78, -0.35) bear watching. EA has been stuck in a downtrend throughout the year. At $11, the stock is testing lows not seen since 1999. Take-Two has also been slumping, albeit not as severely as EA. The current $9 level has provided strong support for the stock during the past three years.
Frontier Communications (FTR 3.92, +0.21) will also report earnings after the bell. The company's shares started the day flat but managed to build up a 5.7% advance over the course of the session. The consensus estimate calls for earnings of $0.06 per share on revenue of $1.24 billion.
In addition to tomorrow's results of the FOMC meeting scheduled for 2:15 PM ET, ADP Employment Change will be reported at 8:15 AM ET and will be followed by the ISM Index and construction spending at 10 AM ET.DJ30 -64.33 NASDAQ -6.32 SP500 -5.98 NASDAQ Adv/Vol/Dec 1022/1.73 bln/1466 NYSE Adv/Vol/Dec 1234/887.9 mln/1779
3:35 pm : Crude oil extended yesterday's losses following numerous European headlines and U.S. economic data. Weakness also came ahead of tomorrow's policy directive from The Federal Reserve. It came off its pit session high of $90.11 per barrel and plummeted into negative territory moments after floor trade opened. It touched a session low of $87.52 per barrel before it consolidated and closed with a 1.9% loss at $88.07 per barrel.
Natural gas traded up to a floor session high of $3.28 per MMBtu in morning action but lost momentum. It fell into negative territory to a session low of $3.16 per MMBtu. However, buyers stepped in during afternoon action and helped push prices higher. Natural gas erased the entire loss and managed to book a 0.3% gain as it closed at $3.22 per MMBtu.
Precious metals followed in crude's footsteps and fell into negative territory despite a weaker dollar. Gold slid off its pit session high of $1631.60 per ounce and brushed a session low of $1614.20 per ounce moments before pit close. It settled at $1615.40 per ounce, or 0.5% lower, after volatile and choppy trading. Silver was also unable to stay above the break-even level and moved into the red in afternoon action. It settled with a 0.4% loss at $27.90 per ounce, just above its session low of $27.86 per ounce.DJ30 -35.88 NASDAQ -1.96 SP500 -3.74 NASDAQ Adv/Vol/Dec 1132/1423.7 mln/1329 NYSE Adv/Vol/Dec 1309/507 mln/1672
5:53PM Jabil Circuit announces pricing of $500 mln 4.700% senior notes (JBL) 21.70 +0.49 : Co announced today the pricing of its offering of $500.0 million 4.700% senior unsecured notes due 2022 (the "Offering"). These notes will be issued at 99.992% of par. Jabil intends to use the net proceeds from the Offering (i) to repay outstanding borrowings under its revolving senior credit facility and (ii) for general corporate purposes.
4:31PM Microchip announces receipt of antitrust clearance from China for SMSC acquisition (MCHP) 33.38 +0.02 :
4:18PM TTM Tech misses by $0.06, reports revs in-line; guides Q3 EPS below consensus, revs below consensus (TTMI) 10.94 +0.30 : Reports Q2 (Jun) earnings of $0.17 per share, $0.06 worse than the Capital IQ Consensus Estimate of $0.23; revenues fell 10.6% year/year to $327.42 mln vs the $329.26 mln consensus. "Second quarter revenue was within our expected range as sales increased following the normal seasonality we experienced in the first quarter. However, weaker than expected demand for advanced technology PCBs as well as higher labor costs in Asia impacted margins and earnings during the quarter." Co issues downside guidance for Q3, sees EPS of $0.16-0.24 vs. $0.33 Capital IQ Consensus Estimate; sees Q3 revs of $340-360 mln vs. $363.10 mln Capital IQ Consensus Estimate. "As we enter the second half of the year, we are beginning to receive orders in our Asia Pacific segment for new handheld products. This improving advanced HDI demand in the second half of 2012 is beginning to materialize as anticipated and should improve our results."
4:16PM Silicon Image beats by $0.02, beats on revs; guides Q3 revs above consensus (SIMG) 3.92 -0.06 : Reports Q2 (Jun) earnings of $0.05 per share, excluding non-recurring items, $0.02 better than the Capital IQ Consensus Estimate of $0.03; revenues rose 19.0% year/year to $63.8 mln vs the $61.08 mln consensus. Co issues upside guidance for Q3, sees Q3 revs of $73-75 mln vs. $72.37 mln Capital IQ Consensus Estimate, with gross margin of ~58%.
4:15PM Atmel reports EPS in-line, misses on revs (ATML) 5.86 -0.16 : Reports Q2 (Jun) earnings of $0.08 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.08; revenues fell 23.1% year/year to $368.2 mln vs the $372.1 mln consensus. Non-GAAP gross margin was 44.6% in the second quarter of 2012 compared to 43.2% in the immediately preceding quarter and 52.3% in the second quarter of 2011.
MIPS Technologies (MIPS) together with Ingenic Semiconductor and Karbonn Mobiles announced availability in India of the Android 4.1 'Jelly Bean' tablet.
Axcelis Technologies (ACLS) announced the first shipment of the co's Purion M medium current implanter.
8:16AM Trina Solar lowers Q2 module shipment outlook; lowers gross margin expectations (TSL) 4.84 : The Company estimates its solar module shipments in Q2 to be between 390 MW to 420 MW, compared to the Company's previous guidance of 500 MW to 520 MW. Additionally, for Q2, co estimates that overall gross margin, including the impact of a provision for potential countervailing and anti-dumping duties and a non-cash inventory write-down in the range of $26-28 mln to $28 million, to be 7.0% to 9.0%, compared to the Company's previous guidance of approximately 10%.
The Company further expects that its operating expenses in the second quarter of 2012 will be impacted by: 1) A receivables provision between $45 million to $48 million primarily for certain customers' accounts receivables; and 2) A foreign currency exchange loss between $22 million to $23 million, which was net of changes in fair value of derivative instruments.
The Company will confirm or revise its previous shipment guidance of between 2.0 to 2.1 GW for the full year 2012 during its second quarter 2012 earnings conference call.
"An overcapacity-induced deflationary pricing environment caused the shortfall in gross margin," said Mr. Jifan Gao, Chairman and CEO of Trina Solar. "Shipment volume fell short of our targets as US market uncertainty on the preliminary impact of the tariff resulted in stagnant demand in North America, and the timing of several large projects in China was pushed to the second half of 2012. Amidst these market conditions, we strived to maintain reasonable gross profits. The receivables provision results largely from the overdue balances for certain customers. Meanwhile, the Company is making a strong effort to collect payments from these customers."
7:48AM Canadian Solar lowers Q2 module shipment expectations; raises gross margin outlook due to one-time items (CSIQ) 2.64 : For the second quarter of 2012, Canadian Solar expects recognized solar module shipments to increase to approximately 410 MW to 420 MW (prior 430-450 MW). This compares to shipments of 343 MW in the first quarter of 2012 and 287 MW in the second quarter of 2011. The Company now expects gross margin for the second quarter of 2012 to range from 12.0% to 12.5% due to the positive impact of one-time items, which it estimates to total approximately 4% (prior 8-10%).
In addition, the Company expects net foreign exchange loss to be approximately $8 million for the second quarter of 2012, resulting mainly from the impact of the decrease in value of the Euro compared to the US dollar during the quarter.
7:32AM Vishay misses by $0.02, reports revs in-line; guides Q3 revs in-line (VSH) 8.76 : Reports Q2 (Jun) earnings of $0.24 per share, excluding non-recurring items, $0.02 worse than the Capital IQ Consensus Estimate of $0.26; revenues fell 17.2% year/year to $588 mln vs the $589.13 mln consensus. Co issues in-line guidance for Q3, sees Q3 revs of $570-610 vs. $588.48 mln Capital IQ Consensus Estimate.
Cirrus Logic (CRUS $35.97 +6.14) reported first quarter earnings of $0.22 per share, $0.01 better than the Capital IQ Consensus of $0.21, while revenues rose 7.4% year/year to $99 million versus the $101.63 million consensus. The company issues upside guidance for Q2, sees Q2 revs of $170-190 mln vs. $130.64 mln Capital IQ Consensus Estimate. Q2 gross margin is expected to be between 52 percent and 54 percent, inline with consensus of 53.9%. In addition, the company is announcing the sale of assets associated with its Apex Precision Power business in Tucson, Ariz., for $26 million. After the sale, Cirrus Logic will continue to maintain a high voltage/high power IC design team in Tucson. This transaction is expected to close within 45 days, subject to certain standard closing conditions. More information is included in our quarterly Shareholder Letter.
Seagate Tech (STX $27.92 -2.51) reported fourth quarter earnings of $2.41 per share, $0.12 worse than the consensus of $2.53, while revenues rose 56.8% year/year to $4.48 billion versus the $4.55 bln consensus. The company also reported gross margin of 33.6%. Co also announced it increased quarterly dividend by 28% to $0.32 per share
Sterne Agee notes, Key PC-NB-Enterprise HDD supplier Seagate (STX) after the close guided to a September quarter "down 10%+ q/q" noting purchasing delays ahead of Win8 and Macro uncertainties. They believe the "down 10% q/q" could imply challenges for both Intel (INTC 25.76 +0.00) and AMD (AMD $4.09 -0.01) They believe the PC group faces challenges with a down 10% q/q HDD shipments in typically the strongest PC quarter ahead of back to school and holidays.
09:18 am Seagate shares fall 8% following earnings
Seagate Tech (STX $27.88 -2.55) reported fourth quarter earnings of $2.41 per share, $0.12 worse than the consensus of $2.53, while revenues rose 56.8% year/year to $4.48 billion versus the $4.55 bln consensus. The company also reported gross margin of 33.6%. Co also announced it increased quarterly dividend by 28% to $0.32 per share
09:14 am Cirrus Logic shares soar over 21% following large upside Q2 revenue guidance
Cirrus Logic (CRUS $36.20 +6.36) reported first quarter earnings of $0.22 per share, $0.01 better than the Capital IQ Consensus of $0.21, while revenues rose 7.4% year/year to $99 million versus the $101.63 million consensus. The company issues upside guidance for Q2, sees Q2 revs of $170-190 mln vs. $130.64 mln Capital IQ Consensus Estimate. Q2 gross margin is expected to be between 52 percent and 54 percent, inline with consensus of 53.9%. In addition, the company is announcing the sale of assets associated with its Apex Precision Power business in Tucson, Ariz., for $26 million. After the sale, Cirrus Logic will continue to maintain a high voltage/high power IC design team in Tucson. This transaction is expected to close within 45 days, subject to certain standard closing conditions. More information is included in our quarterly Shareholder Letter.
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