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From Briefing.com: Weekly Recap - Week ending 14-Dec-12

Dow -35.71 at 13135.01, Nasdaq -20.83 at 2971.33, S&P -5.87 at 1413.58

Equities spent the day in the red as weakness in shares of Apple (AAPL 509.79, -19.89) weighed on the markets throughout the session. The S&P 500 held near its opening levels until the final hour when selling pressure pushed the benchmark index to a loss of 0.4%.

The technology sector was the biggest laggard due to underperformance from Apple and its suppliers. Earlier, UBS lowered its price target for AAPL to $700 from $780 due to an expected decline in iPhone and iPad shipments. The largest tech company settled lower by 3.8% on the day the iPhone 5 began selling in China.

Looking at notable Apple suppliers, Avago Technologies (AVGO 31.13, -2.56), Cirrus Logic (CRUS 25.58, -1.82), Skyworks Solutions (SWKS 19.80, -1.25), and Jabil Circuit (JBL 17.51, -1.02) all lost between 3.7% and 7.6%.

Elsewhere in technology, Adobe Systems (ADBE 37.56, +2.03) advanced 5.7% after beating on earnings and revenue. During the fourth quarter, the software company earned $0.61, which was $0.05 better than the Capital IQ consensus estimate. Meanwhile, the company's revenue of $1.15 billion also exceeded expectations. The software developer topped off the report with guidance, which was on the lower end of analyst estimates. Following the earnings report, JMP Securities upgraded Adobe to ‘Market Outperform' from ‘Market Underperform' with a $42 price target. On the other hand, Janney Montgomery Scott downgraded ADBE to ‘Neutral' from ‘Buy.'

The materials sector outperformed the broader market, and steel suppliers contributed to the strength. Last night, the Chinese HSBC manufacturing PMI survey revealed the second expansionary reading in a row. The data signals a possible rebound in Chinese growth, which would be beneficial to steelmakers. Among the major producers, Cliffs Natural Resources (CLF 33.96, +1.67), Nucor (NUE 42.28, +1.09), and Reliance Steel (RS 59.25, +1.31) all gained between 2.2% and 5.2%.

Energy stocks slipped 0.5% despite crude oil adding over 1.0%. Schlumberger Limited (SLB 68.91, -3.65) slid 5.0% following this morning's profit warning. The company said that it is experiencing continued contractual delays and higher-than-usual seasonal slowdowns in activity.

In notable analyst rating changes, Exxon Mobil (XOM 88.08, -0.50) shed 0.6% after Goldman Sachs downgraded the company to ‘Neutral' from ‘Buy.' Elsewhere, BP (BP 41.39, -0.08) finished lower by 0.2% after Credit Suisse downgraded the energy producer to ‘Neutral' from ‘Outperform.' On the upside, Marathon Oil (MRO 30.82, +0.63) advanced 2.1% after Goldman Sachs upgraded MRO to ‘Buy' from ‘Neutral.'

European markets entered the weekend on a mixed note. The United Kingdom's FTSE shed 0.1%, France's CAC ended flat, and Germany's DAX added 0.2%.

In the United Kingdom, Prudential lost 2.0%, and was the weakest performer. The insurer was pressured after the top industry regulator said European insurers and pension funds will face headwinds due to low interest rates. On the upside, miners outperformed and Polymetal International gained 2.3%.

In France, utility stocks were among the biggest laggards. Electricity provider GDF Suez lost 0.3% and water supplier Veolia Environnement slid 1.1%. On the upside, provider of communications solutions Alcatel-Lucent (ALU 1.24, +0.14) gained 7.0% after securing EUR1.6 billion in financing from Credit Suisse and Goldman Sachs. It should be noted that digital security provider Gemalto will replace Alcatel-Lucent in the CAC on December 24.

Germany's DAX was supported by carmakers. Daimler gained 2.6% after its European market share increased to 5.7% from 5.2%. The uptick was due to strong sales by its Mercedes unit. Meanwhile, Deutsche Bank was the weakest performer. The financial giant lost 1.6% after a German court found the company partially liable for the collapse of the Leo Kirch media group.

In today's economic data, November consumer prices decreased by 0.3%, which was below the Briefing.com consensus. Today's reading follows the 0.2% increase recorded during the prior month. In addition, core prices rose by 0.1% which was in-line with expectations.

Industrial production increased during November by 1.1%, which was better than the 0.1% increase that had been expected by the Briefing.com consensus. The reading follows the revised 0.7% decrease recorded during the prior month. Capacity utilization hit 78.4%, which was better than the 77.9% expected by the Briefing.com consensus, and up from the revised prior month reading of 77.7%.

On Monday, December Empire Manufacturing Index will be reported at 8:30 ET and October net long-term TIC flows will be released at 9:00 ET.

Week in Review: Markets in Holding Pattern as Budget Deal Remains Elusive

On Monday, equities were little changed. With no economic data to digest, investors expressed caution after Italy's Prime Minister Mario Monti announced plans to submit his resignation upon the successful approval of the country's budget. However, afternoon reports from the Financial Times indicated Italy's centrist parties urged Mr. Monti to run on their ticket in next year's election. Domestically, trade was confined to a narrow range and volume was well below-average. As a result, the S&P 500 finished flat.Hewlett-Packard (HPQ 14.75, +0.25) rose by 2.6% following earlier rumors which suggested activist investor Carl Icahn was building a stake in the company.

Tuesday's session was relatively quiet as the major averages followed an upbeat open with a climb to their respective highs. At noon, House Speaker John Boehner said he remains hopeful a budget deal will be reached, but first, Democrats and the President need to outline specific spending cuts. The comments had little effect on the markets as equities continued holding at their best levels. However, 90 minutes before the close, Senate Majority Leader Harry Reid said Democrats do not plan to propose spending cuts, and that reaching a consensus before Christmas would be difficult. In response to Senator Reid's comments, the S&P 500 slipped from its highs, trimming its gain to 0.6%. TripAdvisor(TRIP 41.67, -1.04) spiked 6.6% after Liberty Interactive (LINTA 19.12, -0.16) purchased 4.8 million TRIP shares for $62.50 per share. As a result of the transaction, Liberty Interactive will control a majority voting stake in TripAdvisor.

Wednesday began on a slightly higher note in anticipation of the latest policy statement from the Federal Reserve. The major averages spiked to session highs upon the release of the central bank's directive. However, stocks surrendered all of their gains, and the S&P 500 finished flat. As expected, the Federal Open Market Committee held its Federal Funds Rate steady at 0-0.25%. In addition, the Fed announced ‘Operation Twist' will be replaced by a Treasury purchasing program with an initial rate of $45 billion per month. Also of note, the key interest rate is expected to remain at exceptionally low levels until a target unemployment rate of 6.5% is reached. Molycorp (MCP 10.05, -0.19) slid 3.0% after announcing the departure of Chief Executive Officer Mark Smith. The company's Board of Directors has appointed Costantine Karayannopoulos as Interim President and Chief Executive Officer.

On Thursday, the major averages began on a mixed note before selling pressure pushed the key indices to their respective lows. Shortly before noon, House Speaker John Boehner addressed the media in Washington. During his remarks, the speaker suggested President Obama is not serious about cutting spending, and the White House is willing to go over the fiscal cliff. Mr. Boehner's remarks had little impact on the markets, which continued pushing to fresh lows. However, a late-afternoon headline indicated Speaker Boehner and President Obama will meet in person at 17:00 ET. The report lifted the S&P 500 off its worst level of the day, but the benchmark index still finished with a loss of 0.6%.Boston Beer (SAM 132.38, +0.44) surged 15.5% after the brewer raised its 2012 earnings expectations as well as the 2013 depletion projections. Following the update, the company sees 2012 earnings between $4.30 and $4.60, while the Capital IQ consensus expects earnings at $4.24 per share.

 
 Index	  Started Week	Ended Week   Change  % Change   YTD % 
 DJIA	    13155.13	 13135.01   -20.12	-0.2	7.5 
 Nasdaq	     2978.04	  2971.33    -6.71	-0.2   14.1 
 S&P 500	1418.07	  1413.58    -4.49      -0.3   12.4 
 Russell 2000  822.27	   823.75     1.48       0.2   11.2

4:30PM SunPower reaches settlement in class action litigation (SPWR) 5.41 +0.12 : Co announced it has entered into an agreement to settle the private securities class action suit against the company and certain current and former members of management. This action is titled, "In re SunPower Securities Litigation." The agreement, which is subject to negotiation and execution of a final settlement document and court approval, provides for the payment by SunPower of $19.7 million and would lead to the dismissal of all claims against the defendants. The company expects to reflect the impact of the settlement in its fourth quarter 2012 financial results. "While we strongly believe that the company and its management fully met all their legal obligations, we have decided it is more prudent to focus our efforts on growing new markets and continuing to expand our leading residential market share position," said Lisa Bodensteiner, SunPower executive vice president and general counsel.

ASML Holding NV (ASML) and Cymer (CYMI) provide a status update regarding ASML's previously announced pending acquisition of all of the outstanding shares of Cymer. Cymer has established February 5, 2013 as the date on which it will hold a special shareholders meeting at which the stockholders of record of Cymer as of 7 January 2013 will be asked to vote on, among other things, a proposal to approve the merger agreement,

Adobe Systems (ADBE) reported fourth quarter earnings of $0.61 per share, ex items, $0.05 better than the Capital IQ consensus of $0.56, while revenues rose 0.1% year/year to $1.15 billion versus the $1.1 bln consensus. Key Points: Deferred revenue grew by $59.3 million to a record $619.6 million. Adobe added approximately 10,000 Creative Cloud subscriptions per week during the quarter, versus the addition of 8,000 subscriptions per week in the third quarter. Adobe Marketing Cloud achieved record quarterly revenue of $220.4 million, which represents 32 percent year-over-year growth. "We're driving migration to a subscription model in our Creative business faster than we predicted a year ago, and we are confident fiscal 2013 will be the pivotal year for the transition." According the conference call slides company stated "For the first quarter of fiscal 2013, we are targeting a revenue range of $950 million to $1 billion dollars [vs $1.07 bln Capital IQ Consensus Estimate]..."We expect total Adobe reported revenue in FY13 to be approximately $4.1 billion [vs $4.47 bln Capital IQ Consensus Estimate]. We will closely manage expenses during this upcoming transition year, and expect earnings per share to be approximately $0.62 on a GAAP-basis, and $1.40 on a non-GAAP basis [may not compare to $2.37 Capital IQ Consensus Estimate]."

Microsoft (MSFT) was initiated with a Market Perform at BMO Capital Markets; tgt $30. The firm concludes that a weak PC market, a slowdown in transactional enterprise license sales, and a slow ramp of Surface tablet sales will cap the upside in shares. While they are positive on touch-enabled PCs and enterprise demand for Office-enabled Windows tablets, demand could take longer-than-expected to ramp. While they believe that the Server and Tool business can continue to grow at a ~10% clip and gain share, they think that more of the growth in this business is driven by co's licensing model changes and price increases than most investors believe.