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From Briefing.com: Weekly Recap - Week ending 17-Jan-14The broader market ended the week on a down note, undercut by a spate of uninspiring earnings results and guidance from some widely-held companies that put a damper on the bullish sentiment seen in the middle of the week. There were some buying efforts on Friday that controlled the fallout, but generally speaking there wasn't a lot of conviction among buyers with the exception of some specific stocks.

Those exceptions tended to reside in the price-weighted Dow Jones Industrial Average, which outperformed the other major indices on Friday.

American Express (AXP 90.97, +3.19), which came up shy of consensus earnings estimates but spotlighted encouraging card member spending, was instrumental in the Dow's outperformance. It joined with Visa (V 232.18, +10.41) -- the highest-priced stock in the Dow -- to effectively account for all of the Dow's gains. Remarkably, 21 out of the 30 Dow components ended lower on Friday.

Intel (INTC 25.85, -0.69) and General Electric (GE 26.58, -0.62) were among the Dow laggards. Both companies reported their results for the fourth quarter, yet neither wowed investors. Intel missed by a penny and said it expected FY14 revenues to be approximately flat. GE was in-line with expectations and said things were improving, albeit in a mixed environment.

Morgan Stanley (MS 33.40, +1.40), which beat by eight cents, and Schlumberger (SLB 90.21, +1.60), which beat by two cents, enjoyed positive outings that provided a measure of support for the broader market and their respective sectors.

Be that as it may, every S&P 500 sector closed in the red on Friday. The energy sector (-0.05%) was the relative strength leader while the consumer staples sector (-0.8%) was the biggest laggard. The latter was afflicted by a big earnings warning out of Elizabeth Arden (RDEN 27.96, -6.54).

Other notable companies warning they expect to fall short of earnings expectations included Con-way (CNW 40.59, -0.81), Royal Dutch Shell (RDS.a 70.57, -1.17), and UPS (UPS 99.91, -0.58). The warning from UPS drew a lot of attention, yet the company came back nicely from a loss of more than three points during the day as investors seemed to warm to the notion that its shortfall was tied to the bad weather and the operational challenges of meeting increased demand during the holiday selling period.

The earnings news was the focal point throughout the day and the week. There were some early economic releases, but they didn't have much bearing on Friday's proceedings. Overall, the economic news was good enough not to create any newfound concerns about the economic recovery.

December housing starts slipped 9.8% to an annualized rate of 999,000 units, but the two-month average for starts was the highest since March 2008.
Industrial production jumped 0.3%, which was the fifth consecutive month industrial production increased.
The preliminary reading for the University of Michigan Consumer Sentiment report for January dipped to 80.4 from 82.5, but the downturn wasn't enough to cause any real concerns

Friday was an options expiration day, so volume was heavier than usual with 880 mln shares having traded at the NYSE versus 641 mln on Thursday.

The early sense of things so far is that the fourth quarter wasn't a slam-dunk quarter despite the incoming signs of improving economic activity that were seen during the quarter. Furthermore, there hasn't been a lot of table pounding either with respect to the first quarter and the year ahead.

The latter is owed in part to the fact that the financial companies factored prominently on this week's earnings calendar and they don't typically provide specific earnings guidance. The coming week will provide some more clarity on the outlook when a larger number of industrial and technology companies report their results.

At the moment, the market is having some difficulty finding its way and has the semblance of being at a 'T' intersection, not knowing which way to turn. That indecision has led to some choppy trading action. The guidance from corporate America in the coming week may very well offer some navigational clues.

For the week that just concluded, the S&P 500 declined 0.2%, the Dow Jones Industrial Average gained 0.1%, and the Nasdaq Composite increased 0.5%.

As a reminder, the stock and bond markets will be closed on Monday in observance of Martin Luther King, Jr. Day.

 
 Index       Started Week  Ended Week   Change % Change	 YTD % 
 DJIA	      16437.05	   16458.56	21.51	 0.1	-0.7 
 Nasdaq	      4174.67	    4197.58	22.91	 0.5	 0.5 
 S&P 500	1842.37	    1838.70	-3.67	-0.2	-0.5 
 Russell 2000  1164.53	    1168.43	 3.90	 0.3	 0.4

5:01PM This week's biggest % gainers/losers (SCANX) : The following are this week's top 20 percentage gainers and top 20 percentage losers, categorized by sectors (over $300 mln market cap and 100K average daily volume).

This week's top 20 % gainers

Technology: CMGE (32.66 +24.33%), NMBL (48.72 +23.7%)
Services: DL (22.27 +31.04%)
Industrial Goods: NPO (76.9 +34.43%)
Healthcare: SRPT (26.78 +45.53%), ALNY (87.38 +36.09%), CHTP (4.76 +33.14%), XON (36.78 +32.16%), NLNK (31.95 +29.67%), ARNA (7.26 +27.39%), CTIC (3.63 +25.98%), GALE (6.97 +23.84%), CLDX (28.32 +23.66%), INSY (53.61 +23.53%), QCOR (59.24 +23.06%)
Consumer Goods: BEAM (83.34 +25.63%)
Basic Materials: TC (2.96 +37.61%), RIOM (2.2 +24.69%), RBY (1.09 +23.81%), AUQ (4.83 +22.95%)

This week's top 20 % losers

Technology: ZNGA (3.54 -14.08%)
Services: BBY (24.43 -28.51%), GME (37.69 -16.06%), ARO (7.71 -13.94%), LIN (24.71 -12.22%)
Industrial Goods: PGEM (13.6 -17.61%)
Healthcare: USNA (59.55 -20.23%), AEGR (62.53 -18.66%), GERN (4.5 -18.55%), MNKD (5.78 -14.97%), CORT (3.19 -13.87%), TNDM (26.88 -11.81%)
Financial: QIWI (40 -15.35%)
Consumer Goods: NUS (79.4 -38.52%), SODA (38.15 -22.32%), LULU (47.38 -14.93%), DECK (75.07 -14.14%), HLF (70.22 -12.11%)
Basic Materials: NRP (16.38 -18.79%), AGI (10.15 -13.1%)

4:01PM QLogic and Brocade (BRCD) to accelerate innovation in storage area networks; cos to collaborate on strengthening fibre channel SAN ecosystem through a strategic technology and marketing alliance (QLGC) 11.70 -0.25 : Co and Brocade Communications (BRCD) announced a broad technology alliance agreement that will enhance end-to-end storage connectivity for end users and accelerate innovation in Storage Area Networks. Under the terms of the agreement, QLogic and Brocade will:

Jointly develop capabilities to enhance Fibre Channel technology on an end-to-end basis with improved performance, manageability and reliability for enterprise customers
Align on product plans and testing to accelerate deployment of Gen 5 and Gen 6 Fibre Channel technology
Jointly market and evangelize advanced SAN solutions for the next-generation data centers.

In connection with the technology and marketing alliance agreement, QLogic also acquired Brocade's Fibre Channel and converged network adapter business. This further extends QLogic's market leading adapter offerings and ensures continuity of supply to current Brocade customers. This acquisition is not expected to have a material impact on the operating results of QLogic.

12:19PM Notable movers of interest (SCANX) : The following are some of today's most notable movers of interest, categorized by market capitalization (large cap over $10 billion and mid cap between $2-10 billion) and ranked by % change (all stocks over 100K average daily volume).

Large Cap Gainers

ILMN (135.27 +7.99%): Co outlined plans for expansion and previewed new products at investor day; target raised to $150 from $135 at Mizho; target raised to $190 from $120 at J.P. Morgan
TWTR (63.68 +5.13%): Seeing reports that co plans to partner with startup Stripe for e-commerce; initiated with a Buy at Stifel, target $75
AXP (91.83 +4.61%): Reported Q4 EPS of $1.21 vs $1.25 estimate, revs rose 5.0% yoy to $8.55 bln vs $8.57 bln estimate; upgraded at Susquehanna and Buckingham Research

Large Cap Losers

SLM (24.78 -8.70%): Missed quarterly EPS by $0.12 ($0.61 vs $0.73 estimate); loan originations rose 2% to $524 mln
COF (73.01 -4.49%): Missed quarterly EPS by $0.12 ($1.45 vs $1.57 estimate), revs fell 1.4% yoy to $5.54 bln vs $5.46 bln estimate; downgraded to Neutral from Positive at Susquehanna
INTC (25.64 -3.41%): Missed quarterly EPS by $0.01 ($0.51 vs $0.52 estimate), revs rose 2.6% yoy to $13.83 bln vs $13.74 bln estimate; reaffirmed FY14 revs ~flat yoy at $52.7 bln vs $53.19 bln estimate; sees Q1 revs of $12.3-13.3 bln vs $12.78 bln estimate

Mid Cap Gainers

EA (24.05 +11.65%): NPD Group reported sale of new games at retail shops fell 17% to $1.31 bln; initiated with a Buy at CRT Capital, target $26
SWKS (30.93 +8.07%): Beat quarterly EPS by $0.01 ($0.67 ex items vs $0.66 estimate), revs rose 11.3% yoy to $505 mln vs $500 mln estimate; sees Q2 EPS of $0.59 ex items vs $0.57 estimate, revs of ~$470 mln vs $460.50 mln estimate; target raised at Needham, Northland, Brean Capital, and Canaccord Genuity
AU (13.63 +6.57%): Strength in gold miners: KGC, GFI, EGO also higher; seeing reports that gold miners were mentioned positively by J.P. Morgan analysts

Mid Cap Losers

NUS (77.62 -8.47%): Continued weakness on news that China will investigate recent accusations that the company is operating an illegal pyramid scheme; downgraded to Neutral from Buy at BofA/Merrill
SINA (75.63 -6.14%): Downgraded to Hold from Buy at Jefferies
BBY (25.21 -6.04%): Continued weakness on disappointing domestic holiday comparable sales and lowering of Q4 profit guidance; downgraded to Neutral from Buy at Goldman; mentioned cautiously at Barron's; target lowered to $33 from $50 at Telsey Advisory Group

10:00AM Best Buy (-4%) hits new ~7 month low after falling 29% yesterday on disappointing holiday sales report indicating much lower than expected margins (BBY) 25.72 -1.11 :

8:00AM IBM confirms plans to commit over $1.2 bln to significantly expand its global cloud footprint (IBM) 188.76 : Co announced plans to commit over $1.2 billion to significantly expand its global cloud footprint. This investment includes a network of data centers designed to bring clients greater flexibility, transparency and control over how they manage their data, run their businesses and deploy their IT operations in the cloud.

This year IBM plans to deliver cloud services from 40 data centers worldwide in 15 countries and five continents globally, including North America, South America, Europe, Asia and Australia. IBM will open 15 new centers worldwide adding to the existing global footprint of 13 global data centers from SoftLayer and 12 from IBM. Among the newest data centers to launch are China, Washington, D.C., Hong Kong, London, Japan, India, Canada, Mexico City and Dallas. With this announcement, IBM plans to have data centers in all major geographies and financial centers with plans to expand in the Middle East and Africa in 2015.

The new cloud investments IBM is making will provide business clients the ability to place and control their data globally. IBM SoftLayer gives clients the ability to choose a cloud environment and location that best suits their business needs and provides visibility and transparency to where data reside, control of data security and placement.

IBM SoftLayer is able to deliver high performance services globally across the SoftLayer network. The combination of distributed local data centers and a global network allows clients to place data where it is required, when it is required as well as the ability to consolidate or aggregate data as needed. This provides optimized application performance and responsiveness. SoftLayer's unique network architecture.

Intel (INTC) reported fourth quarter earnings of $0.51 per share, which is below expectations, while revenues rose 2.6% year/year to $13.83 billion which is in line with expectations. Intel reports Q4 gross margins of 62% (INTC guided for gross margins of 61%, +/- a couple of percentage points). The company issued first quarter with revenues of $12.3-13.3 billion which is line with expectations. Intel sees Q1 gross margins of 59% plus or minus two percentage points. The company reaffirmed guidance for fiscal year 2014 revenues of $52.7 billion which is line with expectations. The company sees FY14 Gross margin percentage: 60 percent, plus or minus a few percentage points. PC Client Group revenue of $8.6 billion, up 2 percent sequentially and flat year-over-year. Data Center Group revenue of $3.0 billion, up 3 percent sequentially and up 8 percent year-over-year. "We had a solid fourth quarter with signs of stabilization in the PC segment and financial growth from a year ago...We've built a strong foundation for our business by bringing innovation to the market more quickly across a wide range of computing platforms. For example, at CES, we demonstrated multiple devices that weren't on our roadmap six months ago."
Conference Call Comments: The company sees Q1 gross margin at ~59%; three point decline from the fourth quarter is driven by higher platform writeoffs and overall lower platform volumes in-line with seasonal trends The company sees FY14 gross margin at ~60%; expects start up costs to decline, partially offset my impact of tablets; expects to spend $18.6 bln and expects capital spending of $11 billion.

Silver Spring Networks (SSNI) issued guidance for the fourth quarter with EPS of ($0.01) - $0.00 and revenues of $88 - $89 million which are both below expectations. Non-GAAP gross profit margin was 42.0%, up from 31.4% a year ago, primarily due to a higher mix of higher margin revenue. GAAP gross profit margin was 32.0% as compared to 11.2% a year ago. "For the full year 2013 we now expect top line to grow approximately 13%. We did not close a few expected deals which impacted our fourth quarter results,"

Skyworks (SWKS) reported first quarter earnings of $0.67 per share, which is higher than expected, while revenues rose 11.3% year/year to $505 million which is higher than expected. The company issued guidance for the second quarter with EPS of $0.59, excluding non-recurring items, and revenues of approximately $470 million which are both above expectations.