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From Briefing.com: 4:15 pm : The major averages followed last week's sharp losses with another shaky performance. The Dow Jones Industrial Average and S&P 500 posted respective declines of 0.3% and 0.5% while the Nasdaq (-1.1%) and Russell 2000 (-1.5%) underperformed.

Stocks displayed gains at the open but the early strength faded during the initial hour as the Nasdaq headed into the red. The other indices followed suit and the broad retreat continued until about 12:20 ET when stocks reversed and spent the afternoon in a steady climb. Moderate selling pressure returned during the final hour, knocking the indices off their afternoon highs.

Although there was no news responsible for the turn, the morning selling coincided with a strengthening yen while the session low in equities matched the high point for the Japanese currency. Once the yen began weakening again, a rally in equities ensued. Similarly, the selling observed during the last 30 minutes of action coincided with the yen gaining strength once again.

The Dow and S&P 500 held up relatively well compared to the tech-heavy Nasdaq. The index suffered after being hit with a one-two punch of selling interest as large cap tech names and biotechnology retreated. The tech sector (-1.0%) finished at the bottom of the leaderboard while the iShares Nasdaq Biotechnology ETF (IBB 238.60, -5.42) lost 2.2% and also pressured the health care sector (-0.8%).

Even though technology underperformed, its largest component, Apple (AAPL 550.50, +4.43) added 0.8% ahead of its after-hours earnings report.

Elsewhere among cyclical groups, the industrial sector (+0.2%) drew strength from Caterpillar (CAT 91.29, +5.12) after the Dow component reported above-consensus results and announced a $10 billion buyback program. Transports, however, did not take part in the rally. The bellwether complex lost 0.8% after plunging 4.1% on Friday.

On the countercyclical side, health care (-0.8%) lagged while consumer staples (-0.3%), telecom services (+0.1%), and utilities (+0.2%) outperformed.

The early selling fueled a scramble for downside protection, which sent the CBOE Volatility Index (VIX 17.51, -0.63) as high as 18.99%. However, the subsequent rebound invited many to lift their hedges. As a result, the near-term volatility measure ended lower by 3.5%.

Treasuries finished on their lows with the benchmark 10-yr yield up five basis points at 2.77%.

Participation was a bit above average as 764 million shares changed hands at the NYSE.

Today's economic data was limited to the December New Home Sales, which fell 7.0% to 414,000 from a downwardly revised 445,000 (from 464,000) while the Briefing.com consensus pegged the reading at 457,000. Total sales in 2013 increased 16.3% to 428,000 from 368,000 in 2012. That was the most new homes sold since 485,000 sales registered in 2008. Although that may seem like a lot, more than a million new homes were sold each year from 2003 to 2006.

We hypothesized that the strong sales performance in October and November was due to buyers rushing into the market to take advantage of relatively low interest rates in a rising interest rate environment. The large December decline adds evidence to this theory as the push forward in demand dried up and sales levels returned to where they were during the lackluster summer period. Another drop in January would deliver more credence to the contention that gains in October and November were not from sustainable demand growth.

Tomorrow, December Durable Orders will be released at 8:30 ET while the November Case-Shiller 20-city Index and January Consumer Confidence will cross the wires at 9:00 ET and 10:00 ET, respectively.

Nasdaq Composite -2.2% YTD
Russell 2000 -3.1% YTD
S&P 500 -3.6% YTD
Dow Jones Industrial Average -4.5% YTD

DJ30 -41.23 NASDAQ -44.56 SP500 -8.73 NASDAQ Adv/Vol/Dec 589/2.15 bln/2036 NYSE Adv/Vol/Dec 795/763.6 mln/2278 3:35 pm : Natural gas futures sold off today nicely following a huge rally, which pushed futures above $5/MMBtu late last week (over the weekend).

Today, Feb natural gas sold off $0.35/MMBtu (or -7%) to $4.68/MMbtu, following profit-taking.

Crude oil futures sold off early this morning and remained near its LoD for most of the session. Mar crude ended $0.94 lower at $95.78/barrel.

Precious metals ended the day mixed with Feb gold losing $1.5 to $1263/oz and Mar silver gaining $0.04 to $19.80/oz

4:45PM Semtech announces restructuring activity: to reduce workforce by ~6% (SMTC) 22.85 -0.37 : Co announced a reduction in its workforce by approximately 6 percent as part of a previously announced restructuring effort that is expected to strengthen its focus and increase future operating efficiencies. As a result of these activities, the Company also expects to take one-time charges that include, but are not limited to: employee termination benefits, the write down of inventory, goodwill and other intangibles and the impairment of fixed assets and other assets. Such charges are currently under review and additional details will be provided when Semtech reports its fourth quarter fiscal year 2014 financial results in early March. The estimated financial impact of the recent activity is expected to reduce full, normalized annual operating expenses by approximately $35.0 million for the Company's fiscal year 2015.

"Due to the significant reduction in demand in the second half of our fiscal year 2014, we have initiated a series of operating expense reductions across the Company. We believe these actions position the Company to accelerate earnings growth as our overall demand returns to growth," said Mohan Maheswaran, President and Chief Executive Officer of Semtech Corporation.

4:36PM Apple hits after-hours lows in electronic trade, now down 34.5 pts following earnings/guidance results... stock is now @ $516 (AAPL) 550.50 +4.43 :

4:34PM Apple beats by $0.45, reports revs in-line on lower than expected iPhone sales; guides Q2 revs below consensus; gross margin in-line (AAPL) 550.50 +4.43 : Reports Q1 (Dec) earnings of $14.50 per share, $0.45 better than the Capital IQ Consensus of $14.05; revenues rose 5.7% year/year to $57.59 bln vs the $57.42 bln consensus and $55-58 bln guidance; gross margin 37.9% vs. 36.5-37.5% guidance and 37.4% ests.

51 mln iPhones sold in Q1 vs Street est of ~56.5 mln
26 mln iPads sold in Q1 vs Street est of ~24.5 mln
4.8 mln Macs sold in Q1 vs Street est of ~4.5 mln

Co issues downside guidance for Q2, sees Q2 revs of $42-44 bln vs. $46.22 bln Capital IQ Consensus; gross margin 37-38% vs. 37.4% estimates.

"We generated $22.7 billion in cash flow from operations and returned an additional $7.7 billion in cash to shareholders through dividends and share repurchases during the December quarter, bringing cumulative payments under our capital return program to over $43 billion."

4:32PM Apple initially drops 25 pts to ~$525 following earnings results... stock is now $526.41/share (see 16:30 comments) (AAPL) 550.50 +4.43 :

4:09PM Rambus reports EPS in-line, revs in-line; guides FY14 revs above consensus (RMBS) 9.58 +0.59 : Reports Q4 (Dec) adj. earnings of $0.14 per share, in-line with the Capital IQ Consensus Estimate consensus of $0.14; revenues rose 27.9% year/year to $73.4 mln vs the $73.21 mln consensus, due to the new license agreements signed with SK Hynix, Micron Technology, ST Microelectronics and LSI Corporation during 2013.

Co issues upside guidance for FY14, sees FY14 customer licensing income and rev of $295-305 mln vs. $287.79 mln Capital IQ Consensus Estimate. Customer licensing income and revenue are not without risk and include expectations that the Company will sign new customers for patent as well as solutions licensing. The Company also expects to keep its non-GAAP operating expenses relatively flat, year over year.

4:07PM Sanmina beats by $0.03, reports revs in-line; guides Q2 EPS in-line, revs in-line (SANM) 14.80 -0.44 : Reports Q1 (Dec) earnings of $0.41 per share, $0.03 better than the Capital IQ Consensus Estimate of $0.38; revenues fell 3.0% year/year to $1.45 bln vs the $1.45 bln consensus.

Co issues in-line guidance for Q2, sees EPS of $0.36-0.42 vs. $0.37 Capital IQ Consensus Estimate; sees Q2 revs of $1.425-1.475 vs. $1.44 bln Capital IQ Consensus Estimate.
"Our first quarter results were in line with our expectations. We remain focused on higher value-added services, markets and innovative technologies. This allows us to capitalize on opportunities with new and existing customers and further strengthen our operating model. Our outlook for the second quarter reflects our view of a soft first half of fiscal 2014. We are encouraged by our customers' forecasts, recent wins and overall market improvements that will drive modest growth for fiscal 2014."

4:06PM Seagate Tech misses by $0.07, reports revs in-line (STX) 58.05 -0.52 : Reports Q2 (Dec) earnings of $1.32 per share, $0.07 worse than the Capital IQ Consensus Estimate of $1.39; revenues fell 3.8% year/year to $3.53 bln vs the $3.56 bln consensus.

Co reported NON-GAAP gross margin of 28.5%.
"Seagate's results in the December quarter reflect discipline in managing the profitability of our business and strong operational execution. We continue to strategically invest in our product portfolio and enhance our vertically integrated manufacturing capabilities to effectively capitalize on the cloud, mobile and open source storage trends that are being fueled by data growth,"
The co will guide for Q3 on its conference call at 17:00

4:01PM MagnaChip Semi announced that it is postponing its fourth quarter 2013 earnings release (MX) 17.59 -0.13 : Co announced that it is postponing its fourth quarter 2013 earnings release and investor conference call, previously scheduled for Tuesday, January 28, 2014, to provide additional time for the Company to complete its review of its financial results for the fourth quarter and full year 2013. When the Company completes its review, it intends to issue a press release to reschedule its fourth quarter 2013 earnings release and investor conference call.

12:54PM 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

S (8.77 +4.40%): Co announced the availability of LTE service in 40 more markets nationwide, for a total of 340 markets
CAT (89.43 +3.78%): Beat quarterly EPS by $0.26 ($1.54 vs $1.28 estimate), revs fell 10.4% yoy to $14.4 bln vs $13.61 bln estimate; sees FY14 EPS of $5.85 ex items vs $5.80 estimate, revs of ~$53.2-58.8 bln vs $55.18 bln estimate; co expects 1.7 bln of stock repurchase and announced authorization for new $10 bln stock repurchase program
MRK (53.31 +2.57%): Upgraded to Overweight from Equal-weight at Morgan Stanley

Large Cap Losers

TWTR (56.37 -8.70%): Hearing mentioned negatively at Tier 1 firm; David Faber recommended shorting a "basket of momentum stocks" including TSLA, NFLX, FB, TWTR, VEEV, and DDD
IRE (15.33 -7.37%): Downgraded to Neutral from Buy at Nomura
SNE (15.8 -5.50%): Moody's downgraded to Ba1/Not Prime; outlook stable

Mid Cap Gainers

SMI (4.94 +7.55%): Upgraded to Buy from Sell at UBS
RYN (44.19 +7.31%): Beat quarterly EPS by $0.13 ($0.64 vs $0.51 estimate), revs rose 26.0% yoy to $520 mln vs $438.38 mln estimate; co plans to separate its Performance Fibers business from its Forest Resources and Real Estate businesses
SIG (78.37 +5.24%): Co reported it had a constructive meeting with Corvex Management; co "will continue to carefully review" these matters

Mid Cap Losers

JAZZ (136.13 -8.75%): Weakness in select biotech/healthcare stocks: ALGN, PCYC, ACAD also lower
CTRP (36.68 -7.4%): Continued weakness following questions surroinding Chinese auditors
ISIS (45.33 -6.38%): Seeing some insider selling activity

9:01AM FormFactor announced an organizational restructuring and cost reductions to improve company profitability; Co sees about $1 mln in savings in Q1 and $2 mln beginning in Q2 (FORM) 6.62 : Co announced an organizational restructuring and cost reductions to improve company profitability. These actions will eliminate ~61 positions worldwide with expected savings of about $1 mln in the first quarter of 2014, excluding the restructuring costs of ~$1.2 mln, and about $2 mln of savings per quarter beginning in the second quarter of 2014.

"It has been one year since the acquisition of MicroProbe and these actions are the logical next steps to realize further synergies in our co," said Tom St. Dennis, FormFactor CEO and Executive Chairman. "The restructuring and cost reductions improve our efficiency and effectiveness while positioning FormFactor for a profitable year in 2014." The co will discuss these actions and its Q4 2013 results on its regularly scheduled earnings call scheduled for Wednesday, February 5, 2014.

Altera (ALTR) complemented its suite of verification and board-level design tools with the release of its JNEye link analysis tool.

8:05AM SMTC Corp reports new management determined that the Company should conduct a full physical count of its inventory; estimates that adjustments to the Company's inventory balance resulting from these errors as of the end of Q4 2012, which includes the impact of adjustments for immaterial errors in prior periods in 2012, will total $725K (SMTX) 2.48 : Co reports the physical Inventory count results for fiscal year ended December 29, 2013 and the non-reliance on certain previously issued Financial Statements.

In connection with the preparation of financial statements for the fiscal year ended December 29, 2013, new management of SMTC determined that the Company should conduct a full physical count of its inventory.

The Company's previous practice was to perform cycle counts of inventory on a periodic basis as permitted by generally accepted accounting principles.
As a result of this full physical count, the Company has identified an overstatement of inventory at its Chihuahua, Mexico operations that it has preliminarily estimated at a cumulative $3.2 million.
A portion of this overstatement reflects normal adjustments for missing, excess or obsolete inventory. The majority of the overstatement, currently estimated at approximately $2.0 million, is attributable to errors in the inventory valuation occurring in prior reporting periods beginning with the quarter ended April 3, 2011.
These errors resulted from an inappropriate and unapproved shop floor practice followed by personnel at the Company's Chihuahua, Mexico plant, which involved the improper use of the plant's work order system.
This inappropriate practice was discovered and terminated by the Company in the 2013 third quarter. Based on its review to date, the Company believes these errors are immaterial to its 2011 quarterly and full year financial results.
The Company believes the impact of these errors relates primarily to the fourth quarter of 2012 and the first three quarters of 2013. The Company, based on currently available information, estimates that adjustments to the Company's inventory balance resulting from these errors as of the end of the fourth quarter of 2012, which includes the impact of adjustments for immaterial errors in prior periods in 2012, will total $725,000, and as of the end of the first three quarters of 2013 will total $390,000, $410,000 and $350,000, respectively.
The remaining impact of the overstatement, ~$1.33 million, is expected to be recorded in the fourth quarter of 2013. A portion of this expected 2013 fourth quarter adjustment may represent prior period errors for which no information currently exists by which to determine timing.
The effect of these adjustments will be to reduce inventories, increase cost of sales and reduce net earnings in each period.

As a result, on January 24, 2014, the Board of Directors of SMTC, on the recommendation of management, and in consultation with KPMG LLP, the Company's independent registered public accounting firm, concluded that the Company's financial results for the quarter ended December 30, 2012 included in the Company's financial statements for the year ended December 30, 2012, and for the quarters ended March 31, June 30 and September 29, 2013, should no longer be relied upon.

SMTC intends to correct the errors described above by restating its financial statements for the year ended December 30, 2012 and for the quarters ended March 31, June 30 and September 29, 2013.

8:02AM Micron announces repurchases of convertible debt (MU) 22.92 : Co announces that, using privately-negotiated transactions, it had repurchased approximately $26 mln in aggregate principal amount of its 1.875% Convertible Senior Notes due 2031 for $65 mln in cash, approximately $100 mln in aggregate principal amount of its 2.375% Convertible Senior Notes due 2032 for $249 mln in cash and approximately $38 mln in aggregate principal amount of its 3.125% Convertible Senior Notes due 2032 for $93 mln in cash.

"The transactions we announced today reduced the dilutive effect of our existing convertible notes...We eliminated approximately 10 mln shares from our current dilutive share count and reduced the outstanding principal amount of our debt by approximately $164 million."

7:05AM Sierra Wireless announced that Sierra Wireless has entered into a definitive agreement to acquire Vancouver-based In Motion Technology for $21 mln (SWIR) 21.91 : Co and In Motion Technology announced that Sierra Wireless has entered into a definitive agreement to acquire Vancouver-based In Motion for $21 mln US dollars in cash consideration, subject to certain customary post-closing adjustments.

In Motion is a leader in mobile enterprise solutions, providing rugged in-vehicle mobile routers tightly integrated with an advanced mobile-optimized security system and a powerful management and application platform. The complete solution enables organizations to connect and manage mobile operations, vehicles, and workforces more efficiently, reliably and securely.

With complementary product portfolios and channels, Sierra Wireless and In Motion will together provide the broadest choice of device-to-cloud solutions for enterprise customers, from simple gateways to full featured mobile routers, as well as a comprehensive suite of cloud services and applications. The combined co will hold a strong leadership position and unique capabilities in important growth segments, including public safety, transit, and commercial fleet.

7:01AM Canadian Solar announces the sale of a 10MW utility scale solar power plant in Ontario to a fund managed by BlackRock (CSIQ) 37.25 : Co announced that its subsidiary, Canadian Solar Solutions Inc., entered into an agreement with a fund managed by BlackRock ("BlackRock"), whereby BlackRock will acquire from Canadian Solar the Westbrook 10MW AC utility-scale solar power plant in Kingston, Ontario at a valuation comparable to other recent project sales completed by Canadian Solar on a per megawatt basis in the Ontario market. This follows BlackRock's acquisition on September 30, 2013 of the Demorestville and Taylor Kidd utility-scale solar power plants, totaling 20MW (AC), and located in Demorestville and Odessa, Ontario, Canada, respectively.

The construction of the Westbrook solar plant is already underway, with commercial operation expected in the second quarter of 2014. Canadian Solar is providing turnkey engineering, procurement and construction ("EPC") services to complete the project and will provide operations and maintenance ("O&M") services after completion.

4:03AM ReneSola to provide 57 MW of Virtus PV modules to Isolux Corsan (SOL) 3.39 : Co announces an agreement to provide Isolux Corsan, a global benchmark in the areas of concessions, energy, construction and industrial services and a leader in engineering, procurement and construction projects for solar PV plants, with 57 megawatts of Virtus PV modules for installation in three commercial PV projects in the United Kingdom.

According to the terms of the agreement, ReneSola will deliver 57 MW of Virtus PV modules with an average power output of 250 W. The modules will be installed at projects in Cornwall, Dorset, and Norfolk in the United Kingdom. ReneSola began delivery in December 2013 and the three projects are expected to connect to the grid in March of this year.

FLIR Systems (FLIR) announced that William A. Sundermeier, President of the Company's Government Systems Division, has resigned to pursue other personal and business opportunities. Thomas A. Surran, most recently President of the Company's Commercial Systems Division, has been appointed Chief Operating Officer, and will assume responsibility for FLIR's global commercial and government operations. Mr. Sundermeier has agreed to assist the Company with the transition of his responsibilities through the end of February.
LM Ericsson (ERIC) and Samsung (SSNLF) have reached an agreement on global patent licenses between the two companies. The cross license agreement covers patents relating to GSM, UMTS, and LTE standards for both networks and handsets. Impact of settlement: Settlement ends all ongoing patent related legal disputes Agreement includes global patent cross licensing of cellular technologies License illustrates Ericsson's commitment to FRAND principles Settlement impacts Ericsson sales and net income in Q4 2013 by SEK 4.2 bln. and SEK 3.3 bln. respectively.
ReneSola (SOL) announces an agreement to provide Isolux Corsan, a global benchmark in the areas of concessions, energy, construction and industrial services and a leader in engineering, procurement and construction projects for solar PV plants, with 57 megawatts of Virtus PV modules for installation in three commercial PV projects in the United Kingdom. According to the terms of the agreement, ReneSola will deliver 57 MW of Virtus PV modules with an average power output of 250 W. The modules will be installed at projects in Cornwall, Dorset, and Norfolk in the United Kingdom. ReneSola began delivery in December 2013 and the three projects are expected to connect to the grid in March of this year.
Sierra Wireless (SWIR) and In Motion Technology announced that Sierra Wireless has entered into a definitive agreement to acquire Vancouver-based In Motion for $21 mln US dollars in cash consideration, subject to certain customary post-closing adjustments.