Market Update 080422 http://biz.yahoo.com/mu/update.html 4:15 pm : The major indices finished with sharp losses on Tuesday. A bearish bias prevailed throughout the session after traders were disappointed by earnings reports at several notable companies. Meanwhile, crude oil and the Commodity Index spiked to lifetime highs, which did not help matters.
Texas Instruments (TXN 28.82, -1.77) reported earnings grew by a strong 19%, which met analysts expectations. However, its stock got clipped after the company provided a disappointing outlook. Because of uncertainty regarding the near-term economic outlook, the company expects to earn between $0.42 and $0.48 per share in the second quarter. This falls well short of the expected earnings of $0.48 per share.
TI's dour outlook was taken as bearish signal regarding large-cap tech stocks, with the Nasdaq 100 shedding -1.6%. Semiconductors took the brunt of the selling pressure, as the SOX fell 3.3%.
Tech was not the only area under pressure. Healthcare stocks posted a decline of 1.3%. Shares of health insurer UnitedHealth Group (UNH 34.15, -3.66) declined nearly 10% to a fresh 52-week low, bringing its four-month slide to a total of 42%. The company reported earnings that fell short of estimates, and lowered its full year 2008 guidance.
CME Group (CME 483.50, -40.00), operator of the Chicago Mercantile Exchange, faced notable selling interest, with shares falling roughly 8%. The company reported revenue rose 25% and earnings of $4.67 per share. However, that was not enough to meet the consensus estimate that pegged revenue growth at 26% and earnings of $4.80 per share.
The Amex Airline Index (-12.3%) got hammered and hit a fresh 52-week low after UAL Corp (UAUA 13.55, -7.88) reported disappointing earnings. The operator of United Airlines reported a quarterly loss of $4.45 per share, compared to the expected loss of $3.41. Also not helping things, crude hit a fresh all-time high of $119.90 per barrel on supply concerns in Nigeria and reports of a worker strike in the United Kingdom. The gains in crude helped send the CRB Commodity Index (+1.6%) to its all-time high.
Not every company reported worse than expected earnings -- although buying interest was held in check on some cautious outlooks. Dow components McDonald's (MCD 58.35, -0.32) and DuPont (DD 50.16, -2.09) topped their earnings estimates, while AT&T (T 37.81, +0.22) met expectations. In addition, Coach (COH 31.70, -0.80), Wyeth (WYE 43.99, -0.22) and Kimberly Clark (KMB 64.37, +0.34) came out ahead of their respective consensus estimates.
Economic data were light this session, with only one notable release. The market saw a modest boost following the March existing home sales report, but quickly retreated to predata levels as the data were largely in-line with expectations. March existing home sales fell 2.0% to an annualized rate of 4.93 million from the prior reading of 5.03 million. This was slightly better than the expected reading of 4.92 million. Compared to last year, sales are down 19.3%. Prices have fallen 7.7% versus last year. Housing remains in a deep slump, but the rate of decline has slowed in recent months.
In the end, eight of the ten sectors posted a loss. Consumer discretionary (-1.7%) and materials (-1.4%) posted the largest losses. Energy (+0.2%) and telecom (+0.2%) outperformed on a relative basis.DJ30 -104.79 NASDAQ -31.10 NQ100 -1.6% R2K -2.0% SP400 -1.4% SP500 -12.23 NASDAQ Dec/Adv/Vol 2185/705/1.93 bln NYSE Dec/Adv/Vol 2250/882/1.33 bln
3:30 pm : The major indices are off their worst levels, but continue to trade with losses in excess of 1%. The VIX (+4.0%) has taken a turn higher, indicating increased volatility during the next 30 days of trade.
Looking ahead, the market will have a plethora of earnings reports to sift through on Wednesday. A total of 116 companies are confirmed to report tonight and tomorrow morning, including Ambac (ABK 6.02, +0.08) Boeing (BA 78.02, -1.07), Yahoo! (YHOO 28.59, +0.04), UPS (UPS 71.73, -0.79), to name a few.DJ30 -123.52 NASDAQ -33.88 SP500 -14.77 NASDAQ Dec/Adv/Vol 2211/661/1.60 bln NYSE Dec/Adv/Vol 2319/808/1.04 bln
2:55 pm : The major indices are falling back toward their session lows, as all ten of the major economic sectors are now in negative territory.
The more than 1.5% advance in crude, and a 2.5% advance in grains has sent the CRB Commodity Index (+1.6%) to a lifetime high. Of note, commodities are still well below their inflation adjusted highs that were reached in the 1970s. The CRB Index is up 18% year-to-date and up 35% compared to last year.DJ30 -159.84 NASDAQ -42.63 SP500 -17.69 NASDAQ Dec/Adv/Vol 2220/628/1.44 bln NYSE Dec/Adv/Vol 2368/741/931 mln
2:30 pm : The major indices continue to post steep losses, but are trying to climb higher. There is an overall lack of leadership, as the only sectors in the green -- energy (+0.2%) and telecom (+0.1%) -- are basically clutching the unchanged mark.
Not everything is negative today. Intrepid Potash (IPI 50.29, +18.29) has soared 57% since its IPO this morning. The company is the second largest producer of potash -- a crop nutrient -- in the world. The gains today are even more impressive when considering its IPO was priced at $32 per share, which was well above the expected pricing of $27-to-$29 (which had been increased from $24-to-$26).DJ30 -120.34 NASDAQ -35.28 SP500 -13.63 NASDAQ Dec/Adv/Vol 2208/642/1.33 bln NYSE Dec/Adv/Vol 2318/776/864 mln
2:00 pm : The major indices are climbing off their recently reached session lows thanks to broad-based buying interest. Losses, though, remain substantial with the stock market down nearly 1%.
Within the S&P 500, 86% of stocks are posting a loss. Apple (AAPL 159.59, -8.57) and UnitedHealth (UNH 33.86, -3.95) are the main laggards, while Google (GOOG 557.82, +20.03) and Chevron (CVX 93.73, +1.03) are showing the most strength. By percentage change, the largest gainers are Fifth Third Bank (FITB 20.85, +1.47) and National City (NCC 6.43, +0.40), and the largest losers are BJ Services (BJS 27.52, -5.28) and Tellabs (TLAB 5.11, -0.91).DJ30 -130.44 NASDAQ -35.00 SP500 -13.71 NASDAQ Dec/Adv/Vol 2179/634/1.23 bln NYSE Dec/Adv/Vol 2295/786/798 mln
1:30 pm : Stocks remain depressed, but are off the session's worst levels. Only three of the Dow's 30 components, AT&T (T 37.85, +0.26), Exxon Mobil (XOM 94.38, +0.12), and Chevron (CVX 93.65, +0.95), are trading in positive territory.
Declining issues continue to outnumber advancers by roughly 3-to-1 on the NYSE.
Separately, President Bush said in a speech the economy is in a slowdown, not a recession.DJ30 -137.03 NASDAQ -38.82 SP500 -14.94 NASDAQ Dec/Adv/Vol 2179/617/1.13 bln NYSE Dec/Adv/Vol 2304/762/740.58 mln
1:00 pm : Selling has rekindled and stocks have moved another leg lower. Each of the major indices are now down more than 1%.
The push lower has been strongest in the industrial (-1.5%), materials (-2.1%), and energy (-0.2%) sectors.
Only telecom (+0.3%) is trading in positive territory, helped by AT&T (T 37.95, +0.36). The company announced this morning first quarter results that were in-line with analysts' expectations.DJ30 -162.76 NASDAQ -45.86 SP500 -17.95 NASDAQ Dec/Adv/Vol 2194/600/1.04 bln NYSE Dec/Adv/Vol 2358/708/686.05 mln
12:25 pm : Selling pressure eases as crude oil and the euro retreat off their respective all-time highs.
At session highs, one euro bought as much as $1.6018, which is the most since the currency was introduced in 1999. The euro has since retreated a tad to just under $1.60. The official currency of the European Union is now up roughly 18% compared to last year, and 30% over the last two years.
Meanwhile crude oil is currently up 1.7% to $119.44 per barrel after hitting an all-time high of $119.74.DJ30 -108.37 NASDAQ -33.32 SP500 -12.66 NASDAQ Dec/Adv/Vol 2085/676/876 mln NYSE Dec/Adv/Vol 2186/844/593 mln
12:05 pm : The major indices have spent the entirety of Tuesday's session in negative territory, and are trading with substantial losses. Traders have been disappointed with earnings misses by a few notable companies. At the same time, crude oil continues its rally as prices hit a new all-time high.
Texas Instruments (TXN 28.68, -1.91) reported a healthy 19% increase earnings that met analysts' expectations, but its stock is trading lower after the company provided a disappointing outlook. Uncertainty regarding the near-term economic outlook has prompted the company to provide a cautious second quarter outlook between $0.42 and $0.48 per share. This falls well short of the expected earnings of $0.48 per share.
Investors have taken TI's miss as a bearish signal, sending the Nasdaq 100 down 1.6%.
Shares of UnitedHealth Group (33.72, -4.09) have fallen 11% to a 52-week low, bringing its four-month decline to a total of 43%. The company reported earnings that were two cents short of estimates, and lowered its full year 2008 earnings guidance. As a result, the healthcare sector (-1.5%) is seeing a decent amount of selling interest.
CME Group (CME 472.71, -50.79), operator of the Chicago Mercantile Exchange, is facing some notable selling interest after reporting earnings that failed to meet expectations. A 25% year-over-year increase in revenue and earnings of $4.67 per share was not enough to meet Wall Street's expectation of $4.80 per share.
Airlines (-11.1%) are getting hammered after UAL Corp (UAUA 14.33, -7.10) reported disappointing earnings. The operator of United Airlines reported a quarterly loss of $4.45 per share, compared to the expected loss of $3.41. Also not helping things, crude hit a fresh all-time high of $119.74 per barrel on supply concerns in Nigeria and reports of a worker strike in the United Kingdom.
Not all earnings reports were worse than expected -- although buying interest has been held in check. Dow components McDonald's (MCD 58.52, -0.15) and DuPont (DD 50.01, -2.24) topped their earnings estimates, while AT&T (T 37.84, +0.25) met expectations. In addition, Coach (COH 30.79, -1.71), Wyeth (WYE 43.91, -0.30) and Kimberly Clark (KMB 64.19, +0.16) came out ahead of their respective consensus estimates.
Economic data were light this session, with only one notable release. The market saw a modest boost following the March existing home sales report, but quickly retreated to predata levels as the data were largely in-line with expectations. March existing home sales fell 2.0% to an annualized rate of 4.93 million from the prior reading of 5.03 million. This was slightly better than the expected reading of 4.92 million. Compared to last year, sales are down 19.3%. Prices have fallen 7.7% versus last year. Housing remains in a deep slump, but the rate of decline has slowed in recent months.DJ30 -113.99 NASDAQ -30.33 SP500 -12.81 NASDAQ Dec/Adv/Vol 2036/298/787 mln NYSE Dec/Adv/Vol 2147/856/543 mln
11:30 am : The major indices are unable to gain momentum as eight of the ten sectors remain in the red.
CME Group (CME 475.48, -48.02), operator of the Chicago Mercantile Exchange, is facing some notable selling interest after reporting earnings that failed to meet expectations. A 25% year-over-year increase in revenue and earnings of $4.67 per share was not enough to meet Wall Street's expectation of $4.80 per share. As a result, the firm's shares are down 9.2%.
Shares of Nymex (NMX 93.80, -5.29) are falling in conjunction with CME, as under the previously announced acquisition each share of Nymex will be worth 0.1323 shares of CME.DJ30 -72.63 NASDAQ -17.73 SP500 -8.35 NASDAQ Dec/Adv/Vol 1908/781/636 mln NYSE Dec/Adv/Vol 2025/932/447 mln
11:00 am : The stock market continues to languish in the red, as market participants' sentiment remains negative. Large-cap tech stocks are seeing notable selling interest following the cautious outlook from Texas Instruments (TXN 28.77, -1.83). The Nasdaq 100 is down more than 1%.
Shares of UnitedHealth Group (UNH 34.44, -3.37) have fallen to a fresh 52-week low, marking a 50% decline in the last four months. The company reported earnings that were two cents short of estimates, and lowered its full year 2008 earnings guidance. As a result, the healthcare sector (-1.1%) is seeing a decent amount of selling interest.DJ30 -64.81 NASDAQ -16.83 SP500 -7.75 NASDAQ Dec/Adv/Vol 1859/731/492 mln NYSE Dec/Adv/Vol 2030/874/357 mln
10:30 am : The major indices retreat back toward their session lows as the buying interest fades, fueled in part by the housing data . The energy sector (+0.1%) has recovered into the green, as crude hits a fresh all-time high of $118.45 per barrel. An attack in Nigeria has disrupted supply. Crude oil has spiked more than 16% in April.DJ30 -76.95 NASDAQ -19.37 SP500 -9.34 NASDAQ Dec/Adv/Vol 1829/664/351 mln NYSE Dec/Adv/Vol 2059/793/269 mln
10:05 am : Just hitting the wires, March existing home sales fell 2.0% to an annualized rate of 4.93 million from the prior reading of 5.03 million. This was slightly better than the expected reading of 4.92 million. Compared to last year, sales are down 19.3%. Prices have fallen 7.7% versus last year.
The stock market had extended its losses and then got a modest boost on the economic report. The major indices remain in the red. Only the telecom (+0.4%) sector is posting a gain. The healthcare sector (-1.0%) is the main laggard.DJ30 -48.61 NASDAQ -16.87 SP500 -6.15 NASDAQ Dec/Adv/Vol 1761/621/225 mln NYSE Dec/Adv/Vol 2049/731/188 mln
09:40 am : The stock market kicks off trade on a sour note as it digests a barrage of earnings reports.
Texas Instruments (TXN) is acting as a major selling catalyst. The semiconductor manufacturer met its quarterly earnings expectations, but issued a disappointing outlook and was cautious on the near-term outlook. The news is causing tech stocks (-0.6%) to underperform.
There were some other disappointing results coming from UnitedHealth (UNH), CME Group (CME) and UAL Corp. (UAUA).
There were, however, some bright spots. Dow components McDonald's (MCD) and DuPont (DD) topped their earnings estimates, while AT&T (T) met expectations. In addition, Coach (COH), Wyeth (WEYE) and Kimberly Clark (KMB) came out ahead of their respective consensus estimates.DJ30 -53.41 NASDAQ -13.86 SP500 -6.37
09:16 am : S&P futures vs fair value: -6.3. Nasdaq futures vs fair value: -16.2.
09:00 am : S&P futures vs fair value: -4.2. Nasdaq futures vs fair value: -13.5. Early indications suggest a lower start for the S&P 500 and Nasdaq 100. On the economic front, traders will be paying attention to the March existing home sales report at 10:00 ET. Economists expect home sales to slip to an annualized rate of 4.92 million from 5.03 million.
08:28 am : S&P futures vs fair value: -3.6. Nasdaq futures vs fair value: -11.8. Futures continue to indicate a lower start. McDonald's (MCD) reported earnings of $0.76 per share, which topped expectations by six cents. UAL Corp (UAUA), operator of United Airlines, reported a larger than expected loss of $4.45 per share. Meanwhile crude continues to take out new records, as it hit an all-time high of $118.05 per barrel in earlier trade.
07:55 am : S&P futures vs fair value: -2.9. Nasdaq futures vs fair value: -11.0. Futures point to a lower start with the Nasdaq set to underperform. Quarterly earnings at Texas Instruments (TXN) met expectations, but its report is weighing on traders' sentiment after the company provided a disappointing outlook. In other earnings news, DuPont (DD), Coach (COH), Wyeth (WYE), Kimberly Clark (KMB), and Eaton (EAT) topped estimates. AT&T (T) reported earnings that were in-line with the consensus estimate. CME Group (CME) and United Health (UNH) missed expectations.
06:14 am : S&P futures vs fair value: -0.9. Nasdaq futures vs fair value: -11.0.
06:13 am : FTSE...6066.40...+13.40...+0.2%. DAX...6804.79...+18.24...+0.3%.
06:13 am : Nikkei...13547.82...-148.73...-1.1%. Hang Seng...24939.15...+217.48...+0.9%.
Market Update 080423 http://biz.yahoo.com/mu/update.html 4:20 pm : On Wednesday, the S&P 500 managed to post a modest gain, while the Nasdaq handily outperformed, as traders digested another onslaught of earnings reports. Strength in several large-cap tech names lifted the market, but their advance was partially offset by weakness in financial and energy stocks.
Microsoft (MSFT 31.45, +1.20) was the most influential name within the tech sector (+1.4%) after the company indicated it will not raise its offer for Yahoo! (YHOO 28.08, -0.46). The news caused shares of Yahoo to slip, even though the company reported better than expected earnings.
Shares of semiconductor firm Broadcom (BRCM 27.39, +3.84) soared 16% after the company reported earnings that topped estimates, and guided its second quarter revenue above expectations. The news gave a boost to the Semiconductor Index (+4.1%).
Lastly, tech got a boost from Apple (AAPL 162.89, +2.69) after traders bought its stock ahead of the company's earnings report.
Although tech was the most influential sector due to its heavy weighting, telecom (+2.2%) was actually the best-performing sector by percentage gain. AT&T (T 38.53, +0.72), Verizon (VZ 36.33, +0.60) and Sprint (S 7.67, +0.62) all saw buying interest.
The market had a mostly positive response to the 113 companies that reported earnings. Some notable names that topped estimates included Boeing (BA 82.09, +3.53), Yum! Brands (YUM 40.30, +1.81), EMC Corp (EMC 15.89, +0.30) and Philip Morris International (PM 52.00, +1.93).
Weakness in financials (-0.8%), energy (-0.8%) and materials (-1.3%), however, kept buying interest in check.
Financials underperformed largely due to disappointment regarding a massive quarterly loss at Ambac Financial (ABK 3.46, -2.57). The bond insurer's stock plummeted 43% to a new all-time low after the company reported a massive $5.42 per share loss on $1.7 billion in write-downs and a $1.0 billion increase in loan loss provisions. Analysts were looking for a much smaller loss of $1.51 per share.
Meanwhile the energy and materials sectors succumbed to some profit taking. Going into this session, energy was up 14% and materials were up 9% in the month of April.
UPS (UPS 71.67, -0.23) was a notable laggard. The company reported earnings that were in-line with expectations, but issued a cautious outlook. The company cut its second quarter and full year earnings estimates, citing economic concerns.
There were no economic reports on Tuesday, but the government did release its weekly energy inventory report. The Department of Energy said crude stockpiles rose by 2.42 million barrels, which was larger than the expected 1.50 million increase. Crude traded in a choppy manner following the report, finally settling with a gain of $0.25 to $118.32 per barrel.
Market participants will not be getting a breather tomorrow as 213 companies are confirmed to report their earnings. Some of the bigger names include Apple, Amazon.com (AMZN 81.00, +1.40) and Qualcomm (QCOM 41.89, +0.34). In addition, the market will be digesting the latest durable orders and initial jobless claims reports at 8:30 ET. DJ30 +42.99 NASDAQ +28.27 NQ100 +1.3% R2K +0.6% SP400 +0.4% SP500 +3.99 NASDAQ Dec/Adv/Vol 1317/1532/2.13 bln NYSE Dec/Adv/Vol 1469/1639/1.35 bln
3:30 pm : Stocks are climbing higher, with relative strength within the tech sector (+1.4%). The Nasdaq is approaching its best level of the session, while the Dow and S&P 500 still have a way to go.
Looking ahead, 213 companies are confirmed to report their earnings after this session's closing bell and before tomorrow's open. Some of the bigger names include Apple (AAPL 162.99, +2.79), Amazon.com (AMZN 81.271 +1.67) and Qualcomm (QCOM 41.98, +0.43 ). On the economic front, durable orders and initial jobless claims figures are set for release at 8:30 ET.DJ30 +57.24 NASDAQ +29.28 SP500 +4.88 NASDAQ Dec/Adv/Vol 1318/1542/1.74 bln NYSE Dec/Adv/Vol 1476/1632/1.02 bln
3:00 pm : The major indices have traded in a range-bound fashion the past half hour. The S&P is holding onto a slight gain.
Within the S&P 500, 52% of stocks are posting an advance. The largest percent gainer is Safeco (SAF 65.98, +20.75), with an advance of 46%. It was announced earlier today that Liberty Mutual is acquiring Safeco for $68.25 per share in cash, or $6.2 billion. The largest percent decliner is Ambac (ABK 3.41, -2.62), with a slide of 43%. Traders have been disappointed with the bond insurer's larger than expected loss.
Phillip Morris International (PM 51.98, +1.91), which Atria (MO 22.36, +0.31) recently spun off, is posting a hefty 3.8% gain. The cigarette company reported earnings of $0.89 per share, topping expectations by $0.12.DJ30 +28.09 NASDAQ +21.80 SP500 +1.16 NASDAQ Dec/Adv/Vol 1415/1415/1.58 bln NYSE Dec/Adv/Vol 1576/1519/919 mln
2:30 pm : The Nasdaq has managed to stave off selling interest better than the S&P 500. Microsoft (MSFT 31.34, +1.09), Apple (AAPL 162.73, +2.53), Qualcomm (QCOM 42.03, +0.48) and Broadcom (BRCM 27.28, +3.73) are the best performing names within the Nasdaq.
Telecom (+2.7%) has not been fazed by the recent retreat, as it steadily climbs higher. AT&T (T 38.73, +0.92), Verizon (VZ 36.335, +0.62) and Sprint (S 7.58, +0.53) are all showing strength.DJ30 +26.95 NASDAQ +22.30 SP500 +1.28 NASDAQ Dec/Adv/Vol 1381/1424/1.46 bln NYSE Dec/Adv/Vol 1579/1497/850 mln
2:00 pm : The major indices are trying to regain lost ground, but are unable to maintain any momentum. Market breadth is neutral, with advancers and decliners nearly even on the NYSE and the Nasdaq. Volume is on the average side.DJ30 +24.91 NASDAQ +21.82 SP500 +1.05 NASDAQ Dec/Adv/Vol 1384/1405/1.34 bln NYSE Dec/Adv/Vol 1526/1542/779 nkb
1:30 pm : The stock market has pulled itself out of negative territory, but lingers just above the unchanged mark.
Telecom (+2.0%) continues to exhibit strength as a relative leader. AT&T (T 38.67, +0.86) and Verizon (VZ 36.30, +0.57) are the supportive forces behind the sector's advance.
Oil continues to trade along the unchanged mark at $118.02 per barrel.DJ30 +29.39 NASDAQ +20.84 SP500 +1.52 NASDAQ Dec/Adv/Vol 1394/1367/1.24 bln NYSE Dec/Adv/Vol 1560/1494/723.72 mln
1:00 pm : After extending its decline, the stock market is now trading with a slight loss. The Nasdaq is managing to hold a modest gain, although it is well off its best level of the session.
There was no apparent catalyst for the recent selling interest, although financials (-1.1%) fell as Ambac (ABK 3.49, -2.54) extended its loss to more than 40%. This is actually not Ambac's largest one day percent decline -- its shares fell more than 50% in January on word that Moody's was putting Ambac's Aaa credit rating under review. AIG (AIG 43.64, -1.63) is acting as the largest drag on the financial sector.DJ30 +4.15 NASDAQ +14.53 SP500 -1.25 NASDAQ Dec/Adv/Vol 1384/1352/1.14 bln NYSE Dec/Adv/Vol 1593/1439/667 mln
12:30 pm : The major indices are trending lower, with the S&P 500 giving up nearly all of its gains. Financials (-0.9%) are largely to blame as the sector slips into the red after being up as much as 0.8%. Within the sector, multi-line insurance (-2.4%) is posting the largest loss, as traders sell-off shares of bond insurers Ambac (ABK 3.74, -2.29) and XL Capital (XL 28.18, -1.86) following the companies' worse than expected earnings reports.
Gold has come under some selling pressure as the dollar (+0.73%) holds most of its gains this session. The precious metal is down 2.4% to $900.60 per ounce. It is still up 7.5% this year, but is down 14.8% from its all-time nominal high of $1033 that was reached about one month ago.DJ30 +35.25 NASDAQ +16.11 SP500 +1.56 NASDAQ Dec/Adv/Vol 1387/1346/1.03 bln NYSE Dec/Adv/Vol 1535/1475/593 mln
12:00 pm : The stock market opened on a muted note as disappointing outlooks at several widely held firms kept buying interest in check, but strength in large-cap tech names led to improved investor sentiment. At the East Coast lunch hour, stocks are trading with decent gains, as the Nasdaq outperforms. Eight of the ten economic sectors are posting a gain.
Traders have responded positively, for the most part, to the multitude of earnings reports that were released after yesterday's close and this morning.
Boeing (BA 82.58, +4.02) earned $1.61 per share in its latest quarter, topping estimates by $0.26 and marking a 40% year-over-year increase. Boeing reaffirmed its full year outlook, which falls short of expectations by $0.08 to $0.23 per share. However, traders have not been discouraged by the firm's cautious outlook, and are driving shares higher.
Yahoo! (YHOO 28.29, -0.25) topped earnings expectations and marked its first increase in earnings in roughly two years. It stock, though, is underperforming as traders reflect concerns that Microsoft (MSFT 31.20, +0.95) will not increase its offer of roughly $31 per share offer to acquire Yahoo.
Other firms that topped expectations include, Yum! Brands (YUM 40.64, +2.15), EMC Corp. (EMC 16.18, +0.59), Biogen-Idec (BIIB 64.04, -0.58), Broadcom (BRCM 26.62, +3.07) and Freeport-McMoRan (FCX 119.70, +1.05).
UPS (UPS 71.73, -0.17) is a notable laggard. The company met its earnings estimate, but issued a cautious outlook due to economic concerns.
Ambac's (ABK 3.77, -2.26) stock has plummeted 37% to its all-time low after the bond insurer reported a massive $5.42 per share loss on $1.7 billion in write-downs and a $1.0 billion increase in loan loss provisions. Analysts were looking for a much smaller loss of $1.51 per share. Unlike a month ago, the market's disappointment has largely been contained to Ambac and its peers, although the financial sector (+0.2%) is underperforming on a relative basis.
Technology has really been the driving force behind this session's strength, with the tech sector gaining 1.4%. Interestingly three of the four largest gainers -- Apple (AAPL 164.15, +3.95), Microsoft (MSFT) and Qualcomm (QCOM 42.27, +0.72) -- did not report earnings this session. Apple and Qualcomm are set to announce their respective earnings reports after the closing bell today. Broadcom is the remaining leader, which topped expectations as mentioned above.
There are no economic reports this session, although the government did release its weekly energy statistics. The Department of Energy said crude stockpiles rose by 2.42 million barrels, which was larger than the expected 1.50 million increase. Crude traded in a choppy manner following the report, and is currently down 0.3% to 117.78 per barrel.DJ30 +68.47 NASDAQ +28.01 SP500 +6.19 NASDAQ Dec/Adv/Vol 1152/1532/914 mln NYSE Dec/Adv/Vol 1335/1658/528 mln
11:30 am : The major indices dip off their best levels, but continue to hold solid gains. Energy (-0.5%) and financials (+0.2%) -- which account for nearly 30% of the S&P 500 -- are keeping buying interest in check as they underperform on a relative basis.
The CRB Commodity Index (-0.5%) -- which tracks a basket of 19 commodities -- hit an all-time nominal high in yesterday's trade as crude and grain prices spiked higher. The index has seen some selling interest this session, as investors take profits and the dollar rises 0.85%. DJ30 +70.10 NASDAQ +28.28 SP500 +7.57 NASDAQ Dec/Adv/Vol 1093/1557/795 mln NYSE Dec/Adv/Vol 1258/1687/458 mln
11:05 am : The major indices climb higher, with sentiment leaning positive. Only materials (-0.2%) and energy (-0.7%) remain in the red. Crude oil has pared some of its losses, now only down 0.1%, even though inventories rose by a larger than expected amount -- which is usually bearish for crude prices.
Just last month, any rumor or comment regarding Ambac Financial (ABK 4.22, -1.81) made the market go on massive swings. Market participants were afraid that if Ambac lost its AAA credit rating, it would cause a chain reaction in write-offs at financial firms. This session Ambac reported a massive $5.42 per share loss on $1.7 billion in write-downs and a $1.0 billion increase in loan loss provisions. The market was looking for a much smaller loss of $1.51 per share.
Yet disappointment has been contained to Ambac and its peers such as MBIA (MBI 11.48, -1.80). Ambac's stock is plummeting nearly 30% to a fresh all-time low in the company's nearly 20 years of public trading. Possibly mitigating selling interest in the broader market is word from the company that it exceeds S&P's AAA capital requirements, and expects to meet Moody's Aaa target level of capital in the second quarter.DJ30 +90.54 NASDAQ +30.81 SP500 +9.46 NASDAQ Dec/Adv/Vol 1006/1587/678 mln NYSE Dec/Adv/Vol 1163/1753/391 mln
10:30 am : The major indices catch a modest bid, led by tech stocks (+1.1%). The major indices are trading at their best levels of the session.
After hitting an all-time high of $119.90 per barrel in yesterday's trade, crude oil retreated as the contract switched to June delivery from May delivery. Prices are set to go on the move, as the government's weekly energy report just hit the wires. The Department of Energy said crude stockpiles rose by 2.42 million barrels, which is larger than the expected build of 1.50 million barrels. Just prior to the release, crude was trading down 0.8% to $117.11 per barrel.DJ30 +43.64 NASDAQ +23.44 SP500 +4.15 NASDAQ Dec/Adv/Vol 1186/1271/409 mln NYSE Dec/Adv/Vol 1462/1346/254 mln
09:55 am : The stock market is clutching the unchanged mark. The ten sectors are split down the middle, with five in the red and five in the green -- which reflects the indecisiveness of market participants this morning.
The Nasdaq Composite, led by large cap tech, is modestly outperforming as it posts a decent gain. Apple (AAPL 163.34, +3.14) is providing leadership ahead of its earnings report after this session's close. Shares of Broadcom (BRCM 26.06, +2.51) are up roughly 11% after the company's first quarter results exceeded expectations and the firm guided second quarter revenue above the consensus estimate.DJ30 +0.73 NASDAQ +11.90 SP500 +0.43 NASDAQ Dec/Adv/Vol 1105/1188/226 mln NYSE Dec/Adv/Vol 1504/1229/133 mln
09:40 am : After some swings in premarket trading, the stock market opens on a slightly higher note. The market has been sifting through a multitude of earnings reports. Results have been mixed.
Yahoo! (YHOO), Yum Brands (YUM), EMC Corp. (EMC), Biogen-Idec (BIIB) and Freeport-McMoRan (FCX) all topped expectations.
Boeing (BA) beat its estimate, but reaffirmed 2008 earnings guidance that falls below expectations. UPS (UPS) reported in-line earnings, but cut its full year outlook.
In deal news, Liberty Mutual will acquire Safeco (SAF) for $68.25 per share in cash, or $6.2 billion. It has been approved by the board of directors of both companies. DJ30 +10.50 NASDAQ +10.25 SP500 +2.31 NASDAQ Dec/Adv/Vol 914/1216/108 mln NYSE Dec/Adv/Vol 1169/1400/73 mln
09:17 am : S&P futures vs fair value: +4.5. Nasdaq futures vs fair value: +16.2. There is an acquisition deal of note this morning. Liberty Mutual will acquire Safeco (SAF) for $68.25 per share in cash, or $6.2 billion. It has been approved by the board of directors of both companies.
09:00 am : S&P futures vs fair value: +1.3. Nasdaq futures vs fair value: +12.8. S&P 500 futures versus fair value join the Nasdaq in the green. Biotech firm Genzyme (GENZ) topped its earnings estimates, but issued downside earnings guidance for full year 2008. Separately, crude oil is trading down 0.6% ahead of the government's weekly energy report.
08:30 am : S&P futures vs fair value: -0.3. Nasdaq futures vs fair value: +10.0. S&P 500 futures are flat, while Nasdaq futures indicate a modestly higher start. Apple (AAPL) is aiding in the Nasdaq's outperformance. Its stock is up roughly 1% ahead of the company's earnings report after the close today.
08:00 am : S&P futures vs fair value: -0.2. Nasdaq futures vs fair value: +9.8. S&P 500 Futures point to a flat start as a barrage of earnings reports hit the wires. Yahoo! (YHOO) reported earnings that topped estimates, marking its first profit increase in two years. UPS (UPS) reported in-line earnings, but had some cautious comments regarding the economic outlook. Boeing's (BA) earnings topped estimates, but reaffirmed its full year 2008 earnings guidance below the consensus estimate. Ambac (ABK) reported a loss of $6.93 per share, which is $5.42 worse than expectations. The firm says it exceeds S&P's AAA capital requirements, and expects to meet Moody's Aaa target level of capital in the second quarter.
06:17 am : S&P futures vs fair value: +5.0. Nasdaq futures vs fair value: +10.0.
06:17 am : FTSE...6039.10...+4.40...+0.1%. DAX...6762.76...+34.46...+0.5%.
06:17 am : Nikkei...13579.16...+31.34...+0.2%. Hang Seng...25289.24...+350.09...+1.4%.
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