|From Briefing.com: 4:30 pm : Stocks started the session near the neutral line, but ultimately the path of least resistance was into the red, resulting in the stock market’s tenth loss in 12 sessions and new multi-month lows for the major averages.|
Market participants that opted to abide by the adage, “Sell in May and Go Away” appear prescient with stocks on the slide and down more than 6% month to date. Precarious conditions in the Eurozone have prompted many to take their cues from the euro, often pressuring stocks when the currency takes a dive. Despite efforts to stabilize against the dollar, the euro ultimately eased down to a loss of about 0.2% as of the closing bell. At about $1.270, the euro hasn’t been that low since January.
Giving further credence to Eurozone concerns, Greece's long-term rating was cut to CCC from B- by analysts at Fitch in response to heightened risk that the country will exit the euro. After it was indicated yesterday that some of Greece’s banks may no longer be eligible for the services of the European Central Bank, speculation picked up today that Spanish banks may be on the brink of another downgrade.
Negativity surrounding European banks tainted the perception of domestic Financial stocks, forcing the sector down to a 2.1% loss.
Consumer Discretionary stocks were actually the worst performers of the session. They sank 2.7%. Abercrombie & Fitch (ANF 36.55, -2.95) extended the precipitous drop that it suffered in the prior session, while GameStop (GME 18.52, -2.32) and Dollar Tree (DLTR 95.13, -6.17) both fell hard in response to downside guidance that cast a pall over earnings results. Bucking the negative broad market bias and calls for a strategic overhaul, Sears Holding (SHLD 52.42, +1.55) pleased shareholders by announcing a spin-off of Sears Canada alongside its latest quarterly results. Retail giant Walmart (WMT 61.67, +2.48) also scored an impressive gain, thanks to a strong report.
Apple (AAPL 530.12, -15.96) dropped to a new two-month low as traders rotated out of the Tech heavyweight. Shares of AAPL had rallied almost 60% from the start of the year to their record high in April, but they are now down more than 15% since setting their zenith. The stock’s slide today created an especially heavy drag on the Nasdaq.
Widespread weakness among stocks sent the Volatility Index up more than 8% to 24 for the first time in 2012. The euphemistically titled “Fear Gauge” is now up in excess of 60% from the lows that it set less than two months ago.
Heightened volatility and continued weakness among stocks resulted in further rotation into Treasuries. It was reported shortly after the close that the Note’s yield set a new record low narrowly beneath 1.70%.
Data today ranged from the unsurprising to the disappointing. Specifically, the latest initial jobless claims tally totaled 370,000, which is unchanged from the prior week and on par with the 365,000 claims that had been broadly expected.
The May reading of Philadelphia Fed Index fell to -5.8 from 8.5 in the prior month. Economists polled by Briefing.com had expected, on average, an improvement to 8.8.
Leading Indicators also surprised to the downside. They showed a 0.1% decline, which contrasts with the 0.2% increase that had been broadly forecasted.
Advancing Sectors: Telecom +0.4%
Declining Sectors: Utilities -0.6%, Consumer Staples -0.7%, Energy -0.7%, Health Care -1.0%, Tech -1.7%, Industrials -2.0%, Materials -2.1%, Financials -2.1%, Consumer Discretionary -2.7%DJ30 -156.06 NASDAQ -60.35 NQ100 -2.1% R2K -2.3% SP400 -2.7% SP500 -19.94 NASDAQ Adv/Vol/Dec 484/2.06 bln/2023 NYSE Adv/Vol/Dec 420/945 mln/2665
4:17PM Applied Materials beats by $0.03, beats on revs; guides Q3 EPS in-line, revs in-line; guides FY12 EPS in-line, revs in-line (AMAT) 10.48 -0.18 : Reports Q2 (Apr) earnings of $0.27 per share, $0.03 better than the Capital IQ Consensus Estimate of $0.24; revenues fell 11.3% year/year to $2.54 bln vs the $2.4 bln consensus. Co issues in-line guidance for Q3, sees EPS of $0.21-0.29 vs. $0.26 Capital IQ Consensus Estimate; sees Q3 revs flat to down 10% sequentially, or roughly $2.286-2.540 bln vs. $2.46 bln Capital IQ Consensus Estimate. Co issues in-line guidance for FY12, sees EPS of high end of $0.85-0.95 range vs. $0.95 Capital IQ Consensus Estimate; sees FY12 revs of high end of $9.1-9.5 bln range vs. $9.52 bln Capital IQ Consensus Estimate.
5:44PM GT Advanced Technologies announces orders totaling $8 mlnfor DSS 450 MonoCast upgrades and DSS 450HP furnaces to Taiwan-based Utech Solar Corp (GTAT) 4.49 -0.83 : Co announced that it has received two orders totaling $8 million from Taiwan-based wafer manufacturer UTECH Solar. One order is for its new DSS 450 MonoCast) silicon growth technology and the other order is for additional GT DSS 450HP casting furnaces. UTECH will upgrade a portion of their current GT DSS450 casting furnaces to begin producing MonoCast wafers, which will strengthen its competitive position as a wafer supplier to meet the expected demand for higher efficiency solar cells. In addition, UTECH is also increasing its total wafer production capacity with additional GT DSS450HP multicrystalline casting furnaces to meet the demand from its key customers.
5:23PM Trina Solar Statement on preliminary determination of antidumping duty in the United States (TSL) 6.08 -0.52 : Trina Solar Limited (TSL) offers the following statement regarding the preliminary determination of antidumping duties by the U.S. Department of Commerce (the "DOC"). On May 17, 2012, a preliminary determination was announced by the DOC in Washington, DC regarding the exportation of crystalline silicon photovoltaic cells and modules from China. A preliminary antidumping duty ("AD") rate of 31.14% was calculated to apply to the importation into the United States of Trina Solar's solar cells and modules/panels produced in China. The DOC also preliminarily determined that the AD investigation does not apply to modules manufactured in China that incorporate solar cells produced in a third country. This decision is consistent with DOC's prior preliminary determination in the parallel countervailing duty ("CVD") investigation of the same products. The DOC found "critical circumstances" and therefore the AD rate will apply retroactively to imports, beginning approximately 90 days prior to the preliminary determination. Trina Solar continues to actively defend its position in these administrative proceedings.
4:02PM Marvell announces initiation of a quarterly dividend of $0.06 per share and increases share repurchase authorization by $500 mln to a total of $2.5 bln (MRVL) 13.30 -0.26 :
3:45PM Suntech Power responds to to preliminary decision on tariffs in the antidumping investigation of pv cells from China: 'Duties do not reflect the reality of a highly-competitive global solar industry' (STP) 2.13 -0.13 : Co offered the following statement regarding the U.S. Department of Commerce's preliminary decision to impose antidumping duties of 31.22% on Suntech's crystalline silicon photovoltaic cells imported from China:
"These duties do not reflect the reality of a highly-competitive global solar industry. Suntech has consistently maintained a positive gross margin as revenues are higher than our cost of production. We will work closely with the Department of Commerce prior to their final decision to demonstrate why these duties are not justified by fact," said Andrew Beebe, Suntech's Chief Commercial Officer. "As a global company with global supply chains and manufacturing facilities in three countries, including the United States, we are providing our U.S. customers with hundreds of megawatts of quality solar products that are not subject to these tariffs. Despite these harmful trade barriers, we hope that the U.S., China and all countries will engage in constructive dialogue to avert a deepening solar trade war. Suntech opposes trade barriers at any point in the global solar supply chain. All leading companies in the global solar industry want to see a trade war averted. We need more competition and innovation, not litigation."
11:02AM Silicom Limited secures a Design Win for its 10Gpbs multi-port network adapters from a new customer; co projects sales related to this Design Win will total ~ $1 mln per year (SILC) 14.17 +0.02
SMSC (SMSC) announced that Victory Concept Electronics has selected SMSC's KleerNet technology to deliver low latency, lossless wireless audio streaming technology.