Techs, Financials Lead Sharp Declines in Equities

by: Midnight Trader

4:12 PM, Apr 30, 2010 --

  • DJIA down 158.71 (1.42%) to 11,008.61.
  • S&P 500 down 20.09 (1.66%) to 1,186.69.
  • Nasdaq down 50.73 (2.02%) to 2,461.19.


  • Hang Seng up 1.59%
  • Nikkei up 1.21%
  • FTSE down 1.1%


(+) VCLK gets upgraded.

(+) CSTR jumps on pact with, strong results.

(+) TRMB gets upgraded.

(+) DNDN adding to Thursday gains on FDA approval of Provenge.

(+) APKT lifts full-year view.

(+) SWKS continues evening gain that followed results.

(+) CSUN beats Q1 estimates.

(+) JRCC easily beats with Q1.

(+) DHI swings to unexpected profit.


(-) VSEA turns lower despite beating with earnings.

(-) ATHN misses Q1 estimates and expects Q2 miss.

(-) APPY sets offering.

(-) CPF swings to loss.

(-) BCS profit misses.


Weakness in financial and technology issues spurred broad selling in U.S. markets Friday, with the major indices closing out the session near day lows. A reported Federal criminal probe into Goldman Sachs (NYSE:GS) spooked the market early and pushed financials lower while a mixed bag of earnings and a drop in consumer sentiment in April was enough to send tech and consumer issues swinging south. Despite the gloomy backdrop, traders did hear a bit of upbeat news about the economy as the Commerce Department reported that the U.S. GDP grew at a 3.2% annual rate through the first three months of 2010, in line with expectations and the third straight quarter of growth.

Earnings season rolls forward next week, but the number of top, market moving names begins to thin out. On Monday, traders will catch results from Texas Roadhouse (NASDAQ:TXRH) and Vivus (NASDAQ:VVUS). On Tuesday, MasterCard (NYSE:MA), Merck (NYSE:MRK), News Corp. (NASDAQ:NWS) and Pfizer (NYSE:PFE) are due to report financials. ADC (ADCT), CBS Corp. (NYSE:CBS), JDSU (JDSU) and Symantec (NASDAQ:SYMC) are due with results on Wednesday, followed by Activision (NASDAQ:ATVI) and MGM Mirage (NYSE:MGM) on Thursday. Washington Post (WPO) will distribute financials on Friday.

On the economic front, personal income/spending data, construction spending, the ISM Index, and auto/truck sales are due for release Monday. Factory orders will be distributed Tuesday, followed by ADP employment change, ISM services and crude inventories on Wednesday. Initial claims data is set for release on Thursday. On Friday, the market will see the unemployment rate and consumer credit.

Elsewhere in today's market, Goldman Sachs' woes outweighed the solid U.S. economic data and easing Greece debt worries, with the financial sector leading the market lower.

The potential for a criminal case sparked a flurry of downgrades for GS. Bank of America Merrill Lynch downgraded the shares to neutral and a cut to sell from Standard & Poor's Equity Research. S&P also lowered its price target to $140 per share from $180.

Another decliner was McAfee (MFE), which reported late Thursday Q1 EPS of $0.23, but $0.60 excluding special items, vs $0.34 a year earlier and shy of the Thomson Reuters mean analyst estimate for $0.63. Revenue of $502.7 million is up 12% from $447.7 million a year earlier and the Thomson Reuters mean analyst estimate for $513 million.

The company expects Q2 revs of $500 million to $520 million and non-GAAP EPS of $0.58 to $0.62. The Street is at $0.66 on $526 million in revs.

Athenahealth (NASDAQ:ATHN) was down sharply after the company said late Thursday it earned an adjusted $0.06 per share in Q1, missing the Thomson Reuters mean for $0.13. Sales were $54.5 million, below forecasts for $55.8 million.

For Q2, it sees EPS below consensus, which is $0.17.

On the upside, Acme Packet (NASDAQ:APKT) reported Q1 revenue of $51.1 mln, up from $31 mln in the year ago quarter. Earnings were $0.16 per share, up from $0.07 per share last year.

For the full year 2010, the company raised its outlook to revenue in a range of $204 to $208 mln, vs. its previous view of $182 to $186 mln. EPS is seen between $0.65 and $0.70 per share, vs. its prior view of $0.44 to $0.47 per share. The Street is at $188 mln in revenue and earnings of $0.46 per share.

Power-One (NASDAQ:PWER) reported late Thursday Q1 revs of $152 mln, up 56% year-over-year. EPS was $0.04 per share, up from a year ago loss of $0.70 per share.

Crude oil for June delivery added $0.98, or 1.15%, to $86.15 a barrel.