Stock Futures Flat; S&P 500 at 5-Month High. Stocks to Watch: AAPL, BAC, CROX, INTC, LEN, MGA, MSFT, SNX, TXT
Published on Wednesday, 11 January 2012 07:07 Written by Christopher Lynn
New York, January 11th (TradersHuddle.com) – Stock futures were pointing to a flat open amid mixed overseas performance and as participants digest the S&P 500 closing at its highest level since July. Ongoing fears over funding for euro zone countries amid a massive sovereign refinancing cycle, along with were also weighing in sentiment.
In Asia, stocks closed mixed as economic optimizing, particularly on the prospects of the Chinese and U.S. economy was offset by fears over the ability of euro zone countries to raise new funds, amid Italian and Spanish sovereign debt auction later in the week. In Japan, the Nikkei edged higher, as participants viewed the Wall Street close at its highest level since July as bullish for stocks. Meanwhile, in China, the Shanghai Composite fell 0.4%, snapping a sharp 3-session rally ahead of GDP figures and inflation due out tomorrow.
In Europe, equity markets were turning positive and posting modest gains, following the sharp gains in the prior session. Banking and insurers were helping the gains, as stocks trade near a key technical level. Concern over the bond auctions later this week and Germany GDP figures were capping the gains in the region. The German first estimate of fourth quarter growth showed a contraction of 0.25% versus 0.5% in the prior quarter. Real GDP growth for the whole year of 2011 was 3% versus 3.6% in the prior year.
The euro was edging lower against the Dollar, trading below the $1.28 level. Crude oil was slipping 0.16% to $102.08 per barrel. Gold was climbing 0.85% to $1645.40 an ounce and silver was jumping 1.24% to $30.185 an ounce. Meanwhile, copper was gaining 0.80%.
On economic news, at 10:30 am, the Energy Department will issue its weekly inventory report on crude oil and distillates. And at 2 pm, the Fed will release its Beige Book.
Today’s Stocks to watch: Apple (NASDAQ:AAPL), Bank of America (NYSE:BAC), Crocs (NYSE:CROX), Intel (NASDAQ:INTC), Lennar (NYSE:LEN), Microsoft (NASDAQ:MSFT), Magna International (NYSE:MGA), and Synnex (NYSE:SNX).
Apple (NASDAQ:AAPL), the maker of iPads and iPhones, was falling 0.39% to $421.59 in pre-market on news that Eastman Kodak (NYSE:EK) sued both Apple and HTC Corp for infringement of four patents related to digital camera images. The struggling Eastman Kodak is looking at how to preserve value, as it continues to restructure amid growing speculation the company will file for bankruptcy protection. The stock that logged a new record closing high on the prior session was also under slight pressure following the announcement of additional competitive pressures to its iPhone and iPad devices. According to reports from the CES in Las Vegas, Lenovo is planning to launch smartphones for the U.S. market, while Dell (NASDAQ:DELL) announced plans for a tablet later in the year. Earlier in the week, Apple received a boost from both Goldman Sachs and Needham, which bumped estimates ahead of what is expected by many analysts to be a blow out quarter, with Apple likely posting record quarterly results on record iPhone and Mac shipments. Goldman Sachs bumped its target price to $550 from $520, citing upside in the December quarter and better than expected results in 2012; while Needham maintained its Buy rating and target price of $540, while it raised its EPS estimate to $10.85 for the quarter from $9.55. For the full year Needham said that Apple should earn $38.70 on revenues of $151.95 billion. Apple has calculated support at $363.32 and resistance at $427.75.
Bank of America (NYSE:BAC) was falling 0.15% to $6.62 in pre-market, giving back some of its rally of more than 5.7% in the prior session amid reports that New York state’s financial regulator is investigating several large banks on whether they overcharged customers on force-place insurance, where the loan servicer or lender buys an insurance policy on the property in the case that the homeowner fails to keep up insurance coverage. Bank of America has been embraced by participants this start of the year, with the stock surging 19.2% so far this year, amid improved sentiment on economic growth following better than expected data and as developments in the euro zone have taken the possibility of a major bank failure in the short or medium term off the table.
Crocs (NYSE:CROX), the maker of footwear that utilize its proprietary closed cell-resin, called Croslite, rallied more than 5% to $16.85 in extended hours, trading above calculated resistance at $16.10, following positive reaction to the company issuing upside revenue guidance. Crocs said that it expects annual revenue to surpass $1 billion for the first time in its history, as it sees fourth quarter revenue at the high end of the prior guidance of $200 to $205 million versus consensus of $200 million. Last week, Crocs was initiated with a Hold at BB&T.
Intel (NASDAQ:INTC), the largest chipmaker in the world, was falling 0.55% to $24.37 in pre-market despite announcing deals for its Atom chips, following comments from Microsoft that PC sales were probably worse than expected. The company announced that it has made a deal with Motorola Mobility, in which the mobile phone maker being acquired by Google would use Intel’s new Atom processor in its devices. The multi-device, multiyear strategic collaboration deal will allow Intel’s chips to be use in Motorola’s smartphones and tablets running Google’s Android operating system, expecting the first devices to be launch in the second half of the year. Separately, Intel said that is stuck a deal with Lenovo Group, in which the Atom processor will be embedded in Lenovo’s K800 smartphone, with an expected launch in China during the second quarter of this year. Intel is seen as a late entry to the mobile arena and has been investing heavily on its Atom chip. For the year, Intel has jumped 5.5%.
Lennar (NYSE:LEN), the single-family attached and detached homebuilder, was climbing 1.49% to $21.07 in pre-market and trading above calculated resistance, after the company posted quarterly results that missed on the bottom line but beat on the revenue side. Lennar earned for the quarter $0.16 per share, $0.01 worse than consensus, on revenues that jumped 10.8% year over year to $952.7 million versus consensus of $916.59 million. The company has seen the market starting to stabilize, driven by low interest rates and lower home prices.
Magna International (NYSE:MGA), the most diversified automotive supplier in the world, will be in focus after the company issued fiscal 2012 revenue guidance slightly below consensus. The company sees revenues of $27.8 to $29.3 billion versus consensus of $29.66 billion. Additionally, Magna said that it expects a net increase in total production sales over the two-year period from 2012 to 2014 of about $3.2 billion. Magna broke above its calculated resistance at $36.62 in the prior session, closing at $37.75.
Microsoft (NASDAQ:MSFT), the world’s largest software publisher, was falling 0.79% to $ in pre-market after yesterday Bloomberg reported that the company said PC sales were likely worse than expected, with Microsoft citing Thailand Flooding impacting production. Microsoft has seen solid gains so far this year, adding 7.24%.
Synnex (NYSE:SNX), the IT design-to-distribution business process services Company, was rallying 4.39% to $33.50 in pre-market following its better than expected quarterly results and after the company issued inline earnings and revenue guidance for the current quarter. Synnex said that for its fiscal fourth quarter it earned $1.37 per share, $0.22 better than consensus, on revenues that jumped 15.1% year over year to $2.84 billion. For fiscal first quarter, the company sees EPS in a range of $0.89 to $0.90 on revenues of $2.48 to $2.58 billion. Synnex closed above its calculated resistance at $31.43 at the start of the week and Raymond James raised its target price on Synnex to $36 from $33 last week.
Textron (NYSE:TXT), the maker of Cessna business jets and Bell helicopters will be in focus after reports that it’s conducting a strategic review that could include the spin-off of parts of its aerospace business. The stock has gained 9% so far this year.
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