Tag Archives: Hewlett-Packard

The Best Damn Wall Street “Week in Review” Anywhere…

8 Apr
ergw

“Forget the TPS reports and check out this sad, sad March jobs report”

Week of April 1st – April 5th:
Dow: 14,578 (-0.1% last week, +11.1% YTD)
S&P 500: 1,569 (-1.0% last week, +8.9% YTD)
 

Links Worth Snacking On:

  • Chart of the Week - March Madness upsets by the numbers
  • Bloomberg - The top 20 “green” banks of 2012
  • Wall Street Oasis - The 5 benefits to working in the back office in finance
  • WSJ - How much has the Madison Square Garden arena renovation helped MSG stock?
  • The Economist - Why has Canada killed off the penny?
  • The Accelerators - Should startups not hire M.B.A.s?
  • Market Oracle - The unique seasonal factors affecting the monthly jobs report
  • Businessweek - The million dollar endorsement…in lacrosse

Tired from the traditional cultural highlights of Cancun and Nassau?  Spring Break can be rough.  But those daiquiri-infused migraines are in the books.  The 2nd quarter kicked off on Wall Street last week with a big focus on jobs data.

#1. March Non-Farm Payrolls Report Disappoints

Stocks dropped Friday after the major monthly employment report tossed up a brick.  The Labor Dep’t announced that only 88K jobs were added in March (notably lower than the hefty 200K expected).  And the unemployment rate fell from 7.7% to 7.6%, but mostly because of folks dropping out of the workforce.  No Cinderella story here.

#2. A Big Week for Cars

Detroit flat out enjoyed its best month since May ’07.  Ford and GM gave Michigan something to not be scared about – record high monthly and quarterly sales for many new models.  Plus West Coast electric car newbieTesla plugged into the fun by saying it would turn a profit for the first time.

#3. Stock Winners…

Best Buy doesn’t’ make good cookies – so they’re opening internal boutiqueSamsung stores to get you to visit.  Facebook shares rose after Zuckerberg revealed a new operating system/app hybrid for Android phones that’s ideal for stalkers/creeps.  And investors are betting big on Zynga‘s new gambling games.

#4. …Stock Losers

Shares of struggling Hewlett-Packard took a hit on gossip the company’s Chairman Raymond Lane is jumping ship to to bigger/better things.  And Panasonic suffered on allegations from the deadly SEC/Department of Justice combo that one of their Cali-based subsidiaries was engaging in business bribes (though few bribes are good bribes).

#5. Bank of Japan’s “Operation Q-Squared” Surprise

The Bank of Japan lit a fire under the markets on Thursday by announcing a stimulus program that was actually insane.  The historically conservative central bank is under new leadership that’s determined to end Japan’s 20-year streak of low growth by pumping absurd quantities of money (yen) into the economy by purchasing long-term bonds, similar to the quantitative easing program we have here in the US, but with a black belt.  The new program is hoped to lower interest rates, spur investment  and generate higher exports from the East Asian nation.  

What MarketSnacks Is Checking Out This Week:

  • Monday - The 1st quarter earnings season kicks off with Alcoa
  • Tuesday - NFIB Small Biz Survey
  • Wednesday - Minutes from the Fed’s last meeting
  • Thursday - Weekly Jobless Claims
  • Friday - Reuters/UMich Consumer Sentiment Poll for April

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“Stocks Fall After Bernanke Speech Revives Fiscal Cliff Fears”

20 Nov

Bernanke’s warning to Congress was too serious for comfort

Dow: 12,789, -7 (-0.06%)        S&P 500: 1,388, +1 (+0.07%)

Like many a facial-hair endowed master before him (Gandalf, Dumbledore, Jack Sparrow, etc.), Federal Reserve Chairman Ben Bernanke has the power to move markets with mere expressions, twitches…and especially words.  Stocks rallied big yesterday on optimism Congress will compromise to deal with the looming Fiscal Cliff – but Bernanke’s comments today turned the hope back to worry, edging the Dow down 7 points.  While US housing data continue to electrify, Hewlett-Packard and Best Buy also made headlines for the wrong reasons.

Fed Chairman Bernanke discusses Fiscal Cliff concerns

Ben Bernanke did his best Any Given Sunday locker room speech today to encourage Congress to beat the fiscal cliff.  I can’t do it for you.  I’m too old.   The Fed chairman sent a message to congress that they better get it together and compromise on a plan to avoid the fiscal cliff because the Fed can’t do it alone.  Investors are impressed by the Fed’s actions to stimulate the economy, but the Fiscal Cliff is a major threat that cannot be counteracted by monetary policy alone (Central Banks do monetary policy).  Congress must act with fiscal policy (the spending and taxing of government) or the economy will suffer.  Bernanke: Fiscal Cliff = 9% unemployment again.  Investors feared the beard today.    

Housing Starts & Building Permits for October rise to record levels

Builders be busy.  In a shortened week chock full of housing data, American home news impressed again: Construction on new residential buildings (“Housing Starts”) rose 3.6% in October to reach an annual pace of 894,000 new units.  September’s data was revised hugely higher (a 15.1% surge) and the number of permits for future construction also rose.  Surprisingly, the Commerce Dep’t noted that Hurricane Sandy, despite her wrath, did not unleash a noticeable impact on the figures.  Fresh off of yesterday’s solid existing home sales news (levels not seen since May of ’06), the housing market continues to gain momentum (a construction growth rate similar to a little kid with a new Lego’s kit after drinking 2 sodas and a Capri Sun).

HP hits new low with $8.8 Billion write-off

Shockingly consistent with the printers they produce, Hewlett-Packard (HPQ) is struggling.  They brought in former eBay CEO Meg Whitman to turn things around and, well, that plan’s been slow going.  But today the PC maker-turned-printer & software maker-turned-PC maker (there’s an identity crisis at HP) took a real shot in the hard drive.  HP dropped 12% to a 10-year low after announcing that a software company they bought last year, Autonomy, was actually worth about 1/10th of what they paid.  The $10 BN acquisition was supposed to get the company away from hardware into software.  Instead HP announced today that some glossy and probably fraudulent accounting by Autonomy’s management made it look much more valuable than it was and they horribly overpaid.  The Bait-and-switch forced HP to write down a $8.8 BN loss to correct for the real value of the acquired asset.  HP also announced earnings today, which were completely wiped out by the $8.8 BN write-down and into the red.

Best Buy earnings poor, Krispy Kreme impresses

Best Buy (BBY) has been trying to turn over a new leaf as well – but slowing sales and heavy costs spent  to restructure the business hurt earnings.  The $10 million loss knocked the stock down 13%.  On the bright side, Krispy Kreme (KKD) leapt 23% after increased same-store sales strengthened earnings (the MarketSnacks team’s sweet tooth takes partial responsibility).

Tomorrow:

  • Weekly Jobless Claims – a day early because no Thursday trading for Thanksgiving
  • The final Reuters/University of Michigan Consumer Sentiment Poll for November – we assume most are mentally preparing themselves to be trampled on Black Friday
  • Earnings: John Deere…

© 2012 MarketSnacks

 

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“Dow Falls For Biggest Loss in August”

23 Aug
"Stimulus, Schimulus - don't cry Jennay, the Fed gotsta do something"

“Stimulus, Schimulus – don’t cry Jennay, the Fed gotsta do something”

Dow: 13,058 (-0.88%)        S&P 500: 1,402 (-0.81%)

Run out of Power Rangers popsicles?  Kids will throw a temper tantrum. Ditto for investors (except over economic stimulus – not dessert).  Yesterday’s release of the Federal Reserve “minutes” (details of the most recent central bank policy on July 31st) weighed on markets again today.  More of the Fed’s members seem open stimulus that will boost the economy faster – but investors want definitive policy decisions and expressed their dissatisfaction by dropping the Dow 115 points for its biggest loss of the month.  Material stocks led declines and Hewlett-Packard‘s headline earnings disappointed as economic data came in mixed with some key housing highlights.

Housing data impress, but jobless claims increase

Just like mama used to say, you just can’t have your ice cream cake and eat it too.  Housing data impressed early today: The Commerce Department reported that “New Home Sales” rose in July for its 3rd increase in 4 months and the Federal Housing Finance Agency observed a larger-than-expected increase in June “Home Prices.”  The housing market isn’t by any means fixed, but investors hope positive data shows it has at least bottomed-out on the road to recovery.  On the flip side, the number of Americans filing for unemployment ticked up for the 2nd week in a row.  Weekly jobless claims increased by 4,000 to 372,000, its highest level in a month – a sign of how the labor market is all-over-the-place.  Fresh off all the talk yesterday about the Fed potentially enacting stimulus policy (like a 3rd round of quantitative easing, or QE3), investors are hoping disappointing employment data might prompt the central bank to juice up the economy.

Boeing just can’t get its 787 sales up, HP falls on poor PC sales

American jumbo jet manufacturer Boeing (BA) got a cancellation from the Australian airline Qantas for 35 new 787 jets scheduled to be delivered in 2014 (if Foster’s has taught us anything, it’s that Qantas is Australian for “F my life”).  Boeing execs were not pleased to receive a letter saying, Sorry, we’re going to go ahead and cancel that $8.5 billion order.  This new “787 Dreamliner” is Boeing’s biggest investment of the past decade, intended to upgrade the 747 as a more efficient and modern jet and potentially inspire another Airplane movie.  After loads of delays, Boeing actually has already paid millions to airlines already in late delivery fees, so the 787 has been something of a disaster so far.  Boeing execs in Washington are crossing their fingers that they will sell a few hundred more to make the hefty investment pay off, but the stock still fell 3.5% on the cancellation.  Hewlett-Packard’s (HPQ) shares also dropped today as the 2nd PC maker this week reported poor earnings on falling PC sales – the 8% slam is an unwelcome slap in the face for new CEO Margaret Whitman.

Tomorrow:

  • July Durable Goods Orders
  • Over in Europe: UK 2nd quarter GDP, German Chancellor Angela Merkel meets with Greek Prime Minister Antonis Samaris in Berlin – will the Greeks get an extension on their bailout package?
  • Second quarter earnings season reports: Madison Square Garden

© 2012 MarketSnacks

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“Fed Stimulus Signs Help Down Stocks Finish Flat”

22 Aug
"All 3 of my wishes, Mr. Bernanke, are for any kind of stimulus news from the Fed. Please."

“All 3 of my wishes, Mr. Bernanke, are for any kind of stimulus news from the Fed. Please.”

Dow: 13,204 (-0.51%)        S&P 500: 1,414 (-0.35%)

Doves waft through the air, inspire hand-holding and kum-ba-yah singing – It’s also a term for central bankers who want loose policy to promote economic growth…”hawks,” on the other hand, oppose monetary easing for fear of inflation.  The release of details from the Federal Reserve‘s most recent dove vs. hawk policy meeting had investors talking about stimulus again all afternoon.  Although markets were excited by potential for Fed action, concern over Greece’s pleas for more concessions on its debt reduction schedule weighed on investors as well.  And in the corporate world, tech companies tanked: Hewlett-Packard (HPQ) and Intel (INTC) fell after computer big boy Dell (DELL) dropped 5% after earnings missed expectations (founder Mike Dell’s daughter’s aggressive twitter activities aren’t helping).  Home data and housing stocks made a splash too as the mixed news pushed the S&P 500 into the positive but the Dow dipped 31 points

Federal Reserve FOMC “minutes” hint at stimulus upcoming

Getting a spot in the Federal Reserve’s “Federal Open Market Committee” ain’t too shabby – we assume the meetings are cool because they’re super-secret and everyone wants to know about the details.  The only thing missing is paparazzi.  The FOMC is a branch of our central bank that determines monetary policy and today the transcript (aka “the minutes”) of their most recent meetings from July 31-August 1 was released for investors to sort through the tea leaves for clues on policy plans.  With economic data for 2012 showing slow economic growth in general so far, investors have been hoping for any signs of stimulus – sadly, the last few “Fed minutes” releases have left them disappointed.  But the minutes seen today showed more Fed members favor stimulus measures if the economy doesn’t pick up more sooner.  The news of potential quantitative easing excited investors and reversed stock declines – eyes are now on the Fed meeting next week in Jackson Hole, Wyoming.

Existing Home Sales pick up in July, boost housing stocks

The number of existing homes sold in the real estate market rose 2.3% compared to June and was 10.4% more than July of last year.  Home purchases have a great ripple effect across the economy, just think about it – the median price of existing houses sold in July was $187K, and with every home bought the former owner has that much more money he can spend.  It also gives the new homeowner an excuse to buy new LA-Z-Boys, a big screen TV, and a Batcave themed entertainment theater for in-character Dark Knight viewings.  That’s a lot of household consumption (which is the heart of American GDP) that can be fueled by housing purchases.  This ripple effect is known as the “money multiplier,” which accelerates economic growth.  It’s good news for the general economy, but great news for housing stocks as more housing purchases suggest an improving housing market.  Home construction companies DR Horton (DHI) and Lennar (LEN) both grew at least 3.8% on the news.

Tomorrow:

  • July New Home Sales, June Home Price Index – some more housing data coming your way
  • Your Thursday morning serving of Weekly Jobless Claims – how many Americans filed for unemployment benefits since last week?

© 2012 MarketSnacks

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“Dow Jones Approaches 4-Year High to Cap Quiet Trading Week”

17 Aug

 

Want to know who won the headlines battle?  Apple and Facebook were the only two players in the game today

Dow: 13,275 (+0.19%)        S&P 500: 1,418 (+0.19%)

All quiet on the Wall Street front.  As the MarketSnacks faithful know from our daily summaries, it’s been a slow summer week here on the trading floor with many investors mid-daiquiri in a poolside hammock.  But the twice-monthly Reuters/University of Michigan consumer sentiment index managed to get things going today and move the markets to their 6th straight weekly gain – consumer optimism rose in the first half of August despite expectations it would decline.  Apple and Facebook were the 2 big names making headlines (for opposite reasons & performances) as the Dow ticked up 25 points.  After weeks of sneaky steady increases in the 2nd half of the summer, the blue chip heavy index is now just shy of its 13,275 point 4-year high that was set on May 1st.

Facebook CEO finally acknowledges stock price free-fall, Apple hits another all-time high on iPad mini rumors 

Facebook (FB) dropped another 4% today as investors wonder if it’s really worth billions of billions of dollars. Mark Zuckerberg told his employees today that it’s been ”painful” to watch the stock drop 50% since the IPO in May.  Loads ofemployees have been given FB shares as compensation and others bought the stock post-IPO, pinning their shares to their breast pockets to fulfill the mandatory flair requirement.  But now they’re watching the value plummet and they’re pissed off, particularly since they’re barred from selling their stock for a few more months due to rules preventing insiders from selling too soon.  On the other side of Silicon Valley, Apple (AAPL) hit a new all-time high today at $648 on an analysis by boutique investment bank Jefferies & Co. that said the stock is worth $900/share.  The report estimated an iPhone 5 would be released in September and that a smaller iPad Mini was being developed to compete with lower priced Google (GOOG) and Amazon (AMZN) tablets.  These new products were promised by Jefferies to cause mass-swooning of hipsters from coast to coast to Brooklyn, to be dubbed “Apple-mania.”  FYI – Apple’s now worth $607 billion.

Over the Weekend:

  • PCs 4 Life! Dell and Hewlett-Packard report their second quarter earnings…they’re both expected to tank on poor PC sales

© 2012 MarketSnacks

 

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“Markets Finish Wild Day Up”

24 May

“Bobsleds and stocks, mon”

Dow 12,530 (+.27%)        S&P 1,321 (+.14%)

Up 40 – Down 40 – Up 10 – Down 70?  Over the last two days, stocks have managed to be more all over the place than Carmen Sandiego.  Following yesterday’s European leaders’ summit that provided few solutions, stocks jumped in the last hour of trading today after Italian Premier Mario Monti commented that Greece will keep the euro and that he could persuade the Germans to accept Euro Bonds (collective debt backed by all 17 nations of the Eurozone) for the good of Europe.  Mediocre US jobs data along with ongoing euro uncertainty kept markets down in the morning, but the Dow‘s late rally finished up 34 points.

Weekly Jobless Claims tick down for first time in three weeks, Durable Goods orders up

US econ data has been on a cold streak lately, but today offered a hint of light.  The number of people filing for unemployment (a reflection of weekly firings) dropped from 372,000 to 370,000 last week, ending 3 weeks of increases.  This improvement was in line with economist expectations and reinforces the sense that the jobs market is slowing improving (370,000 people in line for unemployment is still close to 4-year lows), but not fast enough to fix our unemployment problem soon.  Orders for “durable goods” (items that won’t die on you quickly, like that birthday goldfish “Bob” from your girlfriend) decreased in April by 0.2%.  Unfortunately most of the orders came from military purchases of tanks, guns and whatever else Stark Industries produces, meaning purchases by consumers and businesses probably dropped.  Economists are waiting for signs that businesses are confident in economic growth by buying durable goods, but today’s report left doubts.

Hewlett-Packard earnings up after restructuring, poor NetApp earnings bring down Nasdaq

Hewlett-Packard (HPQ) shares were up almost 8% at one point today after reporting revenues that topped forecasts for the 1st quarter.  The computer company has faced uncertainty recently as the demand for PCs softens and yesterday afternoon’s announcement is considered a result of CEO Meg Whitman’s aggressive restructuring plan, which includes the elimination of 27,000 jobs over the next few years.  NetApp (NTAP), on the other hand, is the major global data storage provider you depend on but probably never heard of.  NetApp owns building upon building of windowless, personless buildings that house/cool servers from the world’s computers, and the stock’s 12% fall today after worse-than-expected earnings and 2nd quarter outlook helped pull down the tech-heavy Nasdaq stock index -0.38%.

Tomorrow:

  • 3-day Memorial Day weekend (markets will be closed Monday) – can we go into it without a European debt-copolypse?
  • University of Michigan Consumer Confidence poll for all of May - how do regular folks like you and us feel about the economy?
  • Facebook (FB) was up again today – how will it finish on its 1 week IPO anniversary?

© 2012 MarketSnacks

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