Tag - Gcom

The Russell 2000 closed near opening levels, up slightly to 712.27, a gain of 1.62, or 0.23%. Look for support Thursday at 704, 700 and 695. Meanwhile, resistance comes in at 717, with the big test up at 725.

The Institute for Supply Management Non-Manufacturing survey this morning at 10:00 a.m. ET could spark a little volatility into the morning action, but most traders are already looking ahead to Friday’s big employment data, which could lead to uneven position-squaring type of action Thursday.

The Russell 2000 (IWM) and the other major U.S. indices lost big today as news of a steep decline in the services sector led to recession fears. The small-cap index let go 21.88 points, or 3.02%, to 701.58. The Dow Jones Industrial Average (INDU) was off 370.03 points, or 2.93%, to 12,265.13.

On a year-to-date basis, the Russell 2000 has shed 8.41%, while the Dow has retreated 7.54% and the S&P 500 has shed 8.97%.

The bears ran the show today as news of an unexpectedly deep drop in U.S. services in January sparked a sell-off.

The Institute for Supply Management said that its index of non-manufacturing dropped to 41.9 in January from 54.4 in December. The result is far worse than the one expected by economists. A reading above 50 is a sign of growth.

Services comprise about 75% of U.S. gross domestic product and a decline would surely throw off an economy already beset with a slump in the housing sector, a credit squeeze and a pullback of consumer spending into recession.

Or maybe a recession has already started.

Either way, investors reacted to news of the biggest one-month decline in services in seven years by selling everything in sight. The makers of construction and raw materials suffered the most, follower by insurance companies and those manufacturing agricultural machinery. No single group of stocks posted a gain.

Separately, Banc of America Securities contributed to the bearish mood when it downgraded Yahoo! Inc. (Nasdaq: YHOO) to “neutral” from “buy.”

The Russell 2000 was trending down during the entire session, skidding to its lowest level at the close.

The Russell 2000 (NYSE: IWM) futures are down sharply and the small-cap index will open with a drop.

Helping fuel the bearish mood is Apple Inc. (Nasdaq: AAPL), which forecasted after the close on Tuesday that its second-quarter sales growth will slow to 29% from the 35% growth seen in the first quarter.

The reason: the Cupertino, Calif.-based company does not expect to be able to sustain previously strong sales of its trademark iPod.

Otherwise, Apple reported that its first-quarter profit was $1.58 billion, or $1.76 per share, compared with $1 billion, or $1.14 per share, a year earlier.

Contributing to the pessimism is Motorola Inc. (NYSE: MOT), which forecasted that it will swing to a loss in the current quarter due to sluggish demand for its mobile devices.

Here are the biggest percentage gainers and losers in pre-market trading among companies with a market cap between $100 million and $750 million:

Biggest percentage gainers:

• Globecomm Systems, Inc. (GCOM), up 14%.
• Corinthian Colleges, Inc. (COCO), up 11% despite news on Tuesday that it has lowered its 2008 guidance.
• Pharmasset Inc. (VRUS), up 6%.

Biggest percentage losers:

• First Cash Financial Services, Inc. (FCFS), down 22% on news of a decline in fourth-quarter profit.
• Charlotte Russe Holdings, Inc. (CHIC), down 9%.
• Hoku Scientific, Inc. (HOKU), down 9% on news of a fiscal fourth-quarter sales guidance below Wall Street’s expectations.

The Russell 2000 (NYSE: IWM) futures are rising and the small-cap index will likely open in the green.

Small-cap stocks are set for a bullish opening on news that General Electric Co. (NYSE: GE) reported a fourth-quarter profit from continuing operations of $6.82 billion, or $0.68 per share, compared with $5.95 billion, or $0.58 per share, a year earlier. The result matches analysts’ expectations.

Investors will be paying attention to the Reuters/University of Michigan preliminary consumer sentiment index for January, which will be released at 10 a.m. ET. The index measures consumers’ willingness to spend money. Economists are expecting to see a small decline.

Here are the biggest percentage gainers and losers in pre-market trading among companies with a market cap between $100 million and $750 million:

Biggest percentage gainers:

• Comtech Group, Inc. (COGO), up 10%.
• MedCath Corp. (MDTH), up 9%.
• Globecomm Systems, Inc. (GCOM), up 9%.

Biggest percentage losers:

• Seattle Genetics, Inc. (SGEN), down 5% on news of a 10 million share public offering priced at $9 a share.
• Monarch Casino & Resort, Inc. (MCRI), down 4%.
• Isle of Capri Casinos, Inc. (ISLE), down 2%.

The Russell 2000 (NYSE: IWM) has picked up speed and is outpacing the other major U.S. indices this afternoon. At 2:06 p.m. ET, the small-cap index had advanced 1.86 points, or 0.24%, to 774.24. The Dow Jones Industrial Average (INDU) was up 32.44 points, or 0.25%, to 13,075.18.

Investors are modestly bullish following news that banking giants Citigroup Inc. (NYSE: C), Bank of America Corp. (NYSE: BAC) and JPMorgan Chase & Co. (NYSE: JPM) have agreed to create a structured fund of at least $75 billion to help revive the short-term debt market, according to a report by The New York Times after the start of trading. The fund could be operational within a couple of weeks.

That news helped lift financial shares and send big- and small-cap stocks on an upward trajectory.

Otherwise, the day began quietly, as the bond market is closed and no major economic releases are scheduled as Americans honor Veterans Day.

International Business Machines Corp. (NYSE: IBM) made the headlines on news that it will buy business intelligence software maker Cognos Inc. (TSE: CSN) for $5 billion, while shares of online broker E*Trade Financial Corp. (Nasdaq: ETFC) are in dire straits on news of an analyst downgrade and the possibility of bankruptcy.

The Russell 2000 (NYSE: IWM) is gaining ground after opening little changed this morning as Veterans Day leaves investors with little news to analyze.

At 10:02 a.m. ET, the small-cap index had added 1.93 points, or 0.25%, to 774.31. The Dow Jones Industrial Average (INDU) was up 22.60 points, or 0.17%, to 13,065.34.

Corporate deal-making is coming into focus this morning, following an announcement by International Business Machines Corp. (NYSE: IBM) that it will buy Cognos Inc. (TSE: CSN), a Canadian maker of business intelligence software, for $5 billion.

The offer was expected, as Armonk, N.Y.-based IBM’s rivals had previously also made purchases of intelligence software companies.

Meanwhile, online broker E*Trade Financial Corp. (Nasdaq: ETFC) was downgraded by Citigroup Inc. (NYSE: C) and the possibility of bankruptcy was raised.

Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:

Biggest percentage gainers:

• Globecomm Systems Inc. (GCOM), up 15% on news of a contract with the U.S. Army.
• Dice Holdings Inc. (DHX), up 11%.
• ChemGenex Pharmaceuticals Ltd. (CXSP), up 10%.

Biggest percentage losers:

• Alto Palermo S.A. (APSA), down 24%.
• Basin Water Inc. (BWTR), down 13%.
• ExlService Holdings Inc. (EXLS) down 9%.

Shares of Globecomm Systems Inc. (Nasdaq: GCOM) are gaining ground ahead of the opening after the provider of satellite-based communications infrastructure said it was awarded a contract with the U.S. Army’s Communications Electronic Life Cycle Management Command Program for $9.9 million.

The contract is said to include multiple options that if fully exercised over the next three years would value the contract at $87 million.

Globecomm, which will provide a Joint IP Modem, will work with ViaSat Inc. (Nasdaq: VSAT) as a subcontractor for the development and production of the Joint IP Modem.

Shares of Globecomm (GCOM) gained $0.69, or 5.63%, to $12.95 ahead of the opening. Shares of Globecomm have been trading in the range of $$8.02 to $16.49 for the past 52 weeks.

Globecomm Systems Inc. (Nasdaq: GCOM) reported robust results for its fourth quarter, but investors are sending shares of the satellite-based communication products provider spiraling downward.

 “They reported preliminary information on August 3, there is no new negative information and earnings were exactly in line with estimates. I think it could be profit taking,” said Susquehanna Financial analyst Irit Jakoby.

Jakoby has a positive rating on the stock and Susquehanna Financial is a market maker for Globecomm.

For the three months ended June 30, the Hauppauge, N.Y.–based company recorded earnings of $0.19 per diluted share that clocked in line with the Street.

Globecomm booked revenues of $49.2 million, compared with $35.5 million in the fourth quarter of fiscal 2006. Revenues for the quarter included $5.1 million related to the company’s acquisition of GlobalSat.

Going forward Jakoby says that contracts that are incremental to guidance will serve as catalysts for the stock. She said that as the company announces more contracts it should gain greater visibility.

“Something interesting to note is that the stock tends to go down after earnings announcements,” said Jakoby. “It’s just the way the stock trades.”

Shares of Globecomm fell $0.91, or 6.10%, to $14.00 in afternoon trading. The stock was as low as $13.71 at 11:07 this morning.

Life Partners Holdings, Inc. (Nasdaq: LPHI), The Aristotle Corp. (Nasdaq: ARTL) and Super Conductor Technologies, Inc. (Nasdaq: SCON) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $500 million.

Here are today's biggest percentage losers: