Tag - Pwav

Small-cap stocks opened lower Friday, pulled down by lingering worries about the economy, a dip in stock markets around the world overnight and a renewed safe-haven mentality ahead of the weekend. Today’s small-cap gainers are Retalix Ltd. (Nasdaq:RTLX), Powerwave Technologies (Nasdaq:PWAV) and DivX (Nasdaq:DIVX).

Other Market Watch highlights today included:

• Crude oil prices were slumping today, down about $2 a barrel amid a resurgent U.S. dollar overnight.  
• Today’s trading will not only close the books on a dreadful month for the stock
market, but also represents the final week of trading before voters decide on a new president next week.
• The yield on benchmark 10-year notes was down 2.7%, which reflects strong demand for Treasury notes as the yield moves inverse to price.  
• As the stock market lurched toward the end of a historic month investors seemed reluctant to extend a 3-day buying spree in small caps and money was moving back into Treasury markets.

Small Cap Gainers:

• Retalix Ltd. jumped 31% as the software provider for food distributors and retailers gapped higher on the open. See (Nasdaq:RTLX).
• Powerwave Technologies Up 11% in after-hours; Q3 results beat estimates by $0.03. See (Nasdaq:PWAV).  
• DivX Q3 results top expectations, guides in line to above Street. DivX shares were up 8% overnight. See (Nasdaq:DIVX).  
• Air T boosted 5% in pre-market trading; Q2 results up sharply pver year-ago levels See (Nasdaq:AIRT).


Small Cap Losers:

• Bare Excentuals Inc. gapped lower and shed some 38% on soft earnings news. See (Nasdaq:BARE).  
• Penson Worldwide Inc. is down 32% on news that a subsidiary has incurred a $15.5M unsecured receivable from a firm that has ceased operations.
See (Nasdaq:PNSN).  
• Conexant Systems seats With Q4, guides below Street. Shares down 16% in pre-market. See (Nasdaq:CNXT).  
• Morningstar shares nearly 5% lower in after hours after Q3 results miss estimates. See (Nasdaq:MORN).

The Russell 2000 (NYSE: IWM) and the other major U.S. indices declined in the final minutes of trading as investors got nervous ahead Thursday’s inflation data. The small-cap index lost 6.72 points, or 0.85%, to 782.43. The Dow Jones Industrial Average (INDU) fell 83.16 points, or 0.62%, to 13,223.93.

On a year-to-date basis, the Russell 2000 has retreated 0.63%, while the Dow has risen 6.01% and the S&P 500 has added 3.81%.

Stocks began the day little changed on news that U.S. retail sales growth slowed to 0.2% in October, following an upwardly revised increase of 0.7% in September. The result was in line with economists’ projections but indicates that consumers have become a little more reluctant to spend money due to declining home values and higher gasoline prices.

Most economists expect that fourth-quarter economic growth will shift into lower gear. Consumption is about 70% of gross domestic product.

News on the inflation front was rosier. The U.S. Labor Department reported that the producer price index added a miniscule 0.1% in October, after a jump of 1.1% in September. The core index, which excludes food and energy, stayed put after rising 0.1% the previous month.

Economists were expecting both measurements to rise 0.2%. Producer prices measure the average changes in prices received by domestic producers for their output.

Small-cap stocks moved up out of the gate but then moderated and generally stayed just below the closing level today, while the Dow was trending higher. But the bulls lost their footing within minutes of the closing, when investors apparently adopted a cautious posture ahead of Thursday’s inflation data.

The Labor Department is expected to report that the consumer price index for October increased 0.3%, the same as in October. A higher-than-expected jump in prices will most likely rule out the U.S. Federal Reserve cutting its target interest rate during the remainder of 2007.

Small-cap stocks jumped nearly 3% today, propelled by surprise earnings from Wal-Mart and an easing of credit fears. The Russell 2000 (NYSE: IWM) added 22.06 points, or 2.88%, to 789.15, snapping a two-day losing streak. The Dow Jones Industrial Average (INDU) gained 319.54 points, or 2.46%, to 13,307.09, its first rise in four sessions.

On a year-to-date basis, the Russell 2000 has advanced 0.22%, while the Dow has risen 6.67% and the S&P 500 has added 4.55%.

Trading got off to a bullish start this morning on news that Wal-Mart Stores Inc. (NYSE: WMT) saw a 7.9% increase in third-quarter profit at its U.S. stores, while revenue rose 8.9%.

The result pleasantly surprised analysts and eased fears that the U.S. consumer was cutting back on spending. Americans do about 10% of their shopping at the Bentonville, Ark.-based retailer, which began offering discounts two weeks earlier than last year to lure customers.

Stocks were gaining momentum, with the Russell 2000 adding more than 1% within the first 30 minutes of trading.

The bears had no chance, even after Bank of America Corp. (NYSE: BAC) said that it projects a fourth-quarter pre-tax charge of $3 billion due to its purchase of collateralized debt obligations that have plummeted in value because of the stagnating U.S. housing market. Collateralized debt obligations are loans—such as mortgages—that are pooled together and sold to institutional investors as a package.

The Russell 2000 (NYSE: IWM) moved lower today on news from Wachovia Corp. (NYSE: WB) of more than $1 billion in losses due to the credit crunch. The small-cap index dropped for the third time this week, retreating 8.52 points, or 1.09%, to 772.38. The Dow Jones Industrial Average (INDU) shed 223.55 points, or 1.69%, to 13,042.74.

On a year-to-date basis, the Russell 2000 has lost 1.92%, while the Dow has advanced 4.56% and the S&P 500 has added 2.62%.

The bears dominated the session today following news that Wachovia Corp. expects to suffer additional losses of $1.1 billion in the third quarter due to collateralized debt obligations.

The Charlotte, N.C.-based bank, the fourth largest in the United States, also said that it will write down collateralized debt obligations of about $1.11 per share for the month of October and expects to see loan losses of over $500 million in parts of the country that have been most severely affected by the slump in the housing sector.

The news comes as the latest reminder that the subprime mess continues to plaque the financial system.

The small-cap futures were pointing south and the Russell 2000 joined the other major U.S. indices in opening with a drop.

There was some upbeat economic news today, coming in the form of a surprise narrowing of the U.S. trade deficit. The Commerce Department reported that the deficit declined 0.6% to $56.5 billion in September, the lowest level since May 2005, as exports increased due to a weak dollar and strong growth overseas. In August the deficit stood at $56.8 billion.

The Russell 2000 (NYSE: IWM) recovered from early losses and posted solid gains as a jump in the price of oil lifted energy stocks. The small-cap index added 11.34 points, or 1.43%, to 801.77. The Dow Jones Industrial Average (INDU) advanced 117.54 points, or 0.87%, to 13,660.94.

On a year-to-date basis, the Russell 2000 has increased 1.82%, while the Dow has added 9.51% and the S&P 500 has gained 7.32%.

The price of oil jumped $3.01 to $96.99 a barrel today on news the U.S. Energy Information Administration forecasted that world oil demand growth in the next two quarters will be higher than it previously estimated and a shutdown in production in the North Sea due to expectations of stormy weather.

That led to a rise in shares of energy companies, helping to lift sagging stocks.

Futures were pointing up this morning on news that Citigroup Inc. (NYSE: C) has hired an expert to manage its $43 billion subprime mortgage portfolio and a raised price target for Internet giant Google Inc. (Nasdaq: GOOG).

The indices opened with a rise, but the bulls lost their footing following news that Redbook Research, a publisher of statistics on the U.S. retail market, reported a 0.4% drop in U.S. chain store sales in the final week of October. With consumption comprising about 70% of gross domestic product, a slowdown could spell trouble for the economy.

The Russell 2000 (NYSE: IWM) fell extra hard today as the major U.S. indices tumbled on news of poor corporate earnings and unimpressive economic reports. The small-cap index lost 32.84 points, or 3.97%, to 795.18—its biggest percentage loss this year. The Dow Jones Industrial Average (INDU) tumbled 362.14 points, or 2.60%, to 13,567.87.

On a year-to-date basis, the Russell 2000 has increased 0.99%, while the Dow has added 8.76% and the S&P 500 has gained 6.48%.

The day began with steep declines on news that Exxon Mobil Corp. (NYSE: XOM) suffered a bigger-than-expected drop in third-quarter profit and missed Wall Street’s expectations, while Citigroup Inc. (NYSE: C) was downgraded to “sector underperform” from “sector perform” by investment bank CIBC World Markets over concerns that it might have to cut its dividend to shore up its capital.

Small caps led the way down as stocks dove so sharply that trading curbs were introduced to prevent a massive sell-off.

Investors also had to digest economic news, when the U.S. Commerce Department reported that personal income increased at a seasonally adjusted rate of 0.4% in September, as expected, compared with a rise of 0.3% in August.

However, personal consumption in September increased 0.3%, below the projected rise of 0.4%. That’s a worrying sign that the American consumer might be cutting down on spending in the face of higher oil prices and a recession in the housing sector. In August, personal consumption added a downwardly revised 0.5%.

The Russell 2000 (NYSE: IWM) and the Dow Jones Industrial Average (INDU) fell for the second day in a row on news of housing and subprime concerns and record oil prices. The small-cap index let go 6.01 points, or 0.72%, to 823.35. The Dow lost 71.86 points, or 0.51%, to 13,912.94.

On a year-to-date basis, the Russell 2000 has increased 4.56%, while the Dow has added 11.53%.

Predictions by high-level U.S. officials that the slump in the housing sector will get worse and slow down economic growth brought out the bears today, as small and large caps ended in the red for the second consecutive day.

After the close on Monday, Fed chairman Ben Bernanke said that the slump in the housing sector is expected to get worse and be a drag on economic growth going into 2008. Treasury Secretary Henry Paulson made similar comments at Georgetown University’s law school today, adding that the federal government should work to avoid foreclosures and prevent property values from falling further.

As if to confirm the downcast predictions, the National Association of Home Builders announced that its monthly home builder confidence index fell more than expected in October to a record low.

Contributing to the negative mood was news of weaker-than-expected third-quarter earnings for Wells Fargo & Company (NYSE: WFC). CEO John Stumpf blamed disruptions in the credit markets.