No Gloom, But No Rally — Wednesday’s IP Market Recap

by Marc Bastow | October 24, 2012 5:21 pm

[1]A day that started with some small positive momentum muddled close to breaking even before sliding into negative territory Wednesday — this despite some good earnings news and a report that new home sales for September climbed 5.7% to hit a 2-year high.

Tthe S&P led the way down, off 0.31% to 1,408.75, the Nasdaq dropped 0.29% to 2,981.70 and the Dow settled in down 0.19% at 13,077.34.

Unlike Tuesday’s almost-immediate selloff on disappointing earnings news, early-morning corporate news on Wednesday was positive, led by continued gains in Facebook (NASDAQ:FB[2]), whose stock jumped nearly 20% on the day after posting solid revenue and earnings numbers[3] Tuesday afternoon.

The defense and aerospace sector[4] — including Lockheed Martin (NYSE:LMT[5]), General Dynamics (NYSE:GD[6]) and Northrop Grumman (NYSE:NOC[7]) — had a mixed earnings bag, with LMT and GD managing to gain roughly 2% for the day.

Biotech stocks Gilead Sciences (NASDAQ:GILD[8]), Amgen (NASDAQ:AMGN[9]), and Questcor Pharmaceuticals (NASDAQ:QCOR[10]) all reported earnings[11] on the day, with all three beating both top and bottom line estimates. Gilead shares profited the most from the news, climbing over 5% on the day, with Amgen up marginally and Questcor down a fraction.

The tech sector was also hit with a grouping of companies reporting[12], with only VMware (NYSE:VMW[13]) on the positive end of earnings, revenues and forward guidance among EMC (NYSE:EMC[14]), Juniper Networks (NYSE:JNPR[15]), and Broadcom (NASDAQ:BRCM[16]). WMware finished up just over 2% while Juniper Networks was crushed, down 9%.

AT&T (NYSE:T[17]) also reported earnings[18] that topped market expectations and said cash flow this year will be better than previously expected, but the stock failed to gain any ground, closing down nearly 1% on the day.

A deluge of earnings releases[19] on the day included good news from Boeing (NYSE:BA[20]), which posted Street-beating earnings on matching revenues. However, BA shares closed fractionally down.

Lumber Liquidators (NYSE:LL[21]) continued a magic run[22], gaining over 11% after blowing out third quarter revenue and earnings estimates and providing strong guidance for the remainder of the year. LL is up over 200% on the year.

Lastly, after the bell Wednesday, gamemaker Zynga (NASDAQ:ZNGA[23]) watched its stock surge nearly 15% in after-hours trading following the announcement it would enter the online gambling arena[24].

The earnings machine cranks up again on Thursday with a host of big names, including Apple (NASDAQ:AAPL[25]), Amazon (NASDAQ:AMZN[26]) and Sprint (NYSE:S[27]).

Three Up

• Monster Beverage (NASDAQ:MNST[28]): Up 16.77% ($6.89) to $47.37
• Yelp (NYSE:YELP[29]): Up 7.38% ($1.77) to $25.77
• Dow Chemical (NYSE:DOW[30]): Up 4.66% ($1.33) to $29.88 (Read more here[31])

Three Down

• Netflix (NASDAQ:NFLX[32]): Down 11.87% ($8.10) to $60.12 (Read more here[33])
• Buffalo Wild Wings (NASDAQ:BWLD[34]): Down 10.5% ($8.76) to $74.70
• Corning (NYSE:GLW[35]): Down 9.4% ($1.26) to $12.15

Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long AAPL.

Source URL: https://investorplace.com/2012/10/no-gloom-but-also-no-rally-wednesdays-ip-market-recap-fb-aapl-lmt-noc-gd-t-ba/

---