SMF Notes Google: Color on stock action (563.30 -18.81)
Tuesday, November 30, 2010 12:14 PM
Google: Color on stock action (563.30 -18.81)
GOOG is trading down 3.3% after the European Commission launched an antitrust
investigation into the co after competitors complained that it abused its
leadership position. The Commission will investigate whether Google has abused a dominant market position in online search by allegedly lowering the ranking
of unpaid search results of competing services which are specialised in
providing users with specific online content such as price comparisons
(so-called vertical search services) and by according preferential placement
to the results of its own vertical search services in order to shut out
competing services. The Commission will also look into allegations that Google
lowered the 'Quality Score' for sponsored links of competing vertical search
services. The Quality Score is one of the factors that determine the price
paid to Google by advertisers.
While GOOG is currently trading at lows of the day, we'd note that there was
also speculation making the rounds about a positive development with regard to
the Chinese censorship issues, however there is no confirmation of this.
Finally, speculation continues to swirl that GOOG is close to a deal to
acquire Groupon, with reports today suggesting a price tag in the $5-6 bln
SMF Notes GOOG Google: Consumer Watchdog reiterateS its call for the U.S. Justice Department
Consumer Watchdog says it "welcomed the European Union's antitrust investigation of Google and reiterated its call for the U.S. Justice Department to launch its own investigation of the Internet giant." Consumer Watchdog called on the Justice Department to launch an antitrust investigation of Google in April.
SMF Notes Today's biggest % gainers/losers
The following are today's top 20 percentage gainers and top 20 percentage losers, categorized by sectors (over $300 mln market cap and 100K average daily volume).
Today's top 20 % gainers
* Technology: SGMS (7.57 +12.65%), RIMM (62.53 +6%), TZOO (41.08 +5.36%), BSFT (24.21 +5.26%)
* Services: DSX (13.39 +6.02%), RLD (27.96 +5.79%)
* Industrial Goods: BEZ (63.25 +40.21%), AOS (39.41 +6.31%), RBC (61.66 +5.8%), GTLS (31.23 +5.47%), GTI (19.51 +4.72%)
* Healthcare: KH (20.35 +6.99%), KERX (5.65 +5.41%)
* Basic Materials: UXG (6.61 +10.35%), URRE (3.8 +8.88%), THM (9.64 +8.44%), AXU (7.41 +6.62%), MVG (11.25 +5.34%), CRZO (29.43 +5.07%), EXK (6.31 +4.99%)
Today's top 20 % losers
* Technology: IGTE (20.22 -18.57%), QTM (3.49 -6.68%), LDK (10.27 -6.12%), TSL (22.54 -5.65%), ARUN (21.9 -4.99%)
* Services: MCOX (8.71 -34.92%), CCSC (22.3 -11.44%), CELL (8.2 -6.71%), KKD (5.81 -5.37%), NPD (3.55 -5.08%)
* Industrial Goods: ZOLT (9.24 -7.04%), JKS (24.08 -5.23%)
* Healthcare: CMED (12.23 -9.81%), LXRX (1.23 -5.38%), CTIC (0.36 -5.32%)
* Financial: PCBC (0.26 -10.34%), FTLK (6.09 -7.31%), IRE (1.72 -5.95%)
* Consumer Goods: THO (29.61 -11.98%)
* Basic Materials: CAK (2.61 -7.12%)
SMF Notes Today's most active stocks
The following are today's most active stocks ranked by volume and relative volume, categorized by sectors (over $300 mln market cap and 100K average daily volume).
Today's top 20 volume
* Technology: MSFT (31.92 mln +0.1%), STX (25.92 mln -3.1%), CSCO (21.02 mln -1.03%), S (19.21 mln -1.57%), INTC (17.91 mln -0.84%), RIMM (17.11 mln +6%), MU (12.12 mln -3.83%)
* Services: SIRI (19.93 mln -1.07%), EBAY (12.27 mln -3.8%)
* Industrial Goods: BEZ (33.49 mln +40.21%)
* Healthcare: PFE (14.24 mln -1.39%)
* Financial: C (209.14 mln +1.08%), BAC (54.88 mln -0.97%), IRE (20.47 mln -5.95%), STD (17.39 mln -1.13%), JPM (12.82 mln -1.32%)
* Consumer Goods: F (25.58 mln -1.31%), GM (14.66 mln +0.5%)
* Conglomerates: GE (20.49 mln -0.44%)
* Basic Materials: RIG (13.58 mln -0.22%)
Today's top relative volume (current volume to 3-month average daily volume)
* Technology: IGTE (15x -18.57%)
* Services: MCOX (22.84x -34.92%), BKS (9.42x -4.37%), DSX (7.07x +6.02%), AH (6.31x -1.69%), CETV (5.64x +2.24%)
* Industrial Goods: BEZ (152.67x +40.21%)
* Healthcare: AMRN (16.78x -2.56%), KERX (9.22x +5.41%), SEM (6.91x -0.61%)
* Financial: USB (39.3x -0.91%), OXPS (9.89x +0.81%), IRE (7.12x -5.95%), STD (5.96x -1.13%), ING (5.77x -4.4%), IBKR (5.35x +3.93%)
* Consumer Goods: THO (8.52x -11.98%), TTM (5.69x -4.51%)
* Basic Materials: RBY (8.88x -3.48%), THM (5.7x +8.44%)
SMF Notes AKAM Akamai Tech: Credit Suisse Tech Conference Call Summary
When asked about recent developments with NFLX (referring to NFLX's addition of LVLT as a CDN supplier), AKAM says NFLX is still a great customer and notes that NFLX's decision was not due to a performance issue that caused NFLX to pursue a multi-vendor strategy. The AKAM CFO says that it was an overblown situation and NFLX has always had a multi-vendor strategy... Looking forward on market dynamics, the CFO says that video traffic on the internet can grow 100-fold. At the same time, prices will have to continue to fall... Co says e-commerce will continue to grow, which AKAM looks to take advantage of up selling its offerings, including value-added solutions (not primarily volume driven)... Co says that its value-added solutions have grown to become a larger part of its business, although it may fall short of its expectations of 60% by YE.
Co says software downloads will continue to grow in frequency and size, along with the same dynamics that are growing on the HD side (co's new offering is HD Portal). However, co is seeing better traction with customers from software-as-a-service platforms (CFO cites CRM's Force product). Co has made a large effort to drive that business... When asked about containing CapEx spend, the CFO says reiterates that he expects CapEx to go down over time... On competition, CFO says that AMZN is doing a great job in offering basic Software-as-a-Service for customers to break away from a traditional software model, and while to does offer some CDN, it's only a small overlap with AKAM -- noting that many choose AMZN start up with AKAM as a CDN provider.
SMF Notes European Markets Closing Prices
European markets are now closed; stock markets across Europe performed as follows:
* UK 's FTSE: -0.4%
* Germany 's DAX: -0.1%
* France 's CAC: -0.7%
* Spain 's IBEX: -0.6%
* Portugal 's PSI: -1.3%
SMF Notes Market Internals
The Nasdaq is down 27 (1.1%) to 2498, the S&P 500 is down 6 (0.5%) to 1181 and the Dow is down 43 (0.4%) to 11010. Action has come on light volume (NYSE 382 mln vs avg of 423 mln; NASDAQ 875 mln vs. avg. of 936 mln), with decliners outpacing advancers (NYSE advancers/decliners 860/2039, NASDAQ advancers/decliners 712/1823) and with new highs outpacing new lows on the NYSE, relatively even on the NASDAQ (NYSE new highs/new lows 46/25, and NASDAQ new highs/new lows 46/49).
ETF relative strength:
Silver-SLV +4.1%, Volatility-VXX +3.4%, Jr. Gold Miners-GDXJ +3.0%, Silver Miners-SIL +2.4%, Gold Miners-GDX +1.9%, Gold-GLD +1.6%, Palladium-PALL +1.3%, Copper-JJC +1.2%, 20+ yr Treasuries-TLT +1.1%, Yen-FXY +0.8%
ETF relative weakness:
Solar-TAN -3.2%, Indonesia-IDX -3.2%, Austria-EWO -2.6%, Holland-EWN -2.4%, Italy-EWI -2.2%, South Africa-EZA -2.0%, France-EWQ -2.0%, Spain-EWP -2.0%, Clean Energy-PBW -1.9%, Natural Gas-UNG -1.7%, Europe-IEV -1.5%, Semis-SMH -1.4%, Internet-FDN -1.4% (9% GOOG, 7% AMZN), Water-CGW -1.3%, Coal-KOL -1.3%
SMF Notes HPQ Hewlett-Packard: Credit Suisse 2010 technology conference call summary
Co says they are trying to simplify the networking systems, from wireless and other data centers in enterprise. Co says they plan on taking market share, noting they have been in the past few years. Co says they have significant growth in the market, all awhile they are gaining share with great margins. When asked about market share gains against Cisco (CSCO) the co says there has been a decade of very little competition in the enterprise space. Co says what's happening now is every dollar being spent is being scrutinized, so when someone says you have to upgrade, you create an environment where customers say maybe they will look somewhere else. When asked if there is any chance that the co's operational performance and style will change much because of the new mgmt team, the co says no. Co says the new mgmt team will trying to add value to customers with the portfolio they have and think of how to add to the portfolio to better fit their customers needs.
SMF Notes Floor Talk: Looking back on a bumpy November
Although it was a bumpy ride, the month of November looks like it will end up as a flat month for stocks. The S&P 500 jumped 3.7% in the first few days of the month to set a new 52-week high on Nov. 5 (at 1227), just one day after the Fed released details of its QE2 plans. Since then, it has drifted lower by ~3.5% to its current level just two points above where October ended. The post QE2 action (stronger dollar, higher yields, weaker equities) shows that the market did a very good job of pricing in the QE2 plans ahead of time. Additionally, a weakening euro as European contagion fears intensify has benefited the dollar, and put a lid on stocks. Our TALKX comments have been discussing this possibility for a greater focus on the European sovereign debt problems since the end of October, and those concerns reached new levels this week after the Ireland bailout failed to ease concerns about Portugal , and more importantly Spain . We're now one month away from the end of the year, and the broader market is up ~6% YTD. There are a lot of cross currents in the market right now, with improving economic data being offset by concerns/headline risk around the euro zone. However, the market has been resilient in the face of concerns, and after today's speech from Obama on a meeting with Congressional leaders, it looks like the Bush tax cuts may be extended in some form or another. While this may have already been expected, Obama's comments today were viewed as encouraging, since it sounds like clarity could be gained in the near term.
* Domestic equity markets. The S&P 500 continued its nearly uninterrupted rally at the beginning of November before reaching the 1,200 resistance level and reversing trend. The S&P 500 and the NASDAQ, which followed a similar pattern, ended the month flat. The VIX, or fear index, has been trending down since May, but may have found a bottom at the 18 level this month. The VIX is currently at 22.86, up 13.8% MTD;
* Foreign equity markets. The Nikkei led the group with a gain of 8.1% for the month while France's CAC and Shanghai lagged, ending the month down 5.1% and 4.2%, respectively. Of the European markets, Germany showed relative strength this month with the DAX trading up 1.5% this month;
* Foreign exchange. The dollar, which has been weakening since June, led the pack by appreciating 4.5% this month. The euro, pound, yen, and swiss all ended the month in negative territory;
* Commodities. Crude oil, natural gas, and spot gold rose by 4.7%, 7.9% and 3.0%, respectively.