A better than expected jobless claims number rallied us to new highs in this current range during the pre-market trade. As the market opened and more players started to place their bets the market was pushed lower, until breaking a couple of handles below S4. Although the pivots were tight this was still a drastic move and buyers eventually stepped and rallied us back to unched. The market then pulled back a couple of handles as the market prepared for earnings season and payroll numbers tomorrow morning.
As far as tech is concerned the cloud/virtualization names came out of the gate extremely volatile as expected. EQIX which was hammered for 33% the day prior after taking down guidance was strong up 2%. While, they were buying EQIX on the weakness they were selling CTXS all the way down to the 58 level which held as nice support. VMW, RHT, FFIV, and RAX all were sold off the open, but eventually caught a bid and were able to close off the lows. The bid support in these names was most likely due to short covering, but, there is also the underlying them of takeouts which all names are possible targets, especially CTXS who has been rumored to be taken out by MSFT for over three years.
The hardware names, AAPL, DELL, HPQ, and IBM all had relatively quiet days closing up roughly 1% across the board. The SMH inched up today as WFR closed the day up 3%. MU, MRVL, LLTC, XLNX, and KLAC all rallied today as MU reported after the bell. MU’s headline number was light and the stock is trading down 1% percent after hours. MU’s earnings are usually subject to interpretation, so keep a close eye on the stock tomorrow the last report was not taken well.
There continues to be a lot of takeout speculation in the software space as BMC traded up 7% after BBG and others said it was exploring a sale. ADBE also rallied late this afternoon following a report from the New York Times stating that Ballmer and his entourage has been meeting with Adobe management, possibly discussing a deal. Speculation is that it’s time for MSFT to make a deal and the Adobe deal is rumored to cost MSFT 15 - 17 billion.
Top Performers: ADBE, BMC, WFR, MU, INTU, AKAM, WDC
Worst Performers: YHOO, QLGC, JBL, V, GOOG, GLW, NVDA, JDSU
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