Stocks ended Monday's wishy-washy session in the red, as an international scandal and lackluster earnings and economic reports weighed on sentiment. Ahead of the bell today, U.S. equities are attempting to muscle their way into the black, as the Street digests an aid package for debt-strapped Portugal and a batch of blue-chip earnings reports. While Wal-Mart Stores (WMT) surpassed analysts' profit projections and Home Depot (HD) upped its full-year earnings forecast, fellow Dow component Hewlett-Packard (HPQ) is the proverbial "Debbie Downer" of the bunch, slashing its guidance on soft PC sales and Japan-related woes. Against this backdrop -- and ahead of a round of housing data -- the Dow Jones Industrial Average (DJIA ) is flirting with a 5.6-point lead, while the broader S&P 500 Index (SPX ) is trading just a hair's breadth above fair value.
On the earnings front, Wal-Mart Stores (WMT - 56.06) said it earned $3.4 billion, or 98 cents per share, in the first quarter, compared to a profit of $3.3 billion, or 87 cents, in the year-earlier quarter. Sales, meanwhile, increased 4.4% to $103.42 billion. The results topped analysts' expectations, with the Street looking for a first-quarter profit of 95 cents per share on revenue of $102.93 billion. In the same vein, WMT said domestic same-store sales fell 1.1%, narrower than the 1.3% decline anticipated by analysts. In addition, the retail titan projected second-quarter earnings in a range of $1.05 to $1.10 per share, compared to the Street's forecast for current-quarter earnings of $1.08 per share. At last check, WMT is trading just below breakeven.
Meanwhile, fellow blue chip Home Depot (HD - 36.98) reported a first-quarter profit of $812 million, or 50 cents per share, up 12% from the year-ago quarter. Revenue dipped 0.2% to $16.82 billion. Analysts, on average, were calling for a first-quarter profit of 49 cents per share on sales of $17.02 billion. Looking ahead, the firm upped its current-year earnings per share forecast to $2.24 from $2.20. The Street is anticipating full-year earnings of $2.30 per share for the home-improvement hotshot. Ahead of the bell, HD is off about 0.2%.
Fellow Dow component Hewlett-Packard (HPQ - 39.80) reported an adjusted fiscal second-quarter profit of $1.24 per share on sales of $31.6 billion. The results topped the Street's forecast for earnings-per-share of $1.21 on sales of $30.8 billion. However, the computer king cut its full-year outlook, citing the impact of Japan's earthquake and weak sales of consumer PCs. For the year, the company expects earnings-per-share of at least $5, and expects revenue between $129 billion and $130 billion. Previously, HPQ projected adjusted full-year earnings of $5.20 to $5.28 per share on revenue of $130 billion to $131.5 billion. Analysts polled by Thomson Reuters were expecting full-year earnings of $5.24 per share on revenue of $130.22 billion. In pre-market trading, HPQ is set to surrender about 4.5% out of the gate.
Moving on, Urban Outfitters (URBN - 32.29) reported a first-quarter profit of $39 million, or 23 cents per share, down 27% from the year-earlier quarter. Analysts, on average, had forecast first-quarter earnings of 25 cents per share for the retailer. Revenue for the quarter rose to $524 million from $480 million, exceeding expectations for sales of $523 million. At last check, URBN has shed close to 0.5%.
Finally, Photronics (PLAB - 8.00) swung to a loss of $16.4 million, or 30 cents per share, in its fiscal second quarter, down from a profit of $7.9 million, or 14 cents per share, a year prior. Excluding items, per-share profit rose to 24 cents from 9 cents, while net sales jumped 27% to $133.1 million. The Street's consensus estimates called for adjusted earnings of 16 cents per share on sales of $120 million. Ahead of the bell, PLAB is set to soar about 10%.
Today's earnings docket will feature reports from Analog Devices ( ADI ), Dell ( DELL ), Dick's Sporting Goods ( DKS ), Saks (SKS), TJX Companies (TJX), and Trina Solar (TSL), just to name a few. Keep your browser at SchaeffersResearch.com for more news as it breaks.
The economic agenda heats up today, with the release of new home starts, industrial production, and capacity utilization for April. Wednesday features the regularly scheduled update on domestic petroleum supplies, as well as the minutes from the latest meeting of the Federal Open Market Committee (FOMC). Finally, the economic calendar wraps up early on Thursday, with a flurry of data on the docket. Traders will hear the weekly report on jobless claims, the Philly Fed index for May, April's existing home sales, and the Conference Board's index of leading economic indicators.
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,113,680 call contracts traded on Monday, compared to 691,891 put contracts. The resultant single-session put/call ratio jumped to 0.62, while the 21-day moving average remained at 0.63.
Stocks in Asia ended mixed today, with traders carefully considering soft U.S. economic data and ongoing uncertainty in the euro zone. In Japan, utilities continued to lag on concerns that Tokyo Electric Power's debt burden may be waived, but a weakening yen helped stocks claw their way to a positive finish. Shanghai-listed securities also closed higher, buoyed by bargain-hunting, while Foxconn led the laggards in Hong Kong following news that it would be removed from the country's benchmark stock index. Meanwhile, tech stocks paced the losses in South Korea, offsetting strength in banks and defensive issues. By the close, Japan's Nikkei added 0.09%, the Shanghai Composite gained 0.1%, South Korea's Kospi slipped 0.08%, and Hong Kong's Hang Seng surrendered 0.3%.
European markets are mostly lower at midday, despite strength in mining and energy stocks amid rebounding commodity prices. Finance ministers in the euro zone approved an aid package worth $110.6 billion for Portugal, while traders learned that Greece's private creditors may now be asked to extend bond maturities. At last check, the German DAX has dropped 0.8%, the French CAC 40 has shed 0.2%, and London's FTSE 100 is off 0.1%.
Currencies and Commodities
The greenback has continued Monday's mid-session rebound, with the U.S. dollar index fractionally higher at last check. Elsewhere, black gold has recovered a portion of yesterday's losses, with June-dated crude futures up 16 cents, or 0.2%, to trade near $98 per barrel. Meanwhile, gold and silver futures are also chipping away at their recent deficits, with the front-month contracts up about 0.3% and 0.5%, respectively.
Unusual Put and Call Activity:
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