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12:35pm (EST)
The futures were pointing towards a decent open after the better than expected jobless claims report this morning but the gains were limited. Shortly after the market opened, the mortgage delinquencies report came out and it wasn’t as “impressive”.
Homeowners who missed their mortgage payment fell slightly to 4.57% in the second quarter, down from 4.63%, and showed its first drop in four years. Also, the number of homeowners who received their first notice of foreclosure also fell from 1.2% to 1.1%.
Both reports were non-threats to the bears as they have taken slight control of today’s action.
The Dow is down 14 points to 10,046 but has traded in a tight range. The index hit a high 10,104 and briefly gave up its gains after the mortgage numbers but bounced back before succumbing to selling pressure again. Resistance remains 10,200 but is moving lower and the Dow’s upside now looks limited to 10,100-10,200. Lower highs, and lower lows means we are still trending lower, folks.
The S&P is showing a fractional loss and is flat at 1,056 but is still struggling to hold the 1,050 level. The index has traded to a high of 1,060 but looks weak. The Nasdaq is down 3 points to 2,138 and will lead the way lower or higher for the rest of the session.
Turning to earnings, TiVo (TIVO, $8.19, down $0.24) is down 3% after beating Wall Street’s expectations but they still reported a loss for the quarter. The company reported a loss of $15 million, $0.13 a share, versus a loss of $3 million, or $0.03 a share in the year ago quarter. Analysts were looking for a loss of $0.15 a share.
TiVo did say some good things as sales of its new Premiere DVR recorder has been a hit with die-hard customers. It was the first quarter in three years that sales of TiVo’s equipment through retailers have increased.
The company has been locked up in litigation battles over patent disputes and TiVo fell hard after receiving an unfavorable ruling in mid-May. Shares fell from $17 to $10 that day but the fight isn’t over. We have covered TiVo for a few years and we think they have a good argument.
We also think TiVo is an attractive takeover candidate and the rumor mill has Apple (AAPL, $243.85, up $0.96) making a pitch for the company.
Apple will do a show-and-tell update at the beginning of September and many expect them to update their iPods, which could include an iPod Touch with a camera. Other chatter is that the company will update its plans for the Apple TV with could include an App Store. No more cable bill? Buy the shows you want to see for a buck? We’re down. There could be some “cloud-based” services offered by Apple as well.
TiVo has the best DVR product on the market and an updated Apple TV box would benefit from TiVo’s technology as Apple maps its next course of dominance.
The grape vine is always full of interesting stories but TiVo should survive with or without Apple. The cable companies still could end up paying TiVo but as the litigation process drags, so will TiVo’s shares until some good news comes out.
We have updated all of our current trades in our members Area and we will be back Friday morning with a fresh update.
Apple (AAPL) Showcasing New Products
Wednesday, September 1st, 2010
12:30pm (EST)
The bulls used some overseas news to stage a big rally this morning while economic reports continue to come in mixed here in the US. Futures were pointing towards a strong open after China and Australia reported growth in their economies while a better-than-expected ISM number here at home added some extra gravy.
China’s said its manufacturing sector rose in August for the first time in four months while Australia’s economy grew by the fastest pace in three years during the second quarter. Meanwhile, America’s Institute for Supply Management’s manufacturing index grew to 56.3 in August from 55.5 in July. Wall Street had been expecting a decline to 53.0.
The rally has been a head scratcher for the bears given that the ADP report said private employers cut 10,000 jobs in the U.S. last month compared to a gain of 37,000 jobs in July. This doesn’t bode well for Friday’s “official” report on unemployment but the bulls don’t care. They are partying today.
The Dow is currently up 234 points, or 2.3%, and is at 10,248 while the S&P 500 is higher by 29 points, or 2.7%, to 1,077. The Nasdaq is showing a gain of 56 points, or 2.7%, and is at 2,170.
Resistance levels are Dow 10,200; S&P 500 1,070; and Nasdaq 2,150. These levels have obviously been “stretched” and we will have to see how the gains hold up into the close.
In corporate news, Apple (AAPL, $250.45, up $7.35) will be giving Wall Street an update on its product line and investors will be able to watch the event in real-time streaming video over the internet. We are expecting the company to announce an upgrade for the iPod touch which could include a camera with the same touch screen and operating system as the new iPhone4.
There is also chatter the company could roll-out a newer version of its iTV at a price of $99 which could jump start sales. It’s no secret Apple is negotiating with the big cable and TV studios for the right to rent their shows on iTunes which continues to grow at an incredible pace.
We will be back in the morning with a full update but are expecting Friday to be insane. The ADP report is usually a good indicator on what the numbers for unemployment are going to look like and the bulls could get sideswiped if they aren’t careful. On the other hand, today’s rally has been enough for the bulls to break key resistance levels and if they hold, the market could continue to rally no matter what Friday’s numbers are.
The key thing missing in today’s rally is the lack of volume…
Tags: AAPL, Apple, option picks, stock options trading
Posted in Apple, Market Analysis, Market Commentary | Comments Off