US stocks stayed all but flat on the last trading day of the week, as investors continued to hold out hope that a deal on averting the fiscal cliff can be reached before the Dec. 31 deadline.
On Thursday night, President Barack Obama and House Speaker John Boehner met for the first time in four days at the White House to discuss the issue, and both offices said that "lines of communication remain open."
"Enthusiasm for equities continues to be tempered by the lack of progress by the White House and Congress on the fiscal cliff negotiations," said Addison Armstrong, senior director of market research at Tradition Energy, according to TheStreet
"I lean to the side that there will be a deal," Andrew Fitzpatrick, director of investments at Hinsdale Associates in Hinsdale, Ill., told MarketWatch
The Nasdaq Composite
(INDEXNASDAQ:.IXIC) was down 0.37% to 2,981.14 points on trading volume of 794.37 million as of 12:13 p.m. EST.
Shares of Apple
(NASDAQ:AAPL) tumbled 3.44% to $511.48 on the day the iPhone 5 made its China debut. Though the device is expected to boost the Apple bottom line, it appears that demand of the smartphone will be weaker than expected.
"Some of our Chinese sources do not expect the iPhone 5 to do as well as the iPhone 4S," said UBS analyst Steven Milunovich in a note. Milunovich also cut its price target on Apple to $700 from $780, citing low iPhone and iPad shipment expectations for the Jan - March quarter. Peter Misek of Jefferies also lowered his shipment forecasts for the quarter, saying that Apple had already begun reducing the number of orders to its suppliers because of excess inventory.
On the iPhone 5 China launch, Misek note, “The iPhone 5 China launch has been surprisingly muted but (we) are unsure how much weather (snow) or the required pre-ordering (to prevent riots) are factors.”
Apple wasn’t the only stock hurt by Misek’s report. Shares of Apple suppliers were also down in intraday trading on the news that Apple is cutting production orders. Broadcom
(NASDAQ:BRCM) (-3.47%), Qualcomm
(NASDAQ:QCOM) (-3.87%), Cirrus
(NASDAQ:CRUS) (-5.91%), TriQuint
(NASDAQ:TQNT) (-4.78%), Skyworks
(NASDAQ:SWKS) (-6.84%), OmniVision
(NASDAQ:OVTI) (-1.75%), and Avago
(NASDAQ:AVGO) (-3.86%) were all down on the day.
(NASDAQ:PAY) also declined 11.74% to $29.33 after issuing an underwhelming first quarter forecast. The electronic-payments company projects first-quarter adjusted earnings of $0.70 to $0.73 a share on revenue of $490 million to $500 million. Analysts were hoping for earnings of $0.75 a share on revenue of $498 million.
After having gained 2.39% yesterday on speculation that the company would soon be part of the Standard & Poor’s 500 Index
(NASDAQ:FB) also slid 3.92% to $27.13 as 156 million shares were released from lockup today.
Software maker Adobe Systems
(NASDAQ:ADBE) gained 5.61% to $37.53 after posting expectations-beating fiscal fourth-quarter results. The Photoshop maker reported adjusted earnings of $0.61 a share, compared to the consensus estimate of $0.56 a share. Revenue came in at $1.153 billion, when the Street was looking for $1.1 billion. Adobe was also upgraded to Outperform from Underperform at JMP Securities.
Troubled wireless carrier NII Holdings
(NASDAQ:NIHD), which has posted losses in four of the last five quarters, also jumped 7.63% to $6.42 after announcing Chairman Steven Shindler as interim chief executive officer, replacing Steven Dussek. Shindler was previously the company’s CEO from 2000 to 2008. In his time, Chris King, an analyst at Stifel Financial Corp. in Baltimore, noted that “NII executed almost flawlessly, in our view, delivering strong growth and solid metrics consistently.”
(NASDAQ:TIVO) also improved 2.17% to $12.70 after the stock was initiated with a Buy from Goldman Sachs.
No positions in stocks mentioned.
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