Stocks took a beating on Wednesday, sinking in sympathy with energy and metals prices. Ahead of the bell this morning, it looks like the bears will once again reign supreme, with futures -- and commodities -- pointed south. A revised demand forecast from the International Energy Agency is weighing on black gold, with crude oil futures steepening their slide beneath the century mark, while a cautious forecast from blue-chip bigwig Cisco Systems (CSCO) is also providing pre-market fodder for the bears. At last check, the Dow Jones Industrial Average (DJIA) is trading about 52 points below fair value, while the broader S&P 500 Index (SPX) is positioned for a 7-point drop out of the gate.
In equities news, Cisco Systems (CSCO - 17.78) last night reported a fiscal third-quarter profit of $1.8 billion, or 33 cents per share, down 18% from the year-ago period. Excluding items, the blue chip racked up a profit of 42 cents per share, while revenue edged higher to $10.9 billion from $10.4 billion. Analysts, on average, were calling for a per-share profit of 37 cents on sales of $10.87 billion. However, CEO John Chambers cautioned of a weaker fiscal fourth quarter, and said he doesn't see the company meeting its long-term revenue growth target of 12% to 17% next year. At last check, CSCO is set to start the session about 3.7% lower.
Meanwhile, Kohl's Corp. (KSS - 53.61) raked in a first-quarter profit of $211 million, or 73 cents per share, up 6% from its year-ago earnings. Net sales for the quarter increased 3.1% to $4.16 billion. The results fell roughly in line with analysts' expectations for a profit of 73 cents per share on $4.18 billion in revenue. For the full year, KSS raised its earnings guidance to a range between $4.25 and $4.40 per share, compared to its prior forecast of $4.05 to $4.25 per share. Consensus estimates on Wall Street, meanwhile, are calling for a full-year profit of $4.36 per share. In pre-market trading, KSS is lingering around breakeven.
Finally, Wall Street freshman Zipcar (ZIP - 28.63) swallowed a widened first-quarter loss of $6.1 million, or 95 cents per share, as total operating expenses surged 42% to $53.76 million. Revenue for the quarter ramped up 48% to $49.1 million, boosted by a 31% increase in membership. In a press release accompanying ZIP's quarterly results, Chief Financial Officer Ed Goldfinger noted, "We saw a significant uptick in usage revenue per vehicle per day, which we consider as one of our most important performance metrics." Ahead of the bell, ZIP is flirting with a 1% loss.
Today's earnings docket will feature reports from Evergreen Solar (ESLR), Atlas Energy (ATLS), Biofuel Energy Corp. (BIOF), Body Central (BODY), eDiets.com (DIET), InterOil Corp. (IOC), Nordstrom (JWN), Nvidia Corp. (NVDA), Precision Castparts (PCP), SunPower Corp. (SPWRA), and Teekay Corp. (TK), just to name a few. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Today, the Street will digest the Labor Department's weekly jobless figures and producer price data, as well as the government's business inventories report for March and retail sales data for April. Finally, tomorrow will feature April's consumer price index (CPI) and core CPI, along with the Reuters/University of Michigan consumer sentiment index.
Equity option activity on the Chicago Board Options Exchange (CBOE) saw 1,108,303 call contracts traded on Wednesday, compared to 746,159 put contracts. The resultant single-session put/call ratio jumped to 0.67, while the 21-day moving average remained at 0.62.
The Case for Big Moves in IWM and QQQ
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