Stocks finished slightly lower Friday in a volatile session after chip giant Intel (INTC) cut its revenue outlook. A jump in the 10-year Treasury yield to its highest close since June 2004 kept stock bulls in check, says Standard & Poor's MarketScope. Higher yields, a rate hike in Europe this week, and signs Japan may end quantitative easing fueled fears of rising interest rates.
The Dow Jones industrial average fell 3.92 points, or 0.04%, to 11,021.59. The broader Standard & Poor's 500 index edged down 1.91 points, or 0.15%, to 1,287.23. The tech-heavy Nasdaq composite index lost 8.51 points, or 0.37%, to 2,302.6.
Intel lowered its $9.1-$9.7 billion first-quarter revenue guidance to $8.7-$9.1 billion, primarily due to weaker-than-expected demand and a slight market segment share loss. The chip maker expects gross margin percentage to be adversely impacted by the change in revenue.
Wendy's International (WEN) plans to complete its IPO of Tim Hortons and spin-off remaining shares. Also, the fast food company says it will explore alternatives for its Baja Fresh business. Prudential upgraded the stock to neutral from underweight.
U.S. Steel (X) is in talks to acquire rival AK Steel Holding (AKS), a combination that would strengthen the Pittsburgh giant's position in the automotive industry and take AKS off the menu of acquisition-minded foreign producers, according to news reports.
Starbucks (SBUX) may perk up after the posting stronger same-store sales growth than expected. The coffee chain posted 8% higher February same-store sales and 25% higher total sales.
In earnings news, Novell (NOVL) posted first-quarter earnings per share of 4 cents (non-GAAP), vs. 3 cents a year ago, despite a 5.4% revenue decline. The software maker sees 2-3 cents second-quarter non-GAAP EPS on revenue of $272-$282 million. Baird reportedly downgraded the stock to underperform from neutral.
Univision Communications (UVN) posted fourth-quarter EPS of 25 cents, vs. 19 cents a year ago (pro forma), on an 11% revenue rise. The company sees first-quarter adjusted EPS of 14-16 cents on mid-single-digit revenue rise.
Among other companies in the news, Overstock.com (OSTK) Chairman John "Jack" Byrne says he is considering stepping down from the position, partly due to differences with his son, the online retailer's CEO, according to The Wall Street Journal.
Morningstar (MORN) plans to launch a service today that can be used to compare exchange-traded funds with other ETFs and mutual funds, according to The Wall Street Journal.
In the energy markets, April NYMEX crude prices rose to around $63.67 a barrel as the market continued to factor in geopolitical risk premium, says Action Economics. Talks between Iran and the European Union about Iran's nuclear research program ended without an agreement.
In economic news, the University of Michigan consumer sentiment (final reading) slipped to 86.7, from the preliminary 87.4, according to newswires. That's a little weaker than expected and remains below January and December readings that topped 91, says Action Economics.
The U.S. non-manufacturing ISM rose to 61.0 in February, above the median forecast, from 56.8 in January.
Federal Reserve Vice Chairman Roger Ferguson said the economy is "solidly on track" in a speech at Howard University on the economic outlook in Washington, says Action Economics. The Fed's Ferguson said the economy is "solidly on track," but he warned of "significant risks" that could thwart that optimistic outlook, including a housing sector bust and fresh surge in energy prices, reports Action Economics. He expects Fed policy decisions to be based on what the data reveals and expects housing to "cool off," rather than collapse. Ferguson plans to retire before the month-end FOMC meeting.
The 10-year note yield toyed with 1-year highs, at 4.68%, as the ISM non-manufacturing report firmed nearly 4-points to 60.1, which kept unwinding of curve inversion bets intact and the long-end underperforming in the wake of the global bear market in bonds, says Action Economics. This was fueled overnight by the third consecutive gain in Japan's core CPI to +0.5% year-over-year, which appeared to herald the end of Bank of Japan's quantitative easing, says Action Economics.