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Here are the major headlines in the stock market today.
- Bernanke makes case for QE3– In his much awaited speech at Jackson Hole, WY Federal Reserve Chairman Ben Bernanke did not signal any new monetary easing was coming but took the Fed's well-used approach of leaving the door open if conditions worsen. He called the constant high-unemployment a "grave concern" and stated the current economy is "far from satisfactory." Bernanke did bring up concerns associated with unconventional monetary policy but insisted that the quantitative easing measures have been successful in spurring economic growth and job creation. "It is important to achieve further progress, particularly in the labor market," Bernanke said at the Kansas City Fed's annual Jackson Hole symposium. "Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability."
- Chicago PMI decreases but factory orders gain- The Chicago Purchasing Managers' Index decelerated slightly to a reading of 53.0 in August from 53.7 in July. The 53.0 reading was in line with forecasts. The gauge measures both manufacturers and service providers in the Chicago region with business in the U.S. and abroad, making the reading a measure of overall growth. The Commerce Department said on Friday new orders for manufactured goods rose 2.8% during July, ahead of the 1.9% projection. This was led by strong orders for motor vehicles and parts and civilian aircraft. Yet, non-defense capital goods orders excluding aircraft – often regarded as a barometer of business confidence and spending plans- fell 4% in July.
- Splunk Inc. (Nasdaq: SPLK) surges on better-than-expected earnings– Splunk, a data-mining software company that went public in April reported a second-quarter loss excluding items of 1 cent per share, beating the 4 cent loss expected by analysts. Revenue for the quarter came in at $44.5 million also ahead of the $39.84 million projection. For its fiscal year 2013, Splunk now expects revenue of $183 million to $186 million, compared to prior guidance of $174 million to $177 million. Analysts currently expect revenue of $178.28 million. "Against a challenging economy, they executed very well," Trip Chowdhry, an analyst at Global Equities Research told Investor's Business Daily. "They provide a key technology that companies continue to spend on." Since its IPO where shares were sold at $17, SPLK stock has now more than doubled thanks to today's 17% spike.
- OmniVision Technologies Inc. (Nasdaq: OVTI) rallies on strong earnings– Image sensor maker OmniVision Technologies Inc. saw profits fall in its fiscal first quarter but reported better-than-expected revenue and raised its outlook. Net income fell to $2.3 million, or 4 cents per share, from $42 million, or 68 cents per share in the year-ago period. Without one-time items OmniVision would have earned 21 cents per share, a penny below expected adjusted earnings of 22 cents per share. Revenue fell 6.5% to $258 million but ahead of analysts' forecast of $243.4 million. The company now expects second-quarter earnings excluding one-time items of 21 to 37 cents per share on revenue of $355 million to $390 million. Prior estimates had called for 33 cents per share on revenue of $270.3 million for the current quarter. OVTI stock is up more than 6% in early trading.
The Dow Jones was up 147 points, or 1.13%, and the S&P 500 was up 12.84 points, or 0.93% in early trading.
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