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ADP Payroll Disappoints; Apple’s Record-Breaker; New T-Mobile

The ADP Payroll report for April has come in under consensus. The report indicates just 119,000 new private sector jobs for the month. Estimates were for 150,000 to 155,000 new jobs. That could move markets lower after yesterday's record-high close. The S&P ended the regular session at 1.597. Major indexes have now logged six consecutive months of gains.

We've got another hailstorm of reports today as part of earnings season. Among the companies that have already reported this morning: Merck. The company managed to beat on the bottom line posting 85-cents a share, though revenues came in almost $1/2-billion dollars short. Also out with earnings this morning: three media companies with one common theme: a beat on earnings by a penny, but a miss on revenue. First is Comcast, which logged 51-cents a share. Next is Time Warner, which made 75-cents a share though revenue was almost$200-million short. And finally is Viacom which came in at 96-cents a share.

Apple's (AAPL) bond sale is restoring at least some of the company's shine. Shares rose almost 3% yesterday, after gaining more than 3% on Monday. As for the bond issue, it's $17-billion, the largest-ever non-bank bond sale. There are actually six different products ranging from 3 to 30 years in duration. The purpose is to restore cash to Apple shareholders. Apple has $170-billion in cash on its balance sheet, but about $100-billion of that is tied-up overseas, which is why the company decided to issue the debt.

T-Mobile debuts this morning as a new company on the NYSE. The company has completed its takeover of Metro PCS. The new corporation remains the country's fourth largest cell company, but now with 40-million customers. It will trade under the ticker TMUS.

STOCKS TO WATCH

Facebook (FB) will be reporting earnings after the closing bell. Consensus is for the social network to report 13-cents a share. There's no year-to-year comparison since the company went public last May but revenue's expected to rise about 35% rise to $1.4 billion. Facebook's main challenge remains monetizing its billion-plus users, particularly with the massive shift to mobile. According to one calculation the company has recently shed millions of users, but that's being disputed. Right now Facebook shares are about 27% below their IPO price. They're sitting at almost the same place where they were when we rang in 2013.

Next up is BMC Software (BMC). Reuters is reporting that a private equity alliance comprised of Bain Capital and Golden Gate Capital is offering more than $6.5 billion dollars for BMC. That would put them ahead of a rival consortium including KKR which made a takeover bid last week. According to the report, BMC is allowing that first group to sweeten its offer, so we could see a bidding war. BMC is up about 10% over the past year. It hit its 52-week high about a month ago.

Now we look at Nuance (NUAN), which plunged more than 18% yesterday. Nuance makes speech recognition software which is similar to the iPhone's Siri. Shares tanked when the company reported a loss of 8-cents a share for the quarter and lowered its outlook moving forward. But there's a twist. Activist investor Carl Icahn snapped up another 10-million shares on the drop, upping his stake in the company to nearly 11%. So far Icahn has not commented on the purchase. We should mention that prior to yesterday's drop shares of Nuance were just about where they began the year.

Finally, there's Dreamworks (DWA) which shattered all estimates with its earnings report, released after yesterday's closing bell. You can thank "The Croods" the animated blockbuster that's made nearly $1/2 billion dollars since its release. That helped Dreamworks post earnings of 7-cents a share when estimates were for 3-cents. Revenue was about 35% above the consensus. Dreamworks shares were already up 19% year-to-date ahead of the quarterly report.

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