Bad Earnings and Apple Rumors Send Stocks Reeling

Stocks are down sharply today thanks to worse-than-expected earnings from Bank of America (NYSE: BAC  ) and fears that Apple's (NASDAQ: AAPL  ) report may similarly disappoint. With roughly an hour left in the trading session, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is lower by 167 points, or 1.13%.

Given the absence of economic data, it's safe to conclude that today's decline is attributable to one thing: earnings. After yesterday's closing bell, Intel (NASDAQ: INTC  ) reported that its quarterly earnings plunged by 25% from the same time period last year and that its revenue contracted by 2.5%.

And yet shares in the chip maker are nevertheless moderately higher in afternoon trading. What gives?

The answer is that Intel's results were roughly in line with analysts' estimates. In addition, despite the fact that personal-computer sales purportedly fell 14% over the quarter, Intel's PC processor division only saw its top-line erode by 6%. As my colleague Anders Bylund noted, this wasn't wholly unexpected, given that the company never warned investors of an impending meltdown.

Unfortunately, Bank of America is having the exact opposite experience today. Namely, despite the fact that its net income improved by a factor of four over the first three months of the year, its shares are tanking, down 5.3% at the time of writing.

The reason is that, unlike Intel's, Bank of America's results came in below the consensus forecast. While analysts had estimated that the bank would earn $0.22 per share, its actual earnings came in at $0.20 per share. Suffice it to say, the market's not pleased.

And speaking of being displeased, shares of Apple fell below the $400 threshold for the first time since 2011, erasing nearly a year and a half's worth of gains. The catalyst was an announcement from Cirrus Logic (NASDAQ: CRUS  ) , a supplier of audio chips for the iPhone and iPad. According to the Associated Press, Cirrus said that "sales of a particular chip are slowing down as an unnamed customer [presumed to be Apple] moves to a newer component."

The implication, according to an analyst cited by the AP, is that Apple is unlikely to launch a new iPad Mini in the April-to-June period. For investors, it's important to keep in mind that this is purely speculation and rumor. We should get a better feel for things on Tuesday when the tech giant itself reports earnings.

There's no doubt that Apple is at the center of technology's largest revolution ever and that longtime shareholders have been handsomely rewarded. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on reasons both to buy and to sell Apple, as well as what opportunities remain for the company (and your portfolio) going forward. To get instant access to his latest thoughts on Apple, simply click here now.

LivingSocial Hacked!

LivingSocial has been hacked.

On Saturday, the daily-deals company that's part-owned by Amazon.com (NASDAQ: AMZN  ) posted a "security notice" on its website, alerting users to an unauthorized intrusion into its servers. In pertinent part, the notice advised:

"LivingSocial recently experienced a cyber-attack on our computer systems that resulted in unauthorized access to some customer data from our servers." "The information accessed includes names, email addresses, date of birth for some users, and encrypted passwords." Crucially, though, "The database that stores customer credit card information was not affected or accessed." And also, "we have not received any abnormal reports of accounts with unauthorized charges or activity."

As is common in such incidents, LivingSocial was vague on the details and, in particular, vague on the number of its customers affected by the hack, on the date the attack first took place, and how long LivingSocial's servers were an open book to the hackers. LivingSocial says it's investigating the incident in cooperation with law enforcement.

Meanwhile, the company is urging its customers to change their passwords for accessing the LivingSocial website, and also to change "password(s) on any other sites on which you use the same or similar password(s)."

Why worry about "other" websites? Judging from what little LivingSocial has divulged so far, it appears that hackers now know who you are, what email address you use (often used as a default user or screen name on websites), and may be able to decode even encrypted passwords stolen from LivingSocial. There's a risk, therefore, that they may soon be able to hijack your accounts on other websites using these passwords.

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