In August, economic worries sent the Dow Jones Industrial Average down 4.3% and into negative territory for the year. The S&P 500 and NASDAQ contracted 4.7% and 6.2% for the month, respectively. Even with improved capital spending and strong corporate earnings, the unemployment rate and a slowing global economy remained major contentions. The unemployment rate for July was unchanged at 9.5% and revealed a regression in private sector hiring. On August 27, the Commerce Department lowered its US second-quarter GDP forecast to 1.6% from 2.4%. Year to date, the Dow, S&P 500 and NASDAQ have fallen 4.0%, 5.9% and 6.8%, respectively.

All IBO Stock Indexes traded lower. The Process/Metrology/Motion Instrumentation, Diversified Instrumentation, Lab Consumables/Equipment and Laboratory Instrumentation Stock Indexes fell 12.0%, 5.1%, 4.9% and 2.6%, respectively.

Laboratory Instrumentation Stock Index

In August, the Laboratory Instrumentation Index slipped 2.6% to 499.94, with 17 companies trading lower and four gaining ground. Transgenomic lost the most value, falling 19%, while PerkinElmer improved 8%. For the year, the Index is down 11.7%, with 13 companies in the red and eight in positive territory. Helicos BioSciences is down 51%, while X-Rite is up 51%.

This month’s earnings releases for Index companies were mixed. Caliper Life Sciences reported on August 3 second-quarter break-even EPS, $0.06 ahead of expectations, leading shares up 1.3%. The company projected a full-year loss of $0.07–$0.11 per share. On August 5, Harvard Bioscience announced EPS of $0.06, compared with $0.01 a year ago, but projected full-year EPS at the lower range of its forecast of $0.36–$0.38. Shares declined 1.7%. The same day, PerkinElmer reported EPS of $0.38, $0.05 better than expectations, sending shares up 11.1% the next day. Also on August 5, MOCON more than doubled its EPS at $0.21 a share. Shares climbed 1.4%. The same day, Sequenom announced a loss of $0.25, in line with consensus, but better-than-expected sales. Shares fell 2.5% the next day. On August 12, Dionex reported fiscal fourth-quarter EPS of $0.81, $0.03 ahead of expectations, but its fiscal 2011 EPS outlook of $3.56–$3.64 was just below consensus. Fiscal first quarter EPS is forecast to be $0.60–$0.63. Shares declined 1.1% the following day. X-Rite announced on August 11 EPS of $0.02, compared with a loss of $0.10. On August 16, Helicos reported a loss of $0.06 a share, compared with a loss of $0.10, but shares dropped 5.9% the next day. OI reported on August 16 EPS of $0.19, compared with $0.01. Shares fell 3.0%.

Other companies in the Index recorded lower earnings. On August 3, Bio-Rad Laboratories announced EPS of $1.24, $0.04 below consensus, but shares increased 1.0% the following day. SDIX announced on August 4 a loss of $0.01 per share, compared with breakeven, yet shares climbed 5.0% the next day. On August 5, Luminex announced EPS of $0.02, $0.03 short of expectations. Shares fell 2.8% the next day. Also on August 5, Accelrys reported fiscal first-quarter EPS of $0.05, $0.03 below estimates, leading shares down 3.5% the next day. The company projected fiscal second-quarter EPS of $0.09–$0.11. On August 12, Transgenomic reported a 7% decline in revenues and doubled its loss to $0.02 a share. Shares fell 11.1%.

On August 16, Bruker jumped 4.1% following its announced purchase of Veeco Instruments’ Metrology business (see page 2). On August 31, PerkinElmer revised its 2010 EPS outlook to $1.24–$1.29 due to plans to divest a business (see page 2).

Process/Metrology/Motion Instrumentation Stock Index

The Process/Metrology/Motion Instrumentation Stock Index retreated 12.0% to 322.92. Five companies declined and three improved. Veeco lost 23%, while Nanometrics soared 45%. Year to date, the Index is down 12.4%, with half the companies trading lower and the other half gaining. FEI maintains the largest decline, down 29%, and SDIX is up 35%.

On August 4, RAE Systems reported EPS of $0.04, beating the $0.01 consensus loss. The company projected a small profit for the year, compared with initial guidance for a small net loss. Shares jumped 9.9% the following day. On August 5, Nanometrics announced EPS of $0.60, more than double expectations, leading shares up 24.9% the next day. FEI reported on the same day EPS of $0.22, $0.03 ahead of expectations, and projected third-quarter EPS of $0.23–$0.27. Shares jumped 9.0% the following day. Also on August 5, MTS Systems announced fiscal third-quarter breakeven EPS, in line with expectations. Yet shares slipped 1.9% the following day. On August 16, ICx Technologies announced a loss of $0.11 a share, compared with break-even estimates. However, the company entered into a merger agreement with FLIR Systems (see page 2), leading shares up 14.2%. Zygo reported on August 19 a fiscal fourth-quarter gain of $0.26 per share, $0.16 better than consensus, sending shares up 3.6% the following day.

Lab Consumables/Equipment Stock Index

The Laboratory Consumables/Equipment Stock Index declined 4.9% to 492.22 in August. All seven companies posted negative returns. For the year, the Index is down 1.8%, with six companies trading lower and Sigma-Aldrich up 5%. Enzo Biochem recorded the largest declines for both the month and year, sliding 23% and 34%, respectively. Techne reported on August 3 fiscal fourth-quarter EPS of $0.69, $0.02 below consensus. Yet full-year EPS were $2.94, $0.12 above expectations, sending shares up 3.3%. QIAGEN reported on August 9 EPS of $0.21, in line with expectations. Shares fell 4.8% the following day. Kewaunee Scientific reported on August 24 fiscal first-quarter EPS of $0.25, a decline of 40%, sending shares down 3.7% the following day.

Diversified Instrumentation Stock Index

For the month, the Diversified Instrumentation Stock Index fell 5.1% to 98.06. All six companies declined, led by Teledyne Technologies, which fell 12%. Year to day, the Index has fallen 3.6%, with half the companies gaining in value and the other half trading lower. Agilent Technologies has recorded the largest drop, sliding 13%, while AMETEK has added 12% to its value. Agilent reported on August 16 EPS of $0.54, $0.06 ahead of expectations. The company projected fiscal fourth-quarter EPS of $0.58–$0.59, which was higher than expectations, and raised its full-year EPS outlook by 7% to of $1.94–$1.95. Shares jumped 7.8% the following day.

International

In August, four Pacific Region firms traded lower, but Techcomp was unchanged. For the year, four have negative returns, and Techcomp is up 30%. Hitachi High-Technologies declined the most for the month and year, falling 18% and 26%, respectively. On August 4, Horiba reported EPS of ¥70.96 ($0.78) for the first half, compared with ¥24.11 ($0.25). The company raised its 2010 net income forecast by 4% to ¥5.2 billion ($58 million). Shares rose 2.2% the next day. On the same day, Shimadzu reported a fiscal first-quarter net loss of ¥337 million ($3.7 million) (see page 12), compared with a gain of ¥342 million ($3.5 million), leading shares down 4.4%. The company raised it full-year net income outlook by 4% to ¥8.3 billion ($92 million). On August 11, Techcomp reported a 5% jump in EPS to $0.63 for the first half.

This month, six European companies improved, six declined and two traded flat. Alpha MOS led all companies, up 16%, and Sartorius fell 11%. Year to date, seven companies have positive returns, five have traded lower and two are unchanged. Oxford Instruments maintains the largest increase, up 77%, while Tecan has surrendered 21% of its value.

On August 6, Biohit reported EPS of $0.01, compared with breakeven, yet shares fell 4.2%. On August 12, Analytik Jena reported EPS of €0.10 ($0.13) for the fiscal third quarter, compared with a loss of €0.03 ($0.04). Shares gained 1.4%. On the same day, Tecan reported six-month EPS of CHF 1.50 ($1.38) from continuing operations, compared with CHF 1.64 ($1.45). Shares fell 4.1%. On August 13, Biotage announced EPS of SEK 0.08 ($0.01), compared with SEK 0.06 ($0.01). Shares slipped 2.0% the following day. Exiqon reported on August 19 a loss of DKK 0.34 ($0.06) a share, compared with a loss of DKK 0.71 ($0.13). Shares fell 4.6%. On August 24, Spectris reported six-month adjusted EPS of £0.29 ($0.45) (see page 12), compared with £0.09 ($0.14). Shares fell 4.5%.

IBO Instrument Industry Stock Index

Lab Instrument Stock Index S&P 500

Aug-08 643.46 307.57

Sep-08 590.45 279.64

Oct-08 456.82 232.26

Nov-08 416.63 214.88

Dec-08 390.29 216.56

Jan-09 397.41 198.01

Feb-09 376.99 176.24

Mar-09 393.81 191.29

Apr-09 428.75 209.26

May-09 446.23 220.37

Jun-09 479.85 220.41

Jul-09 522.15 236.75

Aug-09 528.47 244.70

Sep-09 543.19 253.44

Oct-09 535.42 248.43

Nov-09 548.41 262.68

Dec-09 565.94 267.35

Jan-10 546.93 257.47

Feb-10 566.22 264.81

Mar-10 585.87 280.38

Apr-10 596.47 284.51

May-10 557.61 261.19

Jun-10 531.11 247.12

Jul-10 513.20 264.12

Aug-10 499.94 251.58