U.S. Stocks Trade Sideways; Earnings in Focus

123jump.com Staff
20 Apr, 2010
New York City

U.S. stocks traded sideways after Goldman Sachs reported better than expected earnings and the company faces more scrutiny in Europe. IBM reported lower than expected services revenues. Nearly half the flights in Europe are expected to meet the schedule today.

[R]11:40 AM New York – U.S. stocks traded sideways after Goldman Sachs reported better than expected earnings and the company faces more scrutiny in Europe. IBM reported lower than expected services revenues. Nearly half the flights in Europe are expected to meet the schedule today.[/R]

U.S. stocks traded sideways after Goldman Sachs reported sharply higher earnings. The Securities Exchange Commission’s fraud allegation drew attention from regulators in the UK and Germany. The UK regulatory agency FSA has opened a formal inquiry into Goldman Sachs dealing.

European air travel resumed after regulators eased air travel restrictions despite pilots resistance. Nearly half the flights in Europe are back to normal after airports in Paris reopened but London airports are still closed.

More than 14,000 flights are expected to meet their today’s schedule as nearly eight million passengers are stranded in sixteen European nations. In Northern Europe only Scandinavia and Scotland are free of volcanic ash cloud and as is Iberian coastal region.

Goldman Sachs Group, Inc., the financial services firm reported first quarter revenue rose 36% to $12.7 billion from $9.4 billion. Net income surged 99% to $3.3 billion or $5.59 per share from $1.7 billion or $3.39 per share a year-ago quarter.

Commodities, Currencies and Yields

Dollar edged lower against euro to $1.3500 and increased against the Japanese yen to 92.88.

Crude oil increased $1.12 to $82.57 a barrel for a front month contract, natural gas edged higher $0.02 cent to $3.96 per mBtu and gasoline increased 2.020 cents to 227.46 cents.

Gold increased $6.70 in New York trading to close at $1,142.50 per ounce, silver closed higher $0.239 to $17.97 per ounce and copper for the front month delivery increased 4.050 cents to $3.56 per pound.

Yields on 10-year U.S. bonds increased to 3.81% and on 30-year U.S. bonds traded at 4.70%.

Stock Movers

Array BioPharma Inc. surged 37.4% after the drug research company entered into an agreement with Novartis for the worldwide development of the small-molecule MEK inhibitors ARRY-162, currently in a Phase 1 cancer trial, its back-up, ARRY-300, and other MEK inhibitors.

FalconStor Software, Inc. plunged 11.0% after the maker of data-protection software estimates preliminary first quarter revenue to be in the range of $16.8 to $17.1 million.

The Procter & Gamble Company rose 0.3% after the consumer products maker increased quarterly dividend by 9.5% to 48.18 cents per share from 44 cents.

Zions Bancorporation rose 1.0% after the finance company said first quarter net interest income fell 4% to $455.3 million from $474.8 million a year ago.

Earnings Review

Crane Co. ((CR), engineered industrial products manufacturer said first quarter sales fell 4.5% to $530.3 million from $555.1 million a year ago. Net income in the quarter rose 42.4% to $33.2 million or 56 cents per diluted share compared to net income of $23.3 million or 40 cents per share a year ago.

International Business Machines Corporation ((IBM)), an information technology company said first quarter revenues rose 5.5% to $22.9 billion from $21.7 billion a year ago. Net income in the quarter rose 13% to $2.6 billion or $1.97 per diluted share compared to net income of $2.3 billion or $1.70 per share a year ago.

Lincare Holdings Inc. ((LNCR)) the oxygen and respiratory therapy services provider said first quarter revenues rose 10.3% to $410.0 million from $371.7 million a year ago. Net income in the quarter rose 67.7% to $43.6 million or 67 cents per diluted share compared to net income of $26.0 million or 36 cents per share a year ago.

Packaging Corporation of America ((PKG)), the containerboard and corrugated products producer said first quarter sales rose 7.4% to $550.7 million from $512.4 million a year ago. Net income in the quarter fell 25% to $19.2 million or 19 cents per diluted share compared to net income of $25.7 million or 25 cents per share a year ago.

Steel Dynamics, Inc ((STLD)) first quarter sales rose 91.5% to $1.56 billion from $814.7 million a year ago. Net income in the quarter was $65.0 million or 29 cents per diluted share compared to net loss of $87.9 million or 48 cents per share a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 8.09 or 0.07% to 10,900.68, Hang Seng index in Hong Kong increased 218.21 or 1.02% to 21,623.38 and CSI 300 index in China lower 3.05 or 0.10% to 3,173.37. ASX 200 index in Australia increased 10.70 or 0.22% to 4,925.80. The FTSE Bursa KL Composite index in Malaysia closed higher 9.23 or 0.70% to 1,335.90.

The Kospi Index in South Korea increased 12.73 or 0.75% to close at 1,718.03. SET index in Thailand closed higher 39.47 or 5.43% to 765.76 and JSE Index in Indonesia increased 50.84 or 1.79% to 2,891.27. The Sensex index in India increased 59.90 or 0.34% to 17,460.58.

Europe Markets Review

In London FTSE 100 Index closed higher 46.77 or 0.82% to 5,774.68, in Paris CAC 40 Index increased 51.91 or 1.31% to close at 4,022.38, in Frankfurt DAX index higher 87.13 or 1.41% to close at 6,249.57. In Zurich trading SMI increased 76.88 or 1.13% to close at 6,880.56.