Oil Sends Europe Down

Elena
23 Mar, 2006
Frankfurt

European stocks traded mixed at mid-day, reflecting weak energy stocks which declined on five-week low oil prices and largely limited gains on higher Wall Street close and strength in the mining sector. The German DAX 30 gained 0.1%, the French CAC 40 lost 0.2%, and London FTSE 100 fell 0.2%.

8:30 AM A batch of companies underperformed.
Fred's Inc, ((FRED)), retailer, reported Q4 net income of 24 cents a share, down from 27 cents a share a year ago despite sales growth, missing analyst estimate for a profit of 27 cents a share. The company added that profits were hurt particularly by weakness in its pharmacy sales.

General Mills Inc, ((GIS)), ice cream and Pillsbury products company, reported that Q3 earnings advanced nearly 7% to 68 cents a share, from 58 cents a share in the year-earlier period on 3% net sales growth, beating analysts’ expectations for a profit of 65 cents. The company added that profit growth was limited by higher input costs, higher employee benefits expense and increased advertising investment.

Apollo Group Inc, ((APOL)), education services company, reported Q2 earnings of 46 cents a share, down from a profit of 47 cents a share a year-earlier despite 12.6% revenue growth, due to expenses paid to its former CEO under a separation agreement lowered earnings in Q2 by 9 cents a share. The company was in line with analyst estimate for a profit of 46 cents a share.

Family Dollar Stores Inc, ((FDO)), discount retailer, reported Q2 net income of 35 cents a share, 48 cents a share in the same period last year. Q2 results include a litigation charge of 18 cents a share, connected with an adverse litigation judgment. Sales for Q2 were up 9.4% to about $1.74 billion and same-store sales advanced 3.2.

Scholastic Corp, ((SCHL)), children's books publisher, reported that its Q3 net loss widened to $15.5 million, or 37 cents a share, down from $800,000 despite 1%revenue growth, missing analysts forecasts for a loss of 7 cents a share. The company added that staffing and promotional expenses had advanced as revenue from its educational publishing unit fell.


8:00 AM European averages made insignificant moves at mid-day.
European markets traded in a tight range at mid-day. Energy stocks like BP and Total were dragged down by five-week low oil prices to offset gains made on the back of higher Wall Street close and strong mining sector. The German DAX 30 inched up 0.1%, the French CAC 40 lost 0.2%, and London FTSE 100 was down 0.2%. The euro fell 0.2% to 41.2057.


7:45AM Asian markets broadly advanced on U.S. markets gains.
Asian-Pacific benchmarks closed broadly higher, supported by U.S. markets gains and improved confidence in the global economic growth. However, the Nikkei edged down 0.04%, reversing from early gains as investors locked in profit taking, selling steel, property and brokerage stocks, such as Tokyo Steel MFG and JFE Holding. Across the region, Hong Kong’s Hang Seng rose 0.8%, despite the negative impact of interest rate concerns ahead of FOMC meeting. South Korea’s Kospi gained 0.2%, lifted by Kookmin Bank. Australia’s All Ordinaries climbed 0.4% on mining and energy stocks.