U.S. Stocks Drop; Winn-Dixie Net Up

Arthi Gupta
31 Aug, 2010
New York City

U.S. stocks trade lower on worries of slowdown in global economic recovery. Obama urged Senate to approve small business bill. HSBC finalized auto loan portfolio to Santander for $3.56 billion. Hewlett-Packard agreed to pay $55 million to settle kickbacks case.

[R]9:35 AM New York – U.S. stocks trade lower on worries of slowdown in global economic recovery. Obama urged Senate to approve small business bill. HSBC finalized auto loan portfolio to Santander for $3.56 billion. Hewlett-Packard agreed to pay $55 million to settle kickbacks case.[/R]

U.S. stocks fell on economic worries and Asian and European markets declined.

India''s economy logged the fastest growth in more than two years during the April to June quarter helped by growth in manufacturing and mining.

The Central Statistics Organization reported that India''s economy expanded 8.8% on an annual basis during the quarter following 8.6% growth in the preceding January to March quarter.

President Barack Obama on Monday urged for swift Senate action on a bill aimed at boosting the prospects for small businesses around the country.

The bill aims to create a $30 billion fund to help community banks increase lending to small businesses as well as provide $12 billion in tax breaks.

HSBC Holdings plc completed its exit from U.S. auto finance ""run-off"" portfolio by selling the remaining portfolio of loans to Banco Santander SA''s automotive finance arm, for $3.56 billion in cash. Santander will also assume around $431 million of debt.

The carrying value of the loans as of June 30 was $4.3 billion. The transaction is expected to close during the third quarter of 2010.

Santander Consumer USA Inc. already acquired HSBC''s auto finance loan servicing platform and $1 billion in loan receivables in March 2010.

Hewlett-Packard agreed to pay $55 million to settle claims that it defrauded the U.S. government by paying ""kickbacks"" to other technology companies to recommend its products, and by overcharging federal agencies.

The case based on claims, dating back to 2004, that HP was part of a group of IT and consultancy vendors who paid ""influencer fees"" to each other in return for recommendations that the federal agencies should purchase their products. HP agreed to the payment to end the case.

High seas on the Gulf of Mexico forced BP Plc to delay operations of removing a sealing cap and blowout preventer at the well that unleashed he Deepwater Horizon oil spill by as long as three days.

Earnings Review

Allied Healthcare Products, Inc. ((AHPI)), the respiratory care products maker reported fourth quarter net sales declined 7.9% to $11.67 million from $12.71 million in the previous year''s fourth quarter. Net income in the quarter was $86.26 thousand or 1 cent per diluted share compared to a net loss of $16.08 million or $2.04 per share in the comparable quarter a year ago.

Dollar General Corp. ((DG)), the discount retailer said second quarter sales increased 10.8% to $3.21 billion from $2.90 billion in the 2009 second quarter on same-store sales rise of 5.1%. Net income in the quarter soared 51% to $141.20 million or 41 cents per diluted share compared to net income of $93.59 million or 29 cents per share in the same quarter last year.

Donaldson Company, Inc. ((DCI)), the filtration products maker said fourth quarter net sales rose 22% to $515.24 million from $421.32 million in the same quarter last year. Net income in the quarter surged 117% to $51.2 million or 65 cents per diluted share, compared to net income of $23.6 million or 30 cents per share for the year-ago quarter.

DSW Inc. ((DSW)), the branded footwear specialty retailer reported second-quarter net sales grew 12.3% to $415.12 million from $369.49 million a year-ago quarter on same-store sales rise of 12.0%. Net income in the quarter surged 210% to $23.45 million or 52 cents per diluted share compared to net income of $7.57 million or 17 cents per share last year.

Energy Conversion Devices, Inc. ((ENER)), the manufacturer of building-integrated and rooftop photovoltaics stated fourth quarter revenues soared 68% to $86.15 million from $51.42 million a year ago. Net loss in the quarter widened 15.4% to $20.28 million or 48 cents per diluted share compared to net loss of $17.57 million or 41 cents per share recorded last year.

SWS Group, Inc. ((SWS)), the institutional brokerage firm said fourth quarter net revenues dropped 9.8% to $89.34 million compared to $99.0 million in the year-ago quarter. Net loss in the quarter was $0.31 million or 1 cent per diluted share, compared with a net profit of $3.6 million or 13 cents per share in the same quarter a year ago.

Teletouch Communications, Inc. ((TLLE.PK)), the company that offered a suite of telecommunications products and services reported total revenues for fiscal 2010 increased 13.3% to $51.96 million from $45.86 million in the comparable period. Full-year net profit was $1.60 million or 3 cents per diluted share compared with a net loss of $1.92 million or 4 cents per share a year ago.

Winn-Dixie Stores, Inc. ((WINN)), the food retailer reported fourth quarter net sales increased 1.8% to $1.74 billion from $1.71 billion a year ago. Net income in the quarter surged 49% to $13.98 million or 25 cents per diluted share compared to net income of $9.39 million or 17 cents per share in the previous year.