Cyber Monday Sales Strong; EU Unemployment 12-Year High

Arthi Gupta
30 Nov, 2010
New York City

Stocks in New York traded sideways after Cyber Monday sales rose and European Union unemployment rose to a 12-year high. Switzerland-based ABB agreed to buy Baldor Electric for $4.2 billion. European Union opens an investigation relating to antitrust practices of Google.

[R]9:35 AM New York – Stocks in New York traded sideways after Cyber Monday sales rose and European Union unemployment rose to a 12-year high. Switzerland-based ABB agreed to buy Baldor Electric for $4.2 billion. European Union opens an investigation relating to antitrust practices of Google.[/R]

U.S. stocks traded unchanged after Cyber Monday sales were ahead of last year and euro-zone debt crisis worries persisted. Unemployment in the euro zone rose in October but inflation in November was unchanged from October.

Online sale increased 19.4% compared to a year ago sales, according to the latest data released by the retail data analysis firm Coremetrics. The average purchase increased 8.3% from a year ago to $194.89

EU Unemployment Rises, Flat Inflation

Annual inflation in the euro zone in November was recorded at 1.9%, unchanged compared to October. However, unemployment rose in October to 10.1%, up from 10% in September. In the wider European Union zone unemployment was unchanged at 9.6%.

The unemployment rate increased to the highest level in 12 years as governments in the region tighten belts and construction industry slows down.

ABB Acquires Baldor Electric

ABB Ltd., the power and automation technologies provider agreed to buy Baldor Electric Co., a manufacturer of industrial motors, in an all-cash transaction valued at around $4.2 billion, including $1.1 billion of net debt. ABB will commence a tender offer to purchase all of Baldor’s outstanding shares for $63.50 per share in cash.

EU Launches Investigation on Antitrust Violations by Google

The European Commission launched a formal investigation into allegations that Google Inc. abused a dominant position in online search.

The Commission would investigate Google imposes exclusivity obligations on advertising partners, preventing them from placing certain types of competing ads on their Web sites, as well as on computer and software vendors, with the aim of shutting out competing search tools.

Further, European Union regulators would investigate suspected restrictions on the portability of online advertising campaign data to competing online advertising platforms.

""Since we started Google we have worked hard to do the right thing by our users and our industry - ensuring that ads are always clearly marked, making it easy for users and advertisers to take their data with them when they switch services, and investing heavily in open source projects,"" Google said in an e-mailed statement.

Seadrill Buys Petrojack IV

SeaDrill Limited said it acquired the jack-up drilling rig Petrojack IV from Petrojack IV Pte. Ltd., Singapore. The total purchase price for the rig is around $180 million. The contract value for the 3.5 year remaining assignment is about $165 million.

Seagate Ends Buyout Offer

Seagate Technology announced that its Board of Directors terminated discussions with private equity firms regarding a going private transaction, as it determined that the indications of the valuation range were not in the best interest of the company and its shareholders. The company also announced that the Board authorized the company to repurchase up to an additional $2 billion of its outstanding ordinary shares.

Earnings Review

Shanda Games Limited ((GAME)), the Shanghai-based online game developer stated third quarter net revenues declined 14% to RMB 1.09 billion, from RMB 1.27 billion a year ago. Net income in the quarter fell 21% to RMB 289.0 million, compared to net income of RMB 366.6 million in the prior-year quarter. Earnings per ADS were RMB 1.02, compared to RMB 1.32 last year.

Shanda Interactive Entertainment Ltd. ((SNDA)), the Chinese entertainment media company reported third quarter consolidated net revenues edged higher 1% to RMB1.39 billion from RMB1.38 billion in the same quarter last year. Net income in the quarter plunged 77% to RMB99.3 million, from RMB435.3 million in the year-ago quarter. Earnings per ADS declined to RMB1.68, from RMB6.18 in the prior-year quarter.

Thor Industries, Inc. ((THO)), the recreation vehicles maker reported first quarter sales increased 21% to $606.7 million from $502.6 million in the year-ago quarter. Net income for the quarter climbed marginally 1.3% to $23.7 million or 44 cents per diluted share, compared to net income of $23.4 million or 42 cents per share in the prior-year quarter.

Trina Solar Limited ((TSL)), the integrated solar-power products manufacturer reported third quarter revenues soared 104% to $508.3 million from $249.75 million in the year-ago quarter. Net income in the quarter surged 108% to $82.87 million, compared to $39.76 million last year. Earnings per ADS climbed to $1.08 from $0.64 in the prior year.

Zoltek Companies, Inc. ((ZOLT)), the company that develops, manufactures and markets carbon fiber reported fourth quarter net sales decreased 8% to $31.1 million from $33.8 million in the fourth quarter of fiscal 2009. Net loss in the quarter narrowed 89% to $426,000 or 1 cent per diluted share, compared to a net loss of $3.8 million or 11 cents per share in the prior-year quarter.