Apple up 6% on New Software

Elena
05 Apr, 2006
New York City

Stocks opened modestly higher, although trading was light ahead of the release of a report on business activity in the services sector. The Nasdaq showed considerable strength, helped by computer hardware stocks with Apple rising 6% on the introduction of new software that enables Intel-based Macs to run Windows XP. In earnings news, seed company Monsanto reported Q2 income rise of $1.60 per share on sales growth, beating expectations of $1.52 a share.

[R] 9:45AM Stocks slightly gained at opening.[/R]
U.S. stocks slightly advanced at opening with the three major averages continuing the upside trend from the previous session, although buying interest remained subdued before the release of a report on business activity in the services sector. At the start of trading the Nasdaq moved notably higher, benefiting from early strength in the tech sector. Computer hardware stocks showed considerable advance, with shares of Apple ((AAPL)) moving sharply higher after the company introduced new software that enables Intel-based Macs to run Windows XP. Strength was also visible in the gold sector, which benefited from an increase in the price of the precious metal. In the opening minutes, the Dow Jones industrial average was down 3.60 at 11,200.25, the Nasdaq Composite was up 4.46 at 2,349.82 and the Standard & Poor''s 500 index climbed .59 at 1,306.52.


[R]9:15AM Stock futures pointed to a flat opening.[/R]
Stocks futures indicated a lackluster opening, following a gaining session yesterday when lower oil prices and stable fixed income markets supported stocks and sent the Nasdaq Composite index to a five-year high. Today, investors seemed inclined to profit taking as interest-rate concerns weighed on their trading enthusiasm and couple of economic reports were expected. The Institute for Supply Management is due to release its monthly index of the national non-manufacturing sector and the government will release weekly data on petroleum inventories. S&P 500 futures were down 0.40 point but slightly above fair value. Dow Jones industrial average futures fell 4 points, while Nasdaq 100 futures rose 0.75 point.

Crude oil prices retreated ahead of weekly petroleum report and expectations of strong crude stockpiles. Light sweet crude May delivery dropped 18 cents to $65.05 a barrel. London Brent dropped 24 cents to $66.15. European gold dropped for a second day in a row as the rallying metal price deterred purchases from investment funds and jewelry makers. In London gold traded at $583.85 per troy ounce, down from $586.30. In Zurich the precious metal fell to $583.80 from $586.40. Silver fell to $11.69 from $11.70. The U.S. dollar advanced versus major currencies. The euro traded at $1.2252, down from $1.2258. The dollar bought 117.59, up from 117.42. The British pound was quoted at $1.7517, down from $1.7551.

Monsanto Co., ((MON)), seed company, reported Q2 net income of $1.60 a share, up from $1.37 a share in the year-ago period. The company said sales in Q2 advanced to $2.2 billion from $1.91 billion on a boost from corn seeds and traits. Monsanto beat analysts’ expectations for earnings of $1.52 a share. Monsanto reaffirmed a 2006 earnings outlook toward the upper end of its previously announced range of $2.35 to $2.50 a share.

Acuity Brands, Inc., ((AYI)), lighting equipment producer, reported Q2 net income of 32 cents per share, up from a net loss of 20 cents per share in the year-ago period. The results for Q2 included an additional pretax expense of approximately 5 cents per share, for certain share-based incentive plans that were impacted by the 27% appreciation in the Company’s stock price in Q2 and the adoption of SFAS123®, an accounting standard related to share-based payments.

Greenbrier Cos., ((GBX)), railcar manufacturer, reported that Q2 earnings advanced 78% to 54 cents per share, up from 31 cents per share despite a 7% decline in revenue, as better margins drove results. The company took a charge during Q2 that cut its earnings by 2 cents per share. Excluding the charge, Greenbrier matched analysts’ expectations of 56 cents per share.

Pathmark Stores, Inc., ((PTMK)), grocery stores operator, reported Q4 net loss of 28 cents per share, up from a net loss of $10.03 cents per share in the prior year''s period. The results for Q4 of fiscal 2005 and fiscal 2004 included certain adjustments. Excluding these adjustments, Q4 net loss would have been 17 cents per share. Sales for Q4 were $993.3 million, a decline of 0.4% from $996.8 million in the prior year''s period. Same-store sales declined 0.8% in Q4.


[R]8:45AM Senses in India adds 4% in three days.[/R]
Sensex Index in India is on a tear. Mumbai Stock Exchange Index is up 24% for the year on liquidity steady economic expansion and liquidity fro domestic and foreign investors. Daily new funds invested in the market are now higher than $120 million a sharp rise from $40 million a year ago and $30 million three years ago. Sensex Index is now trading at Price to Earnings multiple of 21 for 2007 significantly higher than similar ratios in Brazil, South Korea and Hong Kong. But none of these three economies are likely to generate more than 4% economic growth for the year.

Bank stocks have been on the move on the expectations that the Central Bank is soon to announce a revised credit policy for the private banks. Indus Bank closed up 12% to Rs. 55.65, State Bank of India up 1.45% to Rs. 1,010, Bank of India up 3.3% to Rs. 137 and ICICI bank closed up 1.4% to Rs. 622. L&T, infrastructure company, rose 3.9% to 2,645 on the news that the company has been awarded a $115 million project to be completed in three years. Arvind Mills, textile company rose 11% on the news that Fidelity International, American mutual funds company has raised its investment in the company to 5%. Denim maker has suffered on the global decline in denim prices as denim manufacturing capacities have rose in India and China. Local IT company stocks fell between 1% and 3% ahead of earnings from Infosys, Wipro and Satyam Comuter.


[R] 8:15 AM European averages traded flat at mid-day.[/R]
European markets turned flat at mid-day dealings. Stocks opened higher, boosted by strong U.S. markets close, but the lack of catalysts like earnings or economic reports directed investors’ attention to interest-rate hikes and they decided to lock in recent gains. EADS stood out as one of the most notable losers after DaimlerChrysler and Lagardere decided to reduce their holdings in the aerospace concern by 7.5%. Shares of European Aeronautic Defense & Space Co. dropped 3.9%. The German DAX 30 edged down 0.01%, the French CAC 40 lost 0.1%, while London FTSE 100 inched up 0.01%.


[R]7:45AM Asian markets finished higher. The Nikkei dropped.[/R]
Asian-Pacific benchmarks finished broadly higher. The Nikkei was the sole decliner in the region, closing in the negative for a second consecutive session. The Japanese index traded in the positive throughout the session, lifted by technology stocks, but eventually lost ground on profit taking to finish down 0.3% at 17,243.98. Positive sentiment boosted shares of leading tech companies like camera maker Canon, up 3.8% and computer chip equipment maker Advantest Corp., up 3.9%. Across the Region Thailand shares surged to 3.05% after Prime Minister Thaksin Shinawatra announced he would hand in his resignation. China Shanghai Composite climbed 0.8%, Singapore Straits Times rose 0.5%, Australia’s All Ordinaries surged 0.8%, and South Korea’s Kospi gained 0.2%. Markets in Hong Kong and Taiwan were closed for a public holiday.