Oil Dips on Production Hike Talks; Libya in Focus

Arthi Gupta
08 Mar, 2011
New York City

U.S. indexes rose after oil prices eased and OPEC members talk to ramp up oil production. U.S. consumer credit soared in January and a private survey showed confidence among employers increased. Air China agreed to buy five Boeing 747-8 jets. Dick''s Sporting quarterly net rose.

[R]8:45 AM New York – U.S. indexes rose after oil prices eased and OPEC members talk to ramp up oil production. U.S. consumer credit soared in January and a private survey showed confidence among employers increased. Air China agreed to buy five Boeing 747-8 jets. Dick''s Sporting quarterly net rose.[/R]

Global markets inched higher on reports that a representative of Moammar Qadhafi offered talks with the rebel National Libyan Council on the Libyan leader''s exit. The negotiations are mediated with the help of the Arab League secretary general Amr Moussa.

Moussa also confirmed his support for a no-fly zone over Libya according to French foreign ministry spokesman Bernard Valero.

Crude oil futures are receding modestly, although still above the $105-a-barrel level. London Brent crude dropped below $114 a barrel and U.S. crude stayed below $106.

Members of OPEC are joining Saudi Arabia in raising output to cool soaring prices and allay fears of a supply crunch in the West and banks in the Western nations are refusing to trade Libyan oil.

Dallas Federal Reserve President Richard Fisher said the U.S. Fed has already done its part to get the economy back on solid footing and it is now up to legislators to get the nation''s fiscal house in order to help continue the mending process.

Dennis Lockhart of the Atlanta Fed said he would be cautious about extending asset purchases after June, when the central bank''s quantitative easing program is set to expire, although he didn''t rule out the option of additional asset purchases should the economic recovery falter.

The International Monetary Fund is exploring various possibilities for the introduction of short-term liquidity line, similar to short-term credit facility created in late 2008, to help economies cope with its liquidity needs in the event of a crisis, IMF''s First Deputy Managing Director John Lipsky said on Monday.

U.S. Consumer Credit Soars

The Federal Reserve released a report on Monday showing that U.S. consumer credit increased by much more than estimated in January.

The report showed that consumer credit increased by $5 billion in January following a downwardly revised $4.1 billion increase in December.

Air China Orders Boeing 747-8 Intercontinental Jets

Air China Ltd. agreed on Monday to purchase five 747-8 intercontinental jets from Boeing Co. for a list price of $1.54 billion to expand its international routes.

Air China is expecting to take delivery of the aircraft in stages between 2014 and 2015, and will become the first Chinese customer for Boeing''s newest, fuel-efficient 747-8 Intercontinental passenger jumbo jet.

U.S. Employers Optimistic for Q2

Confidence among U.S. employers is spreading geographically, according to the seasonally adjusted results of the latest Manpower Employment Outlook Survey, conducted quarterly by Manpower Inc.

Employers in all 50 states report positive hiring intentions and 33 out of 50 states anticipate considerable increases.

Of the more than 18,000 employers surveyed, 16% anticipate an increase in staff levels in their second quarter hiring plans, while 6% expect a decrease in payrolls, resulting in a net employment outlook of +10%.

Earnings Review

ABM Industries, Inc. ((ABM)), the provider of facility services said first quarter revenues grew 18.3% to $1.03 billion from $0.87 billion in the comparable quarter a year ago. Net income for the quarter dropped 34.4% to $8.39 million or 16 cents per diluted share compared to net income of $12.78 million or 24 cents per share in the first quarter of the previous year.

AU Optronics Corp. ((AUO)), the thin film transistor liquid crystal display panels maker reported preliminary consolidated revenue declined 17.1% to NT$27.09 billion for February 2011 from NT$32.67 billion in the same period last year.

BroadSoft, Inc. ((BSFT)), the software maker said fourth quarter total revenue soared 85% to $35.77 million from $19.30 million in the same quarter last year. Net income in the quarter surged 2700% to $11.2 million or 41 cents per diluted share compared to net income of $0.4 million or 5 cents per share for the year-ago quarter.

Casey''s General Stores, Inc. ((CASY)), the convenience store operator reported third quarter total revenue increased 23.4% to $1.37 billion from $1.11 billion a year ago. Net earnings in the quarter fell 25.3% to $12.87 million or 34 cents per diluted share compared to net earnings of $17.24 million or 34 cents per share in the previous year.

Chemtura Corporation ((CHMT)), the specialty chemical company reported fourth quarter net sales grew 14% to $680 million from $598 million in the comparable quarter a year ago. Net loss in the quarter widened 6825% to $367 million or $2.25 per diluted share compared to net loss of $94 million or 38 cents per share in the fourth quarter of previous year.

Dick''s Sporting Goods, Inc. ((DKS)), the sporting goods retailer reported fourth-quarter net sales increased 13.4% to $1.52 billion from $1.34 billion in the previous year. Net income in the quarter rose 30% to $87.49 million or 71 cents per diluted share compared to net income of $67.36 million or 56 cents per share in the year-ago quarter.

Icahn Enterprises, L.P. ((IEP)), the diversified holding company said fourth quarter revenues rose 39% to $2.5 billion compared to $1.8 billion in last year period. Net income in the quarter was $82 million or $0.94 per LP unit compared to a net loss of $1 million or $0.09 per LP unit in the prior year period.

Perfect World Co., Ltd. ((PWRD)), the online game developer reported fourth quarter total revenues declined 2.5% to RMB 592.99 million or $89.85 million from RMB 607.90 million last year. Net income in the quarter fell 54% to RMB 125.21 million from RMB 270.85 million in the previous year. On a per ADS basis, net earnings were RMB 2.36 or $0.36 compared to RMB 5.09 last year.

Urban Outfitters, Inc. ((URBN)), the lifestyle retailer said fourth quarter net sales rose 14% to $668.39 million from $588.49 million in the same quarter last year. Net income in the quarter fell 3.2% to $75.2 million or 45 cents per diluted share compared to net income of $77.7 million or 45 cents per share for the year-ago quarter.

Net sales for the year increased 17% to $2.27 billion from $1.94 billion the prior year. For the fiscal year 2011, net income rose 24% to $273.0 million or $1.60 per share compared to $219.9 million or $1.28 per share for the fiscal year ended January 31, 2010.