U.S. Jobless Claims Drop; GE Net Soars 77%, Apple Net Surges 95%

Arthi Gupta
21 Apr, 2011
New York City

The U.S. indexes traded higher after GE and Apple reported better-than-estimated earnings. U.S. weekly jobless claims fell 13,000 to 403,000. BP sued Transocean and Cameron seeking damages of $40 billion for the Gulf of Mexico oil spill.

[R]9:00 AM New York – The U.S. indexes traded higher after GE and Apple reported better-than-estimated earnings. U.S. weekly jobless claims fell 13,000 to 403,000. BP sued Transocean and Cameron seeking damages of $40 billion for the Gulf of Mexico oil spill.[/R]

U.S. stocks traded higher in the early trading after General Electric quarterly net soared 77% and Apple Inc net income surged 83%. Investors looking for parts supply problems linked to Japan did not find clues that show the health of the supply chain.

World indexes edged higher on buoyant earnings led by technology stocks. Markets in China, India, Australia and Europe gained.

The Bank of Japan Governor Masaaki Shirakawa told a Parliamentary Committee on Thursday that the long-term interest rates in Japan remained low.

The central banker cited the lack of strength in the economy and falling working population as major factors behind deflation and reiterated efforts to bring the economy out of deflation.

U.S. Weekly Jobless Claims Fall

First time claims for unemployment benefits in the U.S. showed a modest decrease in the week ended April 16, according to figures released by the Labor Department today.

Jobless claims fell by less than expected and remained above the 400,000 level.

The report showed that initial jobless claims fell 13,000 to 403,000 from the previous week''s revised figure of 416,000.

The four week moving average, showed an increase of 2,250 to 399,000 from the previous week''s revised average of 396,750.

BP Sues Transocean and Cameron

BP plc sued Transocean Ltd. and Cameron International Corp. for at least $40 billion in damages and other costs in separate filings in the U.S. District Court in New Orleans.

The lawsuit alleges that they were responsible for the blowout at the Macondo well due to the failure of every single safety system at the rig, including the failure of the blowout preventer due to a faulty design.

Transocean is the owner of the Deepwater Horizon rig and Cameron is the maker of the blowout preventer that failed.

Monex Buys TradeStation

Monex Group Inc., an online securities brokerage agreed to buy TradeStation Group Inc. for about $411 million.

Under Monex terms, TradeStation''s shareholders will receive $9.75 in cash for each share, which represents a 32% premium to TradeStation''s closing stock price on April 20.

Brookline Banc Acquires Bancorp Rhode

Brookline Bancorp, Inc. agreed to acquire Bancorp Rhode Island and its unit BankRI for about $234 million in cash and stock.

The deal is expected to improve Brookline Bancorp''s level of scale and capital resources, and strengthens its foothold in New England.

Earnings Review

Apple Inc. ((AAPL)), the technology gadgets maker reported second quarter net sales rose 83% to $24.67 billion from $13.50 billion in the prior-year quarter. Net income in the quarter surged 95% to $5.987 billion or $6.40 per diluted share compared to net income of $3.074 billion or $3.33 per share in the same quarter last year.

American Express Company ((AXP)), the bank holding company reported first quarter revenue, net of interest expense, grew 7% to $7.03 billion from $6.56 billion in the year-ago period. Net income in the quarter rose 33.3% to $1.16 billion or 97 cents per diluted share compared to net income of $0.87 billion or 73 cents per share in the year-ago quarter.

Amgen, Inc. ((AMGN)), the independent biotechnology medicines company said first quarter total revenue increased 3% to $3.706 billion from $3.592 billion in the same quarter of 2010. Net income in the quarter dropped 3% to $1.13 billion or $1.20 per share compared to net income of $1.17 billion or $1.18 per share in the prior-year quarter.

General Electric Company ((GE)), the diversified technology, media and financial services company stated first quarter total revenues improved 6.2% to $38.45 billion from $36.20 billion in the comparable period a year earlier. Net earnings in the quarter surged 77% to $3.43 billion, or 31 cents per diluted share compared to net earnings of $1.95 billion, or 17 cents per share a year earlier.

Qualcomm, Inc. ((QCOM)), the wireless telecommunications research and development company said second quarter revenues soared 46% to $3.87 billion from $2.66 billion a year ago. Net income in the quarter increased 29% to $999 million or 59 cents per diluted share compared to net income of $774 million or 46 cents per share a year earlier.

Yum! Brands, Inc. ((YUM)), the restaurant chains operator said first quarter total revenues rose 3.4% to $2.43 billion compared to $2.35 billion in the prior-year quarter. Net income in the quarter climbed 9.5% to $264 million or 54 cents per diluted share compared to net income of $241 million or 50 cents per share in the prior-year period.