Fall in Oil Reverse the Averages

123jump.com Staff
27 Apr, 2005
New York City

Morning trading focused on the earnings miss from several companies including Newmont and Phelps Dodge and unexpected decline in durable orders. In the afternoon, with the report from energy department showing a rise in oil inventories, reversed the market course driving the averages higher. Gold fell more than 1% in metals market.

Durable goods orders declined for third month in a row according to report from Commerce Department. The 2.8% decline largest in 30 months put the market in defensive mood in the morning trading. Last three straight declines were in July-September 2001. Steel orders were up 1% but computer and electronics orders were up by 2.2%.

Energy Department reported last week oil inventory rose by 5.5 million barrels to 324.4 million barrels. Crude oil inventories are now 9% higher than last year and higher than five-year-average.Gasoline inventories are at 4.6% higher than a year ago and inventories of jet and diesel fuel are at 0.4% level higher than a year ago.

Separately President Bush wants to use some of the closed military bases as oil refineries and nuclear power plant faciliites and wants Congress to review the nuclear power plant review process.


S&P - 0.4%
Nasdaq - 0.16%
DOW - 0.47%


In Other News

Oil fell $2.59 to $51.61 per barrel and gasoline futures fell by 8 cents on stronger U.S. inventories.
In NY metals market gold dropped $4.90, silver dropped 10 cents platinum fell $10.70 and Palladium rose a dollar at the close.
European markets close lower as investors focus on weak earnings from STMicroelectronics, Siemens, and Kingfisher, uncertain economic outlook.
Vivendi Universal reported 1Q adjusted profit jump of 37%.
Sony, Cannon, Honda announced positive earnings with 40%, 7%, and 27%.
Asian markets closed lower as investors in Tokyo did not want to commit funds ahead of the holidays ‘Golden Week”.


Earnings Headlines

Verizon reported 1Q profit of 63 cents vs. 43 cents on 6.6% revenue growth.
Oil services firms continue to report strong earnings growth, Baker Hughes reported 80% and Helmerich and Payne 400% earnings growth.
Temple Inland reported four-fold jump in 1Q.
P.F. Chang’s restaurant reported 40 vs. 3 cents for the 1Q earnings.
Phelps Dodge reported 1Q profit of $3.83 vs. $1.90 on copper price increase of 20%.
Air Products and Engelhard reported better than earnings while Sealed Air missed the target and guided lower.
OSI Systems, Newmont mining, Abitibe, Amerada Hess and Boeing disappointed the market with earnings.