U.S. Weekly Jobless Claims, Retail Sales Rise

Arthi Gupta
12 Jan, 2012
New York City

The U.S. indexes fell after U.S. retail sales rose and foreclosure filings drop to 49-month low in December and weekly jobless claims climbed to 399,000. Regions Financial agreed to sell its brokerage unit to Raymond James for $1.2 billion.

[R]9:35 AM New York – The U.S. indexes fell after U.S. retail sales rose and foreclosure filings drop to 49-month low in December and weekly jobless claims climbed to 399,000. Regions Financial agreed to sell its brokerage unit to Raymond James for $1.2 billion.[/R]

U.S. indexes traded lower after weekly jobless claims rose more than estimated and retail sales grew less than anticipated.

The benchmark indexes in Europe gained after bond auctions of Spain and Italy attracted more than expected interests and yields plunged. Spain and Italy successfully raised nearly €22 billion in bond auctions today lifting market sentiment.

Spain successfully raised €10 billion in total, more than twice the target and the yield fell full one percentage point from earlier auctions.

The Italian Treasury also allotted full amount targeted in the auction and the yield dropped 0.5 percentage point or more. Italy sold €12 billion of Treasury bills at an auction today.

The strong auctions lifted market sentiments across the region in stock trading and banks led the market advance.

The European Central Bank left its interest rates unchanged on Thursday. The Governing Council led by ECB President Mario Draghi decided to maintain the main refi rate at 1%.

The Bank of England decided to leave the size of quantitative easing unchanged at £275 billion and hold interest rate at 0.5% on Thursday.

Asian stocks edged lower. A report released by Japan's Ministry of Finance showed that the nation's current account surplus shrank to 138.5 billion yen, as the trade balance showed a deficit of 585.1 billion yen.

Separately, China's inflation slowed for a fifth successive month in December. The headline inflation rate eased to 4.1% in December from 4.2% in November, according to data from the National Bureau of Statistics.

U.S. Retail Sales Rise

U.S. retail sales grew at a seasonally adjusted level of $400.6 billion in December, up just 0.1% from November levels, according to data released by the U.S. Commerce Department today, driven by a surge of 1.5% in automotive-related sales.

U.S. Weekly Jobless Claims Climb

First-time claims for U.S. unemployment benefits rose in the week ended January 7, according to a report released by the U.S. Labor Department today.

Initial jobless claims rose to 399,000 from the previous week's revised figure of 375,000, although claims remained just below the key 400,000 mark.

U.S. Foreclosure Filings Drop

Foreclosure filings in December declined 20% from a year ago and fell 9% from November. The foreclosures including default notices, scheduled auctions and bank repossessions were 205,024 on U.S. properties, according to RealtyTrac.

The foreclosures in December were the lowest monthly total since November 2007.

The year-end data showed that 2,698,967 foreclosure filings were reported on 1,887,777 U.S. properties in 2011, a decrease of 34% in total properties from 2010.

{{Market updates and media industry coverage is managed by Dan Beyer based in Fort Lauderdale, Florida.}}


Regions Sells Morgan Keegan

Regions Financial Corp. agreed to sell its investment brokerage unit Morgan Keegan & Co. Inc. to Raymond James Financial Inc. for $1.18 billion.

Regions added the deal does not include the sale of Morgan Asset Management and Regions Morgan Keegan Trust, which will remain in its Wealth Management division.

Apple Acquires Anobit

Apple, Inc. acquired Israeli semiconductor company Anobit technologies for $390 million, providing it with significant technological boost in the mobile devices market.

The acquisition will help Apple to secure intellectual property and provide it the competitive edge in flash products and pricing.

ADM to Reduce Global Workforce

Archer Daniels Midland Company, the grain processor announced that it will reduce its global workforce to enhance the cost structure of the company.

The company will lay off approximately 1,000 positions, primarily salaried, representing 3% of its global workforce.

Earnings Review

CHS Inc. ((CHSCP)), the integrated agricultural company reported first quarter revenues grew 20% to $9.7 billion from $8.1 billion last year. Net earnings in the quarter soared 106% to $416.2 million compared to net earnings of $201.7 million in the prior-year period.

Infosys Limited ((INFY)), the Indian software services firm reported third quarter revenues increased 14% to $1.806 billion from $1.585 billion in the prior year. Net profit in the quarter climbed 15.4% to $458 million from $397 million earned last year.

Earnings per American Depository Receipts grew to $0.80 from $0.69 in the prior-year quarter.

Williams-Sonoma, Inc. ((WSM)), the home products retailer reported net revenues for the 8-week holiday period ended December 25 increased 4.2% to $901 million.

The company also announced a 29% rise in dividend and a new $225 million stock repurchase program.