U.S. Markets Hold Firm; Greek Negotiations in View

Nichole Harper
17 Feb, 2012
New York City

U.S. stocks struggled and investors focused on the progress on the Greek bailout negotiations. Consumer price index increased 0.2% in January matching the gain in December. H.J. Heinz and Campbell Soup gained on better than expected quarterly results.

[R]1:15 PM New York – U.S. stocks struggled and investors focused on the progress on the Greek bailout negotiations. Consumer price index increased 0.2% in January matching the gain in December. H.J. Heinz and Campbell Soup gained on better than expected quarterly results.[/R]

U.S. stocks struggled and investors looked with optimism about the progress of Greek negotiations.

European markets gained more than 1% and indexes in Japan and China and India gained on the hopes that finance ministers in the euro zone will approve Greek bailout as early as this weekend.

Consumer price index increased 0.2% in January and core index that excludes food and energy prices after adjusting for seasonality gained 0.2%. The index increased 0.2% in December but the estimates of inflation were revised higher in October and November.

The revised index of leading economic indicators in January gained for the fourth month in a row.

In earnings news, H.J. Heinz gained as much as 5% after it reported better than expected earnings and revenues in the fiscal third quarter. Campbell Soup said fiscal second quarter earnings were ahead of expectations even though revenues barely matched estimates. Applied Materials reported better than anticipated earnings and revenue and Aruba Networks fiscal second quarter loss widened.

Greek Optimism, ECB to Participate

Stocks across Europe gained and market indexes advanced more than 1% in Germany, France, Spain and Italy.

Several indexes closed at a 6-month high and the German benchmark index soared to 16% in the year so far leading the region.

Market spirit were lifted in the early trading after European Central Bank officials suggested that the bank is preparing a plan to participate in the Greek debt swap plan as long as it is not part of the Collective Action Clause.

Greek lawmakers are expected to vote on the exception that will exclude the central bank in case not enough private sector borrowers participate in the swap.

Greece is scheduled to vote on private sector debt swap on February 21, a day after the meeting of the euro zone ministers, and will kick in the debt swap period that will end on March 9, according to local media reports.

Stock Movers

H. J. Heinz Company ((HNZ)) gained 4% or $2.11 to $54.21 after the food processing company reported third quarter sales rose to $2.92 billion from $2.72 billion in the same quarter last year. Net income in the quarter increased to $284.7 million or 88 cents per diluted share compared to $273.8 million or 84 cents per diluted share in the year ago period.

K-Swiss Inc. ((KSWS)) dropped 10.6% or 40 cents to $3.35 the sports and fitness products maker said fourth quarter total revenues increased 17.8% to $50.2 million from same quarter last year. Net loss in the quarter widened to $25.2 million or 71 cents a diluted share compared to $20.6 million or 58 cents a share in the year ago quarter.

Nvidia Corporation ((NVDA)) fell 15 cents to $16.30 after visual computing product provider reported fourth quarter total revenues fell to $953.2 million from $1,066.2 million in the same quarter last year. Net income in the quarter dropped to $116.0 million or 19 cents per diluted share compared to $178.3 million or 29 cents per diluted share in the year ago earlier.

Nordstrom, Inc. ((JWN)) decreased 1.6% or 87 cents to $51.31 after the fashion retailer reported fourth quarter net sales increased 12.5% to $3.17 billion in the same quarter last year. Fourth quarter same store sales increased 7.1%.

Net earnings in the quarter increased to $236 million or $1.11 per diluted share compared to $232 million or $1.04 per diluted share in the year ago period.

For 2011 total revenue increased to $10.5 billion from $9.3 billion in last year. For the year same store sales increased 7.2%. Net earnings for the year increased 11.4% to $683 million or $3.14 per diluted share compared to $613 million or $2.75 per share in the prior year.