U.S. Jobless Claims Rise; Trade Deficit Narrows

Arthi Gupta
12 Apr, 2012
New York City

U.S. indexes gained and weekly jobless claims rose to ten-week high, trade deficit narrowed in February and producer price index was flat in March. Sony planned to slash 10,000 jobs in the current fiscal year.

[R]10:55 AM New York – U.S. indexes gained and weekly jobless claims rose to ten-week high, trade deficit narrowed in February and producer price index was flat in March. Sony planned to slash 10,000 jobs in the current fiscal year.[/R]

U.S. indexes climbed after weekly jobless claims rose 13,000 to ten-week high, trade deficit narrowed and producer price index remained flat.

European indexes traded sideways after Italy sold €2.884 billion of 3-year bonds at higher borrowing costs but missed the maximum target set for the issue.

Market sentiment was mildly positive after a week of cautious trading and volatile indexes in the peripheral euro zone and Ireland was in focus after the European Central Bank executive board member Joerg Asmussen said the troubled nation can “gradually re-access markets” as early as “the next year” when the bailout funds run out at the end of 2013.

Industrial production in the euro area increased 0.5% on a monthly basis in February and The Greek jobless rate rose to 21.8% in January.

Asian stocks edged higher tracking the U.S. market gains yesterday however the World Bank trimmed its 2012 growth estimate for China.

The growth projection for this year was lowered to 8.2% from its January estimate of 8.4%, the Washington-based lender said in its China Quarterly Update on Thursday.

U.S. Weekly Jobless Claims Rise

First-time claims for U.S. unemployment benefits rose 13,000 to 380,000 in the week ended April 7, from the previous week''s revised figure of 367,000, according to a report released by the U.S Labor Department today.

The four-week moving average rose to 368,500 from the previous week''s revised average of 364,250.

Also, continuing claims, a reading on the number of people receiving ongoing unemployment assistance dropped to 3.251 million in the week ended March 31st from the revised level of 3.349 million in the preceding week.

U.S. Deficit Narrows

The U.S. trade deficit narrowed to $46 billion in February from $52.5 billion in January, according to data released by the U.S. Commerce Department today, mainly due to a decline in the value of imports.

The value of exports gained 0.1% to $181.2 billion in February, from the $180.9 billion recorded in January. And the value of imports declined 2.7% to $227.2 billion in February from the $233.4 billion logged in January.

Producer Prices Flat

The U.S. producer price index was flat in March following a 0.4% rise in February, according to a report released by the U.S. Labor Department today with a drop in energy prices,

Excluding food and energy prices, the core producer price index rose 0.3% in March after edging up 0.2% in February.

U.S. Foreclosures Drop

Foreclosure filings in the U.S. fell 2% sequentially to 572,928 properties during the first quarter and down 16% from the first quarter of 2011, according to RealtyTrac.

IEA Maintains 2012 Outlook

The International Energy Agency in its monthly Oil Market Report held its 2012 oil demand growth forecast steady at 0.8 million barrels per day to 89.90 mbd.

Sony Plans Strategic Initiatives

Sony Corporation announced a series of strategic initiatives and targeted sales of 6 trillion yen and operating income margin of 5% in its electronics business, and sales of 8.5 trillion yen, operating income margin of more than 5%, and return on equity of 10% for the Sony Group overall, in the fiscal year ending March 31, 2015.

Sony estimates that the headcount across the entire company will be reduced by approximately 10,000 in the next twelve months.

Earnings Review

Commerce Bancshares, Inc. ((CBSH)), the bank holding company said first quarter profit climbed 8.9% to $65.8 million or 74 cents per diluted share compared to a profit of $60.45 million or 66 cents per share last year.

Net interest income fell 0.8% to $159.74 million from $160.97 million in the prior-year quarter.

Fastenal Company ((FAST)), the industrial and construction supplies provider reported first quarter net sales rose 20% to $768.88 million from $640.58 million in the same quarter last year. Net earnings in the quarter increased 26% to $100.19 million or 34 cents per diluted share compared to net income of $79.55 million or 27 cents per share in the previous year.

Rite Aid Corporation ((RAD)), the retail drugstore chain said fourth quarter revenues grew 10.7% to $7.15 billion from last year''s $6.46 billion. Same store sales for the quarter increased 3% consisting of a 1.6% growth in the front end and a 3.8% rise in the pharmacy.

Net loss for the quarter narrowed 21.3% to $163.81 million or 18 cents per diluted share compared to a net loss of $208.11 million or 24 cents per share the prior year.

For the fiscal year 2012, revenues increased 3.6% to $26.1 billion compared to $25.2 billion for the 52-week prior year. Same store sales for the year increased 2.0% over the prior year period. This increase consisted of a 1.1% front-end same store sales increase and a 2.4% increase in pharmacy same store sales.

Net loss for the year narrowed 33% to $378.59 million or 43 cents per diluted share compared to a net loss of $564.87 million or 64 cents per share the prior year.