U.S. Indexes Higher, Best Buy Net Plunges 91%

Arthi Gupta
21 Aug, 2012
New York City

U.S. indexes traded higher following gains in the European and Asian markets. Apple extended gains on the speculation of new products release and Best Buy plunged on weak results. Church & Dwight agreed to acquire Avid Health for $650 million.

[R]9:55 AM New York – U.S. indexes traded higher following gains in the European and Asian markets. Apple extended gains on the speculation of new products release and Best Buy plunged on weak results. Church & Dwight agreed to acquire Avid Health for $650 million.[/R]

In early morning trading, U.S. indexes gained on the thin euro zone optimism and a rise in tech stocks.

Best Buy, the electronics retailer battling a shift to online purchase dropped 7% after sales declined and earnings plunged. The stock traded at a nine-year low.

Asian and European markets rose on hopes that the central banks may act to revive global economic growth as the leaders in the euro zone ramped up another round of talks. Markets are not optimistic that the current round will lead to quick resolutions when more than 25 summits in the last three years have failed to deliver a clear direction.

The People''s Bank of China injected 220 billion yuan into the money market through reverse repurchase operations today, reports said.

Barclays Confirms Discussions

Barclays Plc said that it is in discussions about combining the majority of the Barclays Africa operations with its subsidiary Absa Group Limited.

Church & Dwight to Acquire Avid Health

Church & Dwight Co., Inc. agreed to acquire Avid Health, Inc. the gummy form vitamins and supplements producer for $650 million in cash. The transaction is expected to close early in the fourth quarter.

Earnings Review

Best Buy Co., Inc. ((BBY)), the consumer electronics retailer dropped 7% after it reported second quarter revenue dropped 3% to $10.55 billion compared with $10.86 billion a year earlier. Net earnings attributable to the company plunged 91% to $12 million or 4 cents per diluted share from $128 million or 34 cents per share last year.

DSW Inc. ((DSW)), the footwear and accessories specialty retailer rose 5% after it said second quarter sales rose 7.5% to $512.2 million on comparable sales increase of 4.2%. Net income for the quarter slumped to $29.3 million or 65 cents per diluted share from $139.9 million or $3.96 per share in the year-ago quarter.

Medtronic, Inc. ((MDT)), the medical devices maker was up 0.5% after it said first quarter net sales rose to $4.01 billion, from $3.95 billion last year Net earnings in the quarter grew to $864 million or 83 cents per diluted share from $821 million or 77 cents per share a year before.

Tech Data Corp. ((TECD)), the technology products distributor dropped 5% after it reported second quarter net sales fell 8% to $5.96 billion from $6.45 billion last year. Net income attributable to shareholders dropped to $34.5 million or 88 cents per diluted share from $50.1 million or $1.10 per share last year.