U.S. Personal Spending Falls, Income Climbs

Arthi Gupta
30 Nov, 2012
New York City

U.S. indexes traded sideways as lawmakers negotiate budget details. U.S. personal income increased but spending fell in October. Japan announced $10.7 billion of stimulus measures to boost economic growth.

[R]10:15 AM New York – U.S. indexes traded sideways as lawmakers negotiate budget details. U.S. personal income increased but spending fell in October. Japan announced $10.7 billion of stimulus measures to boost economic growth.[/R]

U.S. indexes traded sideways as lawmakers sent conflicting signals on the progress of budget negotiations. German lower house of the parliament approved Greek aid deal, removing one hurdle from the release of funds on December 13.

The European indexes gained despite disappointing economic data. Euro zone''s annual inflation eased to 2.2% in November and retail sales in Germany declined more than estimated in October.

UK consumer sentiment surged to an 18-month high in November but French consumer spending dropped in October.

Asian markets closed higher.

Japanese Prime Minister Yoshihiko Noda approved $10.7 billion of fiscal stimulus measure to boost economic growth.

Japan''s industrial output rose a seasonally adjusted 1.8% in October from the previous month, the Ministry of Economy, Trade and Industry said in a preliminary reading. Annually, industrial production declined 4.3% in October after falling 8.1% in September.

In another report, Japan''s jobless rate was unchanged at 4.2% in October.

U.S. Personal Spending Falls

U.S. personal income increased $0.4 billion or less than 0.1%, and disposable personal income increased $0.8 billion or less than 0.1% in October, according to a report released by the Commerce Department today.

Personal consumption expenditures decreased $20.2 billion or 0.2% in October.

Earnings Review

Genesco Inc. ((GCO)), the footwear, apparel and accessories retailer reported third quarter net sales increased to $664.46 million from $616.52 million last year. Comparable store sales increased 4% in the quarter.

Net income in the quarter increased to $40.87 million or $1.70 per diluted share from $26.09 million or $1.09 per share in the prior year.

Sears Hometown and Outlet Stores, Inc. ((SHOS)), the home and related appliances retailer reported third quarter net sales rose 3.3% to $556.90 million from a year ago. Comparable store sales climbed 3.1% compared to the same period last year.

Net income in the quarter increased 29% to $8.76 million or 38 cents per diluted share from $6.81 million or 29 cents per share in the previous year.

United Natural Foods, Inc. ((UNFI)), the specialty foods distributor reported first quarter net sales rose 15.8% to $1.41 billion. Net income for the quarter increased 42.1% to $21.5 million or 43 cents per diluted share from $15.2 million or 31 cents per diluted share last year.

Teva Pharmaceutical Industries Ltd. ((TEVA)), the pharmaceutical and drug company estimated full-year 2013 revenues between $19.5 billion and $20.5 billion and adjusted earnings per share of between $4.85 and $5.15.