U.S. Private Sector Adds 118,000 Jobs, Labor Productivity Soars

Arthi Gupta
05 Dec, 2012
New York City

U.S. private sector employment increased less than estimated in November and labor productivity rose in the third quarter. Lowe''s reiterated sales and earnings guidance for the fiscal year. RioCan agreed to acquire a $1.1 billion portfolio of Canadian retail properties.

[R]9:55 AM New York – U.S. private sector employment increased less than estimated in November and labor productivity rose in the third quarter. Lowe''s reiterated sales and earnings guidance for the fiscal year. RioCan agreed to acquire a $1.1 billion portfolio of Canadian retail properties.[/R]

U.S. indexes advanced after Chinese leaders announced new measures to increase urbanization and domestic demand to stimulate economic growth.

The Chinese regulators also lifted restrictions on investments by insurers in commercial banks.

In an interview with Bloomberg yesterday, President Barack Obama indicated that any deal on the fiscal cliff will have to include higher tax rates on wealthy Americans.

The European indexes traded higher and service sector index fell in UK, Germany and Italy but rose in France. Retail sales in the euro zone declined in October after rising in September.

The troika granted Greece an additional two years to meet its budget deficit target, paving the path to release the next tranche of bailout funds on Dec 13.

European leaders remained divided in setting up common banking supervisory authority across the euro zone.

HSBC Holdings Plc agreed to sell its entire 15.57% stake in Ping An Insurance (Group) Co. of China to a conglomerate Charoen Pokphand Group Co. for HK$72.74 billion or $9.39 billion.

Asian markets closed higher after China eased policy regulations. However, the HSBC Services Purchasing Managers'' Index for China fell to 52.1 in November from 53.5 in October.

U.S. Private Sector Employment Up

Private sector employment in the U.S. increased less than estimated in November, according to a report released by payroll processor Automatic Data Processing, Inc. today.

ADP said the private sector added 118,000 jobs in November following a downwardly revised increase of 157,000 jobs in October.

U.S. Labor Productivity Soars

Nonfarm business sector labor productivity in the U.S. increased 2.9% annually in the third quarter, the U.S. Bureau of Labor Statistics reported today. The increase in productivity reflects increases of 4.2% in output and 1.3% in hours worked.

RioCan to Acquire Canadian Retail Properties

RioCan Real Estate Investment Trust agreed to acquire a $1.1 billion portfolio of Canadian retail properties including five regional malls and three grocery-anchored unenclosed shopping centres. The properties are currently owned by Primaris Retail Real Estate Investment Trust.

EU Imposes Fine on Seven Companies

The European Commission imposed a fine of nearly €1.47 billion on seven companies into alleged violation of competition rules in the Cathode-Ray Tubes industry. The companies include Philips, LG Electronics, Panasonic, Samsung SDI, Technicolor, MTPD and Toshiba.

Philips was fined €313.4 million, LG Electronics €295.6 million, Panasonic €157.5 million, Samsung €150.8 million, Toshiba €28 million, and Technicolor €38.6 million.

Also, a joint venture between Philips and LG Electronics was penalized €391.9 million for violation of competition rules.

Philips said it will appeal the decision and Taiwan based Chunghwa was spared from a fine or a penalty after it revealed the conspiracy to regulators.

Earnings Review

Brown-Forman Corporation ((BF.B)), the alcoholic beverage manufacturer said second quarter net sales were flat in the quarter at $1.01 billion, and increased 6% on an underlying basis. Net income in the quarter rose to $173 million or 80 cents per diluted share compared with $157.6 million or 73 cents per share last year.

G-III Apparel Group, Ltd. ((GIII)) the apparel manufacturer reported third quarter net sales grew 6.6% to $543.5 million from the year-ago period. Net profit in the quarter rose to $48.3 million or $2.37 per diluted share compared to net income of $43.6 million or $2.16 per diluted share, in the prior year''s comparable period.

Lowe''s Companies, Inc. ((LOW)), the home improvement retailer reiterated its prior sales and earnings guidance for the 2012 fiscal year, provided in its November 19, 2012 earnings release.

Walgreens Company ((WAG)), the drugstore chain operator reported November sales fell 3.9% to $5.85 billion from a year earlier. Total front-end sales decreased 0.3% compared with the same month in fiscal 2012, while comparable store front-end sales decreased 1.7%.