U.S. Jobless Claims Rise; Tech Stock Rise on Cisco Earnings

Nichole Harper
16 May, 2013
New York City

U.S. market indexes traded sideways and weekly jobless claims jumped to a six-week high. Tech stocks were in favor after Cisco reported strong earnings. Wal-Mart eased after the U.S. same store sales declined 1.4% in the quarter.

[R]1:20 PM New York – U.S. market indexes traded sideways and weekly jobless claims jumped to a six-week high. Tech stocks were in favor after Cisco reported strong earnings. Wal-Mart eased after the U.S. same store sales declined 1.4% in the quarter.[/R]

U.S. stocks traded sideways after weekly jobless claims rose and tech stocks advanced after Cisco reported strong earnings.

Precious metals were in focus after gold eased below $1,400 an ounce and brokers speculated the yellow metal to drop to $1,100 mark.

U.S. jobless claims at the end of last week increased 32,000 to 360,000, Labor Department said today.

In a separate report, housing starts plunged 16.5% in April to an annual 853,000 rate after a revised 1.02 million rate in March, the Commerce Department said today.

The housing starts declined the most since February 2011.

In a separate report, the Federal Reserve Bank of Philadelphia said the general economic index decreased to -5.2 in May from 1.3 in April.

The reading higher than zero signals expansion and the report covers the region including Pennsylvania, southern New Jersey and Delaware.

European Markets

European markets were on the defensive and the index in London declined 0.1% and in Paris edged down a fraction and in Zurich fell 0.7%.

On the earnings front, Richemont SA, the luxury jewelry retailer soared 7% after reporting higher than expected earnings.

Zurich Insurance Group AG decreased 3% after earnings were below expectations.

Suedzucker AG, the sugar processor, declined more than 6.5% after it estimated operating profit in the year to decline.

Asian Markets

Asian markets closed mixed and market indexes in Tokyo retreated.

Japan reported economy expanded at 0.9% in the March quarter from the previous quarter as consumers increased spending. On an annual basis, the economy grew at 3.5% rate but capital spending declined surprising most economists.

The Hang Seng Index in Hong Kong edged up 0.2% and the Sensex in Mumbai increased 0.2%.

Indexes in Australia, Thailand, Indonesia and South Korea declined.

Stocks in Review

Advanced Micro Devices Inc ((AMD)) plunged 14% after the stock had rallied more than 55% in the last one month after Sony announced its plan to use AMD’s chips for the next version of its PlayStation console.

Cisco Systems Inc ((CSCO)) soared 12% after the networking giant reported sales increased 5.4% to $1.22 billion and net income excluding certain items were 51 cents a share.

Tesla Motors ((TSLA)) soared 7% after the maker of electric-car said in a regulatory filing that it plans to use the proceeds of 2.7 million shares worth $229 million and $450 million from a convertible note sale to repay the federal government loan and fund various operations.

Wal-Mart Stores Inc ((WMT)) decreased 2% after the largest retailer estimated second quarter profit below expectation. Earnings per share are estimated in the range between $1.22 and $1.27 a share.