S&P 500 Extends Gains, ConAgra to Sell Private-label Unit to TreeHouse Foods

Nichole Harper
02 Nov, 2015
New York City

Market indexes on Wall Street extended gains and construction spending increased rose in September. ConAgra Foods signed a tentative deal to sell majority of its struggling private-label business to TreeHouse Foods for $2.7 billion. U.S. expands Volkswagen emissions investigation to luxury cars.

[R][2:15 PM New York City, New York – Market indexes on Wall Street extended gains and construction spending increased rose in September. ConAgra Foods signed a tentative deal to sell majority of its struggling private-label business to TreeHouse Foods for $2.7 billion. U.S. expands Volkswagen emissions investigation to luxury cars.[/R]

Market indexes on Wall Street opened higher and extended gains in the session and a private manufacturing survey showed activities in October hit a 2-1/2 year low and construction spending increased in September.

Construction spending in September increased 0.6% at annual rate of $1,094.2 billion from the revised August estimate of $1,087.5 billion and soared 14.1% from a year ago spending of $959.2 billion, the U.S. Department of Commerce said.

Manufacturing index slipped to 50.1 in October from 50.2 in September, the lowest since May 2013 according to a report released by the Institute for Supply Management.

Ant reading above 50 indicates growth and manufacturers continue to cite the strength of the dollar and low oil prices as headwinds.

On Wall Street, Tollbooth Strategy Index edged down 0.56 to 10,949.46.

S&P 500 index increased 14.18 or 0.7% to 2,093.60 and the Nasdaq Composite Index gained 49.33 or 0.9% to 5,103.27.

Crude oil in New York slid 52 cents to $46.07 a barrel and gold fell $6.31 to $1,135.80 an ounce.

U.S. Movers

General Electric Company ((GE)) rose 28 cents to $29.20 after the diversified conglomerate agreed to acquire power and grid businesses of France-based rail transport systems operator Alstom for about $10.6 billion or €9.7 billion.

GE said today that it had completed the sale of its rail signaling unit to Alstom for about $800 million.

Visa Inc ((V)) dropped 2.9% or $2.32 to $75.26 after the credit cards services provider reported revenues in the fourth-quarter ending in September jumped 10.5% from a year ago to $

Net income in the quarter soared 41.1% to $1.51 billion or 62 cents per diluted share compared to $1.07 billion or 43 cents per share from the same quarter last year.

Separately today, Visa agreed to acquire its European unit Visa Europe for about $23.4 billion or €21.2 billion in a cash-and-stock.

The transaction is expected to close in the third-quarter of fiscal 2016.

European Markets

In London trading, FTSE 100 index edged up 1.48 to 6,362.83 and in Frankfurt the DAX index increased 105.14 or 0.9% to 10,954.94.

In Paris, CAC 40 index rose 29.72 or 0.6% to 4,927.23.

Alstom SA edged up 0.05% to €29.67 after the U.S.-based industrial conglomerate General Electric Company completed the power and grid business for €9.7 billion from the France-based rail transport systems operator.

The company already received approval from more than 20 regions and countries including the E.U., the U.S., China, Japan, and India.

HSBC Holdings Plc fell 0.9% to 502.67 pence after the U.K.-based banking and financial services provider reported revenues in the third-quarter ending in September declined 4% from a year ago to $15.08 billion.

Net profit in the quarter surged 52.5% from a year ago to $5.23 billion compared to $3.43 billion and diluted earnings per share increased to 25 cents from 17 cents.

The bank said it has lowered by 30% of the targeted risk weighted assets reduction of $290 billion by the end of fiscal 2017, with a total of $82billion since the start of current year.

HSBC added loan impairment charges and other credit risk provisions in the quarter fell to $638 million from $760 million in the same period a year ago.

Ryanair Holdings Plc jumped 3.2% to 13.92 after the Ireland-based low fare airline company said revenues in the first-half period ending in September soared 14% from a year ago to €4.04 billion.

Net profit in the quarter surged 77.4% from a year ago to €1.41 billion compared to €795 million and diluted earnings per share advanced to 102.66 cents from 57.29 cents.

Ryanair raised traffic target for fiscal 2016 from 104 million to 105 million customers on the higher load factors in the second-half and said unit costs are expected to fall by 5%. The airline estimated net profit between €1.18 billion to €1.23 billion.

Asian Markets

Nikkei average in Tokyo dropped more than 2% and iron and steel sector led the decliners after two manufacturing surveys in China showed the sector remains in the contraction phase.

Stocks in Tokyo fell sharply after two manufacturing surveys showed China’s economic growth may falter despite a number of stimulus measures.

The private survey which includes more number of smaller companies conducted by Markit Economics showed purchasing managers’ index rebounded from a six-and-a-half-year low in September of 47.2 to 48.3 in October.

The reading below suggests that the growth rate is still contracting but the latest reading is a significant departure from the downward trend in place since the beginning of the year.

The government survey reported by the National Bureau of Statistics over the weekend said that the PMI, which has a higher weight to large state controlled enterprises, remained in the contraction phase with a reading of 49.8 in October.

Iron and steel sector stocks led the decliners in Tokyo trading with Kobe Steel Ltd plunging as much as 7%. Nippon Steel and Sumitomo Metals also declined more than 5% after trimming production outlook for the rest of the fiscal year.

The Nikkei 225 Stock Average declined 399.86 or 2.1% to 18,683.24 and the broader Topix index slumped 31.23 or 2% to 1,526.97.

The yen strengthened to 120.59 against a dollar.

Nissan Motor said first-half sales increased 15% and net soared 37%. LIXIL estimated annual net sales to increased 11%.

Stocks in Mumbai, India traded lower but two largest automakers reported strong sales increase in October.

Rupee weakened 32 paisa to 65.58 against one U.S. dollar.

The Sensex Index fell 97.68 or 0.4% to close at 26,559.15. The CNX Nifty slid 15 or 0.2% to 8,050.80.

Maruti Suzuki, the largest auto maker in India said auto sales in October soared 29% and M&M total sales jumped 20%. Tata Motors passenger and commercial vehicles sales increased 1%.

RCom agreed to acquire Sistema''s Indian mobile phone unit of about $686 million.