Oracle, Yahoo Down; Home Builders Up

123jump.com Staff
06 Dec, 2006
New York City

Market averages traded lower in New York, Europe and Asia. Merck traded lower on 2007 revenue outlook. Ford dropped 4% on 50% boost in convertible bond offering. Yahoo lost 2% on management reorganization. Railroad stocks lost ground on downgrade by Merril Lynch. CSX, Union Pacific and Burlington Santa fe declined. Home builders rose on 10-month low mortgage. Lennar, Toll Bros, Beazer Homes and D R Horton rose more than 1%. Boeing wins $5 billion order from Lufthansa. Panera Bread lost 3%.

[R]4:00PM NY – 10:00PM Frankfurt, Germany[/R]
Home buiders rallied on 10-month low mortgage rates in the U.S. Ford raised it convertible bond offering by 50%. Boeing gets $5 billion order from Lufthansa.

Market averages in New York trading lost ground ahead of U.S. jobless report and expected European Central Bank rate hike on Thursday. Merck, Yahoo and Ford lost ground but financial and home builder sector stocks rose. Home buidlers have gained more than 30% in the last three months of trading as mortgage rates have remained low and job market has remained healthy. Panera ((PNRA)) Bread shares lost 3% on lower earnings forecast and candle maker Blyth ((BTH)) fell 12% on lower revenue and earnings outlook.

Yield on 10-year U.S. bond closed at 4.482% and the 30-year bond closed at 4.598%.

Gold declined $11.20 to close at $636.70 a troy ounce, silver lost 29 cents to end at $13.735 a troy ounce and copper decreased 8.7 cents to close at 316 cents a pound.

Oil lost 9 cents to close at $62.34 a barrel and heating oil gained 0.02 cents to finish at 179.85 cents a gallon. Gasoline was down 0.14 cents to end at 163.50 cents a gallon. Natural gas advanced 9.5 cents to close at $7.780 per mBtu.

Asian markets closed mostly higher led by Taiwan with an increase of 1.10%, Australia with an advance of 0.73% and Japan with a gain of 0.65%. The decliners were South Korea with a decrease of 0.48%, Philippines with a loss of 0.37% and Singapore with a decline of 0.24%. Japan finished higher helped by blue chips and after a stronger finish for U.S. stocks.

European markets closed mostly lower led by Norway with a loss of 0.54%, Spain with a decrease of 0.18% and France with a decline of 0.17%. The advancers were Switzerland with a gain of 0.68%, Belgium with an increase of 0.10% and U.K. with an advance of 0.06%. Tech and pharma stocks drag European markets finish lower. Russia gained 0.85%.

Latin America markets closed lower led by Brazil with a decline of 0.14% and Argentina with a loss of 0.05%. Mexico finished flat, while Canada ended higher with a gain of 0.26%.


[R]2:30PM NY – 7:00PM London, UK [/R]
[R]European markets closed lowe on weak pharma and tech stocks.[/R]
European markets closed lower on weakness in Paris, Frankfurt and Oslo. Zurich led the gainers with a rise on 0.7%. Russia gained 0.85% and South Africa lost 1.1% . ECB and Bank of Emgland are expected to adjust interst rate tomorrow. ECB is expected to hike the rate by 0.25% but Bank of England is not likely to change the rates.

French tech leader CapGemini after it planned an issue of 10.4 million shares at euro 455 million to fund its purchase of Kanbay International for $1.25 billion. Retailer Carrefour lost 1.5%, vodafone Group dropped 1.3% and AstraZeneca declined more than 1%.

Royal Bank of Scotland rose 4.2% on the company report that its annual adjusted profit will beat the market forecast. HSBC dropped 0.5% on the downgrade from Credit Suisse. Anglo Irish Bank rose on earnings growth of 38% beating the forecast and divided rise of 20%.

British Tesco has agreed to buy eight retail store from Makro and becomes the leading retailer in Malaysia on the purchase. British cable operator NTL, listed on Nasdaq, dropped its bid to acquire broadcaster ITV. Pay TV operator British Sky Broadcasting has agreed to pay 17.9% controlling interest for ITV.

Cisco to triple its workforce to 6,000 in India and expects domestic sales reach 5% of its global sales in the next five years.

[R]12:30PM NY In New York trading stock are on the decline on lower than expected revenue guidance from Merck, railroad and tech stocks are lower on broker comments.[/R]

Sotcks are in decline after rising steadily for the lst three days and S&P500 reaching six-year high this week. Traders remained focused on weekly jobless report to be released this week. Private payroll based report from ADP stated that the private sector in the U.S. added 158,000 jobs in November. Weekly report from Energy Department showed that crude oil, gasoline and distillate inventory declined last week but remain well above normal level.

Ford Motor ((F)) dropped 4% or 17 cents on the report that the company boosted by 50% its planned sales of unsecured convertible bonds to $4.5 billion.

Oracle ((ORCL)) dropped 90 cents or 4.7% on the downgrade and negative comments from Lehman Bros. The semiconductor equipment maker Novellus Systems ((NVLS)) dropped $1.60 on sell recommendation from Goldman Sachs.

Yahoo ((YHOO)) dropped more than 3% on the management reshuffle and continued worries on its soon to be released new search platform code named Panama.

Ciena ((CIEN)) jumped 5% or $1.70 on the news that Verizon Business is to use company network techology for its trans-Atlantic network.

[R]10:30AM The Sensex advances modestly on Wednesday in a volatile trade.[/R]
The Sensex on BSE finished 11.35 points, or 0.08%, higher to 13,949. The market-breadth was very weak. For every three decliners there were two advancers. As 1,642 shares declined, 929 shares advanced and 57 shares remained unchanged. From the Sensex stocks, 16 advanced while the rest declined. The turnover on BSE was Rs 4,545.28 crore as compared to Rs 4,779 crore on Tuesday. The turnover on NSE was Rs 8,702.49 crore, lower than Rs 8,799.39 crore on Tuesday.

Economic news

India has no plans to do away import duties on cement or ban exports as prices have stabilised after a strong rally earlier this year, a junior industry minister announced on Wednesday.

Most-active

Parsvnath Developers was the most-active stock on BSE with a total turnover of Rs 194.86 crore, followed by Atlanta and Reliance Industries.

Advancers

Ranbaxy Laboratories led the advancers, up 1.61% to Rs 391.20, on a volume of 2.70 lakh shares. ICICI Bank gained 1.23% to Rs 873, after the private sector bank on Tuesday on the offices expansion in Bangkok, Jakarta and Kuala Lumpur, to capitalise on a rise in cross-border deals. With the new offices, ICICI Bank will have a presence in 17 countries.

Bharti Airtel added 1.13% to Rs 646. Reports say that Vodafone Group Plc is ready to upgrade its stake in the telecom firm. Tata Consultancy Services rose 0.58% to Rs 1,195 on reports that it has won a five-year outsourcing contract from United Biscuits of Britain.

Satyam Computer advanced 0.40% to Rs 463, due to a 3.4% surge in ADR on Tuesday to $24.42. Logix Microsystems rose 0.46% to Rs 306 before its board meet today to consider increasing foreign fund investment limit from 49% to 74% and permission to raise capital from international markets.

Yes Bank surged 5.4% to Rs 130 after the bank entered microfinance business in a technical tie-up with Accion International. Adani Enterprises jumped 5% to Rs 221.45. Adani Enterprises is likely to sell its retail business to Reliance Industries with a view to focus on its core business of exports. Shalimar Paints soared 8.61% to Rs 232 as according to media reports there are rumours of promoters scouting buyers for the company and a deal may be announced shortly.

Decliners

Reliance Energy led the decliners, down 2.34% to Rs 540.30. In highly volatile trading the stock ranged between Rs 478 and 557.95. ACC lost 1.51% to Rs 1,147, HDFC dipped 2.10% to Rs 1,570.50 and Cipla shed 1.43% to Rs 249.

Index heavy Reliance Industries fell 0.23% to Rs 1,277.10 on 9.65 lakh shares. Reliance Industries has secured two onshore oil blocks in Yemen. Auto stocks were under intense selling pressure. Bajaj Auto shed 0.46% to Rs 2,710, TVS Motors lost 3.58% to Rs 94.20, M&M slipped 0.80% to Rs 837 and Maruti Udyog was off 0.56% to Rs 944.

Gateway Distriparks lost 0.24% to Rs 185.25 after surging to a high of Rs 197.20. There are reports that the company has emerged as the top bidder for a 15-year operations and management contract of a Punjab Government owned container freight station, which is situated close to Jawaharal Nehru Port Thrust, Navi Mumbai.

[R]9:30AM London advances on Wednesday on gains in banks, housebuilders.[/R]
The FTSE 100 in London advanced 17.6 points, or 0.3%, to 6,103.9. RBS shares climbed 3.7% after the second biggest bank by market capitalisation in the UK announced 2006 profits should be slightly ahead of expectations due to strong organic growth and a good performance from its corporate markets division.

Advancers

The news from RBS cheered the rest of the banking sector. HBOS gained 2.1%, while Lloyds TSB moved up 1.8% and Barclays added 1.1%. Housebuilder Persimmon was among the biggest FTSE 100 advancers. Its shares gained 3% after Merrill Lynch reiterated its buy recommendation.

Persimmon was not the only housebuilder in focus. Barratt Developments added 4.2%, while Bovis Homes added 2.6% and Redrow put on 2.7%. Redrow and Bovis look particularly vulnerable to a bid from either Persimmon, Barratt or George Wimpey, up 1.6%.

Anglo American rose 1.5% on rumours Larry Yung, the third richest man in China, is looking to add to his 1.1% holding in the mining company. Legal & General firmed 0.8% after Deutsche Bank upgraded the insurer from hold to buy and lifted its price target.

Decliners

Land Securities drifted 1.2% lower, while Vedanta Resources eased 1 % as they both traded with entitlement to their latest dividend payments. ITV slipped 0.9% after cable company NTL announced it had no plans to make an offer for the commercial broadcaster.

Shares in JJB Sports lost 2.2% as UBS cut its recommendation on the sporting goods retailer from buy to neutral but raised its price target.

[R]7:30AM Asian stocks ended higher Wednesday with Japan breaking losing streak.[/R]
Asian markets fiished mostly higher on Wednesday. Japanese benchmark Nikkei 225 stock index advanced 0.65% to close at 16371.28. Mizuho Trust Banking gained 0.37% and Nippon Sheet Glass surged 7.33%.Gainers included tire manufacturer Bridgestone, which rose 3.4% after it announced plans to acquire U.S. tire company Bandag. Electric-power provider J-Power also firmed, rising 4.5%.

In Hong Kong, the Hang Seng Index rose 0.43% to 19026.36. Fixed-line operator China Netcom soared 6.2%, China Unicom gained 1.9%, and China Mobile added 1.3%. Large-cap Hutchison Whampoa, which operates one of the largest 3G networks in the world, rose 2.7%, on expectations the company will also have new opportunities after the launch of 3G in China.

Key mining stocks lifted Australian benchmark share index, with merger-and-acquisition activity also winning investor attention in the media sector. The benchmark S&P/ASX 200 index advanced 0.74% to end at 5466.7. BHP Billiton added 1.5% and Rio Tinto gained 2%, encouraged by record highs for nickel and lead on the London Metals Exchange overnight, a six month high for aluminum and support for copper and zinc.

In Taiwan, the Weighted Price Index of the Taiwan Stock Exchange rose or 1.1% to 7693.33, its highest closing level since finishing at 7785.62 on Sept. 5, 2000. Household appliance vendor Tatung, also a major land owner, soared by the maximum daily limit of 7%, its highest closing in over four years. AU Optronics, the world third-largest maker of liquid-crystal display panels by revenue, added 2.3%.

In Korea, the Korea Composite Stock Price Index, or Kospi, closed down 0.5% at 1413.73 after hitting an intraday low of 1399.68. Hyundai Heavy Industries fell 2.7%, Samsung Heavy Industries lost 2.1% and Daewoo Shipbuilding & Marine Engineering fell 2.8%.

[R]6:30AM European markets advance modestly on Wednesday on banks.[/R]
European stocks were higher on Wednesday. By mid morning, the FTSE 100 in London climbed 0.2%to 6,099.9, Frankfurt Xetra Dax was fractionally higher at 6,372.75, and the CAC 40 in Paris gained 0.1%to 5,363.43.

Advancers

Anglo Irish Bank gained 3% after reporting a better-than-expected 38% rise in full-year pre-tax profit and gave a bright outlook on its future prospects. Domestic rival Allied Irish Banks was boosted by the news, up 2.4%, while Bank of Ireland rose 1.4%.

Royal Bank of Scotland rose 3.4% after delivering a pleasing trading update, forecasting full-year 2006 profits ahead of market expectations thanks to strong organic income growth. Other UK banks were also higher. Lloyds TSB gained 1.7% and HBOS added 2.4%.

Decliners

IT services group Capgemini shares dropped 3.4% after it said it is going to issue 10.4 million shares worth 455 million euros ($606 million) to give it room to maneuver and participate in possible future industry consolidation.

ITV shares slipped 0.4% after NTL Inc said it has no present intention of making an offer for ITV, the U.K. commercial broadcaster. In a statement, NTL said a deal between itself and ITV is unlikely to be attained on terms acceptable to NTL.

Oil and gold

Oil prices traded in a narrow range Wednesday ahead of the release of weekly U.S. petroleum inventory data, which is expected to show higher supplies. Light, sweet crude for January delivery fell 10 cents to US$62.33 a barrel on the New York Mercantile Exchange by midday in Europe. The contract had fallen a penny Tuesday to settle at US$62.43 a barrel. January Brent crude at London ICE Futures exchange fell 1 cent to US$63.31 a barrel.

Gold traded in London at $636.75 per troy ounce, down from $643.25 late Tuesday. In Zurich, gold fell to $634.90 from $640.25. Silver fell to $13.62 per troy ounce in London, down from $13.95.

Currencies

The U.S. dollar rose Wednesday against other major currencies in European trading. The euro was quoted at $1.3276, down from $1.3325 late Tuesday. Other dollar rates compared with late rates Tuesday included: 114.97 Japanese yen, up from 114.81; 1.1960 Swiss francs, up from 1.1914, and 1.1425 Canadian dollars, up from 1.1411. The British pound was quoted at $1.9645, down from $1.9743.

[R]5:30AM Gold and silver prices fell Tuesday on stronger dollar, weaker oil.[/R]
February gold slipped $3 to settle at $647.90 a troy ounce on the NYME. March silver lost 22 cents to end at $14.025. January platinum settled down $26.30 at $1,133.70 an ounce. March palladium shed 5 cents to finish at $336.40. The most active March copper contract settled up 7.10 cents at $3.2470 per pound.

January crude oil slid 1 cent to end at $62.43 a barrel. January heating oil declined 1.06 cents to $1.7983 a gallon. January unleaded gasoline settled down 3.10 cents to $1.6364 a gallon. December natural gas fell 12.1 cents to close at $7.685 a million British thermal units.

On the New York Board of Trade, Arabica coffee futures raced to 10-month highs after industry-buying curbed a morning dip. December closed 3.20 cents higher at $1.2340 a pound. March futures of raw sugar in foreign ports remained unchanged at 11.76 cents a pound.