U.S. Movers:PPG, Cooper Ind, Wesco

123jump.com Staff
19 Apr, 2007
New York City

Stocks were higher as investors juggled upbeat economic data, divergent earnings reports and a pullback in Chinese stocks. EBay Inc.''s first-quarter earnings surged 52%, though lower taxes and a decrease in outstanding shares gave a boost to results. Nokia first-quarter net profit declined by 6.6%, shares climbed 3.6%. Altria Group first-quarter profit fell 21% as the company saw weakness in domestic cigarette sales.

[R]2:30PM NY, U.S. Market Movers[/R]

AptarGroup Inc. ((ATR)), dispenser maker, said that its first-quarter net earnings increased 49% to $29.6 million, or 82 cents per share, compared with $19.8 million, or 55 cents per share, in the year-ago period. Revenue jumped 20% to $449.8 million versus $375.5 million a year ago. Shares of the company climbed 8.7%.

Arena Pharmaceuticals Inc.''s ((ARNA)), developer of treatments for obesity, cardiovascular and inflammatory diseases, said that its first-quarter loss widened, due in part to costs related to the Phase III lorcaserin Bloom trial. The first quarter of 2006 also included a $5 million milestone payment under its collaboration with Ortho-McNeil Pharmaceutical Inc. The company reported a first-quarter loss of $31.4 million, or 53 cents per share, compared with a loss of $12.7 million, or 30 cents per share, a year earlier. Revenue fell 60% to $4.91 million versus $12.1 million a year earlier. Shares jumped 11.9%.

Cooper Industries Ltd. ((CBE)), maker of electrical products and tools, reported stronger-than-expected quarterly profit, citing strong demand from utilities and solid sales in the industrial, energy and nonresidential construction markets. Cooper also raised its full-year profit forecast and its shares rose as much as 6% to a record high. Earnings rose 22% to $131.9 million, or 71 cents per share, from $107.7 million, or 57 cents per share, a year earlier. Revenue rose 12% to $1.39 billion, also ahead of estimates. Shares climbed 5.1%.

Intersil Corp.''s ((ISIL)), semiconductor maker, said that its first-quarter net income declined 2% to $33.1 million, or 24 cents per share, from a year-earlier profit of $32.4 million, or 22 cents per share. Revenue declined about 6% to $167.7 million in the latest quarter from $178.9 million a year earlier. Shares climbed 8.3%.

Playtex Products ((PYX)), which makes Banana Boat sunscreen, said it has acquired the owner of the Hawaiian Tropic sun care line, Tiki Hut Holding Co. Inc., expanding its sun care lineup just ahead of the important U.S. summer selling season.

PokerTek ((PTEK)) shares gained 18.3% after the company signed a multi-year agreement with Harrah''s Entertainment ((HET)) to be the exclusive provider for live, player-banked automated poker tables. Financial terms of the agreement, which calls for Harrah''s to install PokerTek PokerPro tables at its casinos, weren''t disclosed.

PPG Industries Inc.''s ((PPG)) shares climbed 5.6% after the company said that its first-quarter earnings rose to $194 million, or $1.17 per share, compared with $184 million, or $1.11 per share, a year earlier, as higher sales at the company''s coatings and optical segments offset declines in its commodity chemical and glass businesses. Net sales climbed to $2.92 billion against $2.64 billion a year earlier.

Avici Systems Inc. ((AVCI)) shares fell 30.2% after the company reported first-quarter net earnings of $6 million, or 42 cents per share compared with the same period a year ago when the company posted a net loss of $5.32 million, or 41 cents per share. Excluding restructuring charges, among other items, earnings were $6.6 million, or 46 cents per share compared with $2 million, or 15 cents per share, last year. Revenue fell to $20.5 million versus $20.9 million. Avici declared a special cash dividend of $2 per share, or about $28 million, payable on June 22 to shareholders of record as of June 11.

Imation Corp. ((IMN)) shares rose 11.6% reported first-quarter earnings of $15.7 million, or 44 cents per share, down from a year-ago profit of $19.4 million, or 55 cents per share. The company said profits were hurt in the latest quarter by price erosion, primarily in the U.S., due to excess industry capacity of NAND flash memory as well as pricing pressure on LTO tape media due to a continued delay in the introduction of LTO 4 drives. The company also agreed to acquire the TDK brand recording media business from TDK Corp.

Power-One Inc. ((PWER)), which makes power conversion products used in electronic equipment, said it expects to report a first-quarter loss of about 14 cents per share due to weakness in its North American business. Power-One also anticipates revenue below guidance at about $124 million. Shares plunged 14.2%.

Wesco International ((WCC)) shares fell 6.4% after the company reported quarterly profit below analysts'' average estimate on lower-than-expected organic sales growth, hurt by lower commodity prices. The electrical construction products provider reported first-quarter net income of $48.2 million, or 93 cents a share, compared with $44.5 million, or 86 cents a share, a year earlier. The company reported net sales of $1,450.6 million for the quarter, compared with $1,265.5 million a year ago.

[R]1:00AM NY, 5:00 PM Frankfurt European stocks closed lower as weak mining stocks offset gains in the shares of Nokia.[/R]
European stock markets closed lower on Thursday, as weakness among mining companies and worries that China will hike interest rates because of stronger-than-expected growth and inflation, offset upbeat margin news from Nokia and hopes for pharmaceutical-sector earnings. Shares of Nokia rose 3.5% after the world''s largest maker of mobile phones posted market share gains and a better-than-expected gross margin. Nokia also said that its Q1 net profit slipped 7%, in line with analyst expectations. In the pharmaceutical sector, drugmakers AstraZeneca and GlaxoSmithKline rose more than 1%, following strong earnings from U.S. drug maker Merck. In addition, exporting automakers DaimlerChrysler and Porsche fell over 1.5% amid weakening dollar. The euro traded near record highs vs. the dollar, and the pound held over $2. The German DAX 30 fell 0.5% at 7,242.73, the French CAC-40 lost 0.1% at 5,829.04 and the U.K. FTSE 100 declined 0.1% at 6,440.60.


[R]11:30AM U.S. market averages regained some ground.[/R]
U.S. stocks regained some ground after the initial drop but remained in the negative territory. The recovery attempt by the major averages was helped by strength among pharmaceutical and biotechnology stocks, with Schering-Plough ((SGP)) and Amgen ((AMGN)) rising 8% and 5%, respectively. Among biotech stocks, shares of Gilead Sciences ((GILD)) climbed 5%, Celgene ((CELG)) rose 4%, and MedImmune ((MEDI)) added 3%. Strength in the computer hardware sector also contributed to the upward move. Intel Corp. ((INTC)) gained 1.7%. On the other hand, the market sentiment was hurt by weakness among health insurance, tobacco, and gold stocks, helping to keep the major averages in the red. Energy and gold stocks also came under pressure amid a significant decrease by the price of oil and gold.

In economic news, the Conference Board said its index of leading economic indicators rose by 0.1% in March after falling the two previous months, coming in slightly below expectations of a rise of 0.2%. Six of the 10 leading indicators rose- jobless claims, factory hours, money supply, vendor performance, building permits and new orders for consumer goods. Four indicators fell- stock prices, consumer expectations, the interest rate spread, and capital equipment orders.

Among the companies releasing quarterly results, D.R. Horton ((DHI)) posted Q2 profit drop of 85% to 16 cents a share from $1.11 a share a year earlier, missing estimates of 27 cents. Home-building revenue dropped to $2.62 billion from $3.53 billion in the year-ago period. Shares of the home builder added 1%. In late morning trading, the Dow Jones industrial average fell 15.93, or 0.12%, to 12,787.91. The Standard & Poor''s 500 index fell 1.98, or 0.13%, to 1,470.52. The S&P hit a new 6 1/2-year high Wednesday. The Nasdaq composite index fell 3.89, or 0.15%, to 2,506.61. Bond prices showed little movement following the economic data and after prices rose for three straight sessions. The yield on the benchmark 10-year Treasury note was unchanged at 4.66% from late Wednesday.

[R]Leading indicators index rebounded in March.[/R]
Thursday morning, the Conference Board released its report on leading economic indicators in the month of March. The report showed that the leading indicators index increased in line with what economists had been expecting. The Conference Board said that the leading index edged up 0.1 percent in March after a revised 0.6 percent decrease in February. Economists had expected the index to increase by 0.1 percent compared to the 0.5 percent decrease originally reported for the previous month. The modest increase by the index reflected large positive contributions from unemployment insurance claims, real money supply, and average workweek in manufacturing. However, the positive contributions were partly offset by decreases in stock prices, consumer expectations, and the interest rate spread. The report also showed that the coincident index edged up 0.1 percent due to a large positive contribution from non-agricultural employment. The Conference Board noted that the strengths of the coincident index have been more widespread than the weaknesses in recent months. The Conference Board added that the lagging index also rose 0.1 percent in March, with four of the seven components advancing.


[R]9:45AM U.S. markets opened lower on Asian weakness and earnings reports.[/R]
Wall Street opened in the red, reflecting steep declines in Asian and European markets. Shanghai Composite tumbled 4.5% amid higher-than-expected economic growth and inflation. In addition to concerns about Asia, earnings reports and economic data will also be in focus. The news of an 11.1% surge in China''s economy in the first quarter offset strong corporate news released by Merrill Lynch & Co. ((MER)), Bank of America Corp.((BAC)), Merck & Co. ((MRK)), and eBay Inc. ((EBAY)). Among the most notable profit gainers, Schering-Plough ((SGP)) reported a 52% rise in Q1 profit to $565 million, or 36 cents a share, topping estimates. The stock surged 7% in early trading. Merck & Co. ((MRK)) advanced 0.4% after it said its Q1 profit jumped 12% to 78 cents per share on strong sales.

On the economic news front, the Labor Department said weekly applications for unemployment benefits dropped by 4,000 to 339,000. The Conference Board is expected to release its March leading economic indicators, and the Philadelphia Federal Reserve is due to report on regional manufacturing activity. In the first hour of trading, the Dow Jones industrial average fell 42.26, or 0.33%, to 12,761.58. The Standard & Poor''s 500 index fell 7.42, or 0.50%, to 1,465.08. The S&P hit a new 6 1/2-year high Wednesday. The Nasdaq composite index fell 20.16, or 0.80%, to 2,490.34. Bond prices rose for the fourth straight session, with the yield on the benchmark 10-year Treasury note falling to 4.64% from 4.66% late Wednesday.

[R]Initial jobless claims fell by 4,000.[/R]
The Department of Labor released its report on initial jobless claims in the week ended April 14 on Thursday, showing that jobless claims fell less than economists had been expecting after surging higher in the previous week. The report showed that jobless claims fell to 339,000 from the previous week''s revised figure 343,000. Economists had expected jobless claims to fall to 320,000 compared to the 342,000 originally reported for the week ended April 7. The modest decrease came after jobless claims surged higher in the previous week, rising to 343,000 from 323,000 in the week ended March 31. The Labor Department also said that the less volatile four-week moving average rose to 328,750 from the previous week''s revised average of 323,500. The report also showed that continuing claims in the week ended April rose to 2.531 million from the preceding week''s revised level of 2.525 million.


[R]9:30AM FTSE 100 declines Thursday on heavy losses in Asian markets.[/R]
The UK market was lower on Thursday. By mid-day, the FTSE 100 42.7 points, or 0.7%, lower to 6,406.0.

Advancers

Mid-cap WH Smith led the advancers, up 2.8%, supported by a 7% rise in first-half profit before tax. The book and stationery retailer announced that while it remained cautious about consumer spending in its markets, it was confident in the outcome for the full year.

Life assurer Prudential gained 0.6% after it reported an 8% increase in sales on an annual premium equivalent basis.

Defensive drug stocks also advanced, with GlaxoSmithKline up 0.7% and AstraZeneca 0.6% higher.

Decliners

Mining stocks, widely seen as a proxy for global and Chinese growth, were hit the worst, with Antofagasta down 2% and Kazakhmys 1.5% weaker. Rio Tinto was down 1.7% despite an upbeat production report.

Oil large-caps were also lower as the price of crude oil dipped below $63 a barrel. BP slid 1.1% while BG Group and Royal Dutch Shell both dropped 0.8%.

Fund managers were also weak as equities markets are under pressure. Amvescap fell 2.2%.

As the pound strengthened its position above the $2 mark for a third consecutive day, dollar earners continued to decline. BAE Systems, the defence group, lost 2.7%. Rexam, the aluminium can producer, gave up 2% and engine maker Rolls-Royce fell 2%.


[R]9:15AM Asian stocks tumbled sharply Thursday on concern of interest rate hike in China.[/R]

Asian markets finished lower on Thursday. Japan Nikkei closed 1.7% lower, giving up 295.35 points, to 17,371.97, as consumer electronics group Sony shed more than 2.1%. export-related shares lost heavily. Canon shed 2.1%, Mazda Motor Corp fell 2.4% and Toyota Motor Corp was down 0.6%.

Other regional markets plunged as well. The Singapore Straits index fell 3.2% to 3,291.28, while Hong Kong Hang Seng index lost 2.3% to 20299.71. China Mobile, the world''s largest mobile-phone operator by users, slid 4.1 %. China Life Insurance Co., the nation biggest insurer, tumbled 3.4%.

Taiwan Weighted Price Index lost 1.4% to 7,888.63. Australian S&P/ASX 200 was down 1.2% to 6,148.30. BHP Billiton, the world largest mining company, dropped 2.6 %. Rio Tinto, the third largest, slid 2.3%. Seoul Kospi index shed 1.4% to 1,513.66 and Malaysian KLSE Composite ended down 1.7%. Shanghai Composite Index in China dipped 4.5%.

China first-quarter gross domestic product rose 11.1% from a year earlier and inflation last month accelerated to a two-year high of 3.3%, the statistics bureau announced in Beijing, after China market close. The market expected 10.4% GDP growth and inflation of 2.7%.


[R]9:00AM Wall Street to open lower on global decline.[/R]
U.S. stock futures dropped Thursday, weighed down by Asian and European declines, amid concern that China will raise interest rates, prompted by data showing higher-than-expected economic growth and inflation. Another batch of earnings data was also in focus. Bank of America ((BAC)) said Q1 net income climbed 5%, helped by growth in fee income. The bank earned $1.16 a share from $1.07 a share. Revenue grew 3% to $18.42 billion from $17.94 billion last year. Analysts estimated earnings of $1.15 per share on revenue of $18.45 billion.

Dow component Altria Group ((MO)) fell 1.4% in the pre-open after it said Q1 net income fell to $1.30 a share from $1.65 a share. On an adjusted continuing operations basis it earned $1.03 a share, compared with estimates of earnings of $1.05 a share. The company also raised its profit forecast from continuing operations for the year to a range of $4.20 to $4.25 a share. UnitedHealth Group ((UNH)) reported Q1 earnings, beating expectations on an adjusted basis, and raised its full-year earnings estimate to a range $3.42 to $3.46. However, revenue came in below forecasts, sending company''s shares down 4.4%.

Among other pre-market earnings highlights, Merck & Co. Inc. ((MRK)) said its Q1 profit jumped 12%. The drug maker posted net income of $1.7 billion, or 78 cents per share, up from $1.52 billion, or 69 cents per share, in the first quarter of 2006. Sales beat expectations, totaling $5.77 billion, up nearly 7%from $5.41 billion a year earlier. Shering-Plough Corp. ((SGP)) reported a 52% rise in Q1 profit to $565 million, or 36 cents a share, topping estimates of earnings of 29 cents. S&P 500 futures lost 7.00 points to 1,473.30 and Nasdaq 100 futures fell 10.75 points to 1,837.50. Dow industrial futures gave up 58 points to 12,800.


[R]8:15AM Merrill Lynch posted 24% profit increase in Q1.[/R]
Merrill Lynch ((MER)) announced Thursday Q1 earnings increase of 24%, exceeding analyst expectations. The company said it earned $2.16 billion, or $2.26 a share, compared with $475 million, or 44 cents a share a year ago, topping estimates of $1.97 a share. In the year-ago Q1, Merrill said it had one-time compensation costs of $1.2 billion. Revenue at the firm rose 24%, to $9.85 billion from $7.97 billion.

Kraft Foods Inc. ((KFT)), the U.S. biggest food and beverage company, posted a 30% profit decline for the first quarter, its last under the control of Altria Group Inc. Net income for Q1 was $702 million, or 43 cents per share, down from $1 billion, or 61 cents per share a year ago. Excluding certain items, the company’s profit was 44 cents per share, 2 cents higher than the average analyst estimates. Revenue rose 5.7% to $8.6 billion, from $8.1 billion a year earlier, topping forecast of $8.41 billion.


[R]8:00AM NY-7:00PM Mumbai Sensex ends lower, banks, select large-caps advance.[/R]

The Sensex on BSE finished 52.49 points, or 0.38%, lower at 13,619.70.

The session was highly volatile as the index traded within a range of 235 points. The market-breadth was weak as 1,358 stocks declined, 1,151 advanced and 84 stocks were unchanged. Of the 30 stocks in the Sensex, 14 advanced, while the rest declined. The turnover on BSE was Rs 3,642 crore, lower than Rs 3,977.99 crore on Wednesday. On NSE, the turnover was Rs 8,194.26 crore, also lower than Rs 8,600.37 crore on Wednesday.

Economic news

Union Minister of Commerce & Industry Kamal Nath announced today that in the fiscal 2006 exports from India reached $125 billion. The Minister also said that merchandise exports had almost doubled in three years, from $63.84 billion in 2004 to $125 billion, representing an annual compounded growth of 25% compared to 12.73% in the previous three years.

The government also announced today the abolition of service tax on all exports. It extended duty concessions to special economic zones and set a target of $160 billion for merchandise exports during the fiscal 2007.

Trading highlights

New issue Advanta was the most-active stock with a turnover of Rs 503.35 crore followed by Reliance Industries and ICRA.

IPO

Advanta India ended higher at Rs 850.05. It listed on BSE at Rs 640, and had declined sharply to a low of Rs 591, before hitting a high of Rs 992.90. Advanta India is a subsidiary of United Phosphorus.

Advancers

SBI led the gainers today, advancing 1.7% to Rs 1,053 on a volume of 9.05 lakh shares. The biggest state-run lender had rallied sharply from a low of Rs 1,014, to a high of Rs 1,062.40. ICICI Bank ended 0.9% higher to Rs 905, rebounding from an initial 3% decline to Rs 870.10. Reportedly, the Reserve Bank of India will probably permit Temasek and the Government of Singapore Investment Corporation to increase their stakes in the private bank to 10% each. Temasek holds 7.41% stake in ICICI Bank and Government of Singapore Investment Corp 2.29%.

Cigarette large-cap ITC advanced 1.2% to Rs 159. Auto maker Hero Honda gained 1.1% to Rs 656 and Maruti Udyog added 0.9% to Rs 775. Larsen & Toubro was 0.4% higher to Rs 1,666, on news that the company had plans for facilities in China for machines, switchgear, valves, tyre-curing and pressing and coal gassification.

Index heavy Reliance Industries gained 0.4% to Rs 1,493. The stock had rebounded from a low of Rs 1,462, and surged to a high of Rs 1,499.50, a record high. Reliance has scheduled board of directors meeting on April 26 2007 and review unaudited financial results for the quarter and year ended in March 2007.

Decliners

ACC led the decliners, plunging 3.5% to Rs 788 despite posting a surge of 54.5% in the first quarter net profit. The cement company reported an advance in net profit ending in March to Rs 363.75 crore from Rs 235.42 crore from a year ago. Net sales grew 26.1% to Rs 1,674.83 crore from Rs 1,327.52 crore a year earlier. Satyam tumbled 3% to Rs 448.

HDFC lost 1.9% to Rs 1,564 ,Bajaj Auto dipped 2.2% to Rs 2,441, BHEL declined 2% to Rs 2,503 and ONGC slipped 1.% to Rs 895.

IT stocks declined on profit-taking. Infosys was down 1.8% to Rs 2,040, Wipro lost 0.4% to Rs 584, Satyam Computers dipped 2.6% to Rs 449.80 and TCS declined 0.2% to Rs 1,244.95.


[R]6:30AM European markets were lower Thursday on interest rate fears.[/R]
European markets declined Thursday. By mid morning, Frankfurt Xetra Dax shed 1.3% to 7,186.14, the CAC 40 in Paris lost 1.1% to 5,774.27 and London FTSE 100 slid 0.8% to 6,396.4. National benchmarks slid in all 17 western European markets that were open.

Advancers

Nokia, the biggest mobile phone maker in the world, gained 1.5% ahead of the Finnish company first-quarter results. Nokia market share is seen increasing to its highest level in 13 quarters, but slipping sales prices were expected to dent profits.

Schneider Electric SA advanced 1.5% after the maker of circuit breakers said first-quarter sales increased 22% to 3.89 billion euros, fueled by acquisitions and increased sales of electrical products. The company said Europe had an excellent start to the year.

Decliners

Among the London-listed miners, Antofagasta fell 2%, while Spanish oil group Repsol shed 1.9%.

German utility RWE dipped 4.6%, while Lufthansa fell 3.2%. Both stocks were trading without the rights to the latest dividend payment.

Logitech International SA dropped 8.2%. Fourth-quarter profit and revenue trailed analysts estimates after the maker of computer mice said sales of Web cameras fell.

Oil and precious metals

Crude oil recovered from early losses to trade for more than $63 a barrel in New York. Crude oil for May delivery rose 2 cents to $63.15 a barrel in after-hours electronic trading on the New York Mercantile Exchange in early trade in London.

Gold fell in London on speculation a rally that took the metal to the highest in eleven months was overdone. Silver also dropped. Gold for immediate delivery dropped $3, or 0.4% to $687.05 an ounce. Silver for immediate delivery declined 6 cents, or 0.6% to $13.895 an ounce. Among other precious metals for immediate delivery in London, platinum gained $7.50 to $1,302.50 an ounce, while palladium dropped $2 to $380.50 an ounce.
Currencies

The euro traded at around two-year highs Thursday, less than one U.S. cent off its record, after the European Central Bank reiterated that another interest rate increase for the euro zone by June was likely. The euro rose to $1.3616, a level not seen since December 2004, before falling back to $1.3576 in morning European trading.

The pound rose as high as $2.0092, then settled back to $2.0029, down slightly from the $2.0057 it fetched late Wednesday in New York. The dollar also fell against Japanese yen, dropping to 117.93 yen from 118.61 yen late Tuesday.