Exxon Mobil Profit up 10%, Sales Fall

Elena
26 Apr, 2007
New York City

Wall Street opened modestly higher on Thursday, with the Dow Jones moving further above the 13,000 mark on much stronger-than-expected earnings from Apple and upbeat results from 3M Corp. and Ford Motor Co. On the Dow, 3M climbed 4% after its earnings beat estimates and Prudential Securities upgraded the stock. Fellow Dow member Ford rose 4.6% after the automaker reported a narrower adjusted loss than analysts had anticipated. Apple traded up 5% on 88% earnings jump in Q1.

[R]9:45AM U.S. markets opened higher. The Dow traded above13,000-point milestone.[/R]
Wall Street opened modestly higher on Thursday, with the Dow Jones moving further above the 13,000 mark on much stronger-than-expected earnings from Apple and upbeat results from 3M Corp. and Ford Motor Co. On the Dow, 3M ((MMM)) climbed 4% after its earnings beat estimates and Prudential Securities upgraded the stock. Fellow Dow member Ford ((F)) rose 4.6% after the automaker reported a narrower adjusted loss than analysts had anticipated. Apple ((APPL)) traded up 5% on 88% earnings jump in Q1. Technology shares also received a boost from chip maker Xilinx ((XLNX)) which rose 3% on better-than-expected earnings.

Exxon Mobil ((XOM)) posted 10% profit rise in Q1, as higher refining, marketing and chemical profit margins offset lower crude oil and natural gas prices. Net income rose to $9.3 billion, or $1.62 per share, up from $8.4 billion, or $1.37 per share a year ago, beating estimates of a profit of $1.52 per share. However, revenue fell to $87.2 billion from $88.9 billion a year earlier, hurt by lower oil and natural gas prices. The Dow rose 28.29, or 0.22%, to 13,118.96 in the opening minutes of trading, hitting a new trading high of 13,120.53. The Standard & Poor's 500 index rose 0.78, or 0.05%, to 1,496.20, and the Nasdaq composite index climbed 4.88, or 0.19%, to 2,552.77.

[R]Initial jobless claims fell by 20,000.[/R]
Thursday morning, the Department of Labor released its report on initial jobless claims in the week ended April 21. The report showed that jobless claims fell by more than economists had been expecting. The Labor Department said jobless claims fell to 321,000 from the previous week's revised figure of 341,000. Economists had expected jobless claims to fall to 330,000 from the 339,000 originally reported for the previous week. The decrease, which marked the bigger drop in jobless claims in nine weeks, was partly due to adjustments related to the Easter holiday, which does not fall in the same week every year. At the same time, the report also showed that the less volatile four-week moving average rose to 332,000 from the previous week's revised average of 329,250. Continuing claims for the week ended April 14 also rose, surging up to 2.594 million from the preceding week's revised level of 2.529 million.


[R]9:30AM FTSE trades higher Thursday on U.S. close overnight and M&A.[/R]
The UK market was higher on Thursday. The FTSE 100 rose 27.8 points to 6,489.5 in mid-morning deals.

Advancers

With markets close to new highs, Amvescap, the fund manager highly exposed to US markets, gained 1.8%, while Man Group, the world largest listed hedge fund rose 1.4% and Investec also made gains, up 1.7%.

Contract caterer Compass Group, up 2.5%, benefited from a 24% rise in interim profits at its French peer Sodexho Alliance.

Arm Holdings surged with a 5.5% rise after it unveiled plans to return over 100 million pounds to investors in 2007.

Miners were also doing well, with Anglo American, Antofagasta and Rio Tinto attracting attention. Anglo American advanced 0.3%, Antofagasta was up 1.9% and Rio Tinto rose 0.1%.

Drugs group Shire was up again thanks to a JP Morgan price target hike following strong first quarter figures released Wednesday.

Decliners

Confirmation that ABN Amro had agreed to consider the offer by the consortium which is behind a 72 billion euros break-up bid led by Royal Bank of Scotland made the UK company shares fall 0.5%. Royal Bank of Scotland also dropped as HSBC kept the shares at neutral and cut its price target.

There was bad news from Sports Direct International, down 8.3%, as the sports retailer warned on slower sales.

With oil prices up above $65 a barrel in New York, cruises company Carnival Corporation was among the decliners, down 0.9%.


[R]9:15AM Asian markets finish higher Thursday with Japan leading gainers.[/R]
Asian markets ended higher on Thursday. The 225-issue Nikkei Average closed 1.1% higher at 17,429.17. Sony rose 0.9% after reports that the electronics company will raise up to 300 billion yen by taking Sony Financial Holdings public. Electronics maker Kyocera advanced 2.1% ahead of its earnings release, while silicon-wafer maker Shin-Etsu Chemical surged 4.3%, ahead of its earnings Friday. Honda Motor gained 1.8% after the auto maker reported upbeat quarterly earnings growth.

In Hong Kong, the benchmark index Hang Seng Index ended up 0.6% at 20,667.29. Shares of China Molybdenum leaped 68% above their initial offer price in debut Hong Kong trading, as investors bought stakes in the specialty metal miner. Shares of Industrial & Commercial Bank of China rose 2% after posting quarterly results that topped expectations.

Taiwan Weighted Price Index gained 0.2% to finish at 8,000.04. Leading gains in Taiwan was Hon Hai Precision Industry which rose 1.6% on hopes of improved earnings at the contract-electronics manufacturer after Apple Computer reported second-quarter earnings rose 88% on year. Hon Hai makes iPods for Apple.

China Shanghai Composite Index added 1% to close at 3,783.06 and Australian S&P/ASX 200 ended up 0.4% at 6,212.20. South Korean Kospi index added 0.5% to close at 1,553.13.


[R]9:00AM U.S. stock futures pointed higher on strong earnings from Apple, 3M, Exxon Mobil.[/R]
U.S. stock futures rallied on Thursday, leading the market to another session of solid gains on the back of strong quarterly profit at Apple and narrower-than-expected loss at Ford. Upbeat quarterly results released by 3M and Exxon Mobil also contributed to the positive mood. On the economic news front, U.S. weekly jobless claims fell by 20,000 to 321,000 during the week ending April 21

Among pre-market highlights, Apple ((APPL)) surged 8% after it reported an 88% profit rise in Q1, helped by record iPod sales as well as the company''s line of Mac computers. Blue-chip stocks were supported by 7% increase in the shares of Ford ((F)) as the automaker posted a narrower-than-anticipated Q1 loss, helped by stronger performance at its international units and higher revenue. Ford reported a net loss of $282 million, or 15 cents a share, compared with a loss of $1.4 billion, or 76 cents a share a year earlier, above estimates of 60 cents loss.

Dow member Exxon Mobil ((XOM)) reported higher-than-expected Q1 earnings, but revenue came in below year-ago levels. The stock edged up 0.8% ahead of the open. Xilinx ((XLNX)) rallied 5.3% in pre-open trading after the chip maker reported better-than-forecast Q4 results. Microsoft ((MSFT)) added 0.7% ahead of earnings release after the closing bell. S&P 500 futures rose 3.20 points to 1,504.00 and Nasdaq 100 futures improved by 9.00 points to 1,903.00. Dow industrial futures hiked up 34 points to 13,154.


[R]8:15AM 3M reported 58% earnings increase in Q1.[/R]
3M ((MMM)) reported 58% Q1 earnings increase. The company earned record $1.4 billion or $1.85 per share, up from 899 million, or $1.17 per share in the first quarter of 2006. First quarter 2007 net income included a net profit of $422 million, or 57 cents per share, due to a gain on the sale of the branded pharmaceuticals business in Europe. Sales increased 6.7% to $1.8 billion. Revenue climbed 6.1% to $5.9 billion.

Halliburton ((HAL)), oilfield services conglomerate, announced 13% profit rise in Q1, boosted largely by increased business in the Middle East which helped offset lower U.S. prices. The company reported net income of $552 million, or 54 cents a share, compared to $488 million, or 46 cents a share a year ago. Revenue rose 17% to $3.4 billion from $2.9 billion a year ago. The stock rose 2.3% in pre-market trading.


[R]8:00AM NY-7:00PM Mumbai Sensex finishes marginally higher on April derivatives expiry.[/R]

The Sensex on BSE finished 11.11 points, or 0.08%, higher at 14,228.88.

The Sensex traded within a range of 256 points today. The market-breadth was weak as there were almost three decliners for every two gainers. As 1,049 stocks advanced, 1,482 declined and only 79 stocks remained unchanged. Of the 30 stocks in the Sensex, 15 advanced, while the other 15 declined. The turnover on BSE was Rs 4,465 crore, lower than Rs 5,200.34 crore on Wednesday. On NSE, the turnover was Rs 11,830.93 crore, higher than Rs 11,078.22 crore on Wednesday.

Economic news

The rupee hit a nine-year high against the dollar on, fourth in a row, and traders anticipated further gains despite the possibility that RBI might intervene to limit its momentum. In early trading, the rupee was at 40.74 per dollar, advancing from close of 40.90 on Wednesday.

Bandwidth costs and internet access charges might be significantly reduced soon with BSNL and MTNL planning to host web servers within the country by the middle of this year. Telecom Minister Dayanidhi Maran today announced that these state companies would set up web servers, which will enable the internet traffic to be diverted within India instead of being routed out of the country.

Market is keenly awaiting the release of inflation report tomorrow. The wholesale price inflation rate is expected to be at 6.09% for the twelve months ending 14th April 2007, unchanged from a week earlier.

Trading highlights

Reliance Industries was the most-active stock with a turnover of Rs 307 crore followed by Indiabulls Real Estate and Orbit Corp.

Advancers

Bajaj Auto and Grasim rallied over 2% each to Rs 2,491 and Rs 2,495, respectively. Grasim had risen 3.5% in early trade to Rs 2,529, supported by strong fourth-quarter results in fiscal 2007, which the company unveiled after trading hours on Wednesday. Grasim reported 80.5% growth in net profit and net sales surging 36.2%.

Information Technology large-caps neglected the surge of the rupee. Investors are worried that rising currency will lower profit margin. Wipro gained 1.3% to Rs 563 and TCS rose 1.5% to Rs 1,240. Refinery stocks also advanced. HPCL rose 3.6% to Rs 271.85, Indian Oil Corporation gained 4.3% to Rs 431 and BPCL advanced 2.9% to Rs 338.10. Hindustan Lever and TCS surged over 1.5% each to Rs 215 and Rs 1,240, respectively.

Decliners

Tata Steel led the decliners, dipping nearly 2% to Rs 560. Satyam declined 1.3 to Rs 460, while ONGC also lost 1.3% to Rs 960 on profit-taking. ICICI Bank shed 0.5% to Rs 957 as 3.4 lakh shares were traded on BSE.

Index heavy Reliance Industries dropped 0.2% to Rs 1,599. Reliance had gained 1.5% in early trade, to a record high of Rs 1,624.80. Reliance unveils fourth-quarter results today. Analysts expect between 2.8% to 9.9% growth in net profit in, between Rs 2,571.30 crore and Rs 2,749.50 crore, compared to Rs 2,502 crore a year earlier.


[R]6:30AM European markets rise Thursday on strong earnings reports[/R]
European markets were higher on Thursday. The German DAX Xetra 30 index rose over the 7,400 level, up 0.8% at 7,401.89, and the French CAC-40 index was up 0.4% at 5,971.88, while the U.K. FTSE 100 index gained 0.6% at 6,498.10. National benchmarks rose in all of the 17 western European markets that were open.

Advancers

ABB led the advancers, up 5.8% in Switzerland after the Swiss-Swedish engineering firm, announced its first-quarter profit more than doubled to a stronger-than-forecast $537 million from $204 million, with revenue up 21% to $6.21 billion and orders up 26% to $8.64 billion.

German pharmaceutical company Bayer rose 3.7% after the company reported an above-forecast increase in first-quarter net profit to 2.8 billion euros, from 600 million euros a year ago.

France Telecom gained 2.9% after it reported that its first-quarter sales rose 1.8% to 12.8 billion euros. France Telecom said its gross operating margin increased to 36.3% from 36.2% on cost controls and confirmed its objectives for 2007.

German chemicals company BASF added 1.8% after its first-quarter profit climbed a better-than-forecast 9% to 1.04 billion euros, with sales up 16% to 14.63 billion euros.

German industrial company Siemens rose 1% after early losses. The company unveiled new financial targets, targeting a return on capital employed between 14% and 16% by 2010, up from the 10% achieved in fiscal 2006.

Decliners

Ericsson declined 0.4% after it announced that its first-quarter net income rose 27%, just below analyst forecasts. UBS downgraded the stock to neutral.

Electrolux sank 5.9%. The second-largest household appliances maker in the world said North American sales declined and raw-materials costs will erode full-year profit.

Oil and precious metals

Gold and silver were little changed after recovering from earlier losses on speculation the dollar may fall to a record low against the euro. Gold for immediate delivery fell $2.20, or 0.3%, to $684.05 an ounce. Silver for immediate delivery fell 3 cents, or 0.3%, to $13.77 an ounce.

Crude oil fell after Iran said it was making progress in talks with the European Union on Iranian nuclear research, while some analysts predicted supplies of crude could meet demand for gasoline during the coming summer. Crude oil for June delivery fell 33 cents, or 0.5%, to $65.51 a barrel in after-hours electronic trading on the New York Mercantile Exchange and stood at $65.61 in morning trading in London. Brent crude for June settlement fell 33 cents, or 0.5%, to $68.24 on the ICE Futures exchange.

Currencies

The dollar rose against other major currencies in morning European trading Thursday. The euro traded at $1.3614, down from $1.3636 late Wednesday in New York. The British pound traded at $2.0002, down from $2.0012. The dollar fetched 119.11 Japanese yen, up from 118.71.