Metal Lift European Stocks

123jump.com Staff
07 Dec, 2007
New York City

European stocks gained across the region led by a rise in UK of 1.1% followed 0.8% gain in Paris, 0.7% rise in Germany, and 0.7% Switzerland. Stocks in Europe rose the third day in a row. Miners advacned as metal prices rose. Xastra surged 8%, Antofagasta added 5%, and Vednata jumped 3%. Arcelor Mittal edged 1.7% higher after the rising metals prices lifted steel stocks as well. Insurance companies edged higher as well.

[R]4:30PM New York, 10:30PM Frankfurt, 4:00AM Mumbai[/R]

[R]Global Markets Indexes[/R]

In London FTSE 100 Index closed up 69.30 or 1.07% to 6,554.90, in Paris CAC 40 Index increased 44.99 or 0.79% to close at 5,718.75, and in Frankfurt DAX increased 53.49 or 0.67% to close at 7,994.07. In Zurich trading SMI increased 57.91 or 0.66% to close at 8,799.65.

Dow Jones Industrial Average edged higher by 5.69 or 0.04% to a close of 13,625.58, S&P 500 decreased 2.68 or 0.18% to 1,504.66, and Nasdaq Composite Index declined 2.87 or 0.11% to a close of 2,706.13. In Toronto TSX Composite increased 13.17 or 0.10% to close at 13,862.97.

Of the 30 stocks in Dow Jones Industrial Average, 13 closed higher, 16 closed lower, and one was unchanged.

American Express led the decliners with a loss of 4.3% followed by losses in Johnson & Johnson of 0.91%, in AT&T of 0.9%, in Intel of 0.89%, in Intel and IBM of 0.8%. Alcoa led the gainers with a rise of 2.9% followed in Verizon of 2%, and in Merck of 1.9%.

Of the stocks in S&P 500, 230 closed higher, 264 fell, and 6 were unchanged. Four stocks fell more than 3% and seventy six increased 3% or more.

Amgen led the decliners with a loss of 5% followed by losses in Capital One of 5%, in Countrywide Financial 4.6%, in Family Dollar 4.5%, and in Fannie Mae 4.4%. J C Penney led the gainers with a rise of 7% followed by increases in Radioshack of 5.8%, in Dillard of 5.6%, and in Cognizant of 5.1%.

In Tokyo Nikkei 225 Index added 82.29 or 0.52% to close at 15,956.37, in Hong Kong Hang Seng index closed down 716.45 or 2.42% to 28,842.47, in Australia ASX 200 closed higher by 53.80 or 0.82% to close 6,654.70.

In South Korea Kospi Index decreased 18.85 or 0.97% to close at 1,934.32, Thailand closed down 3.88 or 0.63% to 616.89, and Indonesia edged lower 16.45 or 0.59% to 2,778.95. India added 170.13 or 0.86% to 19,966.00.

In Latin Markets Chile led the gainers with a rise of 2.17% followed by increases in Mexico of 1.61%, in Argentina of 1.36%, and in Brazil of 1.33%.

Bond Yields edged higher on 10-year U.S. bonds to 4.10% and 30-year bonds increased to 4.57%.

[R]Commodities, Metals, and Currencies[/R]

Crude oil decreased $1.95 to close at $88.28 per barrel for a front month contract, up 42.00% for the year, natural gas decreased 18 cents to $7.16 per mBtu, and gasoline futures decreased 3.23 cents to close at 226.90 cents per gallon.

Gold edged lower $6.90 in New York trading to close at $800.20 per ounce, silver closed down 12 cents to $14.51 per ounce, and copper for front month delivery increased 7.8 cents to 312.60 cents per pound and in London trading closed up $29.50 to $6,680.00.

Dollar edged lower against euro to $1.4654 and higher to 111.69 yen.

[R]9:35AM New York – 8:05 PM Mumbai – Asian markets closed higher.[/R]

U.S. stocks opened flat to lower after the release of unemployment report and new jobs creations report.

Employers added 94,000 jobs in the November month after October data was revised upward by 4,000 to 170,000. Unemployment rate in the month was unchanged at 4.7%.

Macrovision is reported to offer $2.8 billion to acquire Gemstar – TV international.

The per share value of the transaction to Gemstar-TV Guide stockholders, based on the closing price of MVSN stock on December 6, 2007, represents a 29 percent premium to the 10 day average closing price of Gemstar TV Guide’s common stock prior to its review of strategic alternatives announced on July 9, 2007.

The transaction requires, among other customary closing conditions, approval by two-thirds of the outstanding shares of Gemstar-TV Guide common stock, and a majority of the shares of Macrovision common stock voting at the special meetings to be held in connection with the transaction. News Corporation, which owns approximately 41% of the Gemstar-TV Guide common stock, has agreed to vote in favor of the transaction at the meeting of Gemstar-TV Guide stockholders to be held in connection with the proposed transaction, subject to the terms of a voting agreement.


[R]4:00AM New York, 6:00PM Tokyo - Realty, commodity and energy stocks lifts Japan 0.52%. Japan’s economy grew by revised 1.5% in third quarter. Foreign reserve assets soar to $970.1 billion.[/R]

Japan’s stocks parred a 1.4% gain by midday to close up 0.52% buoyed by rising prices of oil and metals and plans by the U.S. to freeze interest rates for five years for variable rate mortgages.

In Tokyo trading Nikkei 225 closed up 0.52% or 82.29 to 15,956.37, while the broader Topix Index rose 9.49 to 1,561.76.

In the first section of the Tokyo Stock Exchange 9.6 billion shares valued at 1.2 trillion yen were traded and in the second section 272 million shares worth 6.2 billion yen changed hands in the second section.

Of the Nikkei 225 stocks 114 rose, 71 declined and 10 were unchanged. Daiwa House Industries led gainers, rising 6.54% on plans the U.S. will freeze interest rates on variable mortgage rates and assist in refinancing into new mortgages.

Crude oil prices rose 3.1% to $90.37 per barrel after OPEC elected to keep its output quota intact. Inpex gained 2.56% and Nippon Oil Corp soared 0.11%.

Japan’s Cabinet Office reported today the economy grew by a revised annualized rate of 1.5% in the third quarter compared to the preliminary estimate of 2.6%. The statistics further showed domestic demand was revised to a decline of 0.1% from a 0.2% gain that in preliminary estimates. However, private demand was unchanged, revised downwards from the gain of 0.4% previous estimate.

Private consumption of households was unchanged in the revised figure at 0.3%. Private residential investment also slumped more at 7.9% in the third quarter as compared to previous projections of 7.8% decline, while private non-residential investment was at 1.1% from 1.7%.

Also, exports of goods and services for the three months to September were revised downwards from the gain of 2.9% to 2.6%.

Japan’s Ministry of Finance reported today that the country’s foreign reserve assets grew by $15.7 billion from the end of October to $970.1 billion as of November 30. Foreign currency reserves contributed $946 billion, securities were at $820 million, gold contributed $19.2 billion and IMF reserve position currently stands at $1.4 billion.

Of the Nikkei 225 index shares, Daiwa House Industries led advancers with a rise of 6.54%, followed by gains of 5.87% in Sumitomo Metal Industries, 5.84% in Kumagai Gumi Company, 5.57% in Tokyo Dome Corp, and 5.32% in Sumitomo Metal Mining.

Realty stocks gained after U.S. President Bush announced plans negotiated by U.S Treasury Henry Paulson and financial companies to freeze interest rates on variable rate mortgages, and also plans to assist refinancing new mortgages and obtaining loans guaranteed by Federal Housing Administration.

Exporters gained as the yen continued to slide, falling to 111.26 at the close of trade today from 110.94 yesterday. Canon Incorporated rose 0.51%, Komatsu Limited edged up 2.53% and Toyota Motor Corporation climbed 1.60%.

Yokogawa Electric Company led decliners with a fall of 3.97% followed by losses in Kyowa Hakko Kog of 2.97%, in Chugai Pharmaceutical Company of 2.97%, in Mitsubishi UFJ Nicos of 2.83%, and In Daiichi Sankyo of 2.53%.

Softbank Corporation reported today the company added 33,000 new customers in November, NTT DoCoMo in the month added 58,100, and KDDI increased 25,100 after the law allowing customers to keep the number even if they change the carrier. Softbank however closed 0.38% down.

Nikkei news reported today that Sumitomo Chemical Company is in talks to build a 200 billion yen plant in Saudi Arabia by 2012. The company closed 1.66% up.


[R]1:00PM New York-Chico''s FAS Inc third quarter earnings decline 44.1%.]/R]

Chico''s FAS, Inc. reported third quarter earnings fell sharply by 44.1% to $23.57 million compared to $42.14 million a year ago, as the retailer for women''s apparel extended losses from the second quarter. The company attributed the decline to weaker demand.

Earnings per share dropped 45.8% to 13 cents per share from 24 cents per share in the year ago quarter. Income from continuing operations declined to $23.7 million from $42.9 million last year, inclusive of a $0.025 gained from the sale of Lucy Activewear.

For the quarter, net sales rose 3.4% to $416 million from $402 million. Chico''s said comparable same store sales declined 9.3% for the thirteen-week period ending November 3, 2007 and fell 5.5% in the thirty-nine week period.

At Chico''s, same stores sales dropped 8% and 5% in the 13-week and 39-week period respectively WH|BM brand''s same store fell 13% and 6% in the quarter and nine months to November 3. Chico''s also said its same-store sales for November fell 13.7%.

In the nine months to November, net sales increased 9.1% to $1.31 billion from $1.20 billion a year earlier. Income from continuing operations fell to $112 million from $150 million and earnings per share fell to 63 cents from 84 cents in prior year.

During the third quarter the company opened 47 new stores, lower than original forecasts of between 58 and 62 stores. Chico''s closed one store. In the quarter the company relocated or expanded 17 stores. In the fourth quarter, the company expects to open between 34 and 36 stores and expand or relocate between 5 and 6 stores. The company is targeting to open between 128 and 132 stores for fiscal 2007, down from a target of 130 and 140.

Chico''s gross profit in the third quarter was fractionally up 0.7% to $242 million from $241 million. The gross profit margin as percentage of sales decreased to 58.3% from 59.9%. Merchandise margin for Chico''s brand declined 100 basis points in the quarter due to higher mark-downs.

The company''s overall gross margin was also impacted by the mix effect of the WH|BH and Soma Intimates sales, which claimed a bigger portion of net sales.

Selling, general and administrative expenses for the third quarter increased 24.9% to $219 million from $175 million a year ago. Store operating expenses also increased in the quarter by 590 points compared to a year ago on higher personnel costs and occupancy cost due to larger stores.

In the quarter, Chico''s enhanced marketing strategies with related expense rising 240 basis points compared to a year earlier. Shared services with the headquarters and other non-brand specific expenses increased 80 basis points mainly due to personnel relocation and recruitment costs.

Inventory per selling square foot as of the end of the third quarter was $73 declined from $77 in the quarter from a year ago.

The Chico''s and Soma brand sales, excluding catalogue and Internet rose 1.3% to $301 million from $297 million last year. At WH|BM brand sales increased by 8.4% to $97 million from $90 million.

The average transaction size for the Chico''s front-line stores in the quarter declined 6%, and was down 5% at WH|BM. The average unit retail for the Chico''s front-line stores for the fiscal 2007 third quarter declined by 8% while the WH|BM average unit retail gained 4%.

Chico''s said it was taking a conservative approach in fiscal 2008 and lowered growth guidance. The company now expects square footage growth of 10% in 2008 from initial estimates of 12%-15%. This will reduce the number of planned store opening to between 60 and 65.

Shares of Chico''s were down 52 cents, or 4.5%, to $10.98 in after-hours trading Tuesday. The stock has traded between $9.86 and $27.94 in the last 52 weeks.

Analysts polled by Thomson Financial expect fourth quarter earnings at $0.07 per share and 69 cents per share at full-year. Revenue is forecast at $475.48 million in the next quarter and $1.79 billion for fiscal 2007.

The company operates 574 Chico''s, 35 outlet stores, 274 White House|Black Market and 18 outlet stores, 63 Soma Intimates and 1 outlet store for the brand totaling 965 women''s specialty stores.

[R]1:00PM New York - AutoZone Inc first quarter earnings rise 7%, same stores sales gain 1.3%, and sales increased 4.5%. share jumps 19.4%.]/R]

AutoZone Inc, the distributor and retailer of automotive parts, reported first quarter sales increased by 4.5% to $1.5 billion from $1.39 billion from a year ago.

U.S same store sales increased 1.3% for the quarter from 0.3% in same quarter in 2006.

For the quarter, AutoZone net income gained 7% to $132.5 million compared with $123.88 million posted in the same period last year on sales of parts with high profit margins.

Earnings rose 17.4% to $2.02 per share from $1.73 per share a year earlier.

Shares of AutoZone soared 19.4% or $20.93 to $128.80 at close Tuesday, on the earnings that stood at the top end of market predictions.

Analysts polled by Thomson Financial estimated first quarter earnings per share of $1.91.

For the quarter, gross profit, as a percentage of sales was 49.9% against 49.2% reported same period last year. The company said higher gross margins were a result of category management strategies and the shift in sales mix to higher margin categories.

GAAP inventory rose 8.9% over the same period last year. However, adjusted inventory per store, which includes supplier owned pay-on-scan inventory, rose below 1% to $507 000 from $503 000 last year.

During the quarter, AutoZone repurchased 2.9 million shares for $350 million, or about $121.00 per share. The company will spend a further $108 million on share buybacks in the ensuing quarter.

AutoZone opened 40 new stores, operating a total of 3,972 stores by the quarter''s end. In Mexico, it operated 124 stores.

Operating expenses, as a percentage of sales rose to 33.6% from 33.2% last year due to higher occupancy costs.

Analysts expect second quarter earnings of $1.61 per share on revenues of $1.35 billion. For the year, revenue is estimated at $6.51 billion on sales growth of 5.5%. In the second quarter sales are expected to rise 3.7%.

After hours Wednesday, AutoZone shares were up 0.22% or $0.28 at $126.50. Over the past 52-weeks, the stock has traded in the range $103.40 to $140.29. Analysts are targeting a one-year price of $125.30.

""""As our operating model continues to be strong, we will maintain our disciplined approach to growing operating earnings and utilizing our capital effectively,"""" said Bill Rhodes, the company''s chairman, president and chief executive officer.

AutoZone is a retailer and distributor of automotive replacement parts and accessories in the United States. Each store carries an extensive product line for cars, sport utility vehicles, vans and light trucks, including new and remanufactured automotive hard parts, maintenance items, accessories, and non-automotive products.