IKB Gets Another 1.5 B Euros

123jump.com Staff
13 Feb, 2008
New York City

L''Oreal reported 8% rise in sales to 17 billion euros and 11% increase in earnings, after excluding one-time gains, to 2.04 billion euros. International sales and new fragrance launch under the Diesel brand contributed to sales. Stora Enso fourth quarter loss of 135.3 million euros and plans to close more paper mills in Helsinki. Hochtief AG, German construction company, reported annual profit of 140 million euros.

[R]10:00PM Frankfurt, 4:00PM New York, 8:00AM Sydney – European stock markets closed higher on the back of U.S. retail sales data. UK housing market deepened according to the latest survey.[/R]

European Markets

In London FTSE 100 Index closed lower 29.90 or 0.51% to 5,880.10, in Paris CAC 40 Index increased 14.69 or 0.30% to close at 4,855.40 and in Frankfurt DAX index higher 5.83 or 0.08% to close at 6,973.67. In Zurich trading SMI decreased 10.44 or 0.14% to close at 7,536.45.

North American Markets indexes

Dow Jones Industrial Average gained 178.83 or 1.45% to a close of 12,552.24, S&P 500 closed up 18.34 or 1.36% to 1,367.20, and Nasdaq Composite Index traded up 53.89 or 2.32% to a close of 2,373.93. In Toronto TSX Composite closed higher 182.95 or 1.40% to close at 13,270.33.

Of the 30 stocks in Dow Jones Industrial Average, 24 closed higher, 6 closed lower, and none were unchanged.

AIG led the decliners for the second time this week in the Dow Jones index with a loss of 1.4% followed by losses in DuPont of 1%, General Motors of 0.8%, and in Coca Cola of 0.8%. Alcoa led the gainers in the index with a rise of 5% followed by increases in American Express of 4%, in Hewlett Packard of 3.33%, and in AT&T of 3.01%.

Of the stocks in S&P 500, 387 closed higher, 110 fell, and 3 were unchanged. Of the index stocks, 26 rose more than 3% and equal number of 26 stocks fell more than 3%.

Jones Apparel led the gainers in the index with a rise of 11% followed by increases in Applied Materials of 10.2%, in Qwest Communications of 7.4%, in Network Appliance of 7%, and in Teradata of 6.6%. MGIC Investments led the decliners in the index with a fall of 11% followed by losses in Dean Foods of 6%, in Brown Forman of 4.5%, and in GameStop of 3.6%.

South American Markets Indexes

In Latin Markets Chile led the gainers in the region with a rise of 1.70% followed by increases in Mexico of 1.51%, in Brazil of 1.27%, in Peru of 0.29%, and in Colombia of 0.19%. Venezuela fell 1.77%.

Asian Markets

In Tokyo Nikkei 225 Index closed higher 46.34 or 0.36% to 13,068.30, in Hong Kong Hang Seng index increased 247.88 or 1.08% closed to 23,169.55. Australia ASX 200 index decreased 66.00 or 1.18% to close 5,542.10.
In South Korea Kospi Index decreased 11.55 or 0.70% to close at 1,631.78, in Thailand SET index closed higher 11.92 or 1.46% to 829.41 and Indonesia JSE Index edged increased 18.71 or 0.72% to 2,610.78. Sensex index in India increased 341.10 or 2.05% to 16,949.14.

Bond Yields increased on 10-year U.S. bonds to 3.72% and on 30-year bonds rose to 4.53%.

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

Crude oil added $0.48 to close at $93.26 per barrel for a front month contract, natural gas decreased 5 cents to $8.39 per mBtu, and gasoline futures increased 2.20 cents to close at 239.00 cents per gallon.

Gold decreased $3.00 in New York trading to close at $908.10 per ounce, silver closed up 4 cents to $17.29 per ounce, and copper for front month delivery decreased 2.00 cents to 354.95 per pound and in London copper futures increased $126.00 to $7,923.00.

Wheat futures fell 21 cents in Chicago trading and closed at $9.09 per bushel. Sugar increased 0.41 cents to 13.26 cents per pound. Soybean future closed up 8.50 cents to $13.47 per bushel.

Dollar edged higher but traded near record lows against euro to $1.4570 and edged higher against yen to 108.32.


[R]3:00PM New York, 9:00PM London – Housing market survey show continued softness and price decline across UK, except Scotland. Unemployment rate falls in January.[/R]

London stock indexes closed down after a report showed that house price falls accelerated in January. However other government reports indicating that the unemployment rate fell to a record and strong earnings from British Energy helped trimmed losses.

In London trading FTSE 100 fell 0.52% or 29.9 to 5,880.10.

Of the 102 stocks in FTSE 100 index 44 gained and 58 declined. British Energy led advancers with a rise of 9% after reporting that EBITDA for nine months ended December 31st stood at £745 million, 5% more than forecasted by analysts.

House Price Falls Accelerates in January

The Royal Institution of Chartered Surveyors reported its RICS UK housing market survey for January 2008. RICS house price balance declined for the sixth month in succession signaling half a year of negative market sentiment, adding that 54.7% more Chartered Surveyors reported a fall than a rise in house prices, from 49.1% in December.

Prices are increasing in Scotland only with the net balance of surveyors in that country reporting price-rise increasing to 7% from 3%. In addition, buyer enquiries fell at the fastest pace since October.

RICS notes that the fallout from credit crunch continues to prevent many would-be-buyers from entering the market and it is likely that demand will remain subdued while mortgage-lending criteria is tight.

The stock of unsold property on surveyors’ books jumped by more than 10% and has increased by 40% since September 2007, while the current average level of unsold property per surveyor stands at 85, the most since in 9 years.

Unemployment plummets

The Office of National Statistics reported today on its web site that the employment rate of people of working age rose 0.3% for the three months to December from the previous month and 0.2% on the year to 74.7% in January.

People in employment for the three months to December rose by 175,000 over the quarter and 296,000 to 29.40 million, the highest since the beginning of comparative records in 1971. However, total hours worked declined by 2.3 million to reach 935.6 million.

Statistics also showed that unemployment fell 0.2% over the previous quarter and 0.3% over the year at 5.2%, and the number of unemployed people fell by 61,000 for the quarter and 86,000 for the year at 1.61 million.

People claiming unemployment benefit declined for 16 consecutive months by 10,800 from December and 128,500 from the previous year to 794,600 in January. The figure is the lowest since June 1975.

The statistics office also added that the inactivity rate for people of working age fell 0.2% from the previous quarter and unchanged for the year at 21.0% for the three months to December 2007.

Economically inactive students has reached a record high of 1.94 million while the number of economically inactive people looking after the family or home has reached a record low of 2.26 million.

Average Earnings Rise

Separately, ONS reported that the annual rate of growth in average earnings, excluding bonuses, rose by 0.1% from the previous month at 3.7 % in December 2007.

Average earnings including bonuses rose by 3.8% in the year to December 2007 from 4% in November. Job vacancies in the three months to January rose by 7,300 over the previous quarter and 72,000 over the year to 677,400.

According to the statistics office December pay growth in the private sector was 4%, while it was 3.3% for the public sector.

Gainers & Losers

British Energy led gainers in the FTSE 100 index shares with a rise of 9% followed by gains in Experian Group of 4.19%, in Man Group of 4.04%, in International Power Plc of 2.59%, and in Reckitt Benckise of 2.56%.

British Energy rose after income exceeded analyst estimates as nine months EBITDA was £745 million. Net income for the three months ended December 31st, however dropped 18% to £140 million from £171 a year earlier.

Alliance & Leicester led decliners in the FTSE 100 stocks with a fall of 6.99% followed by losses in BG Group of 4.21%, in Vedanta Resources of 3.36%, in Taylor Wimpey of 2.70%, and in Persimmon of 2.62%. Homebuilders fell after RICS reported house prices continued to deteriorate in January.

Financial stocks fell on weak housing market survey. Royal Bank of Scotland fell 1.27%, and HBOS shed 1.19%.

Company News

Rio Tinto Plc reported today that net income in the six months ended December jumped from $3.64 billion a year earlier to $4.06 billion, while sales climbed 49% to $17.7 billion on increased production of iron ore. Full-year dividend was increased 31% to $1.36.

International Markets Update

In Tokyo Nikkei 225 Index closed higher 46.34 or 0.36% to 13,068.30, in Hong Kong Hang Seng index increased 247.88 or 1.08% closed to 23,169.55. Australia ASX 200 index decreased 66.00 or 1.18% to close 5,542.10.

In South Korea Kospi Index decreased 11.55 or 0.70% to close at 1,631.78, in Thailand SET index closed higher 11.92 or 1.46% to 829.41 and Indonesia JSE Index edged increased 18.71 or 0.72% to 2,610.78. Sensex index in India increased 341.10 or 2.05% to 16,949.14.

In London FTSE 100 Index closed lower 29.90 or 0.51% to 5,880.10, in Paris CAC 40 Index increased 14.69 or 0.30% to close at 4,855.40 and in Frankfurt DAX index higher 5.83 or 0.08% to close at 6,973.67. In Zurich trading SMI decreased 10.44 or 0.14% to close at 7,536.45.

[R]12:30PM New York – U.S. stocks edges higher on retail sales data.[/R]

U.S. stocks edged higher after a report on retail sales and weekly inventories of crude oil and other fuels.

Retail sales increased 0.3% in January from previous month. The surprise rise in the retail sales lifted market averages and retail stocks. Wal-Mart, Target, and Nordstrom increased after the report. JC Penney and Macy’s edged lower.

Blue Nile, online jewelry retailer, ((NILE)) fell 15% or $8.06 to $45.95 after reporting fourth quarter net sales rise of 23.3% to $111.9 million and net income increased 31% to $7.5 million. Earnings per share increased 29% 45 cents from 35 cents.

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for January, adjusted for seasonal variations, but not for price changes, were $382.9 billion, an increase of 0.3% from the previous month and 3.9% above January 2007. Total sales for the November 2007 through January 2008 period were up 4.4% from the same period a year ago.

Retail trade sales were up 0.4% from December 2007 and were 3.8% above last year.

U.S. crude oil refinery inputs averaged nearly 14.6 million barrels per day during the week ending February 8, up 69,000 barrels per day from the previous week''s average. Refineries operated at 85.1% in the last week. Gasoline production moved higher compared to the previous week, averaging 8.9 million barrels per day. Distillate fuel production rose last week, averaging nearly 4.1 million barrels per day.

U.S. crude oil imports averaged 9.7 million barrels per day last week, down 777,000 barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged 10.1 million barrels per day, 210,000 barrels per day above the same four-week period last year.

Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 841,000 barrels per day. Distillate fuel imports averaged 282,000 barrels per day last week.

U.S. commercial crude oil inventories rose by 1.1 million barrels compared to the previous week. At 301.1 million barrels, U.S. crude oil inventories are in the middle of the average range for this time of year. Total motor gasoline inventories increased by 1.7 million barrels last week, and are above the upper limit of the average range.

Distillate fuel inventories decreased by 100,000 barrels, and are in the middle of the average range for this time of year.


Deere sales rise

Deere & Company ((DE)) announced worldwide net income of $369.1 million, or $0.83 per share, for the first quarter ended January 31, compared with $238.7 million, or $0.52 per share, for the same period last year.

Worldwide net sales and revenues increased 18% to $5.201 billion for the quarter compared with $4.425 billion a year ago. Net sales of the equipment operations were $4.531 billion for the period compared with $3.815 billion last year.

Net sales of the worldwide equipment operations increased 19% for the quarter, including positive effects for currency translation and price changes of 6%. Equipment sales in the United States and Canada were up 9% for the quarter.

Net sales outside the United States and Canada increased 37% including currency translations gains 11%.

Equipment sales are projected to increase by about 17% for full-year 2008 and up 23% for the second quarter. Currency accounts for approximately 3% of the sales increase for both periods. Deere forecasted annual net income of $2.2 billion for the year and in a range of $700 million to $725 million for the second quarter.

Coca Cola earnings rise on international sales

The Coca-Cola Company ((KO)) today reported fourth quarter earnings per share of $0.52, an increase of 79% versus the prior year on a reported basis, and $0.58 after considering items impacting comparability, an increase of 12%. Earnings per share for the quarter included a net charge of $0.06 per share primarily related to restructuring charges and asset write-downs.

Earnings per share for the fourth quarter of 2006 were $0.29 and included a net charge of $0.23 per share primarily related to a non-cash impairment charge at Coca-Cola Enterprises Inc., an equity investee.

Earnings per share for the year were $2.57, an increase of 19% versus the prior year on a reported basis, and $2.70 after considering items impacting comparability, an increase of 14%. Earnings per share for the year included a net charge of $0.13 per share primarily related to restructuring charges and asset write-downs.

Full year 2006 earnings per share were $2.16 and included a net charge of $0.21 per share primarily related to a non-cash impairment charge at CCE.

Unit case volume increased 5 percent in the quarter and 6 percent for the year. Acquisitions contributed 1 point of unit case volume growth for the quarter and year. International operations delivered 7 percent unit case volume growth in the quarter and 8 percent growth for the year, reflecting broad-based growth across all groups.

The Company continued to deliver strong growth in sparkling beverages, which increased unit case volume 4% in the quarter and for the year. Key brands drove the results with Coca-Cola growing unit case volume 3% in the quarter and 4% for the year. Brand Fanta increased unit case volume 4% for the quarter and 5% for the year, and Trademark Sprite increased unit case volume 4% in the quarter and 8% for the year.

Still beverage unit case volume increased 11% in the quarter and 12% for the year. Trademarks Dasani and Powerade continued their strong performance, each increasing unit case volume 9% in the quarter and 10% for the year.

PF Chang’s earnings edges higher

PF Chang’s ((PFCB)) reported income from continuing operations per diluted share for the fourth quarter of fiscal 2007 was $0.37 compared to $0.35 for the fourth quarter of the prior year. Net income per diluted share was $0.28 compared to $0.34 in the prior year. The primary driver of the decline in net income per diluted share was the $0.08 asset impairment charge.

Consolidated income from continuing operations of $9.3 million for the fourth quarter ended December 30, 2007 compared to $9.0 million for the fourth quarter of the prior year. Net income for the fourth quarter of fiscal 2007 totaled $7.0 million compared to $8.8 million a year ago after including discontinued operations related Taneko, Japanese restaurant concept.

[R]10:00AM New York, 7:30PM Mumbai - Sensex advanced 2.1% on earnings reports and a market rebound after a week of volatile global markets.[/R]

Market Sentiment

India markets closed firm on Wednesday, reversing the two days of declines with the benchmark index Sensex gaining 2.1% at 16,949.14. In the broader markets, the Nifty surged 1.9% or 91 to close at 4,929 levels.

Of the Sensex shares, 23 stocks gained while the rest fell. Of the stocks traded on the BSE, 769 stocks advanced, 1,940 stocks declined, and 33 stocks remained unchanged.

Tata Steel was the biggest gainer among the Sensex 30 stocks. ITC, BHEL, HDFC Bank and Housing Development Finance were the other gainers surging over 3.9% each.

Among the NSE-50 stocks, Unitech, Hero Honda, SAIL and Tata Communications surged ahead by over 4.8% each. However, Idea Cellular, Nalco, Cipla and Wipro lost ground by over 2.9% each.

The BSE realty index surged 4.4% or 396 and was the biggest gainer among the sector indices. Unitech, Puravankara, Anant Raj Industries and Housing Development & Infra were the top gainers in this pack.

Daily turnover on the BSE was 5,647 crore rupees while daily revenue on the National Stock Exchange was at 13,172 crore rupees.

Reliance Power was the most active stock on the BSE with the turnover of 531.19 crore rupees, Jaiprakash Associates, Reliance Industries, Reliance Natural Resources and Tata Investment Corporation were also on the most active list.

Gainers and Decliners

Of the Sensex shares, Tata Steel soared 6.7% to 758.2 rupees, ITC, Bharat Heavy Electricals gained 5.5% to 1981.75 rupees, HDFC Bank climbed 4.9% to 1,463 rupees while Housing Development Finance Corporation rose 3.9% to 2,724.95 rupees.

Cipla slipped 3.7% to 179.45, Reliance Communication slumped 3.1% to 558.05 rupees, Wipro shed 2.8% to 409.95 rupees, Bajaj Auto fell 2.4% to 2022.2 rupees and Hindalco Industries lost 1.3% to 149.95 rupees

Unitech spurted 14.5% to 354.45 rupees, Housing Development and Infrastructure jumped 5.5% to 812.55 rupees DLF rose 2.8% to 815 rupees.

Steel Authority of India jumped 6% to 198.7 rupees, Jindal Steel & Power climbed 5.38% to 2,137.9 rupees and Sterlite Industries gained 4.5% to 737.9 rupees.

ICICI Bank rose 3.3% to 1099.25.rupees and the State Bank of India gained 2.9% to 2,116.95 rupees.

Suzlon Energy jumped 4.6% to 313.6 rupees, Tata Power rose 2.7% to 1,213.65 rupees.

Reliance Update

Reliance Industries advanced 2.7% at 2,386.9 rupees. RIL said it has discovered gas in a deepwater block in the Krishna basin. The block KG-DWN-2003/1 covers an area of 3,288 square kilometers. RIL holds 90% participating interest and Hardy Exploration and Production India Inc holds balance 10% in the block.

Reliance Energy rose 1.46% to 1,558.1 rupees and Reliance Power fell 0.89% to 351.4 rupees.

Earnings News

Hindustan Unilever surged 0.2% to 194.05 rupees. The company reported 23.5% rise in net profit to 6314.40 crore rupees on 17.9% rise in total income to 3,847.1 crore rupees in fourth quarter of December 2007 over the third quarter of December 2006.

Deals

Centurion Bank of Punjab jumped 4% to 48.2 rupees. The bank is reportedly in talks with financial institutions and large banks for a possible merger. ICICI Bank and HDFC Bank are also believed to be interested, according to bankers.

New Listing

Cords Cable Industries settled at 138.3 rupees on BSE, a premium of 2.4% as compared to issue price of 135 rupees. The stock debuted at 130 on the BSE, a discount of 3.7% over the IPO price.


[R]5:00AM New York, 7:00PM Tokyo-Corporate Goods Price Index rises to 3% in January.[/R]

Japan stocks indexes surged on gains in shipping lines as they raised freight charges. Investors remained cautious on the market direction ahead of the U.S. retail sales data for January.

In Tokyo trading Nikkei 225 rose 0.36% or 46.36 to 13,068.30, and the broader Topix index gained 0.1 or 0.75 to 1,285.35.

In the first section of the Tokyo Stock Exchange 20 billion shares worth 2.3 trillion yen were traded and in second section 391million yen worth 5.2 billion yen changed hands.

Of the Nikkei 225 stocks 118 gained, 97 declined, and 10 were unchanged. Sumitomo Osaka led gainers in the Nikkei 225 index shares with a rise of 9.39%.

Corporate Goods Price Index Rises

The Bank of Japan announced on its web site that the Corporate Goods Price Index jumped from 2.6% in December to 3% in January, which is the highest since March 1981.

The rate also increased 0.2% from the previous quarter on rising crude oil prices and food prices.

Subprime Losses Rise

Kyodo news online edition reported today that according to the Financial Services Agency Japan financial institution’s subprime related losses almost doubled from the previous quarter in the three months through December to 600 billion yen.

The FSA reportedly added that securities held by Japanese banks that are backed by the U.S. risky home loans also grew in the period to 1.52 trillion yen in the quarter to December from 1.41 trillion yen in the previous quarter.

Buffets Bail Out Offer

CNBC reported yesterday that Chairman of Berkshire Hathaway Inc Warren Buffet offered to assume responsibility for $800 billion in municipal bonds guaranteed by MBIA Inc. and Ambac Financial Group Inc and others.

Japanese investors were however skeptical of the offer and perceived that the offer may benefit Berkshire but is not likely to solve the problems in the subprime loan industry.

Gainers & Losers

Sumitomo Osaka led gainers in the Nikkei 225 index shares with a rise of 9.39% followed by rises in GS Yuasa Corp of 8.29%, in Alps Electric Co. of 7.05%, in Yokohama Rubber of 5.18%, in Taiheyo Cement of 5.03%.

Shipping lines also rose on rising freight charges. Mitsui O.S.K. Lines advanced 4.94%, Mitsui Engineering & Shipbuilding increased 4.6% and Kawasaki Kisen gained 4.43%.

Daiwa House Industries led decliners in the Nikkei 225 index shares with a drop of 7.76% followed by losses in Konami Corp. of 5.56%, in Denki Kigaku of 4.80%, in Nikon Corp. of 4.50, and Clarion Company Limited of 4.45%.

Company News

Asahi online news reported today that Bridgestone Corp announced yesterday at a press conference in Tokyo that it paid 150 million yen in bribes to foreign public officials in connection with the sale of rubber hoses used to transfer crude oil from tankers to onshore storage facilities.

Bridgestone President Shoshi Arakawa however said he will not resign or take responsibility.

The Nikkei reported today that Aiful Corp will raise 120 billion yen of capital by issuing new shares through convertible bond issues. The recent changes in Japan have limited the maximum interest charged for consumer loans to 20% and limited total outstanding loan that a consumer carry, and establish a designate credit bureau for consumers. There are 17,000 small lenders with largest seven lenders including GE Capital and Citigroup controlling 70% of market share.

Separately, the business online edition reported that Fujifilm Holdings will buy midsize drugmaker Toyama Chemical Co for 84.2 million yen.