U.S. Stocks: Heading Lower

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

U.S. stocks fell in the morning trading and declined further in the afternoon as nervous investors faced cautious comments from bank and brokerage analysts. Sanforn Bernstein brokerage analyst said that earnings at Goldman Sachs and Bear Stearns could fall 40%. Lower investment banking fees played a significant parts in estimates revision. Comments from Merrill Lynch analyst suggested that earnings at Fannie Mae and Freddie Mac may remain depressed through 2011.

[R]1:30PM New York – U.S. stocks declined after several analysts lowered earnings for brokers and housing lenders.

U.S. stocks struggled after analysts issued cautionary guidance on financial stocks.

Goldman Sachs and Bear Stearns declined but recovered from the worst levels after Sanford Bernstein brokerage analyst lowered estimates of earnings by 40%. Bear Stearns ((BSC)) dropped to $80 before recovering to $83.25. Goldman Sachs declined to $172.43 before rebounding to $173.40.

David Darst on Bloomberg Television interview said that people are adjusting to the scope of the financial system issues. Merrill Lynch analyst Kenneth Bruce said that Fannie Mae ((FNM)) and Freddie Mac earnings may decline well into the years till 2011.

Earnings Update

Intuit Inc. ((INTU)) a provider of business and tax software said that second quarter revenue of $834.9 million rose 11% from the same quarter last year.

Net income for the quarter ended 31st January was $115.2 million or $0.34 diluted per share, compared with from $145.4 million or $0.40 per diluted share in the same quarter last year.

Express Scripts, Inc. (ESRX) pharmacy benefit manager in North America reported that for the full year, net income rose 42% was $567.8 million, or $2.15 per diluted share, compared with $2.35, or $1.65 per diluted share year-ago.

Net income for the fourth quarter of $138.5 million, or $0.54 per diluted share, compared to $0.68 per diluted share, rose 33% increase over $0.51 per diluted share in the same quarter of previous year.

Nicor Inc. ((GAS)), a holding company that owns gas distributor reported results of twelve months ended December 31, 2007. Gas distribution operating income increased to $128.7 million from $123.9 million of 2006.

For the fourth quarter of 2007, gas distribution operating income decreased to $40.4 million from $43.7 million for the same quarter of year-ago. Revenue increased to $919.5 million from $838.2 million.

Net income for the quarter ended December 2007 fell to $55.5 million, or $1.22 per share, compared to $58.3 million, or $1.29 per share for the same period a year 2006.

Earnings for the 2007 twelve-month period, net income rose to $135.2 million, or $2.99 per share, from $128.3 million, or $2.87 per share, in 2006.

Syntel Inc. (SYNT), a provider of information technology services to the financial services, insurance, manufacturing, retail and healthcare industries, today announce its total revenue for the fourth quarter increased 28.6% to $94.0 million, compared to $73.1 million in the prior-year period and rose 7% from the third quarter.

Full year revenue for 2007 increased 25.0% to $337.7 million, from $270.2 million in 2006.

Net income for the fourth quarter was $15.9 million or $0.39 per diluted share, compared to $13.3 million or $0.32 per diluted share in the same period of 2006.

Net income for the year was $62.9 million.

International Markets

In Tokyo Nikkei 225 Index closed lower 187.82 or 1.37% to 13,500.46, in Hong Kong Hang Seng index decreased 317.96 or 1.35% closed to 23,305.04. Australia ASX 200 index decreased 23.50 or 0.42% to close 5,559.90.

In South Korea Kospi Index decreased 17.91 or 1.05% to close at 1,686.45, in Thailand SET index closed lower 0.27 or 0.03% to 826.86 and Indonesia JSE Index edged increased 6.97 or 0.25% to 2,741.18. Sensex index in India decreased 385.61 or 2.17% to 17,349.07.

In London FTSE 100 Index closed lower 43.70 or 0.74% to 5,888.50, in Paris CAC 40 Index decreased 34.30 or 0.71% to close at 4,824.55 and in Frankfurt DAX index lower 98.56 or 1.43% to close at 6,806.29. In Zurich trading SMI decreased 31.40 or 0.42% to close at 7,454.75.