Techs and Transportations Rally; Lowe's Falls

123jump.com Staff
19 May, 2008
New York City

U.S. stocks edged higher on a rally in tech and transportations stocks. As the earnings season winds down, investors appear to take higher risk and show willingness to pay higher prices for stocks. Broker recommendations lifted Amazon.com, Union Pacific and National City Corp. Campbell Soup reported third quarter revenue rise of 7% to $1.8 billion and earnings gain of 59% to $532 million. Excel Maritime gained after earnings surged 213% on 94% rise in revenue.

[R]2:00PM New York – U.S. stocks edged higher on a rally in tech and transportations stocks.[/R]

U.S. stocks edged higher despite a steady rise in the crude oil prices. As the earnings season winds down, investors appear to be ready to take more risk. Brokers recommended taking more holdings in the tech and transportation sectors on fund managers talked positively on the stocks and economic health.

Union Pacific ((UNP)) surged $5.07 to $158.02 after Stifel Nicolaus upgraded the stock to a ‘buy’ recommendation. The upgrade lifted Burlington Northern SantaFe added $2.79 to $111.33 and Norfolk Southern gained $1.98 to $66.25. Railroads are expected to pass on higher fuel costs and raise prices for freight to customers as road truck carriers have raised prices in the recent months.

Amazon.com ((AMZN)) surged $7.32 to $83.79 after the broker Goldman Sachs added the stock to its conviction list.

International coal companies surged after coal prices reached a new high in Asian trading. Yanzhou Coal Mining Company ((YZC)) surged $8.44 to $110.17. Peabody ((BTU)) added 97 cents to $79.81 and Arch Coal ((ACI)) increased 39 cents to $65.29.

Earnings news

Campbell Soup Company, the world''s largest soup maker reported third quarter sales rose 7% to $1.8 million from $1.7 million a year ago. Net income in the quarter increased 59.21% to $532 million or $1.40 per diluted share compared to net income of $217 million or 55 cents per share, a year ago.

Campbell Soup Company stock ((CPB)) fell $2.12 to $33.82.

Excel Maritime Carriers Ltd, a dry bulk goods ocean carrier reported first quarter revenues rose 94% to $69.8 million from $36.0 million a year ago. Net income in the quarter increased 213% to $38.5 million or $1.93 per diluted share compared to net income of $12.3 million or 61 cents per share, a year ago.

Excel Maritime Carriers Ltd stock ((EXM)) rose $1.38 to $59.10.

Lowe’s Companies, Inc, the nation''s second largest home improvement retailer reported first quarter revenues slipped 1.3% to $12.0 billion from $12.2 billion a year ago. Net income in the quarter fell 18% to $607 million or 41 cents per diluted share compared to net income of $739 million or 48 cents per share, a year ago.

Lowe’s Companies, Inc stock ((LOW)) fell 61 cents to $24.28.

Pacific Ethanol, Inc, the West Coast-based marketer and producer of ethanol reported first quarter sales rose 63% to $161.5 million from $99.2 million a year ago. Net loss in the quarter was $35.2 million or 90 cents per diluted share compared to net income of $1.9 million or 5 cents per share, a year ago.

Pacific Ethanol, Inc stock ((PEIX)) surged $1.48 to $4.68.

World markets

In Tokyo Nikkei 225 Index closed higher 50.13 or 0.35% to 14,269.61, in Hong Kong Hang Seng index increased 123.37 or 0.48% closed to 25,742.23. In Australia ASX 200 index higher 18.40 or 0.31% to close 5,949.40. Market of Malaysia was closed today.

In South Korea Kospi Index decreased 3.51 or 0.19% to close at 1,885.37. Indonesia JSE Index edged increased 25.42 or 1.71% to 2,510.96. Market of Thailand and India were closed today.

In London FTSE 100 Index closed higher 72.20 or 1.15% to 6,376.50, in Paris CAC 40 Index increased 64.06 or 1.26% to close at 5,142.10 and in Frankfurt DAX index higher 69.39 or 0.97% to close at 7,225.94. In Zurich trading SMI increased 125.22 or 1.64% to close at 7,778.93.