CPP Index Falls 0.3%

Elena
15 Nov, 2005
New York City

Asian-Pacific markets finished lower with the Nikkei falling 0.1% on banking stocks. European stocks declined at mid-day, pressured by Vodafone and Diageo. On the earnings front, Home Depot reported Q3 profit rise of 72 cents a share on 10% sales rise, beating estimates of 68 cents a share. American Eagle Outfitters posted Q3 net income increase of 47 cents a share, beating analyst estimate by a penny. Same-store sales rose 14%.

U.S. MARKET AVERAGES

U.S. stock futures are showing weakness in pre-market trading, pointing to a lower opening on economic data expected later in the morning and a warning from Target Corp that same-store sales would come below its forecast of a 4% to 6% increase. On Monday averages closed flat on consolidation of gains, made in the past few weeks.

S&P 500 futures were down 2.70 points, below their fair value. Dow Jones industrial average futures were down 12 points, and Nasdaq 100 futures were down 2 points.

In corporate news, Home Depot ((HD)), home improvement retailer announced Q3 earnings rise of 72 cents per share vs. 60 cents per share in the same period last year on 10.5% sales growth to $20.7 billion. The company also raised its full-year sales increase to the range of 10% to 12% and earnings growth between 17% and 18%.

Health Management Associates ((HMA)), hospital operator, reported a Q4 profit increase of 35 cents per share vs. 30 cents per share a year ago on revenue of $920.8 million, up from $789.7 million last year. HMA revealed that it has executed a definitive agreement to acquire Gilmore Memorial Hospital located in Amory, Mississippi.

Allergan ((AGN)) has made an offer to acquire Inamed ((IMDC)) for about $3.2 billion in cash and stock. The company reported that the deal would represent a premium of about $450 million over the bid made by Medicis. Allergan stated that under its offer, each Inamed share would be exchanged for $84 in cash or 0.8498 of an Allergan share, subject to proration such that a total of $1.45 billion in cash and 17.9 million shares were exchanged.

ECONOMIC NEWS

Wholesale prices rose more than expected in October, according to a report from the Department of Labor, although the report also showed an unexpected decrease in core prices.

The report showed that the Producer Price Index rose 0.7 in October following a 1.9 percent increase in September. Economists had been expecting a more modest 0.1 percent increase in prices.

The increase was partly due to a continued increase in energy prices, which rose 4.1 percent in October after surging up by 7.1 percent in September. While gas prices turned lower in October, prices for residential natural gas and home heating oil advanced at faster rates than in September.

The report also showed that core prices, which exclude food and energy prices, fell by 0.3 percent in October, reversing the 0.3 percent increase seen in September. The decrease surprised economists, who had expected another 0.3 percent increase.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks closed lower, reflecting domestic worries and lackluster U.S. markets session Monday. The Japanese Nikkei shed 0.12% on bank shares and other overvalued stocks sell-off. Across the region, Hong Kong’s Hang Seng finished flat, South Korea’s Kospi declined 0.3%, and Singapore Straits Times lost 0.7%.

European markets lost ground at mid-day trading, pressured by telecom company Vodafone, drinks maker Diageo and mixed performance of U.S. averages Monday. The German DAX 30 lost 0.1%, the French CAC 40 shed 0.1%, and London’s FTSE 100 declined 0.4%. The euro was traded at $1.1672.

OIL, METALS, CURRENCIES

Crude oil prices dropped close to $57 a barrel as unusually warm weather encouraged refiners to stockpile winter fuel. Light sweet crude December delivery fell 32 cents to $57.37 a barrel. London Brent lost 37 cents to $54.36.

Gold price inched up in European trading. In London the precious metal was fixed at $467.55 per troy ounce, up from $467.50. In Zurich gold advanced to $467.28 from $467.25. In Hong Kong gold fell $2.30 to close at $468.25. Silver traded at $7.72, down from $7.80.

The U.S. dollar traded higher against its major counterparts. The euro was quoted at $1.1674, down from $1.1693. The dollar bought 119.04 yen, up from 118.71. The British pound traded at $1.7331, down from $1.7383.

EARNINGS NEWS

Home Depot Inc. ((HD)), home-improvement retailer, posted a Q3 net income of 72 cents a share, up from 60 cents in the same period a year ago, beating analyst estimate of 68 cents a share. Sales increased 10.5%, as comparable-store sales rose 3.6%. Operating margin grew to 11.9%, as the company''s average ticket rose to $58.92. Home Depot also revised higher projected growth range for full-year sales to 10% to 12%, up from 9% to 12% previously, and raised its growth target for earnings per share to 17% to 18% from a range of 14% to 17%.

Group ((VOD)), British mobile operator, lowered its interim dividend by 15% to 2.20 pence a share as it posted first-half net profit down 23.5% to 4.36 pence a share on an impairment charge of 500 million pounds. Sales for the period rose 9% to, beating analysts'' expectations, as Vodafone added 10 million new subscribers, bringing its total customer base to 171 million. The group announced it envisages fiscal-year sales between the 6% to 9% range previously indicated.

BJ''s Wholesale Club Inc. ((BJ)), retailer, posted Q3 net income of 41 cents a share, up 20% from 33 cents a share in the year-earlier period on 9.3% revenue growth and 4.1%. same-store sales rise. Q3 adjusted net income was 38 cents a share, topping analysts’ forecasts of 36 cents a share.

Staples Inc. ((SPLS)), office products retailer, reported Q3 net income of 32 cents a share, up from 28 cents in the same period last year, matching the analysts’ forecasts. Sales increased 11% , above the analyst estimate. Same-store sales jumped 3%, while North American retail sales increased 9%.