Fed, SEC Extensions, Stocks Rise

123jump.com Staff
30 Jul, 2008
New York City

U.S. stocks edged higher for the second day after financials gained and crude oil futures declined. Banks and mortgage lenders Fannie and Freddie rose after SEC extended controversial trading ban on short selling till August 12. In earnings, Cummins rose after second quarter earnings gained 37% but CB Richard Ellis plunged 19% after earnings fell 88%. An employment survey by ADP showed a gain of 9,000 jobs in July. The Fed extended its access to discount window to investment banks till January.

[R]11:20AM New York – U.S. stocks rise for the second day with financials trading higher and crude oil price falling.[/R]

U.S. stocks edged higher in the morning after crude oil fell, financials rose and earnings from Cummins and MetLife lifted the sentiment in trading. Dow Jones Industrial Average gained 131.50 to 11,529, Nasdaq increased 13.36 to 2,332.98 and S&P 500 edged 14 to 1,277.18.

Commodities and metals in the morning trading in New York edged lower. Crude oil futures fell 58 cents to $121.61 a barrel and natural gas dropped 20 cents to $8.93 per mBtu. Gold declined $21.90 t $904.50 per ounce and silver dropped 43 cents to $16.97 per ounce. In base metal trading copper lost 2.80 cents to 356.25 cents per ounce and zinc lost $46.25 to $1,869 a ton.

Fannie Mae and Freddie Mac rose after SEC extended trading ban for naked short strategy on 19 financial stocks till August12. The controversial move is expected to prevent speculative trades from driving these stocks lower. The SEC move is widely perceived as an attempt by the government to shore up stocks of banks and two troubled mortgage lenders. If similar steps were taken by any emerging markets, SEC and traders would have deemed interfering with free markets.

Comcast surged 4% after it reported profit increase of 7.5%, Cummins Inc increased 9% after second quarter earnings rose 37% and MetLife dropped 5% after earnings dropped 19%. CB Richard Ellis plunged 19% after earnings fell 88% on lower earnings.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 208.34 or 1.58% to 13,367.79, Hang Seng index in Hong Kong increased 432.60 or 1.94% closed to 22,690.60. ASX 200 index in Australia increased 89.30 or 1.84% to close 4,936.70. The KL Composite index in Malaysia increased 9.14 or 0.79% closed to 1,159.94.

The Kospi Index in South Korea increased 10.50 or 0.67% to close at 1,577.70. SET index in Thailand closed lower 6.83 or 1.01% to 669.90. The Sensex index in India increased 495.67 or 3.59% to 14,287.21. Market of Indonesia was closed today.

Earnings Review

Alcatel Lucent telecom equipment provider said second quarter revenues declined 5.2% to 4,101 million euros from 4,326 million euros a year ago. Net loss in the quarter was 222 million euros or 16 euro cents per ADS compared to net loss of 336 million euros or 20 euro cents per ADS, a year ago.

Alcatel Lucent ((ALU)) in the last one year traded as high as $13.34 in July 2007 and as low as $5.08 in March 2008. Based on the yesterday’s closing price the company has a market cap of $13.78 billion.

BankAtlantic Bancorp, Inc, a bank holding company said second quarter net loss in the quarter was $19.4 million or 35 cents per diluted share compared to net income of $11.7 million or 20 cents per share, a year ago.

BankAtlantic Bancorp, Inc ((BBX)) in the last one year traded as high as $9.60 in October 2007 and as low as $0.81 in July 2008. Based on the yesterday’s closing price the company has a market cap of $92.83 million.

CB Richard Ellis Group, Inc, the world''s largest commercial real estate brokerage said second quarter revenues declined 15.38% to $1.3 billion from $1.5 billion a year ago. Net income in the quarter plunged 88% to $16.6 million or 8 cents per diluted share compared to net income of $141.1 million or 59 cents per share, a year ago.

CB Richard Ellis Group, Inc ((CBG)) in the last one year traded as high as $38.00 in July 2007 and as low as $15.23 in January 2008. Based on the yesterday’s closing price the company has a market cap of $3.77 billion.

Centex Corporation, one of the largest homebuilders said first quarter revenues dropped 41% to $1.13 billion from $1.90 billion a year ago. Net loss in the quarter was $150.1 million or $1.21 per diluted share compared to net loss of $128 million or $1.05 per share, a year ago.

Centex Corporation ((CTX)) in the last one year traded as high as $40.49 in August 2007 and as low as $10.91 in July 2008. Based on the yesterday’s closing price the company has a market cap of $1.72 billion.

Chicago Bridge & Iron Company N.V, an engineering, procurement and construction company said second quarter revenues rose 28.57% to $1.4 billion from $1.0 billion a year ago. Net loss in the quarter was $140.5 million or $1.47 per diluted share compared to net income of $26.1 million or 27 cents per share, a year ago.

Chicago Bridge & Iron Company N.V ((CBI)) in the last one year traded as high as $63.50 in January 2008 and as low as $27.50 in July 2008. Based on the yesterday’s closing price the company has a market cap of $3.28 billion.

General Cable Corporation, an industrial products company said second quarter sales jumped 41.7% to $1.74 billion including acquisitions in the last twelve months of $478.7 million compared to $1.172 billion. Net income in the quarter rose 17% to $75.6 million or $1.37 per diluted share compared to net income of $62.8 million or $1.15 per share, a year ago.

General Cable Corporation ((BGC)) in the last one year traded as high as $83.58 in December 2007 and as low as $47.88 in August 2007. Based on the yesterday’s closing price the company has a market cap of $3.25 billion.

Jones Lang LaSalle Incorporated, one of the world''s largest real estate service companies said second quarter revenues fell 2% to $660 million from $676.0 million a year ago. Net income in the quarter plunged 69% to $24.5 million or 73 cents per diluted share compared to net income of $77.9 million or $2.32 per share, a year ago.

Jones Lang LaSalle Incorporated ((JLL)) in the last one year traded as high as $117.59 in July 2007 and as low as $52.32 in July 2008. Based on the yesterday’s closing price the company has a market cap of $1.81 billion.

MetLife, Inc, a provider of insurance and other financial services said second quarter revenues rose 4% to $13.72 billion from $13.21 billion a year ago. Net income in the quarter plunged 19% to $915 million or $1.26 per diluted share compared to net income of $1.13 billion or $1.48 per share, a year ago.

MetLife, Inc ((MET)) in the last one year traded as high as $71.23 in October 2007 and as low as $47.73 in July 2008. Based on the yesterday’s closing price the company has a market cap of $37.51 billion.