GDP Grows 4.3%

Elena
30 Nov, 2005
New York City

Asian-Pacific benchmarks closed mixed with the Nikkei crossing 15,000 for the first time in five years, but eventually closed down 0.4%. The biggest gainer was Seoul Kospi, rising 1.4%. European stocks fell on resource stocks. In corporate news, Yahoo dropped after UBS lowered its rating on the company to ''neutral from buy. Jewelry retailer Tiffany posted quarterly income rise of 16 cents a share, meeting expectations. The company affirmed its 2005 guidance.

U.S. MARKET AVERAGES

U.S. stock futures are pointing to a lackluster start of Wednesday trading session, awaiting government’s report on third-quarter Gross Domestic Product with economists predicting an upward revision to an annual rate of 4.1%. The expected strength in the economy keeps investors nervous as the positive figures in GDP may lead the Fed Reserve to continue raising the interest rate. Investors may also focus on the core personal consumer expenditure index, released jointly with the GDP data.

Shares of Yahoo Inc. ((YHOO)), operator of the most visited Web site, fell in European trading after UBS lowered its rating on the company to ''neutral'' from ''buy'' citing strategy concerns.

In earnings news, jewelry retailer Tiffany & Co ((TIF)) reported profot increase of 16 cents a share, vs 12 cents a year ago, in line with expectations. The company affirmed its 2005 earnings outlook.

A drop in oil prices may help offset declines in stocks. Crude was trading below $57 a barrel in New York. A weekly U.S. oil and gasoline inventory report is due at 10:30 a.m.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks closed mixed with the Nikkei crossing 15,000 for the first time in 5 years, but eventually finished lower 0.4% as investors locked in recent profits from technology, banking and steel stocks. Across the region, South Korea’s Kospi surged 1.4%, while Australia’s All Ordinaries lost 0.9%, followed by Hong Kong’s Hang Seng, down 0.6%.

European markets declined at mid-day, dragged by lower close of U.S. markets overnight and weak oil and mining stocks. Losses were cushioned by positive corporate news from Anglo-Dutch steelmaker Corus Group and Danish telecommunications carrier TDC. The German DAX 30 lost 0.3%, the French CAC 40 slipped 0.5%, and London’s FTSE 100 dropped 0.6%.

OIL, METALS, CURRENCIES

Crude oil prices slipped on continuously warm weather and expectations of sufficient fuel supplies. Light sweet crude for January delivery fell 34 cents to $56.35 a barrel in electronic trading on the Nymex. Heating oil slightly rose to $1.6125 a gallon, while gasoline slid to $1.3900. Natural gas rose 16 cents to $11.895 per 1,000 cubic feet. London Brent fell 18 cents to $54.14.

European gold retreated from its 18-year high of $500 per ounce. In London the precious metal was fixed at $493.80 per troy ounce, down from $497.20. In Zurich gold traded at $494.55, down from $494.75. In Hong Kong gold fell $4.25 to close at $493.25. Silver traded unchanged at $8.13.

The U.S. dollar traded in a mixed fashion against its major counterparts. The euro was quoted at $1.1780, down from $1.1786. The dollar stood unchanged against the yen, at 119.52. The British pound traded at $1.7246, up from $1.7193.

EARNINGS NEWS

Rex Stores Corp. ((RSC)), consumer electronics company, reported that Q3 profit more than doubled to 58 cents a share, from 27 cents a share in the year-ago period on 4.2% revenue growth with same-store sales up 4.6%.

The Dress Barn Inc. ((DBRN)), apparel company, reported Q1 net income rose to 64 cents a share, from 24 cents a share in the year-ago period on better-than-forecast results for both its dress barn and murices brands, beating analyst estimate of 40 cents a share. Sales rose 62% and comparable sales rose 9%. The company upped its guidance for the year and expects earnings from $1.90 to $1.95 a share, vs. an earlier view of $1.60 to $1.65 a share.

Tiffany & Core ((TIF)), jewelry and specialty retail store chain, posted Q3 earnings of 16 cents a share, up from 12 cents a share in the same period last year on 8% revenue growth, matching analyst estimate. The company reaffirmed its 2005 earnings estimate of $1.55 to $1.65 a share and its revenue growth forecast of 8% to 10%.

Smithfield Foods Inc. ((SFD)), meat processor, reported Q2 net income of 46 cents a share, down from 52 cents in the same period last year. If not for charges of 9 cents a share, the company would have gained 55 cents a share in Q2, missing on that basis the analyst estimate by a penny