Lehman Bros Tops Estimate

Elena
13 Dec, 2005
New York City

Asian-Pacific benchmarks closed mixed ahead of a key Bank of Japan survey. The Nikkei hit an intraday high of 15,782.30 to close up 0.3% on steel and metals stocks. European averages traded in a narrow range at mid-day, awaiting the U.S. Fed Reserve meeting today. Procter & Gamble lifted its Q2 earnings and sales outlook to 68-69 cents a shaare and 25% to 28% growth respectively.

U.S. MARKET AVERAGES

U.S. stock futures pointed to a weaker opening of Tuesday session with many investors cautious ahead of a Federal Reserve decision on interest rates. Another quarter-percentage-point rate increase is expected, but investors are mostly interested in the outlook for rates and whether the long streak of rate hikes will end soon.

On the earnings front, quarterly results from Best Buy Co. Inc ((BBY)), the leading U.S. electronics retailer and Investment bank Lehman Brothers Holdings Inc ((LEH)) are eagerly awaited.

Procter & Gamble ((PG)) said it expects Q2 earnings and sales to come in at the higher end of its guidance ranges, or 68 cents to 69 cents a share with sales higher by 25% to 26%. The company attributed its new sales outlook to strong performance from both the P&G and Gillette businesses and better-than-expected pricing contribution.

In merger-and-acquisition news, oil company ConocoPhillips ((COP)) agreed to buy Burlington Resources Inc. ((BR)), a major producer of natural gas, in a cash and stock deal worth $35.6 billion, making a huge bet that natural gas will remain lucrative over the long term.

Standard & Poor''s 500 futures were down 0.4 points, slightly above their fair value. Dow Jones industrial average futures were up 3 points, and Nasdaq 100 futures were flat.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks closed mixed with gains capped ahead of a key Bank of Japan survey Wednesday. The Nikkei hit a five-year intraday high of 15,782.30 to close up 0.3%, boosted by strong steel and metals stocks. Among regional markets, Hong Kong’s Hang Seng lost 0.3%, Australia’s All Ordinaries fell 0.5%, while South Korea’s Kospi gained 0.2%.

European stocks traded in a narrow range art mid-day ahead of U.S. Fed Reserve interest rate meeting today. The downside trend was limited by strong energy stocks. The German DAX 30 declined 0.2%, the French CAC 40 gained 0.1%, and London’s FTSE 100 rose 0.2%. The euro fell 0.3% against the dollar to $1.1913.

OIL, METALS, CURRENCIES

Crude oil prices slightly declined after the IEA predicted recovery in global oil demand next year but held above $61 a barrel on cold weather and OPEC’s decision to maintain production at the highest levels. Light sweet crude for January delivery fell 6 cents to $61.24 a barrel on the Nymex. Natural gas climbed 21 cents to $15.05 per 1,000 cubic feet. London Brent lost 21 cents to $59.26.

Gold prices declined in European trading. Gold in London was fixed at $522.80 per troy ounce, up from $536. In Zurich the precious metal fell to $522.03 from $583.03. In Hong Kong gold dropped $12.25 to close at $522.90. Silver opened at $8.69 from $9.07.

The U.S. dollar gained ground against other major currencies. In European trading the euro was quoted at $1.1924, down from $1.119.80. The dollar bought 120.27 yen, up from 119.75. The British pound stood at $1.7681,down from $1.7749.

EARNINGS NEWS

Tupperware Brands v((TUP)), food storage producer, predicted a 2005 sales rise of 6% to 7%, and earnings of $1.02 to $1.07 a share. If not for items, the company expects earnings of $1.45 to $1.50 a share, in line with analyst expectations of earnings a share of $1.49. For 2006 it forecasts sales of $1.75 billion to $1.8 billion, including a $35 million item related to foreign currency, and earnings of $1.41 to $1.51 a share, including foreign currency.

Cendant Corp ((CD)), travel & real estate services provider, warned that Q4 earnings from continuing operations are estimated at 23 cents a share, at the low end of a 23 cent to 26 cents a share range, on continuing challenges at its travel distribution services business. The company stated it believes issues at its international online operations will be addressed by the actions it is takings.

Isonics ((SON)), materials company, announced a revenue growth in its semiconductor division of 50% sequentially. More than 90% of the rise is attributable to sales of 300 million silicon wafers. Isonics'' previous expectation was that revenue would go up 25% sequentially in the quarter. The company noted that, while revenue is advancing, its silicon wafer business is still not profitable.

CIT Group, Inc.((CIT)), financial services company, announced that it is restating 2005 financial results on a technical interpretation of the derivative accounting rules. Earnings for the Q3 came at $1.02, down vs. $1.06 a share in the same period last year. The group stated it did not qualify for hedge accounting.