Hilton Brands Reunite

Elena
29 Dec, 2001
New York City

Thursday morning stocks were flat, trading in a narrow range as investors largely ignored economic data. Initial jobless claims in the week ended Dec 24 rose to 322,000 from 319,000 last week, vs. estimates of a rise of 325,000. In another report, the National Associations of Realtors said that existing home sales fell to a seasonally adjusted annual rate of 6.97 million units in Nov from a 7.09 million unit rate in Oct, slightly below estimates.

U.S. MARKET AVERAGES

In another light trading session, U.S. stock averages started slightly higher but with very little news to boost their way up, they lost direction and settled near the unchanged mark.

Three economic reports were released during the morning session, but investors paid did little in response to economic data. The Labor Department reported that first-time jobless claims rose by an expected 4,000 last week to a seasonally adjusted 322,000. In another report, the National Associations of Realtors said that existing home sales fell to a seasonally adjusted annual rate of 6.97 million units in Nov from a 7.09 million unit rate in Oct, slightly below estimates. The Department of Energy said that crude oil inventories rose by 100,000 barrels for the week ended Dec 23 from 322.5 million last week, while gasoline stockpiles fell1.2 million barrels.

Energy prices rose after the weekly inventory data with a barrel of light crude quoted at $60.45, up 63 cents, on the New York Mercantile Exchange.

The Dow Transportation Average rose by about 1.3%, boosted by gains in airline and trucking stocks. Energy stocks started showing modest gains, following the weekly petroleum report.

Tech stocks showed some weakness with the computer hardware and networking sectors showing modest losses and the disk drive sector sitting below the unchanged mark as well.

Celgene ((CELG)) climbed after announcing FDA approval of its REVLIMID drug, continuing its advance from yesterday and climbing to a new 52-week high. M-Flex ((MFLX)) broke to a new peak on uplifted Q1 guidance.

Bottomline Technologies ((EPAY)) dropped to a new 52-week low on an analyst downgrade. Shanda Interactive Entertainment ((SNDA)) continued its decline to reach a new low.

In midday trading, the Dow Jones industrial average rose 12.26, or 0.11%.The Standard & Poor's 500 index added 1.44, or 0.11%, and the Nasdaq composite index fell 0.29, or 0.01%.

Bonds were little changed, with the yield on the 10-year Treasury note rising to 4.38% from 4.37% late Wednesday.

MOVERS AND SHAKERS

Warner Music Group Corp ((WMG)) plans to pay a quarterly dividend of 13 cents a share, or $19.3 million in total on Feb. 14. Warner Music previously announced that it will pay regular quarterly dividends totaling up to $80 million a year. The stock rose 1%.

Christopher & Banks Corp. ((CBK)), the Minneapolis women's-clothing retailer, reported sales for the four weeks ended Dec. 24 rose 9% to $60.2 million from $55.1 million in the year-earlier period. December same-store sales rose 2%. During the Thanksgiving-through-Christmas period, CBK said, gift-card sales increased to 11 million from 9 million, indicating a 22% increase. The company’s shares advanced 1.2%

ECONOMIC NEWS

Crude oil inventories recorded another build in the latest week, according to government statistics released Thursday, though the advance was far more modest than in the previous week. Stocks of gasoline and distillate fuel oil declined during the period.

The Department of Energy revealed that crude oil inventories ticked up by 100,000 barrels for the week ended December 23, climbing to 322.6 million barrels from the prior week's level of 322.5 million barrels. This followed an advance of 1.3 million barrels in the previous week. Oil inventories were 12.6% higher than their levels of the same time last year.

Gasoline inventories posted a week-over-week decline of 1.2 million barrels, the government said, compared to the previous week's slide of 300,000 barrels. Gasoline stocks were 6% below their levels of last year. Inventories of distillate fuel oil fell by 900,000 barrels in the most recent week.

The National Associations of Realtors released its report on existing home sales in the month of November on Thursday, showing that sales fell slightly more than economist had been expecting.

The report showed that existing home sales fell to a seasonally adjusted annual rate of 6.97 million units in November from a 7.09 million unit rate in October. Economists had been expecting sales to fall to a 7.00 million unit rate.

The report also showed that the national median existing-home price came in at $215,000 in November, up 13.2 percent year-over-year.

Additionally, total housing inventory levels rose 1.2 percent to 2.90 million existing homes for sale at the end of November, a 5-month supply at the current sales pace.

Thursday morning, the Department of Labor released its report on initial jobless claims in the week ended December 24. The report showed that jobless claims rose slightly less than economists had expected.

The Labor Dept. said that jobless claims rose to 322,000 from the previous week's revised figure of 319,000. Economists had been expecting claims to rise to 325,000 compared to the 318,000 originally reported for the previous week.

The report also showed that the less volatile four-week moving average edged up to 325,000 from the previous week's revised average of 324,750. Additionally, continuing claims rose to 2.715 million in the week ended December 17 from the preceding week's revised level of 2.630 million.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks rallied on Thursday with the Nikkei in the lead, up 0.9%, hitting a multi-year high of 16,344.20 on hectic buying in expectations of strong corporate profit and robust economic growth across the region next year. South Korea’s Kospi rose 0.8%, Shanghai Composite surged 1.1%, and Taipei’s Weighted index advanced 0.8%. Hong Kong was the sole decliner, down 0.4%.

European stocks closed higher, supported by resource stocks and gains from the leading German insurers Allianz and Munich Re which posted detailed earnings outlooks. The German DAX 30 gained 0.2%, the French CAC 40 rose 0.3%, and London’s FTSE 100 climbed 0.3%, hitting a fresh four-year high.

OIL, METALS, CURRENCIES

Crude oil prices rose above $60 a barrel after oil inventory report showed an increase in oil inventories but a decline in gasoline and distillate fuels stockpiles. Light sweet crude for February delivery gained 38 cents to $60.15 a barrel on the Nymex. Gasoline rose 5 cents to $1.64 a gallon and heating oil edged up to $1.7025. Natural gas declined 2 cents to $11.66 per 1,000 cubic feet.

European gold prices neared a two-week high on speculations that the central banks may buy more of the precious metal to diversify their reserve. In London gold rose to $517 per troy ounce, up from $515.20. In Zurich the precious metal advanced to $517.03 from $515.75. In Hong Kong gold gained $8.05 to close at $516.90. Silver traded unchanged at $8.59.

The U.S. dollar steadied against its major counterparts ahead of economic data. The euro was quoted at $1.1845, up from $1.1836. The dollar bought 117.90 yen, up from 117.83. The British pound traded at $1.7199, up from $1.7160.

EARNINGS NEWS

Luby's Inc.((LUB)), cafeteria-style restaurants operator, posted a Q1 profit of 8 cents a share, up from a loss of 5 cents a share a year earlier, beating analyst estimate of 3 cents a share. Sales advanced 6.9% in Q1, compared with the same time last year, with same-store sales advancing 6.9% in the quarter. The company announced that its sales in Q1 were hurt by Hurricane Rita, which resulted in a loss of about 236 store days of operations.

CORPORATE NEWS

Hilton Hotels ((HLT)) confirmed that it reached a deal to acquire Hilton Group for about $5.71 billion. The hotel operator said the purchase price equates to a multiple of 11.3 times pro forma 2006 adjusted EBITDA. The deal is likely to close in the first quarter of 2006. The company stated that Hilton Group will retain its gambling and betting business and will likely change its name to Ladbrokes plc.

InterDigital Communications Corp. said late Wednesday that a federal judge confirmed an award rendered by a tribunal against mobile phone making giant Nokia Corp. for between $232 million and $252 million.