Arcelor Hikes Dividend, Fights Mittal

Elena
16 Feb, 2001
New York City

Asian markets closed strong, following Bernanke''s testimony and the oil prices drop. Taiwan climbed 1.44%, followed by the Nikkei, up 0.84%. European averages were led by the French CAC 40, up 0.2%. DaimlerChrysler said 2005 net profit advanced 15%, beating estimates but its operating profit dropped 10%. In Q4, the automaker posted 84% income rise. Arcelor plans to double its dividend to 768 million euros, trying to fend off a hostile $21.9 billion bid from Mittal Steel.

U.S. MARKET AVERAGES

U.S. stock futures were sitting at the unchanged level, pointing to a flat start Thursday, following a modestly higher close yesterday. A rebound in crude oil prices weighed on the broad market. The main focus of the day will be economic data with housing starts data due out before the opening bell. Also, later in the morning, Ben Bernanke will continue his Congressional testimony before the Senate Banking Committee.

January housing starts measure is projected to advance to a rate of about 2 million units in the month. Weekly economic data are also due out today. Economists expect initial jobless claims to come in at 285,000 for the week ended on February 11.

Tech stocks are expected to move to the upside helped by better-than-anticipated earnings from Hewlett-Packard and Applied Materials. Personal computer maker Dell is scheduled to release upbeat quarterly earnings Thursday and provide further support to the sector.

Retail companies Target Corp.((TGT)) and JC Penney Co. Inc. ((JCP)) are due to release Q4 results with analysts expecting strong results after Tuesday's better-than-expected January retail sales report. Goodyear Tire & Rubber Co ((GT)) is also expected to report on Thursday.

Standard & Poor's 500 futures were down 0.4 point, below fair value. Dow Jones industrial average futures were up 1 point, and Nasdaq 100 futures were up 3 points.

INTERNATIONAL MARKETS NEWS

Asian-Pacific benchmarks finished broadly higher, following oil prices drop and Fed Reserve Chairman Bernanke’s comment on further interest-rate increases. Taiwan Weighted index led the gainers with an advance of 1.44%. The Nikkei rose 0.84% with traders looking ahead to Friday’s GDP release. South Korea’s Kospi climbed 0.8% and Singapore Straits Times gained 0.63% on upbeat economic data.

European stocks traded slightly up, reflecting a strong close of U.S. markets overnight and mixed corporate news, including weakness at DaimlerChrysler on disappointing 2005 results. The German DAX 30 was lower at 5.762, the French CAC 40 gained 0.2%, and London’s FTSE 100 added 0.1%.

OIL, METALS, CURRENCIES

Crude oil prices climbed back over $58 a barrel, halting a two-week decline. Light sweet crude for March delivery gained 56 cents to $58.21 a barrel. London Brent added 45 cents to $58.60.

European gold prices further slipped. In London gold traded at the fixed price of $540.65 bid per troy ounce, down from $542.50. In Zurich the precious metal traded at $541.10, down from $544.10. In Hong Kong gold fell $5.30 to close at $540. Silver opened at 9.14, down from $9.23.

The U.S. dollar strengthened against other major currencies. The euro traded at $1.1868, down from $1.1883. The dollar bought 117.98 yen, up from $117.88. The British pound stood at $1.7339, down from $1.7398.

EARNINGS NEWS

DaimlerChrysler, ((DCX)), automotive company, reported that its 2005 net profit advanced 15% to 2.85 billion euros but its operating profit dropped 10% to 5.19 billion euro, due to a 505 million euro operating loss at its Mercedes unit that offset rising profitability at Chrysler. Revenue advanced 5% to 149.78 billion euros over the year on a 3% increase in unit sales. The company beat analyst estimate for a 2005 profit of 2.39 billion euros. In Q4, the automaker gained 84% more to 966 million euros with a 10% revenue increase to 41.45 billion euros.

Baker Hughes Inc, ((BHI)), oil services company, reported Q4 net profit soared 43.6% to 76 cents a share on 19% revenue growth, beating analyst estimate of 73 cents a shareBaker Hughes said it expects 2006 revenue to rise 19% to 21% from $7.19 billion in 2005. Income from continuing operations is expected to be in the range of $3.40 to $3.60 a share.

CryptoLogic Inc, ((CRYP)), gaming software company, reported that Q4 earnings increased 53.5% to 43 cents a share on 39.6% revenue growth, due to increased licensing fees from the company's poker software, which climbed 92% to $7.9 million.

Ness Technologies Inc, ((NSTC)), IT services company, reported that Q4 net income advanced 26.2% to 18 cents a share, if not for extraordinary income, on the back of a 27.6% increase in revenue, in line with analysts’ views.

Ansys Inc, ((ANSS)), software company, reported that its Q4 net income advanced 8.1% to 39 cents a share on 12.3% revenue growth. The company sees Q1 revenue in the range of $41 million to $42 million and adjusted earnings of 35 cents to 36 cents a share.