Earnings Worries; Home Sales; Dow Down

123jump.com Staff
23 Oct, 2009
New York City

New York stocks declined as investor stay on the sidelines as earnings parade continues. Microsoft, Amazon.com and Whirlpool surged on earnings. Most companies are still reporting decline in earnings and sales in the latest quarter. Energy complex stocks traded lower on weak crude oil prices.

[R]12:30 PM New York – New York stocks declined as investor stay on the sidelines as earnings parade continues. Microsoft, Amazon.com and Whirlpool surged on earnings. Most companies are still reporting decline in earnings and sales in the latest quarter. Energy complex stocks traded lower on weak crude oil prices. Home builders fell on the worries that sales will decline after the expiration of tax incentives.[/R]

Stocks in New York fell after the release of earnings from Amazon.com, American Express, Honeywell, Microsoft, Ingersoll Rand and Whirlpool. Cost cutting helped companies in arresting earnings decline, but earnings at most companies are still lower than a year ago with sales down between 8% and 25%.

Amazon.com ((AMZN)) surged 24.8% to $116.57 and Microsoft ((MSFT)) advanced 7% to $28.47.

Seasonally adjusted existing home sales in September increased 9.4% to 5.57 million units from 5.1 million in August. Sales increased 9.2% from a year ago month and increased to the highest level since July 2007 rate of 5.73 million units.

Energy complex stocks and home builders led the decliners in the morning trading. Crude oil decreased 0.4% in the morning trading to $80.83 a barrel.

Earnings Review

Amazon.com, Inc, the online retailer said third quarter sales rose 28% to $5.45 billion from $4.26 billion a year ago. Net income in the quarter rose 68.6% to $199 million or 45 cents per diluted share compared to net income of $118 million or 27 cents per share a year ago.

American Express Company, the credit card company said third quarter revenues fell 16% to $6.02 billion from $7.16 billion a year ago. Net income in the quarter fell 21.5% to $640 million or 53 cents per diluted share compared to net income of $815 million or 70 cents per share a year ago.

Honeywell International Inc, the maker of cockpit electronics reported third quarter sales fell 17.2% to $7.7 billion from $9.3 billion a year ago. Net income in the quarter fell 15.4% to $608 million or 80 cents per diluted share compared to net income of $719 million or 97 cents per share a year ago.

Ingersoll-Rand plc, the maker of heating and cooling systems reported third quarter revenues fell 19.3% to $3.48 billion from $4.31 billion a year ago. Net income in the quarter fell 5% to $216.6 million or 65 cents per diluted share compared to net income of $227.7 million or 70 cents per share a year ago.

Microsoft Corporation, the software company reported first quarter revenues fell 14.2% to $12.92 billion from $15.06 billion a year ago. Net income in the quarter fell 18.3% to $3.57 billion or 40 cents per diluted share compared to net income of $4.37 billion or 48 cents per share a year ago.

Schlumberger Limited, the oil field services company reported third quarter sales fell 25.2% to $5.43 billion from $7.26 billion a year ago. Net income in the quarter fell 48.6% to $787 million or 65 cents per diluted share compared to net income of $1.53 billion or $1.25 per share a year ago.

Whirlpool Corporation, the appliance maker reported third quarter sales fell 8.2% to $4.5 billion from $4.9 billion a year ago. Net income in the quarter fell 46.6% to $87 million or $1.15 per diluted share compared to net income of $163 million or $2.15 per share a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 15.82 or 0.64% to 10,282.99, Hang Seng index in Hong Kong increased 379.21 or 1.71% to 22,589.73, and CSI 300 index in China higher 65.93 or 1.97% to 3,413.25. ASX 200 index in Australia increased 46.60 or 0.97% to 4,859.40. The FTSE Bursa KL Composite index in Malaysia was higher 7.08 or 0.56% to 1,267.10.

The Kospi Index in South Korea increased 9.84 or 0.60% to close at 1,640.33, JSE Index in Indonesia increased 34.76 or 1.43% to 2,467.95. The Sensex index in India increased 21.07 or 0.13% to 16,810.81. Markets in Thailand were closed today.

Europe Markets Review

In London FTSE 100 Index traded higher 63.18 or 1.21% to 5,270.54, in Paris CAC 40 Index increased 37.92 or 0.99% to 3,858.77 and in Frankfurt DAX index traded higher 57.43 or 1.00% to 5,820.36. In Zurich trading SMI increased 24.02 or 0.37% to 6,429.93.