Stocks Struggle, Wholesale Prices Rise

Mukesh Buch
17 Nov, 2009
New York City

European stocks traded lower and Asian markets closed lower after Fed Chairman Bernanke gave a cautious outlook. U.S. commercial real estate loans of $500 billion annually are due for the next few years. Wholesale prices in October increased 0.3%. Euro-zone September surplus was 3.7 billion euros.

[R]8:45 AM New York – European stocks traded lower and Asian markets closed lower after Fed Chairman Bernanke gave a cautious outlook. Commercial real estate loans markets remain closed. Wholesale prices in October increased 0.3%. Euro-zone September surplus was 3.7 billion euros.[/R]

Stocks in Europe traded lower and Asia closed weaker after Fed Chairman Bernanke gave a cautious outlook for the U.S. economy.

Bernanke noted in prepared remarks that U.S. economic conditions are better than they were a year ago but the flow of credit is still constrained and unemployment is still too high for the economy to recover.

Small businesses are still reporting tight lending conditions and expect “business conditions to tighten further.”

Commercial real estate loans are securitization market remains virtually closed and $500 billion of these loans are scheduled to mature annual over the next few years.

The wholesale prices in October increased 0.3% and core prices excluding fuel and food dropped 0.6%. Core prices decreased the most since July 2006. The wholesale prices declined 1.9% from a year ago but core prices increased 0.7% from a year ago.

The preliminary estimate of September trade surplus of the Euro Area 16 with rest of the world was 3.7 billion euro compared with deficit of 6.0 billion from year ago. Seasonally adjusted exports rose 5.5% in September compared with August 2009.

Earnings Review

Sina Corporation, an online media company said third quarter revenues fell 8.5% to $96.4 million from $105.4 million a year ago. Net income in the quarter fell 11.6% to $16.7 million or 29 cents per diluted share compared to net income of $18.9 million or 31 cents per share a year ago.

Atlantia SpA, the toll motorway builder and operator said nine months revenues rose 2% to €2.69 billion from €2.64 billion a year ago. Net profit in the quarter fell 7.6% to €581.9 million compared to net profit of €630 million a year ago.

Burberry Group plc, the luxury goods company said first-half revenues rose 6.2% to £572.4 million from £539.1 million a year ago. Net profit for the first-half fell 24% to £56.8 million or 12.9 pence per diluted share compared to net profit of £74.8 million or 17.0 pence per share a year ago.

The British Land Company PLC, the real estate investment trust said first-half net rental income fell 16% to £208 million from £248 million a year ago. Net loss for the first-half was £112 million or 13 pence per diluted share compared to net loss of £1.3 billion or 213 pence per share a year ago.

easyJet plc, the low-cost airline said full-year revenues rose 12.5% to £2.7 billion from £2.4 billion a year ago. Net profit for the full-year fell 14.4% to £71.2 million or 16.6 pence per diluted share compared to net profit of £83.2 million or 19.4 pence per share a year ago.

Enterprise Inns plc, a leased and tenanted pub operator said full-year revenues fell 7% to £818 million from £880 million a year ago. Net profit for the full-year fell 96.7% to £6 million or 1.2 pence per diluted share compared to net profit of £183 million or 36.7 pence per share a year ago.

ICAP plc, an interdealer broker said first-half revenues rose 6% to £809 million from £764 million a year ago. Net profit for the first-half rose 2% to £94 million or 14.4 pence per diluted share compared to net profit of £92 million or 14.2 pence per share a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 61.25 or 0.63% to 9,729.93, and Hang Seng index in Hong Kong decreased 29.83 or 0.13% to 22,914.15, and CSI 300 index in China higher 2.56 or 0.07% to 3,628.35. ASX 200 index in Australia decreased 25.80 or 0.54% to 4,729.40. The FTSE Bursa KL Composite index in Malaysia was higher 1.64 or 0.13% to 1,279.95.

The Kospi Index in South Korea decreased 6.49 or 0.41% to close at 1,585.98. SET index in Thailand closed lower 0.20 or 0.03% to 706.55. JSE Index in Indonesia increased 5.11 or 0.21% to 2,473.79. The Sensex index in India increased 18.14 or 0.11% to 17,050.65.

Europe Markets Review

In London FTSE 100 Index traded lower 23.81 or 0.44% to 5,358.86, in Paris CAC 40 Index decreased 14.09 or 0.36% to 3,849.07 and in Frankfurt DAX index traded lower 17.93 or 0.31% to 5,786.89. In Zurich trading SMI decreased 17.64 or 0.27% to 6,405.17.