Manufacturing Report Lifts U.S. Stocks

123jump.com Staff
01 Feb, 2010
New York City

Stocks traded higher after manufacturing expanded in January and the dollar advanced. Commodities traded mixed. Exxon gained on better than expected earnings. Gannett Co plunged 10% after revenues declined 14%.

[R]10:30 AM New York – Stocks traded higher after manufacturing expanded in January and the dollar advanced. Commodities traded mixed. Exxon gained on better than expected earnings. Gannett Co plunged 10% after revenues declined 14%.[/R]

Stocks in the early hours of trading traded higher after manufacturing expanded at the fastest pace since August 2004. Commodities traded mixed and Exxon Mobil edged up after reporting smaller than expected decline in profit. Gannett Co Inc and Hewitt Associates, Inc declined after reporting earnings.

The factory index published by the Institute for Supply Management increased to 58.4 in January from 54.9 in December. A read above 50 indicates an expansion.

New orders index increased to 65.9 from 64.8 and export orders increased to 58.5 from 54.5.

The latest read on the GDP suggested that manufacturers are rebuilding inventories and corporate spending in new equipment is also showing nascent signs of activities.

December personal income increased 0.4% and disposable personal income increased 0.4%. Personal consumption expenditure increased 0.2% in the month. In November personal income increased 0.5%, DPI increased 0.5% and PCE increased 0.7%.

December construction spending declined 1.2% as annual rate of $902.5 billion from the revised November estimate of $913.2 million and dropped 9.9% from a year ago spending of $1.00 trillion.

Crude oil futures increase 89 cents to $73.78 a barrel and natural gas futures surged 25 cents or 5% to $5.38 per mBtu. Gold edged higher by $5.80 to $1,089.60 per ounce.

Ten year U.S. Treasuries yielded 3.66% and 30-year bonds traded at 4.57%.

Earnings Review

Gannett Co, Inc, the newspaper publisher reported fourth quarter revenues fell 14.4% to $1.49 billion from $1.74 billion a year ago. Net income in the quarter was $133.6 million or 56 cents per diluted share compared to net loss of $4.7 billion or $20.65 per share a year ago.

Hewitt Associates, Inc., the human-resource services company reported first quarter revenues rose 0.2% to $795.5 million from $794.0 million a year ago. Net income in the quarter rose 5.6% to $68.4 million or 71 cents per diluted share compared to net income of $64.8 million or 68 cents per share a year ago.

Humana Inc, the health insurer reported fourth quarter revenues rose 2% to $7.63 billion from $7.49 billion a year ago. Net income in the quarter rose 44% to $250.7 million or $1.48 per diluted share compared to net income of $174.1 million or $1.03 per share a year ago.

Total revenues for the fiscal year 2009 rose 7% to $31.0 billion from $29.0 billion a year ago. Net income for the year rose 60.7% to $1.04 billion or $6.15 per diluted share compared to net income of $647.2 million or $3.83 per share a year ago.

Sysco Corporation, the distributor of food and related products reported second quarter sales fell 3% to $8.87 billion from $9.15 billion a year ago. Net income in the quarter rose 13% to $268.3 million or 45 cents per diluted share compared to net income of $237.7 million or 40 cents per share a year ago.

Sohu.com Inc, an Internet company reported fourth quarter revenues rose 12% to $135.8 million from $121.6 million a year ago. Net profit in the quarter fell 43% to $32.3 million or 76 cents per diluted share compared to net profit of $56.6 million or $1.45 per share a year ago.

Revenues for the full-year rose 4.6% to $177.1 million from $169.3 million a year ago. Net profit for the full-year fell 6.8% to $147.8 million or $3.57 per diluted share compared to net profit of $158.6 million or $4.06 per share a year ago.