Durable Orders Rise; New Home Sales Fall

123jump.com Staff
24 Mar, 2010
New York City

U.S. stocks traded lower after new home sales declined and factory orders increased more than anticipated. Excluding defense orders, new orders rose 1.6% and excluding transportations, orders increased 0.9%. The dollar gained against the euro after Portugal debt was downgraded.

[R]10:25 AM New York – U.S. stocks traded lower after new home sales declined and factory orders increased more than anticipated. The dollar gained against the euro after Portugal debt was downgraded.[/R]

Stocks in the early trading declined after positive read on factory orders and new home sales decline in February. Continued turbulence in the euro dragged sentiment in stock trading in New York and Europe.

February durable goods orders increased 0.5% or $0.9 billion to $178.1 billion, third consecutive monthly increase including 3.9% in January.

Excluding defense orders, new orders rose 1.6% and excluding transportations, orders increased 0.9%.

Non-defense capital goods excluding aircrafts increased 1.1% after dropping 3.9% in January. Shipments increased 0.8% after falling 1.9%.

Seasonally adjusted new home sales decreased 2.2% to 308,000 and below 13.0% from a year ago. The median sale price of new homes sold in the month was $220,500 and average price was $282,600 with 9.2 months of inventory.

The rating agency Fitch lowered sovereign debt rating on Portugal to AA- with “negative” outlook. Fitch highlighted rising debt and noted that weak economy may force lead to additional downgrades in the year.

Commodities, Currencies and Yields

Crude oil futures of immediate month delivery declined $1.56 to $80.35 a barrel and natural gas futures fell 4 cents to $4.09 per mBtu.

Gold futures decreased $12.10 to $1,091.60 an ounce and copper futures fell 4 cents to $3.33 per pound.

The dollar edged up in international currencies trading. In the early trading in New York, one euro fetched $1.3342 and one dollar traded at 91.93 yen. One pound hovered near $1.4892.

Yields on 10-year U.S. bonds increased to $3.77 and 30-year U.S. bonds were nearly unchanged at 4.68%.

Stock Movers

Adobe Systems Inc gained more than 5% after it reported second quarter sales ahead of market consensus.

ConocoPhillips increased 0.5% after the company said it plans to increase its dividend and repurchase $5 billion of its stock.

Darden Restaurants Inc added 1.7% after it reported third quarter earnings of 95 cents.

General Mills Inc declined 1% after it reported third quarter net increased 15% to $332.5 million compared to 96 cents a share.

Lennar Corp soared 5% after it reported first quarter loss shrank 96% to $6.5 million.

MF Global Holdings Ltd soared 13% after former Goldman Sachs head and New Jersey Governor agreed to lead the company.

Earnings Review

General Mills, Inc ((GIS)), the maker of branded consumer food reported third quarter sales rose 2.5% to $3.63 billion from $3.54 billion a year ago. Net income in the quarter rose 15% to $332.5 million or 96 cents per diluted share compared to net income of $288.9 million or 85 cents per share a year ago.

General Mills, Inc, in the last one year traded as high as $73.95 in March 2010 and as low as $48.02 in March 2009. Based on the yesterday’s closing price of $73.57 the company has market cap of $24.24 billion.

Lennar Corporation ((LEN)), the homebuilder reported first quarter revenues fell 3% to $574.4 million from $593.1 million a year ago. Net loss in the quarter was $6.5 million or 4 cents per diluted share compared to net loss of $155.9 million or 98 cents per share a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 40.88 or 0.38% to 10,815.03, and Hang Seng index in Hong Kong increased 20.84 or 0.10% to 21,008.62, and CSI 300 index in China higher 1.10 or 0.03% to 3,276.67. ASX 200 index in Australia increased 16.70 or 0.34% to 4,891.50. The FTSE Bursa KL Composite index in Malaysia was higher 4.60 or 0.35% to 1,309.45.

The Kospi Index in South Korea decreased 0.81 or 0.05% to close at 1,681.01. SET index in Thailand closed higher 4.06 or 0.52% to 786.54. JSE Index in Indonesia increased 53.99 or 1.98% to 2,774.85. Markets in India were closed today.

Europe Markets Review

In London FTSE 100 Index traded lower 25.17 or 0.44% to 5,648.46, in Paris CAC 40 Index decreased 28.47 or 0.72% to 3,924.08 and in Frankfurt DAX index traded lower 28.64 or 0.48% to 5,988.63. In Zurich trading SMI decreased 20.49 or 0.30% to 6,856.67.