Finance Markets

October 27, 2006

Eurofirst ends higher for fifth week in a row

Permalink: Eurofirst ends higher for fifth week in a row

Filed under: Equities, Economy, Europe

The FTSE Eurofirst 300 was up 0.2 percent over the week to 1,448.46 for its fifth week in a row of positive movement.

The automobile manufacturing sector was up on pleasing quarterly reports. Fiat added 0.3 percent over the week to €13.86, while Renault gained 1.3 percent to €90.90 and DaimlerChrysler was 4.5 percent higher to €43.27.

In a related sector, tire makers saw mixed results. While Michelin added 4 percent over the week to €64 on a quarterly report that was about where analysts expected it to be, Continental dropped 5 percent to €87.49 on negative comments from both Goldman Sachs and Deutsche Bank.

The pharmaceuticals sector was lower. Sanofi-Aventis was 2.2 percent lower for the week to €68.65 and Novo Nordisk declined 4 percent to DKr455. The sector was hurt by the announcement from AstraZeneca in the UK that trials of a new drug to treat stroke patients had not been successful.

On the other hand, the telecommunications sector saw gains during the week on quarterly results and bids rumors. The biggest winner was Telenor, which added 13.2 percent this week to NKr103 after its quarterly results brought positive comments and target share price increases from a number of brokers. France Telecom also did very well, gaining 8.8 percent to €20.56 as its third-quarter report earned it target share price increases from UBS and Citigroup.

There were gains elsewhere in the sector, with OTE of Greece being the exception. OTE dropped 0.2 percent to €19.80 on rumors that Telekom Austria could be looking to buy a share of the Greek telecom. Telekom Austria added 0.1 percent to €20.01. Telefonica gained 5.5 percent to €15.06 and Deutsche Telekom was 6 percent higher to €13.52.

Tokyo markets lower on CPI figures

Permalink: Tokyo markets lower on CPI figures

Filed under: Equities, Economy, Asia, Japan

In Tokyo on Friday equities markets were lower as new consumer price information showed that the Japanese economy might not have completely emerged from deflation, with core consumer prices in September up by only 0.2 percent. The new data makes it fairly certain that the Bank of Japan will not raise interest rates anytime soon.

The Nikkei 225 ended the session at 16,669.07, 0.9 percent lower, while the Topix index dropped 0.8 percent to 1,650.73.

The automobile manufacturing sector managed gains on the session. Nissan was 2.5 percent higher to ¥1,424 even though its quarterly report was not up to expectations. Honda added 2.6 percent to ¥4,270 on an upgraded full-year outlook.

Sony added 1.2 percent to ¥4,880 in a mixed electronics sector. Matsushita dropped 1.8 percent to ¥2,530 before releasing interim figures, but after the session’s close it said it’s operating profits in the first half were up 21 percent.

Banks were lower on the CPI news, with Mitsubishi UFJ 1.3 percent lower to ¥1,510,000. Mizuho Financial dropped 1.9 percent to ¥937,000.

October 26, 2006

Homebuilders decline on lower prices

Permalink: Homebuilders decline on lower prices

Filed under: Equities, Economy, US

The New York equities markets were mixed at midday on Thursday on new concerns that the housing market in the United States is continuing to slow. The Dow Jones Industrial Average had dropped 0.1 percent to 12,120.19 and the S&P 500 was 0.02 percent lower to 1,381.98. The Nasdaq Composite was 0.03 percent higher to 2,375.4.

Pulte Homes reflected the slowdown in its report of a significant drop in earnings and a warning that fourth-quarter earnings will be much lower than current estimates. Pulte’s shares were 0.7 percent lower to $31.98 in the wake of new data from the Commerce Department that shows the median price of a new home down 9.7 percent in September.

Stock exchanges were also lower on the session so far. Nasdaq dropped 0.5 percent to $36.80. Meanwhile, the Chicago Mercantile Exchange, which has agreed to take over the Chicago Board of Trade, dropped nearly 1 percent to $492.10. The Chicago Board of Trade itself dropped even more, by 1.6 percent to $145.08. The NYSE Group, which owns the New York Stock Exchange, fell 1.7 percent to $74.10 despite reporting third-quarter profits had tripled.

In the oil sector, ExxonMobil added 0.2 percent to $71.15 on operating profits that were at $10.5 billion in the quarter, the second highest quarterly profit ever reported by a US company.

Dow Chemical gained 0.9 percent to $40.52 on higher earnings and a share buyback scheme worth $2 billion.

Among retailers, Wal-Mart also added 0.9 percent to $51.30 on the announcement that it is expanding the $4 generic prescription price it introduced in Florida to 12 more states, bringing the total number of states now included in the program to twenty-seven.

European telecoms higher on session

Permalink: European telecoms higher on session

Filed under: Equities, Economy, Europe

Despite gains in the telecommunications sector, the FTSE Eurofirst 300 was lower on Thursday, dropping 0.2 percent to 1,452.33.

Telefonica added 1.6 percent to €14.85, while Deutsche Telekom gained 2.1 percent to €13.22 and Cosmote of Greece was 2.6 percent higher to €18.98. France Telecom was up 3.6 percent to €20.10 on a gain of 3.5 percent in underlying profits thanks to income from foreign purchases. FT was also helped by positive comments from Bear Stearns. Norwegian telecom Telenor added 7 percent to NKr96.60 on its third-quarter earnings report, which was better than had been anticipated and elicited glowing remarks from both Citigroup and Bear Stearns.

ThyssenKrupp added 2.8 percent to €30.82 on rumors that US steel maker Nucor could be ready to make a bid for the German company.

The pharmaceuticals sector was also lower, with Sanofi-Aventis dropping 0.6 percent to €69.70 on the news from Bristol-Myers Squibb reported earnings down in the third quarter. Sales of the blood-thinner Plavix, which Sanofi-Aventis and Bristol-Myers Squibb partner in, were hurt by generic drugs that serve the same purpose. Also not helping the sector was the 7 percent decline on the day by AstraZeneca in the UK after the failure of trials for an experimental stroke drug.

Tiremakers were mixed on the session, with Michelin up 0.6 percent to €63.45 on positive comments from Deutsche Bank. Meanwhile, Continental dropped 3.9 percent to €88.50 on a reduction of its earnings-per-share estimate from Morgan Stanley.

Oil prices fall, remain above $61 per barrel

Permalink: Oil prices fall, remain above $61 per barrel

Filed under: Commodities, Oil, Metals, Economy

Crude oil prices were lower on Thursday but remained at or above the $61 per barrel level. The declines came after Wednesday saw the biggest one day price gain in seven months on reports that inventories had dropped much more than had been expected last week. The lower prices also came despite the fact that Iran and Nigeria had confirmed that they will adhere to OPEC production cuts even though some analysts expected them to be reluctant to cut output that they were already struggling to bring up to quota.

December contracts for Brent crude dropped 65 cents to $61.40 per barrel in London. Meanwhile, on the New York Mercantile Exchange, West Texas Intermediate crude for December delivery fell 40 cents to $61 per barrel.

Natural gas inventories were up 19 billion cubic feet in the US last week, just below the predicted rise of 24 billion cubic feet, remaining near record levels. Nymex November Henry Hub was slightly lower to $7.655 per million British thermal units.

Metals prices were mixed on Thursday. Among base metals, zinc was higher as inventories dropped, while lead prices declined and the price of copper remained about the same. London Metal Exchange warehouses saw their zinc inventories drop another 1,750 tonnes, sending the metal’s price 1.5 percent higher to $4,100 per tonne. Lead dropped 1.6 percent to $1,560 per tonne despite the shutdown of a facility in Australia that sent output there down by 28,233 tonnes. Copper traded at $7,450 per tonne even though labor contract negotiations involving the largest unit of the world’s biggest producer, Codelco, have not been successful.

Among precious metals, prices for both gold and silver were higher as the US dollar weakened. The price of gold added 0.8 percent to $595.60 per troy ounce, while silver gained 2.3 percent to $12.14 per troy ounce.

Euro strengthens on ECB comments

Permalink: Euro strengthens on ECB comments

Filed under: Forex, USD, GBP, Euro, Economy, Yen

The US dollar weakened on Thursday, following the decision by the Federal Reserve on Wednesday to keep interest rates at 5.25 percent for another month. Perhaps even more influential than the decision not to alter the rate were the comments that accompanied the announcement, which was not sufficiently concerned about the possibility of inflation for some analysts and investors. Some analysts expect that the Fed will actually cut rates after the first of the year.

In mid-afternoon trade in New York, the dollar had dropped 0.3 percent against the Japanese yen to ¥118.70 and was 0.5 percent lower versus both the euro and sterling, to $1.2665 and $1.8870 respectively.

The euro was slightly stronger against both sterling and the yen after the president of the European Central Bank said that inflation will remain a risk in 2007 and that the Bank should “remain vigilant” in the face of inflation pressures. Such wording is sometimes seen as a sign that interest rates are likely to rise soon. The euro also got a boost from former US Federal Reserve chairman Alan Greenspan, who said in comments to a group in Washington that both the private sector and central banks are starting to buy euro in preference to the dollar.

The euro added 0.1 percent to £0.6715 in relation to sterling, while it was 0.2 percent higher to ¥150.26 versus the yen.

The Australian dollar was 0.2 percent higher versus the US dollar to $0.7620, but the Canadian dollar was 0.4 percent lower versus the greenback to $1.1280 and the New Zealand dollar fell 1.1 percent to $ 0.6545 against the US currency on the news that the Reserve Bank of New Zealand had kept interest rates at 7.25 percent.

Bond prices rise on Fed interest rate decision

Permalink: Bond prices rise on Fed interest rate decision

Filed under: Bonds, Economy, US, Europe, UK, Japan

Government bond prices were up and yields fell on Thursday in response to a decision by the US Federal Reserve to keep interest rates steady for the time being as well as its comments following the decision that did not sound too strong a warning on inflation. Also helping prices higher was new data on durable goods orders showing that, excluding transportation goods, orders were up just 0.1 percent in September. The ten-year US Treasury bond dropped 3.8 basis points to a yield of 4.73 percent.

In Europe, meanwhile, ten-year yields also fell in response to the Fed decision. The ten-year Bund dropped 1 basis point to 3.85 percent, while the ten-year gilt was 4 basis points lower to a yield of 4.66 percent. The price gains came as the president of the European Central Bank said that inflation would be an issue for the rest of this year and into next year.

In Japan, government bonds were helped by the US bond market, with the ten-year JGB falling 5 basis points to 1.750 percent. Shorter-dated bonds also saw prices go up and yields drop after an auction of two-year issues saw demand quadruple supply. Yields on two-year bonds were 0.3 basis points lower to 0.755 percent.

October 25, 2006

British tobacco sector advances

Permalink: British tobacco sector advances

Filed under: Equities, Economy, UK

The London equities markets were higher on Wednesday on gains in the tobacco and oil sectors. The oil sector was higher after US inventory numbers showed that stockpiles of crude oil, gasoline, and heating oil were all lower last week. The FTSE 100 added 0.5 percent to 6,214.6 percent, while the FTSE 250 gained 0.2 percent to close at 10,425.4, another new record.

Imperial Tobacco Group was 1.6 percent higher to £18.55 ahead of its full-year report, due next week. British American Tobacco, which is scheduled to release its third quarter report later on Wednesday, added 2.5 percent to £14.82 on strong results from Reynolds American. BAT holds 42 percent of Reynolds, which also learned that a US appeals court on the federal level will hear arguments concerning whether a case looking for $200 billion from tobacco companies can be conducted as a class action suit. Meanwhile, Gallaher gained 3.1 percent to 884½p on bids rumors and positive comments.

The pharmaceuticals sector was mixed after UBS upgraded the sector to “overweight”. GlaxoSmithKline added 1.5 percent to £15.11 ahead of the announcement of its third quarter results, but AstraZeneca fell 1.2 percent to £35.92.

Chipmaker Wolfson Microelectronics added 6.4 percent to 287¼p on a perceived vulnerability to bids and on an upgrade to “buy” from Bridgewell Securities. Meanwhile, software maker Misys added 2.4 percent to 205p on the news that an activist group of investors from the US had taken a 4.4 percent stake in the company and on a reiteration of a “buy” recommendation from UBS.

European carmakers see gains

Permalink: European carmakers see gains

Filed under: Equities, Economy, Europe

The FTSE Eurofirst 300 saw gains on Wednesday on advances in the automobile manufacturing sector. The Eurofirst added 0.3 percent to close the session at 1,454.74.

DaimlerChrysler led the way among carmakers with a gain of 4.2 percent to €43.23 on better than anticipated profits in the third quarter. While profits were down by almost 37 percent from the same quarter last year, the carmaker did report a net profit against an expectation of losses in the period. This report, plus a better than expected report from US car manufacturer General Motors, helped send Porsche 2.4 percent higher to €925.10, while Fiat and Renault each added 2.6 percent, to €14.08 and €93.25 respectively. Fiat reported huge growth in earnings in the quarter.

In an associated sector, tire makers were mixed on the session. Continental was 0.4 percent lower to €92.10 after Goldman Sachs issued negative comments. On the other hand, Michelin added 2.8 percent to €63.10 on a report showing that sales were up 4.9 percent in the quarter, about what had been expected. Michelin also announced price hikes and a plan for cutting costs. Credit Suisse reiterated its “under perform” recommendation, but UBS was more positive about the French tire manufacturer.

The semiconductors sector was lower, with STMicroelectronics down 1 percent to €13.17 even though its profits were up by 133 percent in the third quarter. Some analysts, however, expect that STM will not perform as well as the rest of the sector as 2007 begins. Infineon, meanwhile, dropped 1.8 percent to €9.54.

Tokyo markets see losses

Permalink: Tokyo markets see losses

Filed under: Equities, Economy, Asia, Japan

Weakness in the consumer finance and securities sectors sent the Tokyo equities markets lower on Wednesday. The Nikkei 225 dropped 0.5 percent to 16,699.30, while the Topix index fell 0.6 percent to 1,653.38. There were losses in a number of other sectors as well.

In the telecommunications sector, NTT DoCoMo was down 2.2 percent to ¥180,000. Softbank dropped 2.5 percent to ¥2,590. The declines came as investors were wary of a possible price war among mobile phone carriers. KDDI, on the other hand, added 1 percent to ¥735,000 after declines on Tuesday.

The electronics sector saw declines as well, with NEC 6 percent lower to ¥639 on the announcement that it will abandon US accounting standards and use Japanese rules, which are less demanding, instead. The move came after it did not file its report for the quarter ending in March on time with the US Securities and Exchange Commission.

Consumer finance companies were hurt when Japan’s ruling Liberal Democratic Party dropped a plan that would have let the lenders charge more than the maximum allowable interest on some loans. Acom dropped 4.9 percent to ¥4,490, while Takefuji fell 5 percent to ¥4,520 and Aiful was 7.2 percent lower to ¥4,140.

The securities sector was 3.2 percent lower as a whole, with Nomura dropping 2.5 percent to ¥2,165 as investors worried about what its quarterly report would reveal. Their fears were borne out when the securities house’s report showed that profits were down by 28.5 percent in its second quarter. Daiwa Securities, meanwhile, fell 4.1 percent to ¥1,381.

Crude prices rise on inventory declines

Permalink: Crude prices rise on inventory declines

Filed under: Commodities, Oil, Metals, Economy

Crude oil prices were significantly higher on Wednesday after the US Energy Information Administration released figures showing that crude oil, gasoline, and heating oil stockpiles were all lower in the week ending October 20. Crude stockpiles had been expected to rise due to maintenance work that took US refinery utilization down to 86.2 percent last week, from 86.3 percent the week before. Part of the decline was explained by a drop in imports. Brent crude for December delivery added $1.80 to $61.66 per barrel in London, while West Texas Intermediate crude gained $1.70 to $61.05 per barrel on the New York Mercantile Exchange.

Inventories of crude oil were 3.3 million barrels lower last week against an expected rise of 2.6 million barrels while distillates, which includes heating oil, were 1.4 million barrels lower. Gasoline stockpiles were down by 2.8 million barrels, while they had only been expected to decline by 0.6 million barrels. Prices for Nymex December unleaded gasoline added 5 cents to $1.5880 per gallon, while Nymex November heating oil added nearly 4.5 cents to $1.7394 per gallon.

In the metals markets on Wednesday, gold was 1.6 percent higher to $590.50 per troy ounce. In base metals, copper dropped 0.5 percent to $7,455 per tonne on London Metal Exchange stockpiles there grew by 3,450 tonnes and on rumors that China was getting ready to sell 2,000 to 3,000 tonnes during the week. Zinc inventories, however, dropped by 1,725 tonnes, sending that metal 4 percent higher to $4,055 per tonne after reaching as high as $4,145 earlier. Lead added 4.5 percent on the session to a new record of $1,585 per tonne.

US Federal Reserve holds interest rates steady

Permalink: US Federal Reserve holds interest rates steady

Filed under: Forex, USD, GBP, Euro, Economy, Yen

The euro gained strength on Wednesday on the heels of a new business confidence survey out of Germany. The Ifo business climate index was at 105.3 in October, up from 104.9 in September. The index had been expected to drop to 104.5. Analysts said that the growth indicated in the new data encouraged the belief that interest rates in the Eurozone will reach 4 percent in 2007. While the euro remained steady at ¥149.90 versus the Japanese currency, it had added 0.1 percent to £0.6705 in relation to sterling and was up 0.4 percent to $1.2590 versus the US dollar by mid-afternoon trade in New York.

With a trade surplus wider by 6.9 percent in September compared to the same month last year due to a growth of 20.4 percent in exports to the United States and a gain of 19.8 percent in exports to China, the yen was 0.3 percent higher versus the greenback to ¥119.10. The widening was a surprise in light of analysts expectations that Japan’s trade surplus would narrow by 10.9 percent in September.

The Australian dollar was 0.4 percent higher versus the US dollar, to a six-week high of $0.7 610 on inflation that was stronger than had been anticipated. However, the New Zealand dollar dropped 0.3 percent to $0.6610 against the greenback on inflation that was lower than predicted.

Wednesday afternoon the US Federal Reserve announced that it will leave interest rates at 5.25 percent again. While the dollar weakened against the euro initially, it returned to its level before the announcement within a few minutes. The comments released with the announcement said that while some inflation risks are still present, pressures to inflation seem, to the Fed, likely to “moderate over time”. The vote to keep rates steady was 10 to 1.

October 24, 2006

Quarterly reports produce mixed results

Permalink: Quarterly reports produce mixed results

Filed under: Equities, Economy, US

The New York equities markets were mixed in early afternoon trade on Tuesday. The Dow Jones Industrial Average was 0.02 percent higher to 12,118.91, while the Nasdaq Composite had dropped 0.4 percent to 2,342.22 and the S&P 500 was 0.1 percent lower to 1,375.57. The activity was a result of several factors, including a lack of new economic data, earnings reports that were not up to par, and unwillingness to commit ahead of the Federal Reserve’s newest interest rate decision, due Wednesday.

Texas Instruments dropped 2.9 percent to $30.97 on a quarterly report that did not meet expectations and on a disappointing prediction for fourth quarter results. Kraft Foods likewise issued a quarterly report that did not satisfy, and was in consequence 3.8 percent lower to $34.91. Even though Whirlpool’s earnings were a bit better than had been anticipated, it cut its prediction for unit shipment growth in North America. The appliance maker saw shares fall 3.9 percent to $85.86.

Not all the quarterly reports were disappointing. DuPont produced a good quarterly report and added 1.8 percent to $46.28. Lucent, which is being purchased by French telecommunications equipment maker Alcatel, added 7.7 percent to $2.52 on better than expected earnings.

Qualcomm was 3.1 percent lower to $36.91 on rumors that the patent case it filed against Nokia could be in for another look by the courts. Meanwhile, Intel added 1.1 percent to $21.69. added 1.8 percent to $33.46 ahead of its quarterly report, due after the close of trade.

Retailers higher in London

Permalink: Retailers higher in London

Filed under: Equities, Economy, UK

Equities markets on London were higher on Tuesday, with the FTSE 100 adding 0.3 percent to 6,182.5 and the FTSE 250 finishing at a new high of 10,401.6, a gain of 0.4 percent on the session.

Retailers were higher. J Sainsbury added 1.2 percent to 396¾p after bids rumors surfaced late in the session, with private equity said to be interested. Marks & Spencer was helped by an increased target share price and increased earnings forecasts for both 2006 and 2007 from JP Morgan. M&S gained 1.3 percent to 656p.

In the leisure sector Whitbread, which owns Premier Travel Inns, added 4 percent to £14.05 on talk that it is ripe for offers after lower than predicted cash returns.

Miners were lower on the session, with BHP Billiton 0.6 percent lower to £10.14. Anglo American dropped 1.5 percent to £23.79 after the appointment of a new executive that was said to make Anglo more vulnerable to a bid.

British Energy was lower, as well, declining 3.5 percent to 422p after Societe General issued comments that indicated it thinks the energy generator ‘s output could drop by 8.5 tera-watt hours if it has to cut boiler temperatures at its older power plants. It was estimated that such an output decline could send shares down by 110p.

Eurofirst declines on session

Permalink: Eurofirst declines on session

Filed under: Equities, Economy, Europe

In Europe on Tuesday, the FTSE Eurofirst 300 ended slightly lower, down 0.1 percent to 1,449.5

Banks were mixed on the session, with Erste Bank 1.6 percent higher to €54.15 on an upgrade to “buy” from Merrill Lynch, while Raiffeisen added 2.4 percent to €89 and Allied Irish Banks gained 2.8 percent to €21.25. Swedish banks, however, were lower on the session. SEB dropped 1 percent to SKr206, Swedbank was 1.7 percent lower to SKr225.50, and Handelsbanken fell 4.5 percent to SKr192 on third quarter results that saw both operating profits and gross income failing to meet predictions.

Oil companies were mixed as well. Statoil was 1.1 percent higher to NKr167.75 on the announcement that its Snorre oilfield, closed due to a safety problem concerning lifeboats, is being brought back online. Neste Oil added 4.5 percent to €24.35 after declines on Monday on a downgrade from Morgan Stanley. Norsk Hydro, however, dropped 0.5 percent to NKr150.75 after it said that operating profits were up 18 percent in the third quarter, less than had been anticipated.

In the construction sector, Spanish builder Metrovacesa dropped 8.1 percent to €115.70 on remarks from the government stock market regulator that its listing on the Ibex index should be examined.

Alcatel, the French telecommunications equipment maker, added 7.2 percent to €10.29. While net profits were down 42 percent in the quarter, mostly due to one-time gains during the third quarter last year, profits for US telecom Lucent, which Alcatel is purchasing, posted results that were better than had been predicted.

Oil prices rise, but only slightly

Permalink: Oil prices rise, but only slightly

Filed under: Commodities, Oil, Metals, Economy

Crude oil prices were slightly higher on Tuesday on the heels of an announcement that Abu Dhabi National Oil Corporation will export 5 percent less oil next month. The cut is United Arab Emirates’ contribution to OPEC’s output cuts. However, some analysts are of the opinion that for the OPEC cuts to do any good, inventories have to decline or demand must increase, neither of which seems to be on the horizon. Inventories are significantly above last year’s levels in both the United States and Europe.

December contracts for Brent crude were 35 cents higher to $59.56 per barrel in London, while West Texas Intermediate crude for December delivery added 33 cents to $59.14 per barrel on the New York Mercantile Exchange.

In the metals markets, gold added 0.2 percent to $581.30 per troy ounce after having dropped to $573.85 per troy ounce earlier in the session. Base metals prices, however, were down on the session. Zinc dropped 0.4 percent to $3,905 per tonne even though London Metal Exchange inventories dropped another 2,525 tonnes to 117,375 tonnes. Nickel was 0.5 percent lower to $32,250 per tonne after hitting a new record Monday. Copper fell 0.8 percent to $7,485 per tonne.

Yen weakens yet again

Permalink: Yen weakens yet again

Filed under: Forex, USD, GBP, Euro, Economy, Yen

The Japanese yen was weaker on Tuesday despite comments from Japan’s vice minister for internal affairs that he did not see his nation’s currency declining beyond current levels. Some analysts said that the comments were meant for the consumption of European Central Bank officials and were in reference to the euro’s recent gains versus the yen. At midday in New York, the Japanese currency had fallen 0.1 percent in relation to the euro to ¥149.90, while it dropped 0.2 percent versus the US dollar, to ¥119.50.

Sterling dropped 0.1 percent versus both the dollar and the euro after new data showed that the UK economy was on a downward trend, reinforcing the opinion of some analysts that next month’s expected interest rate hike from the Bank of England is likely to be the last in the series. The UK currency stood at $1.8720 in relation to the greenback and at £0.6702 against the euro.

The US dollar was 0.1 percent stronger in relation to the euro and the Swiss franc, to $1.2540 and SFr1.2690 respectively ahead of the Federal Reserve’s decision on interest rates, due Wednesday. The Fed is widely expected to leave rates on hold this month, but many also expect the remarks accompanying that announcement to express heightened concern over inflation.

The Australian dollar added 0.1 percent versus the greenback to $0.75756 and was 0.2 percent higher against the yen to ¥90.56 after a report from the International Monetary Fund that predicted an interest rate hike by the Reserve Bank of Australia.

October 23, 2006

Dow hits another intra-day high

Permalink: Dow hits another intra-day high

Filed under: Equities, Economy, US

The New York equities markets were higher at midday on Monday as earnings reports continue to come in. Over 150 companies listed on the S&P 500 alone are expected to report this week. At mid-session the Dow Jones Industrial Average was 0.9 percent higher to 12,114.11, a new high, while the Nasdaq Composite was up 0.7 percent to 2,359.53 and the S&P had added 0.6 percent to 1,377.17.

Internet search engine Google was still benefiting form its earnings report, issued last week, adding 3.8 percent to $477.15, its highest level ever. Meanwhile in other computer-related news, Apple Computer was 2.1 percent higher to $81.65. In the semiconductors sector, Texas Instruments is expected to report after the end of today’s session.

Wal-Mart gained 3.2 percent to $50.95 after its chief financial officer said that it was planning on slowing capital spending to 2 to 4 percent in fiscal 2008, from 15 to 20 percent this year.

Chewing-gum maker Wrigley gained 14.2 percent to $53.48 on a report that earnings per share in the quarter were above predictions and that its new chief executive will be the first in the company’s history from outside the Wrigley family.

Construction machinery manufacturer Caterpillar added 2.2 percent to $60.30 after having lost 14 percent in Friday’s session on a disappointing quarterly report.

Ford Motor dropped 1.5 percent to $7.89 after it reported that it has lost 62 cents per share in the third quarter, about what had been expected by analysts.

Airlines up on falling oil prices

Permalink: Airlines up on falling oil prices

Filed under: Equities, Economy, Europe

The FTSE Eurofirst 300 added 0.4 percent to 1,450.5 on Monday’s session as financial sectors saw gains that helped balance out losses in the oil sector.

The banking sector was helped by expectations of good earnings reports as well as by continuing bids rumors. Italian bank UniCredit was 0.8 percent higher to €6.62 and Hypovereinsbank added 1.9 percent to €36.63 on the news that Polish legislators voted on Friday to approve a merger between the two banks. Elsewhere in the sector, Raiffeisen International gained 1.1 percent to €86.95 and Danske Bank was 2 percent higher to DKr246 ahead of next week’s quarterly report. Natexis Banques Populaire gained 3.2 percent to €225.20 on speculation about an upcoming merger.

Airlines did well as oil prices continued to decline. Ryanair was 1.3 percent higher to €8.82, while Air France-KLM gained 2.1 percent to €26.35 and Lufthansa added 2.4 percent to €17.31. The sector was also helped by a 2.9 percent gain in the UK by British Airways on an upgrade from Citigroup.

Dropping oil prices did now, however, give any comfort to the oil sector. Repsol and Royal Dutch Shell each dropped 0.8 percent, to €25.83 and €27.03 respectively. Italian refiner Saras was 1.9 percent lower to €4.06 on a lower target share price from Morgan Stanley, which handed out target downgrades to other companies in the sector as well.

OMV fell 2 percent to €41.25, while Statoil was 2.6 percent lower to NKr166 even though Banc of America upgraded the Norwegian company. In the Greek portion of the sector, Hellenic Petroleum dropped 2.6 percent to €9.84, again on a Morgan Stanley downgrade. Morgan Stanley also reduced Neste Oil’s recommendation, from “overweight” to “equal weight”, sending the Finnish refiner 3 percent lower to €23.30. Norsk Hydro saw the biggest loss in the sector, dropping 4.1 percent to NKr151.50.

Real estate takes Tokyo markets higher

Permalink: Real estate takes Tokyo markets higher

Filed under: Equities, Economy, Asia, Japan

The real estate sector helped Tokyo equities markets to gains on Monday, with the Nikkei 225 closing at 16,788.82, up 0.8 percent, and the Topix index adding 0.9 percent to 1,659.39. Elsewhere, the Mothers index of small and mid-cap stocks gained 2.6 percent to 1,239.76.

The banking sector was up as well, advancing 1.6 percent as a whole, benefiting from the fact that as the earnings season begins banks are nearly the last sector to report. Mitsubishi UFJ was 1.3 percent higher to ¥1,510,000.

Real estate, besides still taking advantage of signs that property prices in Japan are continuing to climb, were helped when Goldman Sachs raised the target share prices of the three largest companies in the sector last week. Mitsubishi Estate added 3 percent on the session to ¥2,955, while Mitsu Fudosan gained 3.3 percent to ¥3,020 and Sumitomo Realty & Development was 4.2 percent higher to ¥3,990.

The telecommunications sector was mixed. KDDI dropped 0.9 percent to ¥784,000. On the other hand, NTT DoCoMo added 0.5 percent to ¥188,000 and Softbank was up 3.5 percent to ¥2,685 ahead of an announcement concerning its mobile phone unit.

Construction machinery manufacturer Komatsu was 4.3 percent lower to ¥2,120 after a disappointing quarterly report from Caterpillar in the United States.

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