Morning Market Update
Relying On Old-Fashioned Stock Picking, Lee Ainslie Reports His “Strongest Quarter” Ever
Lee Ainslie's Maverick Fund USA enjoyed its "strongest quarter in the fund's history" during the three months to the end of June. According to a copy of the firm's second-quarter letter to investors, which ValueWalk has been able to review, Maverick Fund USA gained 18% in the second quarter. Following this performance, the fund was Read More
- US: Dow Futures: 13016.00 (-0.18%), S&P 500 Futures: 1381.20 (-0.43%), NASDAQ Futures: 2699.75 (-0.18%)
- Europe: CAC: 3194.69 (-1.20%), DAX: 6652.62 (-0.77%), FTSE: 5697.53 (-0.37%).
- Asia-Pacific: Australia: 4375.20 (0.34%), China: 2404.70 (-0.09%), Hong Kong: 20809.71 (0.79%), India: 5189.00 (-0.25%), Japan: 9561.83 (0.01%).
- Metals: Gold: 1654.10 (0.72%), Silver: 30.78 (1.41%), Copper: 3.74 (0.99%)
- Energy: Crude Oil: 103.90 (-0.21%), Natural Gas: 2.21 (2.03%)
- Commodities: Corn: 6.04 (-0.41%), Soya Bean: 13.64 (0.96%), Wheat: 6.30 (-0.63%)
- Currency: EUR/USD: 1.3210 (-0.05%), GBP/USD: 1.6186 (0.14%), USD/JPY: 80.7100 (-0.77%)
- 10 year US Treasury: 1.935% (-0.049)
Financial and Economic News Update
U.S. stock-index futures trading lower: U.S. stock index futures are pointing to a lower open on Thursday, after more Americans, than previously forecast, filed for unemployment benefits last week. The Dow Jones industrial average and the NASDAQ futures were trading close to 0.2 percent lower, while the S&P 500 was down 0.4 percent.
European markets down: European markets were trading lower after a report showed confidence in the euro area declined in April. The German DAX (INDEXDB:DAX) was 0.8 percent lower at 6652.62, the FTSE 100 (INDEXFTSE:UKX) was down 0.4 percent at 5697.53, and the CAC 40 (INDEXEURO:PX1) was down 1.2 percent to 3194.69. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) lost 1.1 percent.
Asian markets end higher: Asian markets closed higher on Thursday with the HANG SENG INDEX (INDEXHANGSENG:HSI) ending up 0.8 percent at 20,809.7, while the Shanghai Composite Index (SHA:000001) finished down 0.1 percent at 2,404.7 points. The NIKKEI 225 (INDEXNIKKEI:NI225) ended flat at 9,561.83. The S&P/ASX 200 (INDEXASX:XJO) index rose 0.34 percent to 4,375.2.
Company News Update
- Exxon Mobil Corporation (NYSE:XOM) said first quarter net profit slipped to $9.5 billion, or $2.00 per share, missing analysts’ expectations of $2.09 per share of earnings excluding items.
- The Dow Chemical Company (NYSE:DOW), the largest U.S. chemical company by revenue, reported first-quarter net income of $412 million, or 35 cents per share, compared with $625 million, or 54 cents per share, a year earlier.
- United Parcel Service, Inc. (NYSE:UPS), the world’s largest package-delivery company, reported first-quarter profit of $970 million, or $1.00 per share, from $915 million, or 91 cents a share, a year earlier, that trailed analysts’ estimates.
- PepsiCo, Inc. (NYSE:PEP) reported first quarter profit excluding some items of 69 cents a share that exceeded the average analysts’ estimate of 67 cent a share.
- United Continental Holdings Inc (NYSE:UAL), the parent of United Airlines, reported a wider than expected first quarter loss amid higher fuel costs.
- U.S. automaker Chrysler said first quarter net income more than quadrupled to $473 million, from $116 million a year earlier, making it the best quarter in 13 years.
- Michigan-based PulteGroup, Inc. (NYSE:PHM), the largest U.S. homebuilder by revenue, reported a narrower than expected first-quarter loss as it controlled costs and sold houses at higher prices.
- Bristol-Myers Squibb Co. (NYSE:BMY) reported a 12 percent rise in first-quarter profit to $1.1 billion, or 64 cents per share, from $986 million, or 57 cents a share, a year earlier.
- Lockheed Martin Corporation (NYSE:LMT), the world’s largest defense company, said first-quarter profit rose 20 percent, boosted by strong sales of jet fighters, cargo planes and electronic systems.
- Time Warner Cable Inc (NYSE:TWC), the second- largest U.S. cable-television provider, reported a stronger than expected 18 percent rise in first-quarter profit, driven by higher broadband-Internet subscription.
- Raytheon Company (NYSE:RTN), the world’s largest missile maker, reported first quarter net income attributable to company of $448 million or $1.32 per share compared with $384 million, or $1.06 a share, a year earlier. The company also raised its forecast for full year earnings per share.
- Unilever plc (LON:ULVR) (NYSE:UL) the world’s second- biggest consumer-goods company, reported an 8.4 percent rise in first-quarter sales beating market expectations of a 6.4 percent gain. The Anglo-Dutch maker of Dove soap and Knorr stock cubes also increased its quarterly dividend by 8 percent to 24.3 euro cents a share.
- Royal Dutch Shell Plc (LON:RDSA) (NYSE:RDS.A), Europe’s biggest oil company, reported a 16 percent rise in first-quarter earnings that beat estimates. The oil major also raised the target for asset sales this year.
- Barclays PLC (LON:BARC) (NYSE:BCS), Britain’s second- biggest bank by assets, reported a 22 percent increase in first-quarter profit to 2.45 billion pounds that topped analyst estimates.
- Alcatel Lucent SA (EPA:ALU) (NYSE:ALU), France’s largest telecommunications equipment supplier, reported an operating loss of 221 million euros ($292 million) for the first quarter, because of slower demand and weaker gross margin.
- Volkswagen AG (FRA:VOW3), the world’s second- largest carmaker, said first-quarter operating profit rose 10 percent to 3.21 billion euros ($4.26 billion), better than what analysts’ were expecting.
- Germany’s biggest bank, Deutsche Bank AG (FRA:DBK) (NYSE:DB) reported a 33 percent drop in first quarter net income to 1.38 billion euros ($1.82 billion) that missed the 1.56 billion euro average analysts’ estimate.
- German chemicals and pharmaceuticals giant Bayer AG (FRA:BAYN) posted a better than expected 9.4 percent rise in first-quarter adjusted earnings before interest, tax, depreciation and amortization to 2.44 billion euros ($3.22 billion), and confirmed its sales forecast for 2012.
- Banco Santander, S.A. (MCE:SAN) (NYSE:STD), Spain’s biggest lender and Europe’s second-largest by market value, said first-quarter net profit fell 24 percent to 1.60 billion euros ($2.11 billion), slightly below analysts’ expectations of 1.64 billion euros.
- Kyoto-based Nintendo Co., Ltd (TYO:7974), the world’s largest maker of video-game machines, reported a 43.2 billion yen ($533 million) loss for the year ended March 31, compared with analysts’ estimate for a 58.1 billion-yen loss. Annual sales plunged 36 per cent to 647.7 billion yen ($8 billion) due to weak demand weak demand of the ageing Wii home console.
- Hyundai Motor Co., South Korea’s largest carmaker, reported first-quarter net profit of 2.45 trillion won ($2.15 billion) that exceeded analysts’ estimates.
- Bank of China (HKG:3988), the country’s third biggest lender by market value, reported a 9.8 percent rise in first-quarter profit to 36.76 billion yuan (US$5.85 billion), below the average net profit forecast of 37.42 billion yuan.
- China Unicom (Hong Kong) Limited (HKG:0762), the nation’s second-largest mobile-phone operator by accounts, said first-quarter net income rose to 1 billion yuan ($159 million), and revenue jumped 25 percent to 61.19 billion yuan.
- Jiangxi Copper Company Limited (HKG:0358), China’s biggest producer of the metal, reported a 14 percent jump in first-half revenue to 28.8 billion yuan, but profit dropped 9.6 percent to 1.43 billion yuan.
- Chinese automaker, BYD Company Limited (HKG:1211), which is partly owned by Warren Buffett’s Berkshire Hathaway Inc., said first-quarter profit plunged 90 percent to 27 million yuan, from 266.74 million yuan the previous year.
- Las Vegas gaming mogul Sheldon Adelson’s Macau unit, Sands China Ltd. (HKG:1928) posted first-quarter earnings that missed market expectations.