Every morning we put out a news report with the latest news in global stock markets, company news, and global economic news.
Morning Market Update
Michael Mauboussin: Here’s what active managers can do
The debate over active versus passive management continues as trends show the ongoing shift from active into passive funds. Q2 2020 hedge fund letters, conferences and more At the Morningstar Investment Conference, Michael Mauboussin of Counterpoint Global argued that the rise of index funds has made it more difficult to be an active manager. Drawing Read More
• US: Dow: 13072.00 (0.39%), S&P 500: 1413.20 (0.56%), NASDAQ: 2667.25 (0.63%)
• Europe: CAC: 3438.13 (0.34%), DAX: 7235.95 (0.60%), FTSE: 5828.46 (0.41%).
• Asia-Pacific: Australia: 4510.50 (0.10%), China: 2101.58 (-0.69%), Hong Kong: 21810.23 (0.21%), India: 5705.30 (0.24%), Japan: 9055.20 (1.11%).
• Metals: Gold: 1714.60 (0.76%), Silver: 32.09 (1.50%), Copper: 3.57 (0.10%)
• Energy: Crude Oil: 86.34 (0.71%), Natural Gas: 3.43 (-0.58%)
• Commodities: Corn: 7.51 (-0.43%), Soya Bean: 15.65 (-0.41%), Wheat: 8.82 (-0.23%)
• Currency: EUR/USD: 1.2976 (0.02%), GBP/USD: 1.6135 (0.60%), USD/JPY: 80.2300 (0.54%)
• 10 year US Treasury: 1.838% (0.049)
Financial and Economic News Update
U.S. stock-index futures rise: U.S. stock-index futures are pointing to a higher open on Thursday after weekly jobless claims fell last week. Weekly jobless claims dropped 23,000 to a seasonally adjusted 369,000, the Labor Department said today. Economists were expected a reading of 365,000. In other economic news, new orders for durable goods rose 9.9 percent in September, against expectations for a rise of 7.1 percent. The Dow Jones industrial average, the S&P 500 and the NASDAQ are all trading around half a percent higher.
European markets trading higher: European markets are trading higher on Thursday with the German DAX (INDEXDB:DAX) up 0.6 percent at 7235.95, the FTSE 100 (INDEXFTSE:UKX) gained 0.4 percent to 5828.46 and the CAC 40 (INDEXEURO:PX1) added 0.3 percent to 3438.13. The euro zone blue-chip ESTX 50 PR.EUR (INDEXSTOXX:SX5E) (Euro Stoxx 50) was trading 0.3 percent higher.
Asian markets end mostly higher: Asian markets closed higher on Thursday with the HANG SENG INDEX (INDEXHANGSENG:HIS) up 0.2 percent at 21,810.2, while the SSE Composite Index (SHA:000001) (Shanghai Composite Index) shed 0.7 percent. Japan’s NIKKEI 225 (INDEXNIKKEI:NI225) climbed 1.1 percent to 9,055.20. The S&P/ASX 200 (INDEXASX:XJO) index added 4.7 points to 4,510.5. The benchmark Indian 30-share BSE SENSITIVE (INDEXBOM:SENSEX) index gained 0.4 percent.
Company News Update
• ConocoPhillips (NYSE:COP) reported third quarter earnings excluding items of $1.44 a share that easily beat the average analysts’ estimate of $1.19 a share. Revenue declined 12 percent to $14.52 billion, topping street expectations for $11.12 billion.
• The Procter & Gamble Company (NYSE:PG) reported first quarter earnings excluding one-time items of $1.06 a share that beat the average analysts’ estimate of 96 cents a share. Sales fell 3.7 percent to $20.7 billion, trailing estimates of $20.78 billion.
• Sprint Nextel Corporation (NYSE:S) reported third quarter loss of $767 million, or 26 cents a share, compared with a loss of $301 million, or 10 cents, in the year-ago quarter. Revenue gained 5.2 percent to $8.76 billion. Analysts were expecting a loss of 42 cents a share on revenue of $8.81 billion.
• Microsoft Corporation (NASDAQ:MSFT) will officially unveil its Windows 8 operating system today.
• PulteGroup, Inc. (NYSE:PHM) reported third quarter earnings excluding certain items of 27 cents a share that easily beat the average analysts’ estimate of 20 cents a share. Revenue gained 14 percent to $1.30 billion, trailing estimates of $1.41 billion. Home sale gross margin widened to 21.6 percent from 20.3 percent.
• Aetna Inc. (NYSE:AET) posted third quarter earnings excluding certain items of $1.55 a share that easily beat the average analysts’ estimate of $1.34 a share. Revenue jumped 6 percent to $8.9 billion, missing Street expectations for $8.96 billion.
• Raytheon Company (NYSE:RTN) reported third quarter earnings excluding items of $1.60 a share, on revenue of $6.05 billion. Analysts had projected earnings of $1.27 a share on revenue of $6.16 billion. The defense contractor raised its full-year earnings forecast, but lowered its revenue outlook.
• International Paper Company (NYSE:IP) reported third quarter earnings excluding items of 75 cents a share, 2 cents below the consensus estimate. Revenue for the period stood at $7.03 billion, missing estimates of $7.08 billion.
• Automotive retailer AutoNation, Inc. (NYSE:AN) posted third quarter profit of $81.6 million, or 66 cents a share, up from $70.7 million, or 48 cents, in the year-ago quarter. Revenue rose 12 percent to $3.93 billion. Analysts had projected earnings of 67 cents on revenue of $3.95 billion.
• Celgene Corporation (NASDAQ:CELG) posted third quarter earnings excluding some items of $1.29 a share, 2 cents above the average analysts’ estimate. Revenue came in at $1.42 billion, also topping estimates of $1.41 billion.
• Mead Johnson Nutrition CO (NYSE:MJN) posted third quarter earnings excluding one-time items of 71 cents a share, on revenue of $921.3 million. Analysts had projected earnings of 72 cents on revenue of $977 million. The company lowered its full-year earnings outlook.
• Colgate-Palmolive Company (NYSE:CL) reported third quarter earnings excluding items of $1.38 a share, in line with analysts’ estimates. Revenue declined 1.2 percent to $4.33 billion, trailing Street expectations for $4.39 billion. The consumer-products company unveiled a four-year restructuring program.
• Simon Property Group, Inc (NYSE:SPG) said third-quarter funds from operations, which gauges a property company’s ability to generate cash, rose to $720.1 million, or $1.99 per share, from $606.2 million, or $1.71 per share, in the year-ago period. Revenue rose 14.4 percent to $1.23 billion. Analysts had projected FFO of $1.92 a share on revenue of $1.19 billion. The country’s largest shopping-mall owner raised its quarterly dividend to $1.10 a share from $1.05 a share.
• The Hershey Company (NYSE:HSY) reported third quarter earnings excluding one-time items of 87 cents a share, on revenue of $1.75 billion. Analysts were looking for earnings of 86 cents a share on $1.75 billion in sales.
• Starwood Hotels & Resorts Worldwide, Inc. (NYSE:HOT) posted third quarter earnings excluding items of 58 cents a share, on revenue of $1.46 billion. Analysts had forecast earnings of 53 cents a share, on $1.48 billion in revenue. The hotel operator raised its full-year adjusted earnings outlook.
• McKesson Corporation (NYSE:MCK) has agreed to buy health-care services company PSS World Medical, Inc. (NASDAQ:PSSI) for $29 per share, or $1.46 billion in cash.
• Investment firm Raymond James Financial, Inc. (NYSE:RJF) reported fourth-quarter profit of 69 cents per share, six cents above estimates. Revenue jumped 30 percent to $1.07 billion, topping analysts’ expectations of $1.05 billion.
• Hess Corp. (NYSE:HES) has agreed to sell its interest in the Beryl area fields in the North Sea and the Scottish Area Gas Evacuation System to Royal Dutch Shell plc (ADR) (NYSE:RDS.A) (LON:RDSA) for $525 million.
• Sherwin-Williams Company (NYSE:SHW) said third quarter profit rose to $235 million, or $2.24 a share, from $179.9 million, or $1.71 a share, in the same period last year. Revenue for the period came in at $2.6 billion. The company also raised its full-year earnings estimate.
• Dunkin Brands Group Inc (NASDAQ:DNKN) reported third quarter earnings excluding one-time items of 37 cents a share, 2 cents above the average analysts’ estimate. Revenue gained 5 percent to $171.7 million, trailing estimates of $174.1 million.
• Roper Industries, Inc. (NYSE:ROP) reported a 5.8 percent increase in third quarter profit to $116.7 million, or $1.17 a share, up from $110.3 million, or $1.12 a share, in the year-ago period. Sales stood at $747.6 million, trailing estimates of $761 million.
• Swiss bank Credit Suisse Group AG (ADR) (NYSE:CS) reported third quarter profit of 254 million francs that trailed estimates of 415 million francs, and said it intends to reduce costs by 1 billion francs ($1.1 billion) by 2015.
• French drug maker Sanofi SA (ADR) (NYSE:SNY) (EPA:SAN) reported third-quarter profit that topped estimates, and said full-year earnings would decline less than expected despite expiration of patents.
• Unilever plc (ADR) (NYSE:UL) (LON:ULVR), the world’s second-biggest consumer-goods company posted third quarter revenue growth of 5.9 percent that beat analysts’ expectations for growth of 5.3 percent. Sales were boosted by demand for personal care products in emerging markets.
• German chemicals company BASF SE (ETR:BAS) (FRA:BAS) said third quarter earnings before interest, taxes and one-off items gained 5.4 percent to 2.07 billion euros ($2.7 billion), beating the average analyst forecast of 1.94 billion euros. The company reaffirmed its outlook for the year.
• Anglo-Swedish pharmaceuticals giant AstraZeneca plc (ADR) (NYSE:AZN) (LON:AZN) gained 1.2 percent in London trading after reporting third-quarter earnings of $1.51 per share that beat the average analysts’ estimate of $1.45 per share.
• France Telecom SA (ADR) (NYSE:FTE) (EPA:FTE) reported a slight drop in third-quarter earnings and cut this year’s dividend by as much as 41 percent, as it tackles tougher than expected competition in its key home market and a worsening economy.
• Schneider Electric SA (EPA:SU) reported third quarter revenue that trailed estimates, and lowered its full-year sales forecast amid weak performance in western Europe and China.
• Advertising major WPP PLC (LON:WPP) fell 2.7 percent in London after slashing its full-year sales growth target for the second time in as many months, as clients in North America and Europe cut back on their spending.
• London-listed diversified miner Anglo American plc (LON:AAL) gained 1 percent after reporting a 12 percent rise in third quarter copper output.
• French insurer AXA (EPA:CS) gained 2.2 percent after reporting a 3.7 percent sales rise for the first nine months of the year, driven by higher property and casualty insurance sales and a stronger dollar.
• Bank of China (HKG:3988) (SHA:601988), the country’s fourth biggest lender by market value, closed percent higher after posting a third-quarter net profit gain of 16.7 percent that beat analysts’ estimates. Interest margins widened due to increased demand for credit.
• General Motors Company (NYSE:GM) is planning to buy a stake in its South Korean unit from second-biggest shareholder, Korea Development Bank, Reuters reported. The state-run bank holds a 17 percent stake in GM Korea.
• Chinese oil major CNOOC Limited (ADR) (NYSE:CEO) (HKG:0883) gained 1.3 percent after reporting a 4.7 percent rise in third quarter unaudited oil and gas sales revenue that were largely in line with analyst expectations. The country’s largest offshore oil and gas producer also raised its annual output target.
• Japan’s Sharp Corporation (TYO:6753) tumbled 4.2 percent after the Nikkei newspaper reported that the maker of Aquos televisions would likely announce a first-half net loss of around 400 billion yen.
• China’s second-largest mobile operator, China Unicom (Hong Kong) Limited (ADR) (NYSE:CHU) (HKG:0762) reported a 27 percent rise in third-quarter net profit to 2.0 billion yuan ($320 million) from 1.596 billion yuan in the year-ago period. Analysts had forecast earnings of 2.2 billion yuan.
• Australia and New Zealand Banking Group (ASX:ANZ) reported record full-year net profit of 5.66 billion Australian dollars ($5.86 billion), but still trailed estimates for 5.96 billion Australian dollars. The country’s third-largest lender by market value said it will pay a dividend of 79 cents per share in the second half.
• Galaxy Entertainment Group Limited (HKG:0027) reported a 46 percent year-on-year rise in third-quarter EBITDA, its 16th consecutive quarter of growth, as the casino operator continued to benefit from a steady stream of visitors to its new flagship resort in Macau
• Japanese telecom operator KDDI Corp (TYO:9433) jumped 5.5 percent while trading house Sumitomo Corp (TYO:8053) rose 1.4 percent, following a Nikkei news report that the companies plan to combine their cable-television holdings into a single unit.
• ZTE Corporation (SHE:000063), the world’s fourth-biggest mobile phone maker, reported a net loss of 1.95 billion yuan ($310 million) for the July-September period, its first quarterly loss since listing its shares in Hong Kong in 2004.
• Wynn Macau Ltd (HKG:1128) surged to a five-month high in Hong Kong amid investor optimism that the Macau casino operator could pay a special dividend after its parent Wynn Resorts, Limited (NASDAQ:WYNN) boosted its payout to investors.
Economic Calendar for Thursday, October 25, 2012:
08:30 A.M. ET: Initial Jobless Claims (Week ending Saturday, October 20, 2012)
08:30 A.M. ET: Continuing Jobless Claims (Week ending Saturday, October 13, 2012)
08:30 A.M. ET: Durable Goods Orders (September)
08:30 A.M. ET: Durable Goods Orders ex Transportation (September)
08:30 A.M. ET: Chicago Fed National Activity Index (September)
09:45 A.M. ET: Bloomberg Consumer Comfort Index (Week ending Sunday, Oct 21)
10:00 A.M. ET: Pending Home Sales (MoM) (September)
10:00 A.M. ET: Pending Home Sales (YoY) (September)
10:30 A.M. ET: EIA Natural Gas Report (Week ending Friday, October 19, 2012)
11:00 A.M. ET: Kansas Fed manufacturing activity (October)
01:00 P.M. ET: 7-Year Note Auction
04:30 P.M. ET: Fed Balance Sheet
04:30 P.M. ET: Money Supply