Oct. 19, 2010 (WALLSTmoney) --
Investors are running from stocks in early morning trading today as commodities are dropping, the dollar is gaining and traders are trying to absorb a plethora of earnings reports with mixed messages.
The Dow Jones Industrial Average is down by 106.03 points, or .95% to 11,037.66. The S&P 500 has dropped by 10.86 points, or .92%, to 1,174.06. The NASDAQ is also in the red; down 26.09 points, or 1.05%, to 2,452.35.
The US Dollar is up against the euro by .0129 and gaining ground against the yen; up .4100.
Oil futures for November delivery are down $1.97 to $81.11.
The 10-year bond yield is u .0240 to 2.5150%.
DATA NEWS --
According to the International Council of Shopping Centers and Goldman Sachs, chain-store sales for the week ended Oct. 16 rose 1.7% from the year-earlier period, representing the slowest rate in at least four weeks. Sales fell .7% on a week-over-week basis.
The U.S. Commerce Department reported that new construction of U.S. houses increased for the third straight month in September. New home starts rose .3% in September to a seasonally adjusted 610,000 annualized units, which is well above the 578,000 anticipated by economists from MarketWatch. Starts of new single-family homes rose by 4.4% to 452,000, but starts of large apartment units slipped 9.7% to 158,000. Building permits, considered a leading indicator of housing construction, dropped 5.6% to a seasonally adjusted annual rate of 539,000. This is the lowest level of permits since April 2009, while the number of new construction homes is the highest level of starts since April.
China raises rates -- China's central bank surprised everyone with its first increase of interest rates in nearly three years, a move that reflects its concern about rising asset prices and stubborn inflation. The Bank announced that it was raising benchmark rates by 25 basis points, taking one-year deposit rates to 2.5% and one-year lending rates to 5.56%.
AT THE OPEN --
Earnings were the primary focus --
Bank of America Corp. reported a bigger quarterly net loss today, but excluding a sizable charge for writing off goodwill adjusted profit beat Wall Street expectations. The Bank posted a third-quarter net loss of $7.3 billion, or $.77 per share, compared with a net loss of $1 billion, or $.26 per share, for the same quarter in 2009. Excluding the goodwill-impairment charge of $10.4 billion, Bank of America earned $3.1 billion, or $.27 per share, in the most recent quarter. Shares of BAC are trading up .57% to $12.41.
Goldman Sachs reported third-quarter net income of $1.9 billion, or $2.98 a share, down from $3.19 billion, or $5.25 a share, for the same quarter in 2009. According to an analyst survey at Thomson Reuters, it was estimated that Goldman would report earnings of $2.32 a share. Shares of GS are trading up 1.12% to $155.42.
Johnson & Johnson reported an increase in third-quarter profit, even though sales came in moderately lower than the sales from the same quarter in 2009. JNJ reported earnings of $3.42 billion, or $1.23 a share, compared with $3.35 billion, $1.20 a share, for 2009. Revenue fell .7% to $14.98 billion, down from $15.08 billion. These numbers topped earnings of $1.15 a share, on revenue of $15.24 billion. Shares of JNJ are trading down 1.28% to $63.04.
Lockheed Martin cut its continuing-operations profit forecast to a range of $6.75 to $6.95 a share, from $7.15 to $7.35 a share. Net sales rose 5.6% to $11.38 billion. For the quarter ended Sept. 26, Lockheed reported net earnings fell to $571 million, or $1.57 a share, from $797 million, or $2.07 a share, for the same quarter in 2009. Earnings were reported at $565 million, or $1.55 a share, including a one-time charge of 32 cents a share for a voluntary executive separation program. These numbers fell shy of analyst estimates of $1.62 per share on $11.61 billion in sales. Shares of LMT are down 2.81% to $68.07.
Forest Laboratories Inc. reported second-quarter net income increased to $286.1 million, or $.61 a share, from $186.7 million, or $1.37 a share, in the same quarter of 2009. Net sales increased 7.7% to $1.04 billion, from $962.7 million, but fell short of Wall Street analyst's expectations of earnings of $.93 per share and revenue of $1.06 billion. Shares of FRX are down 1.28% to $33.16.
Illinois Tool Works Inc. announced its third-quarter profit was $419.3 million, or $.83 per share, which is up from $302.4 million, or $.60 a share, for the third quarter in 2009. Operating revenues climbed to $4.02 billion, compared to $3.58 billion in the year prior. These numbers just topped profit estimates of $.82 per share on revenues of $4.03 billion. Shares of ITW are trading up 5.14% to $46.65.
Peabody Energy Corp. reported net income rose to $224.1 million, or $.83per share; well up from $106.8 million, or $.40 per share for the same period in 2009. Revenue rose to $1.86 billion from $1.66 billion, just beating Wall Street expectations of earnings of $.91 per share on revenue of $1.85 billion. Peabody stated that it expects 2010 adjusted earnings of $2.95 a share to $3.15 a share. Shares of BTU are up .58% to $51.83.
EMC Corp announced that its third-quarter net income rose 58%. The data storage company also bumped-up its full-year earnings outlook. EMC earned $472.5 million, or $.22 pershare, up from $298.2 million, or $.14 per share, in 2009. Restructuring and some other costs aside, profit was $.30 a share, compared to $.23 a share last year. The reported numbers beat analyst estimates of $.30 per share on revenue of $4.14 billion. Shares of EMC are trading down .36% to $20.73.
