Markets Mixed, Closing News 4/24/12

The Dow & S&P traded higher today on the backs of strong earnings from Dow components, MMM and UTX and positive news from IBM.  The Nasdaq was under pressure on a drag from Apple which traded lower for a 10th straight day ahead of its earnings report. 


Many important industrial companies that have worldwide exposure beat analysts’ expectations and revised their full year guidance upward which encouraged investors today.  Meanwhile, Apple blew away its earnings expectations after the Bell this evening, so we should see some momentum change in the Nasdaq, and possibly the broader markets, tomorrow.


The S&P CaseShiller Home Price Index was up 0.15% to 134.20 which was below expectations of +0.20% to 134.68.  March New Home Sales were down 7.1% to 328k from a revised 353k (up from 313k) in February; however, this was better than the 319k expected by analysts.


Consumer Confidence was at 69.2 just shy of the 69.6 expected by analysts; it was revised down in Feb. from 70.2 to 69.5.


There are differing stats circulating, but approximately 77-80% of S&P comanies have beat earnings expectations


Market Indices/Statistics:



  • Dow closed up 74.39 pts/+0.58% to 13,001.56

  • S&P closed up 5.03 pts/+0.37% to 1,371.97

  • Nasdaq closed down 8.85 pts/-0.30% to 2,961.60

  • 25 of the 30 Dow stocks closed higher

  • 7 of the 10 S&P 500 sectors closed up

  • Telecom was the most positive sector (+2.79%); IT was the biggest decliner (-0.60%)

  • The VIX ended down 0.87 at 18.10

  • Oil is up $0.42 to $103.53

  • Nat Gas is down $0.024 to $2.179

  • Gold is up $9.50 to $1,642.10

  • Euro vs. Dollar is up $0.0039 to $1.3193

  • Dollar vs. Yen is up $0.20 to $81.36

Companies in the News:


Big Lots Inc. (BIG, -$11.00/-24.1% to $34.71) traded down after lowering its 1st quarter sales guidance to slightly negative from an increase of 2-4%.  Certain of its outdoor home care segments have shown weak sales.  Several analysts lowered their price targets and ratings on the company.


Wal-Mart Stores Inc. (WMT, -$1.77/-3.0% to $57.77) shares were under pressure again today as the company deals with the bribery allegations facing its Mexican subsidiary and charges that senior managers hid those allegations.  MetLife, Inc. announced that Eduardo Castro-Wright, former head of Wal-Mart Mexico and current Wal-Mart Stores vice chairman, voluntarily resigned from its board due to personal reasons.  Wal-Mart also announced that it has employed several strategies to address strict adherence to Foreign Corrupt Practices Act policies, including the hiring of a global compliance officer who will be charged specifically with policing the company’s compliance with the FCPA.


Earnings


3M Co. (MMM, +$1.36/+1.6% to $88.49) reported EPS of $1.63 vs. estimates of $1.49; revenue was $7.5 billion, 2.4% better than the $7.3 billion reported in the year ago period.  Strong sales on auto and aerospace industries were key earnings drivers.


Air Products & Chemicals Inc. (APD, -$4.01/-4.5% to $84.72) reported adjusted EPS of $1.31 vs. estimates of $1.32; revenue was $2.34 billion, 2% lower than the $2.392 billion reported in the year ago period and lower than analysts’ estimates of $2.43 billion.


AT&T Inc. (T, +$1.11/+3.6% to $31.72) reported EPS of $0.60 vs. estimates of $0.57; revenue was $31.8 billion, 1.8% better than the $31.2 billion reported in the year ago period.


Baker Hughes Inc. (BHI, +$1.97/+4.8% to $43.04) reported EPS of $0.86 vs. estimates of $0.80; revenue was $5.36 billion, 18% better than the $4.53 billion reported in the year ago period and better than the $5.22 billion expected by analysts.


Coach Inc. (COH, -$3.25/-4.3% to $71.87) reported EPS of $0.77 vs. estimates of $0.75; revenue was $1.1 billion, 16.6% better than the $950.7 million reported in the year ago period.  Stock was under pressure because growth in North America had slowed and revenue didn’t satisfy investors.


Hershey Co. (HSY, +$3.71/+6.0% to $66.00) reported adjusted EPS of $0.96 vs. estimates of $0.81; revenue was $1.73 billion, 10.7% better than the $1.564 billion reported in the year ago period.  Profit margins soared, because the company raised prices 10% last year to offset the costs of raw materials – when those costs came down, prices stayed the same yet the company was still able to offer a perceived value.


Illinois Tool Works Inc. (ITW, +$1.46/+2.6% to $56.68) reported EPS of $0.97 vs. estimates of $0.95; revenue was $4.5 billion, 6.4% better than the $4.3 billion reported in the year ago period.  The Company raised its full-year guidance to $4.14 to $4.38 versus the prior forecasted range of $4.02 to $4.26.


International Business Machines (IBM, +$1.38/+0.7% to $200.00) raised its quarterly 14% and expanded its share buyback program by $7.0 billion.


Itau Unibanco Hldg S/A ADS (ITUB, -$0.15/-0.9% to $16.72) posted a first-quarter net profit of 3.43 billion Brazilian reais ($1.82 billion), down from BRL3.53 billion in the year-earlier period.  Profits suffered as expenses with provisions rose.


Neflix (NFLX, -$14.39/-14.1% to $87.68) shares traded lower again today after warning that subscriber growth is expected to slow in the current quarter.  The company did manage to beat earnings expectations for the first quarter.


Parker Hannifin Corp. (PH, +$7.02/+8.7% to $87.96) reported EPS of $2.01 vs. estimates of $1.71; revenue was $3.39 billion, 4.8% better than the $3.240 billion reported in the year ago period.  The company raised its FY 2012 estimates to $7.30-$7.50 per share, higher than estimates of $7.08.


RadioShack Corporation (RSH, -$0.63/-10.6% to $5.34) reported EPS of ($0.08) vs. estimates of $0.05; revenue was $1.01 billion vs. estimates of $1.06 billion.  Earnings were impacted by weakness in the company’s Sprint postpaid wireless business and poor demand for prepaid wireless handsets, laptops and home entertainment accessories.


Western Union Co. (WU, +$0.11/+0.6% TO $18.06) reported EPS of $0.40, in line with estimates; revenue was $1.393 billion, 8.6% better than the $1.283 billion reported in the year ago period.  The company reaffirmed its 2012 financial outlook.


Earnings After the Bell


Apple Inc. (AAPL, -2.0% to $560.28) reported EPS of $12.30 vs. estimates of $10.04; revenue was $39.2 billion vs. estimates of $36.81 billion.  The company announced that it sold 35.1 million iPhones and 11.8 million iPads. The company had $110 billion in cash on its balance sheet at the end of Q2.  Q3 guidance is lower at $34.0 billion vs. estimates of $37.48 billion. The stock is trading over $600 in the after-market.


Juniper Networks Inc. (JNPR, +$1.46/+7.2% to $21.63) reported adjusted EPS of $0.16 vs. estimates of $0.13; revenue was $1.03 billion vs. estimates of $976.8 million.  JNPR shares were halted briefly this afternoon when its earnings information started to inadvertently leak on Bloomberg.


Coming Wednesday:


Economic Reports:  Weekly Mortgage Applications (+6.9% expected) at 7:00 a.m.; March Durable Goods Orders (-1.7% expected) and Capital Goods (+1.0% expected) at 8:30; FOMC Rate Decision (0.25% expected)   Earnings  ABB Ltd. ADS (est: $0.32), AvalonBay Communities Inc. (est: $1.24), Boeing Co. (est: $0.92), Canon Inc. ADS (est: $0.57), Caterpillar Inc. (est: $2.12), Cenovus Energy Inc. (est: $0.52), Corning Inc. (est: $0.28), Credit Suisse Grp AG ADS (est: $0.6), Crown Castle Intl Corp. (est: $0.18), Dr Pepper Snapple Grp Inc. (est: $0.48), Eli Lilly & Co. (est: $0.78), Encana Corp. (est: $0.07), Equity Residential (est: $0.62), General Dynamics Corp. (est: $1.71), GlaxoSmithKline PLC ADS (est: $0.91), Goldcorp Inc. (est: $0.53), Harley-Davidson Inc. (est: $0.71), Hess Corp. (est: $1.6), Host Hotels & Resorts Inc. (est: $0.13), Las Vegas Sands Corp. (est: $0.58), Lorillard Inc. (est: $1.99), Motorola Solutions Inc. (est: $0.54), Natl Oilwell Varco Inc. (est: $1.39), NextEra Energy Inc (est: $1.01), Northrop Grumman Corp. (est: $1.59), Praxair Inc. (est: $1.36), Sap Ag Ads (est: $1.48), Siemens AG ADS (est: $2.14), Southern Co. (est: $0.49), Sprint Nextel Corp. (est: $-0.42), TE Connectivity Ltd. (est: $0.66), Thermo Fisher Scientific Inc. (est: $1.1), Vale S.A. ADS (est: $0.81), WellPoint Inc. (est: $2.28), Williams Companies Inc (est: $0.36), Williams Partners L.P. (est: $0.92), Wyndham Worldwide Corp. (est: $0.55)


 


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