JDfn Daily Digest - August 15, 2008
The output of U.S. factories rose 0.4% in July, the best gain in 10 months. Overall, industrial production increased a seasonally adjusted 0.2% in July as expected, despite a 1.9% drop in output of utilities. Capacity utilization increased a tenth to 79.9% in July, still far below the level that would signal tight supply chains.
The Empire State Index said its monthly survey rose to 2.8 in August, up from negative 4.9 in July. Economists were expecting negative 2.8. The survey had been hovering in the single-digit negatives in May, June and July.
The University of Michigan/Reuters consumer sentiment index rose to 61.7 in early August from 61.2 in July. The index reached an almost three-decade low in June. Economists were expecting the index to rise to 62.0.
OPEC has cut its forecast for growth of global oil demand for a fifth month and said production is more than adequate, signaling a more comfortable supply and demand balance. OPEC left its forecast for world consumption growth next year unchanged, predicting an increase of 900,000 barrels per day.
Oil futures were pressured by reports out this week suggesting the global economy is slowing significantly. Reports from Europe, Asia and the U.S. all pointed to the possibility of lower oil demand worldwide.
General Motors Corp. (GM) will announce a multimillion-dollar investment at its Lordstown, Ohio plant and release photos its new Chevrolet Cruze small car next Thursday. The Cruze will be officially unveiled at the Paris Motor Show next month.
Toyota Motors (TM) plans to unveil a new Lexus hybrid and the next generation of its hot-selling Prius next year as the company looks to hit the one-million mark in hybrid sales in 2010. A production version of the Lexus and Prius will be displayed at the North American International Auto Show in Detroit in January.
A federal bankruptcy judge has rejected a settlement involving Countrywide Financial (CFC), saying he was not convinced it was fair to nearly 300 borrowers allegedly hurt by the mortgage lender's abusive practices. The judge ordered both sides to address his concerns, and scheduled an Oct. 2nd status conference.
Waste Management (WMI) that it was disappointed that Republic Services Inc (RSG) turned down its revised proposal to acquire Republic for $37 a share in cash. In a corporate statement, Waste Management said it continues to believe that their revised proposal would provide superior value to Republic stockholders.
AirTran Airways (AAI), a subsidiary of AirTran Holdings Inc., said it will waive all baggage fees for active members of the U.S. military. AirTran does not charge for a first checked bag, but the second bag can cost between $10 and $20 to check.
Scheduled U.S. Economic Reports (Next Week)
Home Builders Index (Aug), Producer Price Index (July), Housing Starts (July), Philly Fed Index (Aug), Leading Indicators (July)
In Earnings News
J.C. Penney Co. (JCP) reported a 36 percent decline in second-quarter profit. The retail chain said net income for the three-month period ended Aug. 2 was $117 million, or 52 cents per share. Analysts expected 50 cents per share.
Abercrombie & Fitch Co. (ANF) said profit fell 4 percent to $77.8 million, or 87 cents per share. Analysts expected profit 86 cents per share on revenue of $851.4 million.
Agilent Technologies (A) reported third-quarter net income of $169 million, compared with a net profit of $185 million in the year ago period. The company reported a profit of 45 cents a share, flat from the previous year.
Oplink Communications Inc. (OPLK) said, excluding special items, they expect to earn between 13 cents and 17 cents for the period ending Sept. 30th. Analysts expect the company to earn 16 cents per share on revenue of $38 million.
Scheduled Earnings Reports (Next Week)
Home Depot, Target, Analog Devices, Hewlett Packard, BJs Wholesale, Longs Drugs, Foot Locker, Intuit, The Gap, HJ Heinz, Burger King, Perry Ellis International
Stocks in the News
Ford Motor Company (F) is planning to build a new, seven-passenger luxury crossover.
Merrill Lynch (MER) will reportedly institute a hiring freeze for the remainder of 2008.
Autodesk (ADSK) said earnings for the second quarter stayed largely flat despite better-than-expected revenue.
La-Z-Boy Inc. (LZB) was downgraded by BB&T Capital Markets, citing weaker demand for its products.
AMR Corp’s (AMR) American Airlines is facing $7.1 million in civil penalties from the FAA for safety violations and lapses in drug and alcohol testing at the airline.
Illinois Tools Works (ITW) said it is forecasting quarterly earnings per share from continuing operations of 93 cents to 99 cents.
Ambac Inc (ABK) and MBIA Inc (MBI) traded higher after S&P affirmed ratings for the companies' respective insurance units.
Kohl’s Corp (KSS) reported its quarterly profit fell 12% from a year ago as consumers spent less.
Time Warner Inc’s (TWX) Warner Bros. Pictures unit said it has delayed the release of "Harry Potter and the Half-Blood Prince" to July 19, 2009.
The Empire State Index said its monthly survey rose to 2.8 in August, up from negative 4.9 in July. Economists were expecting negative 2.8. The survey had been hovering in the single-digit negatives in May, June and July.
The University of Michigan/Reuters consumer sentiment index rose to 61.7 in early August from 61.2 in July. The index reached an almost three-decade low in June. Economists were expecting the index to rise to 62.0.
OPEC has cut its forecast for growth of global oil demand for a fifth month and said production is more than adequate, signaling a more comfortable supply and demand balance. OPEC left its forecast for world consumption growth next year unchanged, predicting an increase of 900,000 barrels per day.
Oil futures were pressured by reports out this week suggesting the global economy is slowing significantly. Reports from Europe, Asia and the U.S. all pointed to the possibility of lower oil demand worldwide.
General Motors Corp. (GM) will announce a multimillion-dollar investment at its Lordstown, Ohio plant and release photos its new Chevrolet Cruze small car next Thursday. The Cruze will be officially unveiled at the Paris Motor Show next month.
Toyota Motors (TM) plans to unveil a new Lexus hybrid and the next generation of its hot-selling Prius next year as the company looks to hit the one-million mark in hybrid sales in 2010. A production version of the Lexus and Prius will be displayed at the North American International Auto Show in Detroit in January.
A federal bankruptcy judge has rejected a settlement involving Countrywide Financial (CFC), saying he was not convinced it was fair to nearly 300 borrowers allegedly hurt by the mortgage lender's abusive practices. The judge ordered both sides to address his concerns, and scheduled an Oct. 2nd status conference.
Waste Management (WMI) that it was disappointed that Republic Services Inc (RSG) turned down its revised proposal to acquire Republic for $37 a share in cash. In a corporate statement, Waste Management said it continues to believe that their revised proposal would provide superior value to Republic stockholders.
AirTran Airways (AAI), a subsidiary of AirTran Holdings Inc., said it will waive all baggage fees for active members of the U.S. military. AirTran does not charge for a first checked bag, but the second bag can cost between $10 and $20 to check.
Scheduled U.S. Economic Reports (Next Week)
Home Builders Index (Aug), Producer Price Index (July), Housing Starts (July), Philly Fed Index (Aug), Leading Indicators (July)
In Earnings News
J.C. Penney Co. (JCP) reported a 36 percent decline in second-quarter profit. The retail chain said net income for the three-month period ended Aug. 2 was $117 million, or 52 cents per share. Analysts expected 50 cents per share.
Abercrombie & Fitch Co. (ANF) said profit fell 4 percent to $77.8 million, or 87 cents per share. Analysts expected profit 86 cents per share on revenue of $851.4 million.
Agilent Technologies (A) reported third-quarter net income of $169 million, compared with a net profit of $185 million in the year ago period. The company reported a profit of 45 cents a share, flat from the previous year.
Oplink Communications Inc. (OPLK) said, excluding special items, they expect to earn between 13 cents and 17 cents for the period ending Sept. 30th. Analysts expect the company to earn 16 cents per share on revenue of $38 million.
Scheduled Earnings Reports (Next Week)
Home Depot, Target, Analog Devices, Hewlett Packard, BJs Wholesale, Longs Drugs, Foot Locker, Intuit, The Gap, HJ Heinz, Burger King, Perry Ellis International
Stocks in the News
Ford Motor Company (F) is planning to build a new, seven-passenger luxury crossover.
Merrill Lynch (MER) will reportedly institute a hiring freeze for the remainder of 2008.
Autodesk (ADSK) said earnings for the second quarter stayed largely flat despite better-than-expected revenue.
La-Z-Boy Inc. (LZB) was downgraded by BB&T Capital Markets, citing weaker demand for its products.
AMR Corp’s (AMR) American Airlines is facing $7.1 million in civil penalties from the FAA for safety violations and lapses in drug and alcohol testing at the airline.
Illinois Tools Works (ITW) said it is forecasting quarterly earnings per share from continuing operations of 93 cents to 99 cents.
Ambac Inc (ABK) and MBIA Inc (MBI) traded higher after S&P affirmed ratings for the companies' respective insurance units.
Kohl’s Corp (KSS) reported its quarterly profit fell 12% from a year ago as consumers spent less.
Time Warner Inc’s (TWX) Warner Bros. Pictures unit said it has delayed the release of "Harry Potter and the Half-Blood Prince" to July 19, 2009.
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