JDfn Daily Digest - August 1, 2008
Non-farm payrolls fell for the seventh straight month in July while the unemployment jumped to 5.7%, a four-year high. Payrolls fell by 51,000 in July, led by losses in manufacturing, construction, retail and temporary help. Since December, 463,000 jobs have been lost, the strongest signal that the economy is in a recession.
The Institute for Supply Management reported that U.S. manufacturing activity was flat in July. The ISM manufacturing index slipped from 50.2% in June to 50% in July. The ISM has been hovering around 50% for the last 10 months.
The final euro-zone manufacturing purchasing manager’s index fell to 47.4 in July, down from 49.2 and slightly below a preliminary estimate of 47.5 suggesting that the manufacturing sector contracted even further, posting the steepest decline since June 2003.
Spending on U.S. construction projects fell by 0.4% in June, pulled lower by weaker outlays on housing and state and local construction. Economists expected construction spending to decline by 0.3% in June. Year over year, construction spending is down by 5.9%.
Northwest Airlines Corp. (NWA) reported that it will add fuel surcharges of up to $80 for many domestic round-trip tickets. The surcharge would apply to travel to about 7,000 routes between two cities, beginning Jan. 10th.
Siemens AG (SI) has sold an 80.2 percent stake in its cordless phone unit to another German firm. The deal will transfer the stake of Siemens Home and Office Communication Devices on Oct. 1st. Siemens said spinning off the unit will allow it to continue its "strategy of focusing on the three sectors: Energy, Industry and Healthcare."
Scheduled Economic Reports (Next Week)
Personal Income and Spending, Factory Orders, ISM Non-Manufactory Index, Pending Home Sales, Consumer Credit, Productivity, Wholesale Inventories, FOMC Meeting
In Earnings News
General Motors (GM) reported a $15.5 billion quarterly loss, as North American sales dropped by 20 percent and plunging prices for SUVs prompted deep charges for its auto finance business. The company’s net loss was equal to $27.33 per share, compared with a profit of $891 million, or $1.56 per share a year ago. Analysts expected a loss of $2.67 per share.
Nissan Motor Co. (NSANY) said its net profit for the quarter dropped 42.8 percent, hit by a rising yen and accounting provisions for the declining value of leased vehicles. The automaker said net profit fell to 52.8 billion yen ($505 million) for the quarter, while sales fell 4.1 percent from a year earlier to 2.3 trillion yen ($22.4 billion).
Chevron Corp (CVX) said second-quarter net income for the quarter rose 11% to $6 billion, or $2.90 a share, from $5.4 billion, or $2.52 a share in the year-ago period. Analysts expected earnings of $3.03 a share.
Total SA (TOT) reported that its profit climbed 38.7 percent in the second quarter, joining other oil companies in posting strong results as oil prices surged this past spring. The company said it earned 4.73 billion euros ($7.38 billion) in the quarter, up from 3.41 billion euros in the same period a year ago.
NYSE Euronext (NYX) says its net income rose 21 percent during the second quarter, driven by increased transaction volume and better expense management. The parent of the New York Stock Exchange and Euronext says it earned $195 million, or 73 cents per share. Analysts forecast a quarterly profit of 78 cents.
Nortel Networks (NT) said its second-quarter loss grew to $113 million or 23 cents a share, from a loss of $37 million, or 7 cents a share, a year ago. Analysts had a consensus forecast of a three-cent loss.
Cigna (CI) says its second-quarter profit rose 37 percent on a jump in premiums and fees as the company's acquisition of Great West Healthcare boosted membership. Profit rose to $272 million, or 97 cents per share. Analysts expected a profit of 97 cents per share.
Sun Microsystems Inc. (JAVA) says its fiscal fourth quarter profit plunged 73 percent on slumping sales to big U.S. companies. The company said its net income for the quarter was $88 million, or 11 cents per share. That was in line with analysts’ expectations.
Scheduled Earnings Reports (Next Week)
EchoStar Corp, Humana, Cisco Systems, News Corp, Procter & Gamble, Wendy’s, Dean Foods, Polo Ralph Lauren, Time Warner, Hertz, 1-800-Flowers, DirecTV, Public Storage, Toyota Motor Corp.
Stocks in the News
ComScore Inc (SCOR) second-quarter net income rose to $2.6 million, or 9 cents a share.
Ingersoll-Rand (IR) second-quarter profit dropped to $256 million or 88 cents a share.
Chiquita Brands International (CQB) reported second-quarter earnings of $62.1 million, or $1.37 a share, up from $8.6 million, or 20 cents a share, in the year-ago quarter.
Administaff (ASF) reported that second-quarter net income fell 19% on 12% higher revenue.
McAfee (MFE) second-quarter net income fell to $47.8 million from $48 million a year earlier.
Wachovia Corp’s (WB) Chief Risk Officer Donald Truslow plans to retire and the bank has begun a search for his successor.
Cognizant Technology Solutions (CTSH) reported its second-quarter net income rose to $103.9 million, or 35 cents a share.
The Institute for Supply Management reported that U.S. manufacturing activity was flat in July. The ISM manufacturing index slipped from 50.2% in June to 50% in July. The ISM has been hovering around 50% for the last 10 months.
The final euro-zone manufacturing purchasing manager’s index fell to 47.4 in July, down from 49.2 and slightly below a preliminary estimate of 47.5 suggesting that the manufacturing sector contracted even further, posting the steepest decline since June 2003.
Spending on U.S. construction projects fell by 0.4% in June, pulled lower by weaker outlays on housing and state and local construction. Economists expected construction spending to decline by 0.3% in June. Year over year, construction spending is down by 5.9%.
Northwest Airlines Corp. (NWA) reported that it will add fuel surcharges of up to $80 for many domestic round-trip tickets. The surcharge would apply to travel to about 7,000 routes between two cities, beginning Jan. 10th.
Siemens AG (SI) has sold an 80.2 percent stake in its cordless phone unit to another German firm. The deal will transfer the stake of Siemens Home and Office Communication Devices on Oct. 1st. Siemens said spinning off the unit will allow it to continue its "strategy of focusing on the three sectors: Energy, Industry and Healthcare."
Scheduled Economic Reports (Next Week)
Personal Income and Spending, Factory Orders, ISM Non-Manufactory Index, Pending Home Sales, Consumer Credit, Productivity, Wholesale Inventories, FOMC Meeting
In Earnings News
General Motors (GM) reported a $15.5 billion quarterly loss, as North American sales dropped by 20 percent and plunging prices for SUVs prompted deep charges for its auto finance business. The company’s net loss was equal to $27.33 per share, compared with a profit of $891 million, or $1.56 per share a year ago. Analysts expected a loss of $2.67 per share.
Nissan Motor Co. (NSANY) said its net profit for the quarter dropped 42.8 percent, hit by a rising yen and accounting provisions for the declining value of leased vehicles. The automaker said net profit fell to 52.8 billion yen ($505 million) for the quarter, while sales fell 4.1 percent from a year earlier to 2.3 trillion yen ($22.4 billion).
Chevron Corp (CVX) said second-quarter net income for the quarter rose 11% to $6 billion, or $2.90 a share, from $5.4 billion, or $2.52 a share in the year-ago period. Analysts expected earnings of $3.03 a share.
Total SA (TOT) reported that its profit climbed 38.7 percent in the second quarter, joining other oil companies in posting strong results as oil prices surged this past spring. The company said it earned 4.73 billion euros ($7.38 billion) in the quarter, up from 3.41 billion euros in the same period a year ago.
NYSE Euronext (NYX) says its net income rose 21 percent during the second quarter, driven by increased transaction volume and better expense management. The parent of the New York Stock Exchange and Euronext says it earned $195 million, or 73 cents per share. Analysts forecast a quarterly profit of 78 cents.
Nortel Networks (NT) said its second-quarter loss grew to $113 million or 23 cents a share, from a loss of $37 million, or 7 cents a share, a year ago. Analysts had a consensus forecast of a three-cent loss.
Cigna (CI) says its second-quarter profit rose 37 percent on a jump in premiums and fees as the company's acquisition of Great West Healthcare boosted membership. Profit rose to $272 million, or 97 cents per share. Analysts expected a profit of 97 cents per share.
Sun Microsystems Inc. (JAVA) says its fiscal fourth quarter profit plunged 73 percent on slumping sales to big U.S. companies. The company said its net income for the quarter was $88 million, or 11 cents per share. That was in line with analysts’ expectations.
Scheduled Earnings Reports (Next Week)
EchoStar Corp, Humana, Cisco Systems, News Corp, Procter & Gamble, Wendy’s, Dean Foods, Polo Ralph Lauren, Time Warner, Hertz, 1-800-Flowers, DirecTV, Public Storage, Toyota Motor Corp.
Stocks in the News
ComScore Inc (SCOR) second-quarter net income rose to $2.6 million, or 9 cents a share.
Ingersoll-Rand (IR) second-quarter profit dropped to $256 million or 88 cents a share.
Chiquita Brands International (CQB) reported second-quarter earnings of $62.1 million, or $1.37 a share, up from $8.6 million, or 20 cents a share, in the year-ago quarter.
Administaff (ASF) reported that second-quarter net income fell 19% on 12% higher revenue.
McAfee (MFE) second-quarter net income fell to $47.8 million from $48 million a year earlier.
Wachovia Corp’s (WB) Chief Risk Officer Donald Truslow plans to retire and the bank has begun a search for his successor.
Cognizant Technology Solutions (CTSH) reported its second-quarter net income rose to $103.9 million, or 35 cents a share.
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