Stock Market Wrapup April 16th
Stocks advanced solidly today, aided by some upbeat news on consumer spending and some better-than-expected profit reports from U.S. corporations. Investors were encouraged by a government report that showed consumer spending resulted in a March retail sales gain of 0.7%. The start of the trading week also saw a slight drop in crude oil prices and firming by the 10-year Treasury note.
The Commerce Department's report on March retail sales was above expectations as well as an improvement over the revised 0.5% increase recorded in February. The government had originally reported a meager 0.1% increase in February retails sales. The Commerce Department also said business inventories rose 0.3% in March, which was more than the 0.2% Wall Street was expecting, but investors shrugged off the gain.
Today's earnings news began with a Q1 report from Citigroup (NYSE: C), the nation's largest bank. Investors were pleased by top-line results that exceeded expectations, pushing the shares up 2.6%. The banking giant's bottom-line results were hurt by charges associated with the cost-cutting measures the company recently announced. Citigroup reported net income of $5 billion, or $1.01 a share, which represented an -11% decline from the $5.64 billion, or $1.12 a share, it earned a year earlier. Excluding charges, the bank would have reported a profit of $1.18 a share. Revenue jumped 15%. Subscribers can read our analysis of Citi's Q1 performance in today's issue.
Citi's results helped boost the shares of several money center banks. Rising today were the shares of Wachovia (NYSE: WB), J.P. Morgan Chase (NYSE: JPM), and Bank of America (NYSE: BAC). J.P. Morgan and Bank of America, along with two private-equity funds, also agreed today to purchase SLM (NYSE: SLM), the student-loan provider widely known as "Sallie Mae." The company's shares jumped 18.4%. The group will pay $60 a share, or $25 billion, for the company.
Elsewhere in the financial sector, California-based mortgage lender Fremont General (NYSE: FMT) surged 26% after the company announced it had found a buyer for its subprime business. Fremont says it has a signed letter of intent for its subprime portfolio, but did not disclose the purchaser.
The report from drugmaker Eli Lilly (NYSE: LLY) reflected a similar scenario to that of Citigroup, with similar results for its shares. The stock closed up 2.7% despite the fact that Lilly reported a -39% decline in its Q1 profits. Revenue, however, was up 14%. Lilly's bottom line was hurt by charges associated with acquisition costs, plant closings, and a licensing deal with OSI Pharmaceuticals (Nasdaq: OSIP) for an experimental drug. Lilly raised its full-year forecast.
Toy maker Mattel (NYSE: MAT) said strong sales of its Fisher-Price, Hot Wheels, and Matchbox products helped boost revenue 19% to $940. Profits, however, dropped -60% against last year's Q1, which was aided by 15-cent a share tax benefit.
By the BullMarket.com Staff
The Commerce Department's report on March retail sales was above expectations as well as an improvement over the revised 0.5% increase recorded in February. The government had originally reported a meager 0.1% increase in February retails sales. The Commerce Department also said business inventories rose 0.3% in March, which was more than the 0.2% Wall Street was expecting, but investors shrugged off the gain.
Today's earnings news began with a Q1 report from Citigroup (NYSE: C), the nation's largest bank. Investors were pleased by top-line results that exceeded expectations, pushing the shares up 2.6%. The banking giant's bottom-line results were hurt by charges associated with the cost-cutting measures the company recently announced. Citigroup reported net income of $5 billion, or $1.01 a share, which represented an -11% decline from the $5.64 billion, or $1.12 a share, it earned a year earlier. Excluding charges, the bank would have reported a profit of $1.18 a share. Revenue jumped 15%. Subscribers can read our analysis of Citi's Q1 performance in today's issue.
Citi's results helped boost the shares of several money center banks. Rising today were the shares of Wachovia (NYSE: WB), J.P. Morgan Chase (NYSE: JPM), and Bank of America (NYSE: BAC). J.P. Morgan and Bank of America, along with two private-equity funds, also agreed today to purchase SLM (NYSE: SLM), the student-loan provider widely known as "Sallie Mae." The company's shares jumped 18.4%. The group will pay $60 a share, or $25 billion, for the company.
Elsewhere in the financial sector, California-based mortgage lender Fremont General (NYSE: FMT) surged 26% after the company announced it had found a buyer for its subprime business. Fremont says it has a signed letter of intent for its subprime portfolio, but did not disclose the purchaser.
The report from drugmaker Eli Lilly (NYSE: LLY) reflected a similar scenario to that of Citigroup, with similar results for its shares. The stock closed up 2.7% despite the fact that Lilly reported a -39% decline in its Q1 profits. Revenue, however, was up 14%. Lilly's bottom line was hurt by charges associated with acquisition costs, plant closings, and a licensing deal with OSI Pharmaceuticals (Nasdaq: OSIP) for an experimental drug. Lilly raised its full-year forecast.
Toy maker Mattel (NYSE: MAT) said strong sales of its Fisher-Price, Hot Wheels, and Matchbox products helped boost revenue 19% to $940. Profits, however, dropped -60% against last year's Q1, which was aided by 15-cent a share tax benefit.
By the BullMarket.com Staff
posted by Stock Administrator @ 7:39 PM
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