Mid-day Update: U.S. Markets Tread Water Slightly Lower on Durable Goods Miss; Apple Bitten by Earnings
After U.S. stock index futures turned mixed following the 8:30 a.m. ET release of data that showed a significant decline in March durable-goods orders. By midday, all three major U.S. equity indexes were modestly lower. Market participants are balancing the disappointing data against a slew of major corporate earnings reports, which have also been mixed.
According to the Commerce Department, durable-goods orders fell 5.7% in March, well below the 3.2% decline forecast by economists polled by MarketWatch. Stripping out the volatile transportation sector, orders fell a smaller 1.4%. Orders for core capital goods edged up 0.2% after a 4.8% decline in February. Durable orders for February, meanwhile, were revised down to show a 4.3% gain from a prior reading of a 5.6% increase.
Apple's ( AAPL ) always highly anticipated earnings report featured results that beat expectations, but soft guidance is driving the company's stock lower, with shares down 1.2% at $401.36 in recent dealings. Although the company posted a top and bottom line Street beat, forward guidance came in lower than expected. The company also announced a significant share buyback, which will positively impact earnings per share going forward.
Ford Motor Company ( F ) reported a 15% increase in Q1 profit, driven by a strong performance in its North American division. F earned $2.44 billion in pre-tax profit in North America during Q1, making it its most profitable quarter since the company began reporting North American results, in 2000. Investors initially greeted the numbers with enthusiasm. However, after rising about 1% early, F has reversed course to trade 1% lower at mid-day.
Asian stocks gained, with Japan's Nikkei advancing to the highest close in five years as the yen weakened. Shares were boosted by expectations that China and Europe may add more stimulus to their economies after a spate of weak data on Tuesday.
European bourses were also trading higher. The European Central Bank meets on May 2, and some speculate that rates will come down.
A surge in oil prices on lower supply numbers and a rise in gold prices in response to the bad durable goods data were leading commodities higher at midday. Oil was up $1.34 per barrel at $90.52, although natural gas backed off its recent bull run, down $0.058 at $4.18 per million BTUs.
Gold was rebounding $14.40 per ounce at $1,423.20, with silver rising $0.014 at $22.88. Copper was up $0.0735 at $3.1775.
Here's where the markets stood at mid-day:
NYSE Composite up 32.33 (-0.35%) to 9,146.02
Dow Jones Industrial Average down 27.39 (-0.19%) to 14,692.07
S&P 500 up 0.79 (+0.05%) to 1,579.57
Nasdaq Composite Index down 5.59 (-0.17%) to 3,263.74
Nikkei 225 Index up 2.32%.
Hang Seng Index down 1.73%.
Shanghai China Composite Index up 1.53%.
FTSE 100 up 0.22%.
DAX up 1.17%.
CAC 40 up 1.4%.
NYSE SECTOR INDICES
NYSE Energy Sector Index (^NYE) up 168.48 (+1.32%) at 12,975.98
NYSE Financial Sector Index (^NYK) up 25.38 (+0.46%) to 5,589.08
NYSE Healthcare Sector Index (^NYP) down 25.76 (-0.28%) to 9,210.20
(+)DPS (+2.9%,new 52-week high) Reports Q1 EPS of $0.51 compared to $0.48 in the prior year period. Its core EPS was $0.53. Analysts were expecting EPS of $0.46 per share. Dr. Pepper reported $1.38 in net sales, nearly even with consensus. The Street expected $1.39 billion in revenue for Q1.
(+) BKI (+25.6%, new 52-week high) Agreed to be bought by Georgia-Pacific LLC for $37.50 per share in cash. The transaction, subject to completion, is valued at approximately $1.5 billion, including debt.
(+) BA (+3.4%, new 52-week high) Reported a non-GAAP Q1 EPS increase of 24% to $1.73, up from $1.40 the previous year, driven by strong performance across the company's businesses. GAAP earnings came in at $1.44, against $1.22 last year. Consensus was for EPS of $1.47.
(-) EW (-23.3%, new 52-week low) Reported Q1 EPS of $0.72, ex one-time items, missing the Capital IQ consensus estimate of $0.76. Revenues of $496.7 million also fell short of the consensus of $518.75 million.
(-) NS (-3.5%) Reported Q1 net income was $24.4 million, down from $26.2 million a year prior. That's an EPS of $0.17 vs. $0.23 EPS a year ago. Total revenues were $999.7 million. Analysts expected $0.43 EPS on $659.6 million in revenues. It's unclear if the numbers are comparable.
(-) FBC (- 7.8%) Reports Q1 2013 net income applicable to common stockholders of $22.2 million, or $0.33 per diluted share, compared to a net loss of $94.2 million, or $1.75 per share, in Q4, and a net loss of $8.7 million, or $0.22 per share, a year ago. According to Yahoo Finance, analysts were expecting FBC to earn $0.98 per share in Q1.