Stocks Shaken By Japan Earthquake; Investors Eye Fed Interest Rate Decision
Stocks are sharply lower in mid-day trading, but off session lows, after post-quake radiation fears in Japan, which sent that country's main stock index down 11%, triggered a global equities sell-off. Adding to the mix is a monetary-policy meeting by the Federal Reserve on Tuesday due at 2:15 EST. The sell-off also sent crude oil and gold futures plunging.
In the economic data, The Empire State index rose to 17.5 in March from 15.4 in February. This is the fourth straight increase and the highest level of the index since last June. The gain was a bit less than expected. Also reported, U.S. February import prices jumped 1.4%, driven largely by a 3.7% rise in fuel.
In company news:
Texas Instruments ( TXN ) disclosed yesterday, that after a preliminary assessment, its manufacturing site in Miho, Japan, about 40 miles northwest of Tokyo, suffered substantial damage during last Friday's 9.0 magnitude earthquake.
ADRs of Swiss pharma giant Novartis ( NVS ) are down even as the company said an experimental drug for the treatment of myelofibrosis, a rare form of blood cancer, met the goals of a late-stage study, which should pave the way to file the drug for regulatory approval in the second quarter.
Former Walt Disney Co. ( DIS ) CEO Michael Eisner joined the board of IAC/InteractiveCrop ( IACI ), the Internet company that is controlled by Barry Diller, The Wall Street Journal reports. Diller had originally hired Eisner at Disney, the report noted. Eisner served as the CEO of Disney for about 20 years.
General Electric Co. ( GE ) is defending the design of the now-stricken reactor it supplied to Japan 40 years ago, saying its containment system is safe and reliable, the Wall Street Journal and other news outlets report.
Capital One Financial Corp. (COF) said charge-offs fell across the board in February as delinquencies were mostly reduced. U.S. charge-offs -- loans banks don't think they will be able to collect -- declined for the third straight month. The metric had fluctuated in the latter part of 2010 after mostly dropping early last year.
Net charge-offs in February fell to 5.91% from 6.79% a month earlier at Capital One's U.S. card business and declined to 5.42% from 5.72% internationally, according to a filing with the Securities and Exchange Commission. Auto-finance charge-offs dropped to 1.97% from 2.62%.
Bank of America (BAC) cut 100 jobs from its consumer and small-business banking units, The Wall Street Journal reports. The bank also intends to shutter 10% of its branches over the next few years. Bank of America shares are down 2.6%, or $0.37, to $13.86.
Hewlett-Packard (HPQ) Chief Executive Leo Apotheker is planning to push deeper into software and the growing market for cloud computing, Bloomberg reports. At an event in San Francisco, Apotheker said that the company is starting a cloud computing service that allows developers to create applications, the report said.
SunPower (SPWRA) says Japanese suppliers have indicated that, while certain operations are currently disrupted due to infrastructure issues, they have not sustained major damage to their facilities.
In earnings news:
--DSW (DSW) reports Q4 EPS of $0.41, up from $0.30 a year ago but below the Street view of $0.44 per share. Sales were $468.5 mln, up from $402.6 mln last year, and ahead of the Street view of $445 mln. For 2011, the company is forecasting EPS in the range of $2.60 to $2.75 per share. The Street is at $2.70 per share.
--China Sky One Medical (CSKI) says Q4 sales fell 10.2% to $26.8 million from a year ago. Non-GAAP EPS fell to $0.21 from $0.47 a year ago. The company said results were in line with its expectations.
--Williams-Sonoma (WSM) reports Q4 revenue of $1.195 bln, ahead of the analyst consensus of $1.186 bln on Thomson Reuters. EPS was $1.08, vs. expectations of $0.98 per share. For Q1, the company is guiding for revenue in the range of $745 to $765 mln, vs. Street estimates of $749 mln.
Commodities are down. April gold contracts have shed $2.86, or 2.25%, to $1,393 an ounce, while April crude oil contacts are down 2.76%, or $2.75, at $98.45 a barrel.
In energy ETFs, the United States Oil Fund (USO) is down 2.69% to $39.81 and the United States Natural Gas fund (UNG) is up $0.11, or 1.06%, to $10.53.
In precious metal ETFs, the SPDR Gold Trust (GLD) is down 2.12% to $135.91. Market Vectors Gold Miners (GDX) is down 4.08% to $55.45. iShares Silver Trust (SLV) is down 4.08% to $33.59.