3M’s second-quarter profit rose 3.4 percent as slowing demand for films for LCD televisions dampened strong growth in its other businesses.
3M Co. makes office supplies such as Scotch tape and Post-it notes, coatings for television screens, roofing shingles and other industrial supplies.
The company said Tuesday that it earned $1.16 billion during the quarter, or $1.60 per share. Revenue rose 14 percent to $7.68 billion. That topped analyst expectations for net income of $1.59 per share on revenue of $7.52 billion, according to FactSet.
The Japan earthquake in March hurt sales growth by 2.4 percentage points, and cut 7 cents per share from 3M’s profit.
3M has been coping with a slowdown in films that coat the screens of LCD televisions. But sales of those screens fell 22 percent in the last quarter, faster than expected. 3M said too much inventory and a maturing market are driving TV manufacturers to go with cheaper films. Sales fell 10.6 percent to $973 million in 3M’s Display and Graphics business, the only one of its six big divisions to post a sales decline payday loans direct lenders. That division still had operating income of $222 million.
Its biggest division, Industrial and Transportation, saw operating profits of $544 million on sales of $2.6 billion.
Not counting companies it bought, 3M sales volumes rose 3.2 percent, and prices rose 0.8 percent.
Investors consider 3M an economic bellwether because of the diversity of its businesses.
“While economic growth moderated a bit in the second quarter, we believe that the global economy will continue to expand and 3M is well-positioned to capitalize on that growth,” said Chairman and CEO George Buckley.
Maplewood, Minn.-based 3M raised the low end of its full-year guidance by 5 cents, to $6.05 to $6.25 per share. Analysts have been expecting $6.23. It expects full-year profits to be hurt by 11 cents to 12 cents per share by the impact of the Japan earthquake.
Greece’s prime minister was gambling his government’s survival and the danger of a devastating debt default on a Tuesday night confidence vote aimed at helping him passing deeply disliked austerity measures that have provoked strikes, protests and a slump in his popularity.
Greek deputies began voting after midnight in a crucial confidence motion called by Prime Minister George Papandreou after he reshuffled his cabinet to face down an internal party revolt and help him pass deeply unpopular austerity measures.
The vote was being conducted by roll call after a heated debate that saw sections of the opposition briefly walk out. Papandreou needs 151 votes in the 300-member parliament to win, which he is expected to do.
A loss would likely lead to early elections and throw into question whether Greece can pass a new austerity bill by the end of June as demanded by the country’s international creditors. Unless the new measures pass, Greece will not receive the next batch of funds from its bailout loans, and will face a disastrous default.
Greece is being kept financially afloat by euro110 billion ($157 billion) EU-IMF bailout fund.
A default by Greece could spark a financial maelstrom around the world, dragging down Greek and European banks as well as stoking renewed fears over the finances of other eurozone countries, such as Portugal, Ireland and Spain.
Expectations that Papandreou would win lifted world markets. His Socialist party holds a five-seat majority in the 300-member legislature, and a simple majority is needed to pass.
“Indications over the last 24 hours or so have certainly been that the government will survive, if only because the alternative would be so dire,” said Beat Siegenthaler, an analyst at UBS.
Papandreou reshuffled his Cabinet last week and replaced his finance minister to ease growing dissent within the governing party.
On Tuesday the new finance minister, Evangelos Venizelos, promised that parliament will pass the unpopular austerity package by the end of June in order to comply with European Union demands to receive the next payment in its bailout loan.
Venizelos said Parliament is set to vote on euro28 billion ($40.2 billion) worth of budget cuts and other savings next week.
Greece has said it will face a default unless it receives the euro12 billion ($17.3 billion) rescue loan installment from European countries and the International Monetary Fund.
“We must follow this course to save the country,” Venizelos said.
“Our European partners … face is with distrust,” he said. “This is an atmosphere that we have to change.”
Papandreou’s popularity has been hammered by the latest austerity measures, with an opinion poll published Tuesday giving the Socialists a 20 loans for people with bad credit.1 percent approval rating. Rival conservatives faired marginally better, at 21 percent, in the GPO survey for private Mega television of 1,000 adults. No margin of error was given.
Some 7,000 protesters, chanting “thieves! thieves!” were gathered outside parliament, while a strike by the country’s powerful electricity workers’ union continued to cause rolling blackouts for a second day.
Socialist skeptics, however, appeared to shy away from another fight.
Prominent dissenter Nikolas Salagiannis, said he would vote in favor of the government following the cabinet reshuffle.
“This has generated a slim hope that the issues can be addressed … We back the new government,” Salagiannis said. But he added: “Make no mistake, our connection with people in the street and in the squares is dwindling by the day. We have gone from austerity to more austerity, from denial to denial to get where we are … and the public’s tolerance has been used up.”
Though considered unlikely, if Papandreou loses Tuesday’s vote he would have little choice but to call early elections or try to form a coalition government. However, all opposition parties have said they want elections.
But even after winning, he faces an even more difficult task: Getting parliament to back the new austerity measures as well as an unpopular euro50 billion ($71 billion) privatization program by the end of the month.
If the new austerity measures pass, the finance ministers of the 17-nation eurozone will meet July 3 to give Greece its next bailout installment.
A key requirement from the eurozone and the IMF is that Greece steps up its privatization drive.
European officials are also discussing a second, similar-sized bailout for Greece since it’s obvious the country won’t be able to return to the bond markets and raise money to pay creditors any time soon.
“I trust that the new Greek government will receive the confidence of parliament,” European Commission President Jose Manuel Barroso said after meeting with Papandreou Monday, but added the crucial vote was the one on the new austerity package.
“I therefore trust that Greece’s elected representatives will back these measures next week in a spirit of national and indeed European responsibility,” Barroso said. “These choices are not easy, but nor are the problems that need to be addressed. Now is not the time to falter.”
Toyota recalled 106,000 first-generation Prius hybrid cars globally on Wednesday for faulty steering caused by a nut that may come loose.
The single minor accident suspected of being related to the problem was reported in the U.S., according to Toyota Motor Corp.
The latest recall from Toyota, which has taken hit to its reputation from massive recalls worldwide, affects 48,000 Prius vehicles in Japan, starting with the first Prius models that went on sale in 1997, and those manufactured through 2003.
It also affects 58,000 vehicles sold abroad, including 52,000 Prius cars sold from 2001 through 2003 in the U.S., some 1,200 in Great Britain, and 800 in Germany, company spokesman Paul Nolasco said.
Toyota says loose nuts in the electric-power steering can cause the vehicle, if operated over a long time, to steer with too much force.
The problem can be fixed by putting in better nuts and will take about four hours, it said.
In Japan, Toyota also recalled 21,600 iQ small-cars for braking problems, caused by a valve that became faulty during manufacturing, possibly causing braking power to decline.
Twenty-one complaints were received that may be caused by the problem, but there were no accidents, the automaker said overnight pay day loans.
In the U.S. and Canada, Toyota recalled 34 Venza and 16 Sienna 2011 model vehicles to replace an insufficiently treated driveshaft. The driveshaft could break, causing the vehicle to stall, according to Toyota.
Over the last two years, Toyota has announced massive recalls ballooning to more than 14 million vehicles.
Its once sterling reputation has come under scrutiny. It faces damage lawsuits and lingering doubts in the U.S. on whether it had been transparent enough about the recall woes.
Toyota has been trying to communicate better with customers and empower regions outside Japan to make safety decisions.
U.S. government testing has indicated the problems of runaway cars weren’t caused by electronics or software, but most likely by ill-fitting floor mats or driver error.
Toyota faces a new problem since the March 11 earthquake and tsunami in Japan destroyed key parts suppliers.
The maker of the Lexus luxury car and Camry sedan said Tuesday it expects to be back to 90 percent of pre-disaster production in Japan in June, faster than initially expected.
Unemployment rates fell last month in more than three-quarters of the nation’s states, adding to evidence that companies are feeling more confident in the U.S. economy.
The Labor Department said Friday that unemployment rates dropped in 39 states in April. It’s the largest number of states to see a decrease since November 2003. Rates rose in three states and the District of Columbia. They were unchanged in eight states.
Employers added workers in 42 states, the best showing since March 2007
Asian markets were mixed Tuesday as Japan’s inability to tame a nuclear crisis led to the drastic decision to dump radioactive water into the sea, and companies experienced production problems amid supply and power interruptions.
Oil prices hovered above $108 a barrel in Asia as traders mulled whether political uprisings in the Middle East and signs of strong global crude demand justify extending a 30 percent gain since mid-February.
Japan’s benchmark Nikkei 225 index dropped 1.5 percent to 9,579.45, amid frantic _ and unsuccessful _ efforts to control a radioactive leak at a nuclear plant damaged by a monster earthquake and tsunami that struck off the country’s northeastern coast on March 11.
Shares of Tokyo Electric Power Co. Inc., the utility known as TEPCO that operates the plant, have been in a free fall since the disaster, nose-diving a staggering 80 percent. On Tuesday, the stock hit its lowest point in 60 years after dropping 17 percent.
TEPCO’s coastal Fukushima Dai-ichi nuclear power complex has been leaking radiation since the quake and tsunami knocked out its crucial cooling systems. The company is now struggling to contain the crisis and has resorted to pumping contaminated water into the Pacific Ocean. The damage, meanwhile, forced the plant to cut its daily power supply in Tokyo and surrounding areas, causing many factories to suspend or limit operations.
Still other companies have limited or stopped production because of supply chain disruptions.
Shares in Japan’s powerhouse auto sector skidded downward. Toyota Motor Corp., the world’s largest automaker, slid 3.1 percent after the company said Monday it will temporarily shut down all of its North American factories because of parts shortages. The temporary shutdowns are likely to take place later this month, affecting 25,000 workers, but no layoffs are expected, the company said.
Honda Motor Corp. dropped 2.9 percent, and Nissan Motor Corp. slumped 2.5 percent.
“The disruption to Japanese supply chains is beginning to become apparent credit score. Honda is slowing its North American production, but it also announced it will resume homeland production in two weeks,” Bank of America Merrill Lynch said in a report, adding that Nissan was cutting output in China by 10 percent.
Elsewhere, South Korea’s Kospi index rose 0.3 percent to 2,122.69 after a sluggish morning. Tech giant Samsung Electronics declined about 0.4 percent on worries its first-quarter earnings will likely fall short of expectations, Yonhap news agency reported.
Australia’s S&P/ASX 200 rose 0.3 percent to 4,899.80. Benchmarks in Singapore and New Zealand were also higher. Key indexes in the Philippines, Thailand and Indonesia dropped. Markets in Hong Kong, mainland China and Taiwan were closed for a public holiday.
The Bank of Japan meets this week and investors will be looking to see if it enacts any further policy measures. The central bank has pumped billions of yen into the economy to keep liquidity flowing through the system. It has also received international support to stem the export-sapping appreciation of the yen following last month’s disaster.
Trading volume was light on Wall Street on Monday, with some investors waiting for Alcoa Inc. to report its first quarter earnings next Monday, the unofficial start of the earnings seasons, before making any big moves.
The Dow Jones industrial average gained 0.2 percent to 12,400.03. The S&P 500 rose less than a point to 1,332.87. The Nasdaq composite fell less than a point to 2,789.19.
Benchmark crude for May delivery was down 42 cents to $108.05 in electronic trading on the New York Mercantile Exchange. The contract settled at $108.47 per barrel on Monday, a fresh 30-month high as fighting in Libya and unrest in the Middle East continued to raise doubts about future supplies.
In currencies, the dollar rose to 84.31 yen from 84.04 yen late Monday in New York. The euro fell to $1.4200 from $1.4216.
The Swiss franc, the best- performing major currency the past year, has become the only haven in the foreign-exchange market as the Group of Seven weakens the yen and the Federal Reserve floods the U.S. financial system with dollars.
The franc has surged 7.8 percent in the past year, the most among the 10 most-widely traded currencies tracked by the Bloomberg Correlation-Weighted Indexes. Not even the cash spent by Switzerland’s central bank last year to curb the franc’s strength was enough to keep it from appreciating more than 18 percent against the euro.
Bets by futures traders on further gains against the dollar reached the highest level this month since 2004, even as Swiss National Bank President Philipp Hildebrand said its rise poses “considerable risks” to the economy. Swiss growth will likely lag behind Germany and the U.S. this year as exports from watchmaker Swatch Group AG (UHR) to technology company OC Oerlikon Corp. risk becoming less competitive.
“The franc has become the ultimate safe haven,” said Audrey Childe-Freeman, head of European currency strategy in London at the private-bank unit of JPMorgan Chase & Co., the second-biggest U.S. lender by assets. “In a world where there are question marks against both the dollar and the euro and an environment that will be choppy for the yen in the context of intervention, the franc seems to be the best bet.”
Currency Trading
Switzerland’s currency has benefited from the nation’s role as a stable, neutral financial center and as an exporter of precision products from watches to machine tools. Since 1975, only the yen has appreciated more than the franc among the 10 currencies tracked by the Bloomberg Correlation-Weighted Indexes.
Exports account for about 50 percent of Switzerland’s economy, compared with 39 percent for Germany. The Alpine nation’s current-account surplus — the broadest measure of trade because it includes investment — may shrink to 10.95 percent of the economy this year, from 15.33 percent in 2010, according to the median of 10 estimates in a Bloomberg survey. Germany’s surplus may expand to 5.3 percent this year from 5 percent, a separate survey shows.
While Switzerland’s $491 billion economy is the 19th biggest in the world, the country has the sixth-most actively traded currency, according to the Basel, Switzerland-based Bank for International Settlements. The bank’s data show it accounts for 6.4 percent of the $4 trillion average daily turnover in foreign-exchange markets during the three years ended 2010.
‘Victim of Success’
“We are a victim of our own success,” Rudolf Minsch, chief economist at Economiesuisse, the biggest Swiss industry group, representing 30,000 companies totaling 1.5 million employees, said in a phone interview from Zurich on March 23.
The franc fell 1.4 percent last week to 1.29593 per euro and was 2.1 percent weaker at 91.99 centimes per dollar, after climbing to a record 88.52 centimes on March 17. It traded at 1.24025 per euro on Dec. 30, the strongest level since the euro’s 1999 debut. The franc was at 1.29482 per euro and 91.88 centimes as of 1:05 p.m. in New York.
The currency is still over-valued by 39 percent against its U.S. counterpart and is 32 percent too expensive versus the euro, according to an index developed by the Paris-based Organization for Economic Cooperation and Development that uses relative costs of goods and services.
Hedge funds and other speculators held a net 27,640 contracts at the Chicago Mercantile Exchange as of March 15 betting on a gain in the franc versus the dollar, the most since December 2004, before slipping to 21,301 last week. Traders on average have held a net 10,029 contracts expecting declines over that period, according to the Washington-based Commodity Futures Trading Commission.
Abandoning Euros
“The currency we are longest in Europe is the Swiss franc,” John Taylor, chairman of New York-based FX Concepts LLC, the world’s largest foreign-exchange hedge fund. “I don’t see any chance that the flow of money into Switzerland will change. People just want to get the heck out of the euro.”
Taylor, whose firm’s global currency fund returned 12.53 percent last year, its best performance since before the global financial crisis, said the franc may appreciate to 1.10 per euro, or 17.7 percent, as investors seek refuge from Europe’s sovereign-debt crisis, which has forced Greece and Ireland to seek bailouts from the European Union and International Monetary Fund personal business card.
The franc may be vulnerable as EU leaders negotiate an aid mechanism for the region’s most-indebted nations and the European Central Bank raises interest rates faster than the SNB.
Optimism Tempered
“We continue to see the franc as a safe haven, but we have to recognize that a lot of that is priced into the currency,” said Axel Merk, president of Merk Investments LLC in Palo Alto, California. “Yes, we like the Swiss franc but I wouldn’t bet my house on it.”
The median of at least 30 analyst estimates in Bloomberg surveys is for the currency to weaken to 1.35 per euro by year- end, and to 97 centimes per dollar.
Switzerland’s benchmark rate will probably end the year 1 percentage point below that of the ECB, Bloomberg News surveys of economists show. The SNB’s main rate is 0.25 percent compared with the ECB’s 1 percent.
Yield Differences
The extra yield that investors get for holding German two- year notes instead of similar maturity Swiss securities has more than doubled since Dec. 31, reaching 114 basis points, or 1.14 percentage point, on March 21, the most since June 2009 and up from last year’s low of 17 basis points in June.
Investors have little concern that the SNB will seek to buy and sell currencies in an effort to weaken the franc after the central bank failed at such attempts from March 2009 to June 2010. The intervention contributed to a $21 billion loss for the SNB last year, according to the central bank.
While Oxford-educated Hildebrand, 47, who has been head of the central bank since January 2010, and the SNB tried to weaken the franc on their own, the G-7 jointly sold yen on March 18 as that currency’s strength threatened Japan’s recovery from the magnitude 9 earthquake. The yen has fallen 6.8 percent to 81.81 per dollar from the postwar high of 76.25 touched on March 17.
In the U.S., the Fed began buying $600 billion of Treasuries in November in a second round of its quantitative- easing policy that will run through June. The central bank held $2.61 trillion of assets as of last week, up from less than $1 trillion in 2008. The Fed has kept its target rate for overnight loans at a record low of zero to 0.25 percent since December 2008.
Relative Growth
The Swiss economy will expand 1.95 percent this year, lagging behind growth of 2.6 percent in Germany and 3.1 percent in the U.S., according to Bloomberg surveys of economists. While the SNB raised its growth forecast for this year on March 17 to about 2 percent from 1.5 percent, the economy is “still facing considerable risks,” Hildebrand said in Geneva on March 22.
Swiss stocks are trailing their counterparts in Western Europe. The benchmark Swiss Market Index has declined 1.1 percent this year, compared with a 0.2 percent gain in Germany’s DAX Index and a 4.3 percent increase by France’s CAC 40 Index.
Stephen Urquhart, president of Omega, Swatch’s largest watch brand, said Swiss companies cope with a strong currency by focusing on the perceived quality of their products.
‘We Are Swiss’
“Most people buy our product because we are Swiss, and I think we just have to face the pros and cons of being a Swiss company,” he said in an interview March 23. “There are probably more pros than cons by the way.”
Oerlikon said the franc will reduce its reported revenue by about 200 million francs ($218 million).
“It would certainly be easier with euros but you can’t change your reporting currency overnight,” Juerg Fedier, the company’s chief financial officer, said in an interview.
Swiss exports increased in February as growth in Germany and Asia fueled demand for watches and machinery parts. The country’s trade surplus widened to 2.49 billion Swiss francs from 2.04 billion francs the previous month, the Federal Customs Office in Bern reported on March 22.
“The franc is basically the only safe-haven currency left,” said Kasper Kirkegaard, a senior strategist at Danske Bank A/S in Copenhagen, who expects the currency to trade at about 90 centimes per dollar in six months “The fundaments are very strong. That speaks in favor of a strong currency.”
China ordered banks to set aside more cash for the third time this year, judging that inflation remains a bigger threat to the world’s second-largest economy than Japan’s earthquake and nuclear crisis.
Reserve requirements will increase half a percentage point from March 25, the People’s Bank of China said on its website yesterday. The ratio will rise to 20 percent for the nation’s biggest banks, excluding any extra limits for individual lenders.
Premier Wen Jiabao has set taming inflation as the nation’s top economic priority this year, citing “exorbitant” house- price increases and risks to social stability. China followed India, which raised interest rates the previous day, in tightening monetary policy even after Japan’s crisis roiled global stock markets and threatened to disrupt supply chains across Asia.
The move “is another sign that the tragic events in Japan are unlikely to have a significant impact on policy decisions elsewhere in Asia,” said Brian Jackson, an emerging-markets strategist at Royal Bank of Canada in Hong Kong. “Uncomfortably strong inflation throughout the region suggests that more policy action is required.”
Crude oil pared gains and copper fell after the announcement. The move may lock up about 350 billion yuan ($53 billion), according to Australia & New Zealand Banking Group.
Reining in Credit
An interest-rate increase for China is “a couple of weeks away,” said Shen Jianguang, a Hong Kong-based economist at Mizuho Securities Asia Ltd. He said the reserve-ratio increase was to soak up money as central-bank bills matured short term personal loan. Shen estimated that annual inflation may accelerate to 6 percent this month, the fastest pace since July 2008.
The benchmark one-year lending rate stands at 6.06 percent after three increases since mid-October. The government is aiming to rein in credit growth after a record 17.5 trillion yuan ($2.7 trillion) of lending over 2009 and 2010.
“This is clear evidence that the tightening agenda is still alive in China and signals that when nerves have settled, we will get more interest rate hikes,” said Stephen Green, a Shanghai-based economist for Standard Chartered Plc.
Zhou Xiaochuan, the governor of the People’s Bank of China, said this month that rates will be used to curb inflation, and played down the role of currency gains, which U.S. officials have encouraged China to use as a tool.
Consumer prices rose at an annual 4.9 percent pace in February and output increased 14 percent in the first two months of 2011, according to the statistics bureau. Producer prices jumped 7.2 percent last month, the most since September 2008.
Inflation has topped the government’s 4 percent target for this year for each of the past five months.
–Zheng Lifei, with assistance from Sophie Leung. Editors: Paul Panckhurst, Stephanie Phang.
To contact Bloomberg News staff for this story: Lifei Zheng in Beijing at +86-10-6649-7560 or lzheng32@bloomberg.net
The cost of living in the U.S. climbed more than forecast in January, led by higher prices for food and fuel that may be starting to filter through to other goods and services.
The consumer-price index increased 0.4 percent for a second month, exceeding the 0.3 percent median estimate of economists surveyed by Bloomberg News, figures from the Labor Department showed today in Washington. The so-called core rate, which excludes volatile food and fuel costs, rose 0.2 percent, the biggest gain since October 2009.
Growing economies in Asia and Latin America are boosting global demand for oil and other commodities, raising costs for American factories. Accelerating growth is prompting some companies to carry out beginning-of-year price increases even as consumers remain constrained by unemployment at 9 percent.
“You’re going to see more companies that attempt to pass through” higher costs, said Tom Porcelli, chief U.S. economist at RBC Capital Markets Corp. in New York, who correctly forecast the gain in core prices. “How successful they are depends on the economic backdrop. We’re looking at a slightly firmer inflation backdrop.”
The projected gain in consumer prices was based on the median of 79 economists in a Bloomberg survey. Estimates ranged from increases of 0.2 percent to 0.5 percent.
More Claims
Another Labor Department report showed more Americans than projected filed first-time claims for unemployment insurance last week, a sign the improvement in the labor market will take time to develop.
Applications for jobless benefits increased by 25,000 to 410,000 in the week ended Feb. 12, exceeding the 400,000 median forecast of economists surveyed by Bloomberg. The total number of people receiving unemployment insurance was little changed, while those collecting extended payments decreased.
Stock-index futures dropped after the reports. The contract on the Standard & Poor’s 500 Index maturing in March fell 0.2 percent to 1,330.2 at 8:48 a.m. in New York. Treasury securities rose, sending the yield on the benchmark 10-year note down to 3.57 percent from 3.62 percent late yesterday.
Federal Reserve policy makers took a more optimistic view of the U.S. economy last month while maintaining their dissatisfaction with job growth as they pressed forward with an expansion of record monetary stimulus, minutes of last month’s policy meeting released yesterday showed.
Fed View
Even with soaring commodity costs, the Fed remains concerned that consumer inflation is below its long-range annual target of 1.6 percent to 2 percent.
“Despite further increases in commodity prices, measures of underlying inflation remained subdued and longer-run inflation expectations were stable,” the minutes said.
Energy costs increased 2.1 percent in January from a month earlier, and rose 7.3 percent for the prior 12 months, today’s report showed. Food prices rose 0.5 percent last month, the biggest gain since September 2008, and were up 1.8 percent for the 12-month period.
Core inflation was boosted by a 1 percent increase in the cost of clothing, the most since February 2009, and a 2.2 percent rise in airline fares.
Rents Climb
The report showed rents, which make up almost 40 percent of the core rate climbed at the same pace as in prior months. Owners-equivalent rent, one of the categories designed to track rental prices, increased 0.1 percent in January. Mounting foreclosures are reducing homeownership, may drive up demand for rental housing.
The cost of medical care increased 0.1 percent, restrained by a 0.1 percent drop in medical services that was the biggest since November 1975.
An unemployment rate that’s held at or above 9 percent since May 2009 is also restraining labor costs. The threat of deflation, or a prolonged decline in prices that’s harmful to the economy, prompted Fed policy makers November 3 to announce the central bank’s purchase of $600 billion in additional Treasury securities by the end of June.
“Costs have continued to rise, even in the first quarter, for things like steel,” Ronald D. Kropp, chief financial officer, said in a conference call on Jan. 31. “We have put price increases in place. Our goal is to recover not just the cost, but also the margin.”
No Pass-Through
“Commodity inflation has continued to push our food costs higher in 2011 already, and we expect continued inflationary pressure on many of our ingredients,” said John R. Hartung, chief financial officer at Denver-based Chipotle in a Feb. 10 earnings teleconference. “We plan to hold off on any menu- pricing decisions until later in the year, which will allow us to see how inflation plays out on a sustained basis.”
The CPI is the broadest of three monthly price gauges from the Labor Department, because it includes goods and services. Almost 60 percent of the CPI covers prices consumers pay for services ranging from medical visits to airline fares and movie tickets.
Stocks rose near the end of choppy session Friday, ending the week with gains of more than 2%, as investors looked past a muddy report on the U.S. job market.
The Dow Jones industrial average (INDU) rose 30 points, or 0.2%, to close at 12,092. The S&P 500 (SPX) gained nearly 4 points, or 0.3%, to end at 13,11. The Nasdaq (COMP) added 15 points, or 0.5%, to 2,769.
For the week, the Dow gained nearly 2.3%, while the S&P 500 was up 2.7%. The Nasdaq added better than 3% over the last five trading days.
Stocks made a late-session advance after bouncing between small gains and losses for most of the day following mixed signals from the government’s all-important jobs report.
The Labor Department said employers added 36,000 jobs in January, which fell far short of expectations. Meanwhile, the unemployment rate unexpectedly fell to 9% — down from 9.4% the month before.
Economists had forecast a gain of 149,000 jobs in January, but many analysts said severe winter weather hindered hiring last month.
"There’s a bit of confusion about what these numbers actually mean," said Brian Gendreau, market strategist at Financial Network. "And it comes in the context of many reports indicating a strengthening economy and job market."
Friday’s jobs data came after encouraging reports on private sector payrolls and weekly jobless claims earlier this week. And monthly sales figures from retailers and automakers came in better than expected.
A robust reading on the manufacturing sector on Tuesday sent stocks soaring above two key psychological barriers: 12,000 on the Dow and 1,300 on the S&P 500.
In addition, quarterly reports from a range of big U.S. companies have shown continued gains in earnings and surprisingly strong revenue growth.
After 11 days of violent turmoil in Egypt, traders said the market has priced in the geopolitical risk associated with the anti-government protests there.
"To the extent it doesn’t deteriorate significantly, I think investors have come to the conclusion that Egypt is not an immediate concern," said Dan Greenhaus, chief economic strategist at Miller, Tabak and Co.
Stocks ended higher Thursday, as investors digested comments about the economy from Federal Reserve chairman Ben Bernanke — who said a weak job market continues to weigh on the recovery.
Companies: Shares of JPMorgan Chase (JPM, Fortune 500) slipped nearly 2% after allegations late Thursday that the investment bank was warned about Bernard Madoff’s Ponzi scheme years prior to its collapse, but did nothing to stop it.
Early Friday, Aetna (AET, Fortune 500) also reported stronger-than-expected fourth-quarter earnings and boosted its dividend, sending shares of the company 12% higher.
Shares of JDS Uniphase Corp. (JDSU) surged 23%, after the communications equipment maker logged quarterly earnings late Thursday that widely beat expectations.
Food company Tyson (TSN, Fortune 500) reported fiscal first-quarter earnings that topped expectations. Shares were up 6% in mid-day trading.
After the market close Thursday, Las Vegas Sands (LVS, Fortune 500) posted disappointing earnings, sending shares of the casino company 8% lower. Other casino stocks, including Wynn Resorts (WYNN) and MGM Resorts International (MGM, Fortune 500), shared the pain. Shares of Wynn fell 2%, while MGM shares slumped 1.4%.
World markets: European stocks closed higher. Britain’s FTSE 100 climbed 0.2%, the DAX in Germany ticked up 0.3% and France’s CAC 40 rose 0.2%.
Japan’s Nikkei rallied 1.1%. Other Asian markets, including Shanghai and Hong Kong, remained closed for the lunar new year holiday.
Currencies and commodities: The dollar rose against the euro, the British pound and the Japanese yen.
Oil for March delivery fell $1.62 to $88.88 a barrel.
Gold futures for April delivery was down $3.30 to $1,349.70 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 3.58%, from 3.54% late Thursday.
When people talk green energy in Ontario they mostly discuss two technologies: solar panels and wind turbines.
That
Powered by WordPress -- XHTML 1.0