Market briefing---Matt (slow)
NYSE---Deb (fast)
Nasdaq---Julie (slow)
Microsoft vs EU---Bob (fast)
>> welcome to “world financial report.” i’m matt nesto. let’s bring you the closing be numbers. stocks technically finished down. three red arrows on my screen there. the dow and s&p both little changed on the day, each down one point in―and change. the nasdaq also down .4% and finishing close to their worst levels of the session. looking at bonds, they were on the rise today. the 10-year note up 4/32, the yield falling to 3.70 and similar moves on the shorter end of the curve. and in currencies, you see the latest trade there during new york trade, the dollar was down across the board against all three of the major peers. shares of goldman sachs rose after it said fiscal first-quarter earnings almost doubled to a record. an increase in stock and bond trading pushed net income to $1.3 billion on a% share basis. the firm blew away street forecasts. revenue in the quarter rose to a record with equity sales and trading revenue surging 77% to $1.7 billion. goldman’s earnings capped the most profitable quarter ever for wall street brokers with combined net income of over $3.5 billion. more on goldman’s earnings later in the program. an afternoon rally couldn’t hold and that led the markets to close slightly lower today. deb kostroun with the details at the big board.
>> at one point we thought we had a really good rally on our hands, the dow up 66 points. it turn out to be not all that convincing by the close of trading because we sold off so quickly at the end of the day so that turnaround not holding until the close and now we see new lows for the year for the dow and the s&p 500, although we saw the lows obviously hit yesterday. closing below that level so new lows again for the major averages and that was even though, as matt was talking about, the better-than-expected earnings from goldman and family dollar, although family dollar actually performed quite well, we’ll show you that chart in a moment. also, we had many companies saying their first quarter going to be better than expected. limited, also eastman chemical one of the companies. looking at material stocks, although the market not doing much, materials performing well in the s&p 500. eastman chemical, this is the largest maker of plastics for soda bottles, saying their first-quarter earnings will exceed analysts’ expectations, leading other chemical makers higher. this is one of the first companies, especially coming out of the chemical area as they have higher costs in natural gas and raw materials, even crude oil as that goes into the making of things like chemicals. retail stocks performing well, we mentioned limited brands, they rallied today and raised their first-quarter profit forecast as much as 13 cents a share because of stronger-than-expected sales. also family dollar, they also performed well on their earnings. profit rose 12% in their second quarter. back to you.
>> thank you very much.% from the nyse to the nasdaq we go and the nasdaq had a similar afternoon rally but couldn’t hold on to those gains, either. julie hyman has the wrap-up report from the nasdaq marketsite in times square.
>> traders saying at this point there’s nothing to buoy the market . we’re in between earnings periods and there’s not a lot of economic news flow coming out and the market is buffeted. we saw that in today’s session, up for part of the day and down part of the day and ending down .4%. trading was on slightly lower-than-average volume. pulling ugs down the most today, microsoft and amgen. amgen today holding its first-ever research and development meeting and giving a profit forecast, excluding some costs for next year, $2.71 to $2.85 a share. analysts expected $2.83 a share and those shares falling 3.8% today. we received better-than-expected numbers from palmone, biggest maker of hand-held computers with its biggest gain in 19 months’ time. the third-quarter net loss narrowed and on a per-share basis, posted a profit of a penny a share where analysts expected a 33-cent loss. one of the groups that performed well today, transportation rising today. led by shares of c.h. robinson, a company that arranges freight shipments receiving an analyst upgrade at bear stearns. that analyst saying there’s an expected acceleration in revenue and earnings growth in the second quarter of this year given that, those shares looking inexpensive and they rose 4%, as well as shares of airlines, some of the same shares that fell in yesterday’s session, jetblue and ryanair doing well today.
>> the european union’s competition commissioner mario monti is preparing for tomorrow’s ruling in the microsoft antitrust case. an appeal, however, might delay any penalties for what some legal experts could be as long as two years. bob bowden has been following the microsoft-e.u. story and has the latest.
>> good afternoon. the e.u. accuses microsoft of illegally using its dominance to hurt competitors such as sun microsystems which filed the original complaint against microsoft in 1998, as well as other software companies like real networks. people familiar with the matter said earlier this month that the e.u. will order microsoft to disclose secret parts of its operate system code to rivals and force microsoft to offer a version of windows without music and video software at a discount to computer makers. if that take place, experts say microsoft will likely appeal a legal strategy that will delay legal penalties for years. one attorney thursday “it often takes two years for an appeal to be rendered and given the complex issues raised in this case, probably longer.” the dow jones reported that the e.u. member states have approved already a sanction of $497 million euros or $613 million u.s. citing a person familiar with the matter, that would be less than 2% of microsoft’s annual sales. barry james, portfolio manager with james investment research, says that fine is not what’s important.
>> microsoft, of course, will pay the fine and that’s not an issue. but we are very closely going to watch what behaviors will have to be changed so if they’re prohibited from introducing new components into the operating system in future editions, that’s not very good. and if they are forced to release the details of their code to competitors, we have to watch that very carefully.
>> when will we know of an appeal? under e.u. rules, the company has two months and 10 days to appeal once the decision is announced. if it appeals, microsoft can lodge a request to have the court set aside the remedies and the court could grant a full or partial suspension of sanctions. crise bright, antitrust lawyer in london, said the commission has not shown urgency in its investigation so it will be hard to argue that the world will fall apart if remedies aren’t applied followed immediately. year to date, microsoft down 12%, the third worst performing stock of the 30 dow industrials. shares are down for 14 of the last 16 sessions. back to you.
>> it’s statistically an amazing story, no question at all. the european rankles are -- ranges are butt a―but a small piece. it’s an issue that have kept shares in check since y2k. this is a logarithmic chart to show you percentage moves, not price moves. and what you’re looking at is a green trend line that really shows that flat trading range that we’ve been in for the most part of this century, decade, millennium, since the year 2000, the stock trading between $25 and $30. if you look comparatively how shares of microsoft have done, two years weekly down 20%, the white line, versus the orange line, the s&p 500, down 5% over that period of time. just for interesting comparisons we throw in the amex software index, it, too, down, like microsoft, about 19%. what does $600 million mean to microsoft? we’ve been talking about it, it equals about 1% of the cash they have on hand and three days -- three weeks of operating profits and 6.eight days of revenue. stay with us.
