Market briefing --- Matt (slow)
Nasdaq --- Julie (slow)
Reports --- Carmen (fast)
welcome back to “the world financial report.” i’m matt nesto. as we like to do when we start a fresh half-hour is give you the freshest check on the day’s numbers on trade. the dow, little to talk with the s&p 500 and a generally downtrend ever so slightly the nasdaq, down a quarter of a percent today. and yahoo’s chief executive is selling stock of his company. his biggest sale since joining the internet firm three years ago. terry semel filed to sell 1.5 million shares valued at $83 million. and at the end of 2003, he owned more than 10 million shares. and yahoo is the owner of the world’s most used group of websites. and the stock has more than doubled in the past 12 months. and set a new three-year high or hit a three-year high i guess you could say last week. the nasdaq financial and banking stocks fell for the second straight day after those better-than-expected―i’m not sure if that’s better than expected. i think higher-than-expected consumer prices numbers came in. julie hyman has details from the nasdaq market site with this wrapup report.
>> the nasdaq financial index lost once again today. you’re correct. and down 4.3% in the past couple of days. and investors’ financial services was the worst performer in today’s session. contributing most to the decline of that index. and the banking index down 4.2% over the past two days. and northern trust was the worst performer in today’s session. and with those interest rate concerns continuing to plag the market and inflation concerns after today’s c.p.i. report. the bright spot within the nasdaq, transportation stocks, interestingly enough, those were the only―one of only two groups to rise in today’s session. led by j.b. hunt. this is the number two trucking company in the u.s. it came out today and said first quarter profit almost tripled. its sales rose 8%. and also costs related to accidents fell. so that helped the company as well. and earnings per share came in 15 cents above what analysts were expecting. and also we wanted to take a look at some of the extra companies reporting earnings. take two interactive was one of them. those shares falling 9.3% a forecast that’s earnings related. the company also announcing a management change. they named richard rodel the interim c.e.o. after jeffrey lapen, the current c.e.o., stepped down. the company also cut its forecast for the second quarter and the fiscal year. this is because they’re delaying the release of one of its video games. a video game company delaying the release of red dead revolver, the maker of the grand theft auto game. and wd-40. those shares falling by 8.3%. this company made a fiscal year forecast that was below its own previous forecast as well as analysts. $1.75 a share. analysts, $1.82 a share. so that’s hurting the stock in the session.
>> and we mentioned the inflation data. let’s recap. people paid more for energy and transportation in march. consumer prices rising for the fourth straight month. and much higher than expectations. they were up half a percent with food and energy. which account for most of the increase. if you back that out, and you get the core inflation number, it was up .4%. look at the increase there. month on month on month. that’s the biggest gain. that 4%. that we’ve seen in two years. and yesterday it was retail sales and today it was all about inflation. both roiling the bond markets and stock markets to some degree. today’s inflation report could prompt the fed to consider a rate hike sooner than many had expected. and carmen roberts has been on this all day and gives us this report. carmen?
>> we had treasuries falling for the fifth straight day after the consumer price index showed rising inflation. the yield rose 4.47%. that’s the highest level this year. and the manager of $10 billion at john hancock funds says the yield on the 10-year note may rise to 5.25% this year. and economists at lehman brothers changed their view today on when they expect the fed to boost interest rates. they now say they expect the increase in the 1% target in the interest rate to come as soon as september. lehman had preesm predicted an increase would―had previously predicted an increase would come this year. bank one is in that same camp.
>> our next move will be in september from actually previously it was in 2005. so we have a move in september and a move in december. but each of them is just a quarter point. and rates will remain remarkably low even with those moves.
>> and the central bank has said that the two things keeping interest rates low are sluggish job creation, and tame inflation. and the march jobs report show the economy added the most jobs sense 2000. and now the c.p.e. report shows rising inflation―the c.p.i. report shows rising inflation.
>> and how high and robert parry, the outgoing fed president of san francisco said last week that his inflation remains 1% and 2%, the fed’s tart rate should be 3.5%. economists michael moran said the call is a little bit low.
>> right now the fed is highly accommodative with its monetary policy and start moving away from that into a neutral position. in my view, a neutral fed funds rate is probably in a range of 4% to 5%.
>> in foreign exchange trading, the dollar surged against the yen and rose against 13 other major currencies. and higher interest rates make holding dollars more attractive. greg anderson, a senior currency strategist for abn-amro sees the dollar reaching a cyclical bottom of about $1.16 per euro. that’s within the next 13 months. another analyst at munder said there will be some pain for the bears betting on a weaker dollar. back to you.
>> carmen roberts, back to you. strong earnings reports have been unable to mark a major stock market rally in recent sessions. our next guest says that the underlying fundamentals remain strong. and in many companies. and that there is some good buys out there. particularly large cap growth stocks. we will be joined by ed dowd, state street research, coming up after a quick break.
