Market briefing --- Matt (slow)
NYSE --- Deb (fast)
Opec --- Peter (slow)
welcome to “world financial report,” i’m matt nesto. we said it, but here it is again. first-quarter sales up 16% at mcdonald’s. the company saw stronger revenue in all of its geographic region. sales officially in at $4.4 billion, higher than the average estimate of analysts. the company says that u.s. sales so far this month remain strong and european sales trends have improved significantly compared to march. earlier this month, mcdonald’s announced first-quarter profit of 40 cents a share. also today, affleck is another another―aflac reports results after the close of trading. the seller of supplemental health insurance says first-quarter profit rose 43%. backing out one-time items, aflac made 51 cents a share. aflac hired more agents and increased trading to turn around a slowdown in sales growth last year and sales in u.s. policies surged nearly 14%, the fastest pace in two years. still, shares are lower in extended trading by about 2%. let’s give you the closing numbers here today. it was a mixed market statistically but one that was across-the-board down from earlier highs. the dow and s&p each down .3% -- up .3% and .2% respectively. bonds on the rise today with terror concerns helping the relative safety of the treasury bonds. you see yield creeping down to 4.38% on the 10-year. also gains on the shorter end and the dollar was mixed here today. the yen lower in new york trade. the euro and pound both up, little change, as you see there as things get underway in asia. deborah kostroun was tracking the day’s trade at the big board on wall street.
>> as we closed out today’s session, we started the day very strong on the very positive economic reports. but then things fouling on the geopolitical concerns and especially when the headlines crossing and so what we did see by the close of trading, the dow off its best level of the day and so some of the things that we did see, the consumer confidence, existing home sales, very strong. stocks gaining on the rise in consumer confidence. energy stocks performing well. then the geopolitical concerns, also greenspan comments on energy prices pushing energy prices higher. nymex gasoline futures closing at a record high and earlier gains pared by geopolitical concerns. talking about the consumer confidence, retail stocks getting a good lift today. wal-mart, target, j.c. penney and may department stores performing quite well. in addition to the deposit of news we had there, homebuilders performing well, as well, on existing home sales pulte saying first-quarter profit jumping 53% as falling mortgage rates spurring more people to buy new houses and the amex oil index closing at a record high on the day, as well as the s&p energy index at its best level in a couple of years, record highs. also record highs in these stocks. in addition to that, you saw three-year highs on some stocks. massey coal lower although csfb focusing in on coal stocks as alternative fuel sources. some of the other stocks in focus today, some of the steel stocks such as u.s. steel. u.s. steel closing down $2.76. even though the average price of hot-rolled sheet steel used in appliances and cars was 47% in the fourth quarter, one of the things we did see, u.s. steel, demand from china coming in well but that stock lower as many analysts expected higher profit from u.s. steel because of the jump we’ve seen in steel and we’ve been speaking about commodity prices, as well.
>> thank you very much. appreciate it. oil prices, as deborah said, rose today after the president of opec said the oil cartel may change its target price for a barrel of oil. the news was the hot topic at an energy conference today in washington that included the saudi oil minister and federal reserve chairman alan greenspan. a lot of power all in one room, including bloomberg’s peter cook, who was there. what’s the latest?
>> that announcement, matt, that opec may raise its target price of $25 a barrel for oil to $32 a barrel drew a lot of attention at the conference. among the speaker, saudi oil minister who made clear saudi arabia does not support the change.
>> saudi arabia continues to be committed to opec’s $22 to $28 price span and believes an opec basket price of $25 is fair for both consumers and producers.
>> he added that several factors outside of opec’s control have helped drive crude prices up and more specifically gasoline prices in the united states. he said those include global instability and limited refining capacity in the united states. the deputy secretary of energy challenged that conclusion after meeting privately with him at the conference.
>> there are obviously other issues out there, refinery constraints exist, fuel specifications have an impact, all of which we agree with. but at the end of the day, gasoline prices, in our view, is that crude oil prices are directly responsible.
>> alan greenspan told the conference that rising energy prices could force changes in how americans consume energy and that the recent rise in oil and gas prices is already affecting business decisions in the u.s.
>> the recent shift in expectations, however, has been substantial enough and persistent enough to influence business investment decisions, especially for facilities that require large quantities of natural gas.
>> greenspan repeated his view that the u.s. needs to be prepared to import more natural gas from abroad to avoid price volatility and that effort appears to be underway, but in the near term, the situation, in his words, will be challenging.
>> appreciate it. also on the economic front today, mexico’s central bank reduced its overnight lending rate in a bid to reverse a decline in interest rates. policymakers say rising interest rates in the u.s. could lure money from mexico, weaken the peso and quicken inflation. inflation in mexico is running as 4.2% in the past year, which is, of course, the largest economy in latin america. the central bank has asian flation target of―has an inflation target of 3%. janus capital agreed to cut fees and pay a $100 million penalty to settle allegations it allowed favored clients to engage in improper fund trading. the denver-based firm reached an agreement with new york attorney general eliot spitzer and colorado’s attorney general, both with the approval of the s.e.c. frank quattrone took the witness stand today on his retrial on obstruction of justice charges and told jurors he had no reason to fear investigations of credit suisse first boston’s i.p.o.’s. quattrone is on trial for a second time, accused of impeding probe of csfb’s i.p.o.’s allocation practices. his first trial ended in a hung jury in october. wall street is waiting for word on the google i.p.o. it may revise interest in investing in new companies and may pay around $80 million in investment banking fees. morgan stanley and credit suisse first boston may get the bulk of the investment banking fees and some investors say the company may have a market value of $20 billion based on its estimated annual revenue of $1 billion. google is the leading search engine on the internet. folks, we are going to take a break but still much more news to come right after this.
