Interview: Nasdaq marketsite
>> the dollar’s recent drop to a record low against the euro and five-year drop against the yen hasn’t helped close the record trade deficit. still, some of the biggest companies are seeing benefits on the balance sheets.
>> it benefits us because we report results in dollars so given that we have 22% of our business outside the u.s., when that 22% is translated back into dollars at higher rates, that benefits our business. but by the time you get to the bottom line, it’s more of a revenue effect.
>> yahoo reported yesterday its fourth-quarter earnings jumped five-fold and revenue topped $1 billion. yahoo owns 33% of yahoo japan, japan’s most popular website. yahoo japan is due to report results later today after the tokyo market closes. earnings news from yahoo and juniper networks was better than analysts expected. better than forecast earnings from juniper and yahoo failed to translate into gains in the nasdaq on wednesday. robert gray reports.
>> the followthrough from the earnings reports from yahoo and juniper networks was short lived, rising briefly in the open on the nasdaq before falling along with the rest of the composite, suffering its second worst drop of the new year in point and percentage terms on this wednesday. juniper networks, traders saying their better-than-expected earnings were good but not good enough to keep the stock rallying. it rallied more than 50% from its low in august up to its recent peak and pulled up ahead of the earnings and was not enough to keep the momentum going. similar story at yahoo, beaten by two cents but the carry-through not happening today. google touched a record high during the session but ended turning lower by the end of the day, falling, as well, on the session. ebay was the big stock to fall during the session, its report out after the close of trading today, lifts expecting 34 cents a share. the stock briefly traded higher but closed the session 3.5% here in new york and overstock.com, a beneficiary from ebay, rising after saying their listings were up 50% in the five days since ebay raised their prices, so a lot of people defecting from ebay to overstock for listings. qualcomm, another stock we were watching during the day, that stock finishing lower in the session as well as symantec, also reporting its earnings out after the close of regular trading today. at the nasdaq marketsite, i’m robert gray.
>> general motors says profit fell more than 1/3 on higher healthcare costs and losses in europe. net income at the world’s biggest automaker fell 37% to $630 million. sales rose 5.1% to $51.3 billion. medical expenses for the company’s employees, retirees and dependents account for $1,400 for every vehicle it sells and those costs are rising 10% each year. in europe, general motors lost $742 million last year, its fifth straight annual decline. profit was hurt by $600 million in costs related to plant closings and writing down its investment in fiat. g.m.’s finance chief says the automaker has a strategy in place to turn around the business.%
>> what you’ll see in 2005 is about 25% of our expected volume this year will be new product. so i think we’re going in the right direction. you’re seeing the renaissance of a number of new products. it started with the cadillac. saturn’s on the way, new pontiac. a number of other products from the g.m.c. side, the chevrolet side so you’re starting to see this roll up.
>> g.m. has the smallest market capitalization of the six major automakers operating in the u.s. executives familiar with the plans say mitsubishi motors will ask other mitsubishi group companies and banks for at least 500 billion yen or $4.9 billion u.s. japan’s only unprofitable carmaker needs the money as a bailout for the second time in nine months. executives say mitsubishi motors plans to sell at least 200 billion yen of preferred shares in subordinated bonds to three mitsubishi companies. another 50 billion yen would come from the state owned development bank of japan and the rest from the units of mitsubishi tokyo financial that would provide credit and swap debt for equity. coming up, the biggest lumber maker in australia and new zealand says declining lumber sales hurt profit. we’ll ask a fund manager whether this means investors should avoid shares of carter holt harvey.
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carmaker takes another shot at reorganizing finances. we’ll have details on mitsubishi motors’ bailout plan. and ebay’s fourth-quarter earnings jump yet investors and analysts looked for more. ebay said this year’s earnings won’t meet current estimates. we’ll hear from chief executive meg whitman in the following hour. dow components pfizer, j.p. morgan both missed analysts’ estimates. bank of japan governor toshihiko fukui suggests japan will resist international pressures to let the yen strengthen, sending the yen lower in new york. u.s. stocks fell on disappointing results from companies like motorola. economic figures showed declines in consumer prices and jobless claims. the s&p 500 lost 1%, dow lost about .8% and nasdaq declined more than 1.5%. julie hyman reports from the new york stock exchange.
>> the s&p and dow closed near their lows for the year today. if we have another downsession, they could break through the years thus far for 2005. it looked like investors were weighing negative earnings more heavily than they were more positive economic news that came out in the morning. technology largely responsible for the decline that we had today. these four gruns you see here -- technology, hardware, semiconductors, software services and telecom services were the four biggest declines within the s&p 500, all technology-related industries. a number of technology-related companies were out with earnings today. motorola said fourth-quarter profit was higher by 34%. however, its first-quarter profit may miss analysts’ estimates. those shares taking a hit of 7%. lucent, its first-quarter net income down 49%. its revenue rose less than expected, seeing declining orders from wire-line carriers, companies like bellsouth, those shares down 7.5%. teradyne, semiconductor equipment maker, saying it had a fourth-quarter profit versus a loss a year earlier. however, the company said revenue would decline in the first quarter. those shares fell 6%. big declines for many companies releasing earnings today. speaking of companies out with earnings, let’s talk about pfizer. fourth-quarter earnings there up more than four-fell. expenses fell. sales of lipitor cholesterol treatment rose, however, they did miss the average analyst estimates. they took the drug stocks generally down along with them, down .8%. we also saw a similar story with diversified financials. j.p. morgan, one of the companies out with earnings within that particular group. its fourth-quarter profit was down 11%, missing analysts’ estimates and because of that, we also saw diversified financials generally doing poorly once again in today’s market , pretty broad-based decline today. i’m julie hyman, bloomberg news, at the new york stock exchange.
>> australia’s markets will open in about half an hour. woodside petroleum and virgin blue are among stocks to watch today. let’s go to stuart kelly, our stocks reporter in sydney, for more on those companies. what’s the latest?
>> the benchmark indexes futures contracts for march declined by about 1/3, indicating that the benchmark index may fall again for the third session in a row. watch for oil producers woodside petroleum and santos limited. they may fall today after crude oil futures in new york declined 1.7% on speculation a u.s. government report may show inventories of oil and petroleum products rose last week. keep an eye on james hardie shares. they may gain after u.s. housing starts surged 11%, the biggest increase in almost seven years, slightly ahead of expectations.
>> and, i gather there is news about miller’s retail. what’s the latest on that company?
>> watch out for miller’s retail shares, a discount apparel company in australia. the chief executive said he bought a 15.8% stake in the company this morning. that’s after the shares plunged 13% on friday after a disappointing earnings report. investors, though, were surprised, because on monday, the shares surged or rebounded back 11% and then another 15% again on tuesday. pearlstein said he bought the stake because he believed in the future of miller’s retail.
>> thank you, stuart. in news outside the business world, more than two dozen are killed in iraq 10 day before legislative elections. ron madison has more.
>> five car bombings in and around baghdad leave at least 27 people dead. the u.s. military says u.s. soldiers killed two civilians who tried to drive through an army patrol. the first bombing took place near australia’s embassy in central baghdad. the deadliest blast came an hour later where 18 people were killed near a hospital in the capital’s center. interim prime minister iyad allawi said he expects such attacks to increase as the election day in iraq approaches. the u.s. foreign relations committee endorses condoleeza rice as secretary of state. on the senate panel, democrats john kerry and barbara boxer voted against george w. bush’s nominee, expressing concerns about the administration’s iraq policies. the full senate does plan to confirm rice later after bush is sworn in for his second term. rice will be the first black woman to serve as secretary of state. meantime, at the u.s. state department, the man rice called her dear friend and mentor said farewell to his colleagues at the state department. outgoing secretary of state colin powell defended the record of the administration’s last four years, saying american diplomacy over that time produced a record all americans could be proud of and praised department workers, calling them america’s troops.
>> even though i step down as your secretary, i will never leave you, i will always be a part of this wonderful family. thank you all and god bless you. [applause]
>> powell called condoleeza rice, as well, a dear friend. the death toll, now, from last month’s tsunami rises above 200,000. the a.f.p. puts the new total at almost 220,000 after indonesia announced an additional 50,000 deaths. figures were cited from thailand, sri lanka and india to compile the new tally. a father and daughter are being reunited after being separated by the december 26 tsunami in this video. that is the latest look at world news. i’ll bring you another update at the top of the hour. back to you.
>> thank you, ron. up next, yahoo’s c.f.o. susan decker tells us why she prefers a weak dollar despite government calls to strengthen the currency.
