Dow plunged 207 to close at its lows, decliners over advancers 4-1 & NAZ fell 61. The Financial Index dropped 5 to the 174s.
The MLP index fell 2+ to the 266s & the REIT index dropped 4+ to the 221s, coming off an outstanding month. Junk bond funds were weak & Treasuries rose on the increased uncertainties out of Europe. The VIX, volatility index, shot up 2+ to the 31s. Oil jumped 2 to its highest level in 3 months & gold had one of its best days in history, going over $1700.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Bloomberg
Delta Air Lines Q3 profit missed expectations because of higher fuel costs. DAL said corp travel was holding up & it expects a profit in Q4. "We continue to see solid revenue trends" into the current period, President Edward Bastian said. He continued, saying Oct unit revenues were up 10%, aided by corp gains. These results follow losses reported last week by Southwest Airlines (LUV) & American Air parent AMR (AMR) which cited fuel costs & a strong US dollar that eroded overseas sales. The 2nd-largest airline has cut headcount with voluntary buyouts, reduced flying to less-profitable cities & consolidated facilities to cut costs. It has also invested in new airplane seats and other amenities to boost sales, with a goal of having $1B in new revenue streams by 2013. Q3 EPS was 65¢, up from 43¢ a year earlier. Excluding one-time items, EPS was 91¢, short of the 93¢ expected. Revenue rose 10% to $9.8B. Passenger revenue per available seat mile climbed 11% but operating expenses increased 13%, with aircraft fuel & related costs up 42%. Its hedging strategy saved $100M in Q3. The average fuel price was $3.29 per gallon & DAL forecasts a Q4 fuel price of $2.98 per gallon. The stock fell 46¢.
Delta Air’s Profit Misses Analysts’ Estimates as Fuel Costs Outpace Fares
Simon Property funds from operations (FFO) improved in Q3 because it made more money from rents & management fees. The nation's biggest mall operator also boosted its full-year FFO outlook for the 3d time & the quarterly div was increased. FFO rose to $1.71 from 90¢ last year. Analysts were looking for $1.66. Revenue rose to $1.07B from $979.3B as revenue from minimum rent & overage rent improved. Tenant reimbursements increased to $294M from $274M, while management fees & other revenues climbed to $31.2M from $30M. Total sales per square foot increased 9.3% to $517, while average rent per square foot climbed 3.4% to $38.87. SPG expects 2011 FFO of $6.80-6.85, up from a prior forecast of $6.65-6.73 (analysts predict $6.81). The quarterly div was raised to 90¢ & special div of 20¢ will also be paid. The stock slipped 1.76 in a down market.
Simon Property Increases Forecast, Dividend as FFO Beats Analyst Estimates
The German parliament is set to vote on a non-binding call for the ECB to end its secondary-market bond-buying program once the enhanced European rescue fund is enacted, The joint motion sets out terms for the lower house, the Bundestag, supporting the European Financial Stability Facility (EFSF) in a vote tomorrow. It “notes that the need” for the ECB to continue its secondary-market program ends with the new fund’s enactment & urges Chancellor Merkel's gov to “respect” the ban on central-bank credits as well as primary-market purchases by the ECB as the EFSF is set in stone. “For us it was a condition that the Bundestag, respecting the central bank’s independence, has a clear position: no more unconditional debt-buying by the ECB,” Carsten Schneider, the opposition's budget spokesman told reporters. The motion sets criteria to which Merkel must adhere when she goes to Brussels after the EFSF vote tomorrow for a 2nd European summit in 4 days. The budget committee or the full chamber must be allowed to vote once more after leverage models have been transformed into guidelines for the fund, according to the text. Plans to resolve the debt problems remain fluid.
This was a bad day for the market, but to be expected after hardly missing a step in this month's rise. Earnings are not all that great, at best giving mixed signals about the US economy. The European debt mess brings on market selling. The plan to emerge from these conditions is fuzzy at best. A big vote is due in a couple of days, but that probably will represent only another step in getting squared away. Speaking of debt messes, we still hear very little about the goings on in DC & there are only a couple of weeks left before the super committee will deliver its plan to cut $1½T in spending. Whatever the plan says will produce a lot of screams, not good for the stock market.
The MLP index fell 2+ to the 266s & the REIT index dropped 4+ to the 221s, coming off an outstanding month. Junk bond funds were weak & Treasuries rose on the increased uncertainties out of Europe. The VIX, volatility index, shot up 2+ to the 31s. Oil jumped 2 to its highest level in 3 months & gold had one of its best days in history, going over $1700.
ALERIAN MLP Index (^AMZ)
DJ REIT INDEXDJR (^DJR)
Click below for the latest market update:
Treasury yields:
U.S. 3-month | 0.000% | |
U.S. 2-year | 0.247% | |
U.S. 10-year | 2.116% |
| CLZ11.NYM | ...Crude Oil Dec 11 | ...93.18 | ....... 1.91 | (2.1%) |
| GCV11.CMX | ...Gold Oct 11 | ......1,706.20 | ... 54.70 | (3.3%) |
Delta Air Lines Q3 profit missed expectations because of higher fuel costs. DAL said corp travel was holding up & it expects a profit in Q4. "We continue to see solid revenue trends" into the current period, President Edward Bastian said. He continued, saying Oct unit revenues were up 10%, aided by corp gains. These results follow losses reported last week by Southwest Airlines (LUV) & American Air parent AMR (AMR) which cited fuel costs & a strong US dollar that eroded overseas sales. The 2nd-largest airline has cut headcount with voluntary buyouts, reduced flying to less-profitable cities & consolidated facilities to cut costs. It has also invested in new airplane seats and other amenities to boost sales, with a goal of having $1B in new revenue streams by 2013. Q3 EPS was 65¢, up from 43¢ a year earlier. Excluding one-time items, EPS was 91¢, short of the 93¢ expected. Revenue rose 10% to $9.8B. Passenger revenue per available seat mile climbed 11% but operating expenses increased 13%, with aircraft fuel & related costs up 42%. Its hedging strategy saved $100M in Q3. The average fuel price was $3.29 per gallon & DAL forecasts a Q4 fuel price of $2.98 per gallon. The stock fell 46¢.
Delta Air’s Profit Misses Analysts’ Estimates as Fuel Costs Outpace Fares
Delta Air Lines Inc. (New) (DAL)
Simon Property funds from operations (FFO) improved in Q3 because it made more money from rents & management fees. The nation's biggest mall operator also boosted its full-year FFO outlook for the 3d time & the quarterly div was increased. FFO rose to $1.71 from 90¢ last year. Analysts were looking for $1.66. Revenue rose to $1.07B from $979.3B as revenue from minimum rent & overage rent improved. Tenant reimbursements increased to $294M from $274M, while management fees & other revenues climbed to $31.2M from $30M. Total sales per square foot increased 9.3% to $517, while average rent per square foot climbed 3.4% to $38.87. SPG expects 2011 FFO of $6.80-6.85, up from a prior forecast of $6.65-6.73 (analysts predict $6.81). The quarterly div was raised to 90¢ & special div of 20¢ will also be paid. The stock slipped 1.76 in a down market.
Simon Property Increases Forecast, Dividend as FFO Beats Analyst Estimates
Simon Property Group, Inc. (SPG)
The German parliament is set to vote on a non-binding call for the ECB to end its secondary-market bond-buying program once the enhanced European rescue fund is enacted, The joint motion sets out terms for the lower house, the Bundestag, supporting the European Financial Stability Facility (EFSF) in a vote tomorrow. It “notes that the need” for the ECB to continue its secondary-market program ends with the new fund’s enactment & urges Chancellor Merkel's gov to “respect” the ban on central-bank credits as well as primary-market purchases by the ECB as the EFSF is set in stone. “For us it was a condition that the Bundestag, respecting the central bank’s independence, has a clear position: no more unconditional debt-buying by the ECB,” Carsten Schneider, the opposition's budget spokesman told reporters. The motion sets criteria to which Merkel must adhere when she goes to Brussels after the EFSF vote tomorrow for a 2nd European summit in 4 days. The budget committee or the full chamber must be allowed to vote once more after leverage models have been transformed into guidelines for the fund, according to the text. Plans to resolve the debt problems remain fluid.
This was a bad day for the market, but to be expected after hardly missing a step in this month's rise. Earnings are not all that great, at best giving mixed signals about the US economy. The European debt mess brings on market selling. The plan to emerge from these conditions is fuzzy at best. A big vote is due in a couple of days, but that probably will represent only another step in getting squared away. Speaking of debt messes, we still hear very little about the goings on in DC & there are only a couple of weeks left before the super committee will deliver its plan to cut $1½T in spending. Whatever the plan says will produce a lot of screams, not good for the stock market.
Dow Industrials (INDU)
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