Dow was off 78, decliners over advancers 5-2 & NAZ fell 19. The Financial Index dropped 1+ to the 194s (where it was 2 months ago). The MLP index was up a fraction to go over 400 (just 11 away from its record made earlier this year) & the REIT index fell 2 to the 263s. Junk bond funds were mixed & Treasuries rose with the yield on the 10 year Treasury approaching the recent record lows. Oil fell for the first time in 8 days on concern that European govs aren’t doing enough to contain the worsening debt crisis, raising worries that demand will slip. Gold also pulled back.
Photo: Yahoo
Euro zone finance ministers approved the terms for a bailout loan for Spanish banks of up to €100B ($122.9B). The agreement came as concerns on the stability of Spain's economy, & that the gov itself might need rescuing, sent the country's borrowing costs soaring & stock prices plummeting. The interest rate on the 10-year bond was at 7.2%, not encouraging. The document calls for strict monitoring of the banks that receive aid. It also requires the Spanish gov to present this month plans to reduce its budget deficit to under 3% of GDP by 2014. "The eurogroup is convinced that the reforms attached to this financial agreement will contribute to ensuring a return of all parts of the Spanish banking sector to soundness and stability," the finance ministers said. "The aim of this program is very clear: to provide Spain with healthy, effectively regulated and rigorously supervised banks, capable of nurturing sustainable economic growth," Olli Rehn, the European monetary affairs commissioner said. Christine Lagarde, the head of the IF, also welcomed the agreement. "The implementation of these measures will contribute to significantly strengthen Spain's financial system, an essential step in restoring growth and prosperity in the country," she said. OK, now let's see some action.
Euro Finance Chiefs Give Final Approval to Spain Bank Rescue
General Electric, a Dow stock, reported a 2.5% rise in quarterly profit from continuing operations, just beating estimates, as solid demand in the US for equipment used in energy production offset the effects of a weakening European economy. The largest US conglomerate EPS in Q2 fell 15.8% to 29¢ from 35¢ a year earlier. Factoring out one-time items including charges related to its former US subprime mortgage business & a Japanese consumer finance arm, EPS was 38¢, above the estimate of 37¢. Revenue rose 2.5% to $36.5B from $35.62B, but was shy a $36.8B forecast. CEO Jeff Immelt held steady the company's 2012 profit outlook, which calls for double-digit growth. "Our industrial outlook remains positive," he said. The stock gained 15¢.
GE Profit Climbs as Energy Gains Overcome Turbine Drop
Photo: Bloomberg
Google Q2 revenue surged 35%, helped by its acquisition of Motorola Mobility Holdings & as more users clicked on advertisements. Sales were $12.2B, compared with $9B a year earlier. EPS before some costs was $10.12. The $12.5B acquisition of Motorola Mobility closed in May. GOOG has been using ads on mobile devices & the YouTube video site to bolster revenue, & it continues to benefit from user queries on its home page. Its sales are tied to the number of times Web surfers click on ads that run on its pages & partner sites. The number of such clicks rose 42% in Q2. Excluding revenue passed on to partner sites & the impact of Motorola Mobility, Q2 sales were $8.36B, slightly below the projection of $8.39B. Motorola Mobility contributed revenue of $1.25B for the period. While total clicks on ads increased, the average cost per click in Q2 declined 16% from a year earlier, & was up 1% from the prior period. The stock rose $17.
Nothing was resolved the week in the markets. Earnings are beating lowered estimates & are being greeted with limited enthusiasm. The euro debt mess is lumbering along after the Spanish bailout was made official. Nobody knows where this will lead not to mention the need for more bailouts. The € fell a penny to under $1.22, another low, demonstrating a lack of confidence by the markets in solving problems. Currently, Dow is up 95 making for a fairly good week. But weakness today is a reminder that the gains are shaky.
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month | 0.081% | |
U.S. 2-year | 0.214% | |
U.S. 10-year | 1.467% |
| CLQ12.NYM | ...Crude Oil Aug 12 | ...91.16 | .... 1.50 | (1.6%) |
| GCU12.CMX | ...Gold Sep 12 | ......1,578.40 | ... 3.10 | (0.2%) |
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Euro zone finance ministers approved the terms for a bailout loan for Spanish banks of up to €100B ($122.9B). The agreement came as concerns on the stability of Spain's economy, & that the gov itself might need rescuing, sent the country's borrowing costs soaring & stock prices plummeting. The interest rate on the 10-year bond was at 7.2%, not encouraging. The document calls for strict monitoring of the banks that receive aid. It also requires the Spanish gov to present this month plans to reduce its budget deficit to under 3% of GDP by 2014. "The eurogroup is convinced that the reforms attached to this financial agreement will contribute to ensuring a return of all parts of the Spanish banking sector to soundness and stability," the finance ministers said. "The aim of this program is very clear: to provide Spain with healthy, effectively regulated and rigorously supervised banks, capable of nurturing sustainable economic growth," Olli Rehn, the European monetary affairs commissioner said. Christine Lagarde, the head of the IF, also welcomed the agreement. "The implementation of these measures will contribute to significantly strengthen Spain's financial system, an essential step in restoring growth and prosperity in the country," she said. OK, now let's see some action.
Euro Finance Chiefs Give Final Approval to Spain Bank Rescue
General Electric, a Dow stock, reported a 2.5% rise in quarterly profit from continuing operations, just beating estimates, as solid demand in the US for equipment used in energy production offset the effects of a weakening European economy. The largest US conglomerate EPS in Q2 fell 15.8% to 29¢ from 35¢ a year earlier. Factoring out one-time items including charges related to its former US subprime mortgage business & a Japanese consumer finance arm, EPS was 38¢, above the estimate of 37¢. Revenue rose 2.5% to $36.5B from $35.62B, but was shy a $36.8B forecast. CEO Jeff Immelt held steady the company's 2012 profit outlook, which calls for double-digit growth. "Our industrial outlook remains positive," he said. The stock gained 15¢.
GE Profit Climbs as Energy Gains Overcome Turbine Drop
General Electric (GE)
Google Q2 revenue surged 35%, helped by its acquisition of Motorola Mobility Holdings & as more users clicked on advertisements. Sales were $12.2B, compared with $9B a year earlier. EPS before some costs was $10.12. The $12.5B acquisition of Motorola Mobility closed in May. GOOG has been using ads on mobile devices & the YouTube video site to bolster revenue, & it continues to benefit from user queries on its home page. Its sales are tied to the number of times Web surfers click on ads that run on its pages & partner sites. The number of such clicks rose 42% in Q2. Excluding revenue passed on to partner sites & the impact of Motorola Mobility, Q2 sales were $8.36B, slightly below the projection of $8.39B. Motorola Mobility contributed revenue of $1.25B for the period. While total clicks on ads increased, the average cost per click in Q2 declined 16% from a year earlier, & was up 1% from the prior period. The stock rose $17.
Google (GOOG)
Nothing was resolved the week in the markets. Earnings are beating lowered estimates & are being greeted with limited enthusiasm. The euro debt mess is lumbering along after the Spanish bailout was made official. Nobody knows where this will lead not to mention the need for more bailouts. The € fell a penny to under $1.22, another low, demonstrating a lack of confidence by the markets in solving problems. Currently, Dow is up 95 making for a fairly good week. But weakness today is a reminder that the gains are shaky.
Dow Jones Industrials
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