Wednesday, March 18, 2015

Markets slip lower prior to FOMC announcement

Dow dropped 72, decliners over advancers 4-3 & NAZ lost 12.  The MLP index fell 1+ to the 415s & the REIT index was pennies higher in the 333s.  Junk bond funds backed off & Treasuries rose as stocks declined.  Oil is now in the 42s & gold is a tad lower.

AMJ (Alerian MLP Index tracking fund)

CLJ15.NYM.....Crude Oil Apr 15....42.30 Down ...1.16  (2.7%)

GCH15.CMX....Gold Mar 15.....1,147.00 Down ...1.30  (0.1%)

3 Stocks You Should Own Right Now - Click Here!

FedEx narrowed its full-year profit forecast as a strong holiday shipping season was offset by the effects of a strengthened dollar & falling fuel surcharges.  EPS will be $8.80-$8.95 in this fiscal year.  FDX had reiterated a forecast of $8.50-$9 as recently as Jan 23, & the street estimate was for $8.98.  It is in the middle of a $1.7B cost-cutting program begun in 2012, primarily aimed at FedEx Express, which is the company’s airline business.  Q3 revenue of $6.66B at the unit declined slightly from a year earlier as lower fuel surcharges & the currency impact trimmed the benefits of higher volume growth.  But Q3 EPS of $2.01 topped the $1.88 estimate.  “We expect continued revenue and earnings growth this year, driven by ongoing improvements in all of our transportation segments,” CFO Alan Graf said.  “We expect to deliver record fourth quarter and fiscal year earnings.”  Falling fuel prices are providing a tailwind for transportation companies.  The stock lost 3.09.  If you would like to learn more about FDX, click on this link:

FedEx Narrows Profit Forecast as Currency Drags on Results

FedEx (FDX)

Oracle posted flat Q3 revenue & slightly lower profit as the US dollar strengthened, but the business software maker raised its quarterly div 25% to 15¢.  The company reported sales of $9.3B, the same as last year.  Revenue for the fiscal Q3 would have risen 6% without the impact of unfavorable currency rates.  The estimate was for $9.46.  ORCL said its cloud-computing software & platform service revenue rose 30% to $372M, an area keenly watched as it tries to migrate its business toward a remote, internet-enabled model.  EPS was unchanged at 56¢, compared with an estimate of 55¢.  The stock rose 1.82.  If you would like to learn more about FDX, click on this link:

Oracle Revenue Flat, Hurt by Strong Dollar

Oracle (ORCL)

General Mills reported a better-than-expected quarterly profit as sales rose in the US after 5 straight qtrs of decline.  Sales in the US grew 1% in Q3, helped by higher sales of yogurt & snacks.  The company has seen sluggish US sales of products such as cereals & frozen foods in the past few years as consumers shift to foods perceived as healthier.  It is expanding into faster-growing segments such as natural & organic foods.  GIS said in Sep that it would acquire organic food maker Annie's for about $820M.  The company said that it expected to complete the elimination of about 800 jobs, mainly in the US, by the end of fiscal 2015 under its "Catalyst" cost-cutting plan.  GIS expects to take a net charge of about $146M related to these job cuts.  The company will also shut plants in Massachusetts & California under another restructuring plan, called "Project Century", cutting about 680 jobs by the end of fiscal year 2016.  EPS was 56¢, down from 64¢ a year earlier.  Excluding items, EPS was 70¢ & net sales declined 0.6% to $4.35B.  Analysts had expected EPS of 67¢ on revenue of $4.35B.  The stock slid 31¢.  If you would like to learn more about GIS, click on this link:

General Mills Sees Job Cuts, Posts Sales Drop

General Mills (GIS)

Not a lot happens in the stock market until Janet speaks & that is a few hours away.  There is a lot of talk about whether the word "patient" will be used or substituted with another word, to gives hints about interest rate increases.  Either way, the hikes are coming & this bull market is not in all that great of shape if bulls have to worry about a word here or there on raising interest rates.  Economic fundamentals are more important & they are only doing so-so.  By the way, the Treasury has reached its debt ceiling again.  This time it will juggle payments until congress agrees about raising the ceiling.

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