Dow lost 41, decliners over advancers 3-1 & NAZ was off 4. The MLP index sank 5+ to 311 & the REIT index lost a fraction to the 325s. Junk bond funds were mixed & there was buying of Treasuries. Oil fell to the 43s (but off the lows) & gold was flattish.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif?0.6481214334364639)
IBM, a Dow stock, disclosed that the SEC is conducting an investigation related to the technology seller's revenue recognition. The SEC is looking into the accounting treatment of certain transactions in the US, the UK & Ireland. IBM is cooperating with the SEC. The SEC declined to comment. “IBM has a rigorous and disciplined process for the preparation of its financial statements and the reporting of revenue,” an IBM company spokesman said. “We are confident that the results and information we report have been appropriate and consistent with GAAP.” IBM last week cut its full-year profit forecast & reported its 14th straight qtr of shrinking sales. The company has been working to become a seller of cloud computing & data analytics technology, as demand for older businesses decline. IBM is banking on its newer operations, folded within its strategic imperatives, to deliver $40B in revenue & account for 40% of sales by 2018. The company in Jun 2014 said the SEC didn’t plan to recommend an enforcement action after investigating how IBM reported revenue from offsite cloud services. The probe, which began in 2013, examined sales for services delivered over the internet such as storing customers’ data. The stock dropped 5.80. If you would like to learn more about IBM, click on this link:
club.ino.com/trend/analysis/stock/IBM?a_aid=CD3289&a_bid=6ae5b6f7
United Parcel Service reported a surprise drop in revenue, though growth in its intl division helped drive profit higher. The company backed its outlook for the year. For Q3, EPS was 1.39, up from 1.32 a year earlier. Revenue ticked down to $14.24B from $14.29B a year earlier, hurt by lower fuel surcharge rates & currency impacts. Excluding currency impacts, revenue would have risen 1.8%. Analysts had expected EPS of 1.37 on revenue of $14.43B. Total company shipments grew 1.9% to 1.1B packages, led by US air products & European transborder shipments. In the domestic segment, profit fell 1.6% to $1.26B, dragged by lower fuel-surcharge revenue. But daily shipments ticked up 0.6%, helped by growth in air products. Profit in the intl segment grew 10% to $507M, helped by network improvements & a 1.2% increase in daily export shipments. In the supply chain & freight segment, operating profit increased 1.9% to $219M. The company's acquisition of Coyote Logistics, which closed during Q3, helped offset lower forwarding revenue & a drop in less-than-truckload tonnage. The results come as UPS heads into the holiday peak season, & the company is working to keep its expenses in check. UPS has spent $200M more than it expected the last 2 years, first as its network was swamped with unexpected packages in 2013, & then as packages spiked around Thanksgiving & Christmas last year & left the network underused in between. The stock lost 3.08. If you would like to learn more about UPS, click on this link:
club.ino.com/trend/analysis/stock/UPS?a_aid=CD3289&a_bid=6ae5b6f7
DuPont, another Dow stock, reported a bigger-than-expected quarterly profit as its cost-cutting efforts helped offset the impact of a strong dollar & weakness in its agriculture business. Cost reductions contributed 10¢ per share Q3 operating earnings of 13¢, helping the company beat the average analyst estimate of 10¢. The company has speeded up cost cuts to counter weakening sales, & is targeting $1.6B in annual savings by the end of 2017. "Amid the current challenging macro environment, our priority is to aggressively manage what is within our control, including taking a fresh look at DuPont's cost structure and capital allocation strategy to identify ways to further improve shareholder return," Edward Breen, interim CEO, said. Breen took over from Ellen Kullman, who stepped down from her post earlier this month. DD, which gets about 60% of its sales from outside North America, said net sales fell 17.5% to $4.87B. Analysts had expected revenue of $5.3B. EPS attributable to DD nearly halved to 26¢. The stock rose 1.68. If you would like to learn more about DD, click on this link:
club.ino.com/trend/analysis/stock/DD?a_aid=CD3289&a_bid=6ae5b6f7
Earnings were on the dreary side today, especially from UPS which gives a flavor of how the US & global economies did in Q3. But Janet's words will carry weight tomorrow & little movement is expected until the markets hear soothing words from her.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLZ15.NYM | ....Crude Oil Dec 15 | ....42.95 |  ...1.03 | (2.3%) |
IBM, a Dow stock, disclosed that the SEC is conducting an investigation related to the technology seller's revenue recognition. The SEC is looking into the accounting treatment of certain transactions in the US, the UK & Ireland. IBM is cooperating with the SEC. The SEC declined to comment. “IBM has a rigorous and disciplined process for the preparation of its financial statements and the reporting of revenue,” an IBM company spokesman said. “We are confident that the results and information we report have been appropriate and consistent with GAAP.” IBM last week cut its full-year profit forecast & reported its 14th straight qtr of shrinking sales. The company has been working to become a seller of cloud computing & data analytics technology, as demand for older businesses decline. IBM is banking on its newer operations, folded within its strategic imperatives, to deliver $40B in revenue & account for 40% of sales by 2018. The company in Jun 2014 said the SEC didn’t plan to recommend an enforcement action after investigating how IBM reported revenue from offsite cloud services. The probe, which began in 2013, examined sales for services delivered over the internet such as storing customers’ data. The stock dropped 5.80. If you would like to learn more about IBM, click on this link:
IBM Says the SEC Is Investigating Accounting for Revenue Recognition
International Business Machines (IBM)
United Parcel Service reported a surprise drop in revenue, though growth in its intl division helped drive profit higher. The company backed its outlook for the year. For Q3, EPS was 1.39, up from 1.32 a year earlier. Revenue ticked down to $14.24B from $14.29B a year earlier, hurt by lower fuel surcharge rates & currency impacts. Excluding currency impacts, revenue would have risen 1.8%. Analysts had expected EPS of 1.37 on revenue of $14.43B. Total company shipments grew 1.9% to 1.1B packages, led by US air products & European transborder shipments. In the domestic segment, profit fell 1.6% to $1.26B, dragged by lower fuel-surcharge revenue. But daily shipments ticked up 0.6%, helped by growth in air products. Profit in the intl segment grew 10% to $507M, helped by network improvements & a 1.2% increase in daily export shipments. In the supply chain & freight segment, operating profit increased 1.9% to $219M. The company's acquisition of Coyote Logistics, which closed during Q3, helped offset lower forwarding revenue & a drop in less-than-truckload tonnage. The results come as UPS heads into the holiday peak season, & the company is working to keep its expenses in check. UPS has spent $200M more than it expected the last 2 years, first as its network was swamped with unexpected packages in 2013, & then as packages spiked around Thanksgiving & Christmas last year & left the network underused in between. The stock lost 3.08. If you would like to learn more about UPS, click on this link:
club.ino.com/trend/analysis/stock/UPS?a_aid=CD3289&a_bid=6ae5b6f7
United Parcel 3Q Profit Rises, Tops Estimates
United Parcel Service (UPS)
DuPont, another Dow stock, reported a bigger-than-expected quarterly profit as its cost-cutting efforts helped offset the impact of a strong dollar & weakness in its agriculture business. Cost reductions contributed 10¢ per share Q3 operating earnings of 13¢, helping the company beat the average analyst estimate of 10¢. The company has speeded up cost cuts to counter weakening sales, & is targeting $1.6B in annual savings by the end of 2017. "Amid the current challenging macro environment, our priority is to aggressively manage what is within our control, including taking a fresh look at DuPont's cost structure and capital allocation strategy to identify ways to further improve shareholder return," Edward Breen, interim CEO, said. Breen took over from Ellen Kullman, who stepped down from her post earlier this month. DD, which gets about 60% of its sales from outside North America, said net sales fell 17.5% to $4.87B. Analysts had expected revenue of $5.3B. EPS attributable to DD nearly halved to 26¢. The stock rose 1.68. If you would like to learn more about DD, click on this link:
club.ino.com/trend/analysis/stock/DD?a_aid=CD3289&a_bid=6ae5b6f7
DuPont's Profit Beats Estimates on Cost Cuts
E.I. du Pont de Nemours (DD)
Earnings were on the dreary side today, especially from UPS which gives a flavor of how the US & global economies did in Q3. But Janet's words will carry weight tomorrow & little movement is expected until the markets hear soothing words from her.
Dow Jones Industrials
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