Month: September 2015

The Securities and Exchange Commission is voting on new rules that would force most mutual funds, outside of money market funds, to have sufficient liquid assets to meet the legal requirement for daily redemptions and access to funds within seven days. It would also allow “swing pricing,” which is the process of reflecting in a fund’s NAV the costs associated with shareholders’ trading activity in order to pass those costs on to the purchasing and redeeming shareholders. However, Commissioners Kara Stein and Michael Piwowar have expressed concern about the rule’s proposed three-day liquid asset minimum. Piwowar also said swing pricing could increase the volatility of a fund’s NAV.

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Shares of Volkswagen AG’s U.S.-based suppliers are taking a beating in morning trade Tuesday, as concerns over whether the German automaker will survive the emissions scandal intensify. Among VW’s top suppliers, according to FactSet, the shares of Perceptron Inc. dropped 3.2%, BorgWarner Inc. slumped 6.2%, Tower International Inc. shed 2%, Gentex Corp. fell 1.3% and Harman International Industries Inc. lost 3.3%. Among the shares of VW’s top U.S. customers, according to FactSet, Asbury Automotive Group Inc. slid 1.9% and Avis Budget Group Inc. gave up 2%. VW’s stock plunged 17% in overseas trade, tumbling 19% on Monday.

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Amazon.com Inc. will offer a $30 discount for a one-year Prime membership, which includes free two-day shipping and its catalog of videos and music. New users will be able to get Prime for $67 versus $99 regularly, beginning Friday at midnight and expiring at 11:59 p.m. PT the same day. The company said it is offering the deal to celebrate five Emmy wins for its original series “Transparent,” as more consumers cut the traditional cable cord and opt instead for on-demand video streaming. Shares of Amazon fell 1.7% to $539.46 in recent trade, following a broader market selloff, but are up 26% over the last three months, vastly outperforming the broader S&P 500, which is down 7.3%. (Correction: an earlier version of this reported the discount was for $69).

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From:: Stock Market News

The broader market indexes may not be suffering huge declines, but the breadth data couldn’t be much worse. Within the S&P 500 , only 17 of 502 components are trading higher, while the shares of all 30 members of the Dow Jones Industrial Average are declining. The S&P 500 is down 1.1% in morning trade and the Dow is down 186 points. The total number of declining stocks outnumbered advancers by about 8 to 1 on the NYSE, and by nearly 6 to 1 on the Nasdaq. On the NYSE, 92% of the total volume is in declining shares, while 71% of Nasdaq volume is in decliners.

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The chief executive of Goldman Sachs Inc. , Lloyd Blankfein, said Tuesday he has been diagnosed with lymphoma and will undergo chemotherapy in New York over the next few months. In a memo published on the investment bank’s website, Blankfein said it is a “highly curable” form of lymphoma, and his doctors fully expect him to recover. “My doctors have advised me that during the treatment, I will be able to work substantially as normal, leading the firm,” said the memo. “I will, however, reduce some of my previously planned travel during the treatment period.” Goldman Sachs shares fell 1.7% in premarket trading, and are down 5.4% in the year so far, while the Dow Jones Industrial Average has lost 7.4%.

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Weatherford International Ltd.’s stock soared 15% in premarket trade Tuesday, after the oilfield service company announced late Monday that it was cancelling the share and convertible debt offering announced earlier that day. The stock had plunged 17% on Monday, the eighth-biggest one-day decline in 43 years it has been publicly traded, according to FactSet, and the biggest drop since December 2008, after the company said at 8:25 a.m. Eastern that it was selling $1 billion worth of common shares and convertible debt. About 14 hours later, Weatherford issued a release said it decided not to pursue the public offerings. “While investor interest was strong for this offering, we are unwilling to sell securities at prices that do not reflect the value we have created at Weatherford,” the company said in a statement. At current premarket prices, the stock still has to rise another 5% to make up what it lost on Monday. The stock had tumbled 37% over the past three months through Monday, while the S&P 500 had lost 7.3%.

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Ashland Inc.’s stock surged 5.9% in premarket trade Tuesday, after the company announced plans to separate into two independent, publicly-traded companies, one focused on specialty chemicals and the other on high-performance lubricants. The company said the move represents the completion of its transformation from an oil refiner to a chemicals company. Current Chief Executive William Wulfsohn will become CEO of the new Ashland, which will focus on specialty chemicals used in consumer and industrial markets, which generated $3.6 billion in sales for the 12 months ending June 30. Sam Mitchell, the current president of the Valvoline business, will serve as CEO of the new Valvoline, focused on lubricants, which generated sales of $2 billion in the year ending June 30. “We believe that separating into two industry-leading public companies…will generate significant value for shareholders by enabling each company to focus on its specific business and strategic priorities,” Wulfsohn said. The stock has tumbled 17% over the past three months, while the S&P 500 has lost 7.3%.

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ConAgra Foods Inc. said Tuesday it had a net loss of $1.24 billion, or $2.85 a share, in its first fiscal quarter, after earnings pf $484.5 million, or $1.12 a share, in the year-earlier period. Earnings were weighed down by an impairment charge totaling $1.95 billion pretax on the company’s private label operations, which it is selling. Excluding that charge and other items, the company had EPS of 38 cents. Sales came to $2.79 billion, up from $2.76 billion a year ago. The FactSet consensus was for EPS of 40 cents and sales of $3.69 billion. “We expect to grow profits modestly in fiscal 2016 across the consumer foods and commercial foods segments by building on the stronger foundations established last fiscal year, with an emphasis on improving price/mix and implementing relentless cost discipline,” Chief Executive Sean Connolly said in a statement. Shares were not yet active in premarket trade, but are up 17% in the year so far, while the S&P 500 has lost 4.5%.

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General Mills Inc.’s stock climbed 1.6% in premarket trade Tuesday, after the cereal, frozen meals and snacks company beat fiscal first-quarter profit expectations, offsetting a decline in sales. For the quarter ended Aug. 30, earnings rose to $426.6 million, or 69 cents a share, from $345.2 million, or 55 cents a share, in the same period a year ago. Excluding non-recurring items, adjusted per-share earnings came to 79 cents, above the FactSet consensus of 69 cents. Sales declined 1% to $4.21 billion, below the FactSet consensus of $4.25 billion, as an 11% decline in reported international sales offset a 4% increase in U.S. retail segment sales. Excluding the effect of currency movements, sales would have increased 4%. The company expects full fiscal-year adjusted EPS to grow at a mid-single-digit percentage rate above the previous year’s $2.86, while the FactSet consensus of $2.96 implies 3.5% growth. The stock has climbed 6.5% year to date, while the S&P 500 has lost 4.5%.

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From:: Stock Market News

Darden Restaurants Inc. shares rose 1.3% in premarket trading Tuesday, after the operator of Olive Garden and LongHorn Steakhouse restaurant chains beat profit and sales estimates for its first fiscal quarter. Darden said it had net income of $86.4 million, or 68 cents a share, in the quarter, down sharply from $503.2 million, or $3.81 a share, in the year-earlier period, when the numbers were impacted by a gain on the sale of discontinued operations. Adjusted per-share earnings came to 63 cents, ahead of the FactSet consensus of 58 cents. Sales rose 5.7% to $1.69 billion, ahead of the FactSet consensus of $1.68 billion. The company said it is raising its outlook for adjusted EPS for fiscal 2016 to $3.15 to $3.30 versus a prior $3.05 to $3.20. Its same-restaurant sales growth outlook is unchanged at 2.0% to 2.5%. Shares have gained about 20% in the year so far, while the S&P 500 has fallen 5%.

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