Category: Stock Market News

WASHINGTON (MarketWatch)- The U.S. current-account deficit, a measures of the nation’s debt to other countries, dropped 4.5% in the third quarter to $113 billion from $118.3 billion. The decline was mostly tied to a lower trade deficit in goods, the government said Thursday. The U.S. posted an unusually large increase in agricultural exports, mainly soybeans, in the third quarter after a poor harvest among South American producers. The current account reveals if a country is a net lender or debtor. The current account deficit was 2.4% of GDP in the third quarter. That’s down from 2.6% in the second quarter and well below a peak of 6.3% in 2005.

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CVS Health Corp. said it will raise its annual dividend by 18% in 2017, to $2.00 a share from $1.70 a share. Based on Wednesday’s closing price for the drugstore chain’s stock of $78.96, the new dividend implies a dividend yield of 2.53%, compared with the aggregate dividend yield for the S&P 500 of 2.08%, according to FactSet. CVS also said at its analyst day that it affirmed its adjusted earnings-per-share outlooks for 2016 and 2017, that it expects to deliver cost savings of $700 million to $750 million across its businesses by 2021 and that it has more than $18 billion authorized for share repurchases over the next few years. The stock, which was still inactive in premarket trade, has tumbled 19% year to date, while the S&P 500 has gained 10%.

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Shares of Sanderson Farms Inc. were indicated higher in premarket trade Thursday, after the fresh and frozen chicken products company reported fiscal fourth-quarter earnings and revenue that beat expectations. Earnings for the quarter to Oct. 31 jumped to $76.0 million, or $3.36 a share, from $27.4 million, or $1.22 a share, in the same period a year ago. The FactSet consensus for earnings per share was $2.65. Revenue grew to $790.8 million from $679.6 million, topping the FactSet consensus of $790.7 million, as overall market prices for poultry prices increased. The company said whole chicken prices declined 4.0%, but boneless breast mean prices increased 7.4%, jumbo wing prices rose 9.5% and bulk leg quarters prices increased 46%. The higher overall prices resulted from improved export demand. “Market conditions strengthened at the beginning of our fourth fiscal quarter of 2016, although market prices declined seasonally after Labor Day,” said Chief Executive Joe Sanderson, Jr. The stock has rallied 15% year to date through Wednesday, while the S&P 500 has gained 10%.

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General Mills Inc. was downgraded Thursday to sector perform from outperform at RBC Capital Markets on concerns that declines in the company’s yogurt business will hurt earnings growth. The company’s price target was lowered to $69 from $73. General Mills brands include Yoplait and Liberte. General Mills sales fell in the most recent quarter on slumping sales of its yogurt brands. The company announces second-quarter earnings on Tuesday. RBC analysts add yogurt to a list of categories, including cereal, where sales have slipped. “While it is conceivable that cereal can return to growth, the recent deterioration in yogurt has been concerning – especially since it has coincided with lower competitive price pressure,” RBC wrote. “We now believe it is unlikely that General Mills will meet its full-year FX-neutral global sales growth target of flat to down 2%.” General Mills shares are down 0.3% in premarket trading, but up 9% for the year to date. The S&P 500 index is up 10.2% for 2016 so far.

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Scholastic Corp. reported Thursday fiscal second-quarter earnings that rose to $67.9 million, or $1.96 a share, from $64.9 million, or $1.84 a share from the same period a year ago. Excluding non-recurring items, adjusted earnings per share rose to $1.99 from $1.89. The EPS consensus from Estimize, a crowdsourcing platform that gathers estimates from Wall Street analysts, as well as buy-side analysts, hedge-fund managers, company executives, academics and others, was $1.74. Revenue grew 4% to $623.1 million from $601.8 million, beating the Estimize consensus of $598 million. The children’s book publisher and media company said its results were boosted by revenue growth in its trade channels in the U.S. and Canada and by the strength of new Harry Potter-related publishing. The stock, which was still inactive in premarket trade, has run up 19% year to date, while the S&P 500 has gained 10%.

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The Bank of England on Thursday left its key interest rate at a record low 0.25%, meeting widely held expectations. The central bank also left unchanged the size of its asset purchase program at £435 billion ($543 billion) and its corporate-bond purchase program at £10 billion. All nine members of the rate-setting board voted to stand pat on policy. This week, Britain’s consumer-price index leapt above 1% for the first time since October 2014. “Sterling’s effect on CPI inflation will ultimately prove temporary and fully offsetting it would require exerting further downward pressure on domestic costs, including wages, and would therefore involve lost output and higher unemployment,” the BOE said in a statement. The pound fell to $1.2459 from $1.2483 just before the BOE’s policy decision was released. The pound has been under pressure Thursday, with the U.S. dollar rising after the Federal Reserve [l: on Wednesday raised interest rates and signaled it will continue raising rates in 2017.

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Shares of Eli Lilly & Co. surged 3% in premarket trade Thursday, after the drug maker provided an upbeat profit and sales outlook for next year. The company expected 2017 net earnings per share of $3.51 to $3.61. Excluding non-recurring items, such as the the amortization of intangible assets and one-time acquisition costs, adjusted EPS is expected to be $4.05 to $4.15, above the FactSet consensus of $3.96. Revenue is projected to be $21.8 billion to $22.3 billion, also above the FactSet consensus of $21.7 billion. For 2016, the company still expects adjusted EPS of $3.50 to $3.60, surrounding the FactSet consensus of $3.52. Lilly said it continues to see the potential to launch 13 new products through 2023. “Because of our confidence in our future growth prospects, we are reaffirming our financial commitments through the remainder of the decade,” said Chief Financial Officer Derica Rice. The stock has tumbled 20% year to date through Wednesday, while the SPDR Health Care Select Sector ETF has lost 3.7% and the S&P 500 has gained 10%.

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The National Basketball Association and its players union tentatively agreed to a new collective bargaining agreement Wednesday night, which, if ratified, could deliver labor peace through the 2023-’24 season. The deal, announced by both parties, lifts the threat of a lockout next year. League owners and players will likely vote to approve the deal before year’s end. Under terms of the CBA, the average NBA salary will rise to around $8.5 million a year, according to a report by Yahoo. Under terms of the deal, the status quo will largely be maintained, reports say, with the league salary cap and luxury tax largely unchanged.

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Veritex Holdings Inc. plunged more than 25% Wednesday afternoon after the Texas-based bank announced that it would merge with another bank in the same state, Sovereign Bancshares Inc. Veritex said it would issue more than 5 million shares to Sovereign and pay $58 million in cash to complete the deal. In a separate announcement, the company said it would sell fresh shares on the open market to fund the cash portion of the payment. Veritex, which ended Wednesday’s session with a market capitalization of $245.5 million, plunged from $22.84 a share in late trading to $17.01 after a trading halt of about 30 minutes. The deal is expected to close in the second quarter of 2017.

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Yahoo Inc. disclosed another security breach Wednesday, and said more than 1 billion users’ accounts could be affected, double the number of affected users Yahoo claimed in an earlier hack that was believed to be the largest on record. In an announcement Wednesday afternoon, Yahoo said that a trove of information passed on from law enforcement in November appears to be user data stolen in August 2013. “The stolen user account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (using MD5) and, in some cases, encrypted or unencrypted security questions and answers,” Yahoo said in its announcement. Yahoo said in September that a hack in 2014 accessed data from about 500 million users, and specified Wednesday that this trove of data is believed to be from a separate incident. The troubled internet company has agreed to be purchased for $4.8 billion by Verizon Communications Inc. , but reports have said Verizon is looking for a discount after the earlier hacking. Yahoo shares fell 2.5% in late trading Wednesday.

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