December 14, 2017

S.&P. 500 Again Closes at a Record

The Standard Poor’s 500-stock index notched a third consecutive record closing high on Monday and major indexes rose, though disappointing McDonald’s earnings kept the Dow from making significant gains.

Banks and health shares were the day’s best performers, with financials advancing for the 10th time in the past 12 sessions. Bank of America led the group, while United States-listed shares of UBS rose 3.2 percent to $19.23 after the Swiss bank’s second-quarter profit beat forecasts despite a charge to settle a regulatory lawsuit.

At the close, the Dow Jones industrial average was up 1.81 points, or 0.01 percent, at 15,545.55. The S.P. 500 rose 3.44 points, or 0.20 percent, to 1,695.53, and the Nasdaq composite added 12.77 points, or 0.36 percent, to 3,600.39.

Analysts said the market is likely to trend higher in the absence of any weak economic news but would need strong earnings and positive forecasts from companies to post large gains.

“Most earnings have been good, maybe not great but good, and as a consequence I think investors continue to show that equities is the asset class of choice for them right now,” said Rick Meckler, president of LibertyView Capital Management in Jersey City. “It’s difficult to see, short of some really strong economic numbers, what could push the market significantly ahead.”

Weaker-than-expected results from McDonald’s, the world’s largest restaurant chain, weighed on the Dow after the company said full-year results would be “challenged” by falling sales in Europe, its biggest market. Its shares lost 2.7 percent to $97.58.

Shares of Netflix fell 6.1 percent in after-hours trading after the company reported a higher profit for the second quarter but added fewer subscribers to its video streaming service than analysts expected.

Five of the S.P. 500 industry sectors advanced in Monday’s session. Trading volume was below average, with 5.2 billion shares changing hands on American exchanges.

The S.P. 500 has added nearly 19 percent so far this year. Recent data showed funds that hold American stocks gained $16.96 billion in the week ended Wednesday, the most since June 2008.

A rise in metal prices lifted materials shares, with Newmont Mining up 5.8 percent to $30.35, enough to lead gains in the S.P. materials sector.

Technology shares also moved higher, with Microsoft adding 1.9 percent to $32.01 after the software maker tumbled 11.4 percent on Friday following dismal results.

The PHLX housing sector index fell 0.8 percent after an unexpected drop in American home resales in June. The data also gave support to bets that the Federal Reserve will extend its rate of bond purchases to support the economy.

September, however, remains the most likely time for the Fed to announce that it will begin scaling back its $85 billion a month in bond purchases, according to a Reuters poll.

Nearly one-third of S.P. 500 companies are expected to report earnings this week, including Apple on Tuesday.

Of the 109 companies in the S.P. 500 that have reported earnings for the quarter, 64.2 percent have beaten analyst expectations, while fewer than half have topped revenue estimates, Thomson Reuters data showed.

Article source: http://www.nytimes.com/2013/07/23/business/daily-stock-market-activity.html?partner=rss&emc=rss

Samsung Forecasts Record $8.3 Billion Profit

SEOUL — Samsung Electronics projected Tuesday a profit of $8.3 billion in the quarter that ended last month as demand picked up for the flat screens it makes for mobile devices, including those for products sold by Apple.

The forecast could signal a run of five consecutive record quarters, but it may end in the January-to-March period because of weaker seasonal demand. But a strong line of new smartphones — the biggest earner for Samsung, the South Korean giant — and improving chip prices have eased concerns that earnings growth could slow this year.

“Investors are a bit concerned that Samsung’s momentum may slow in the first half,” said Kim Sung-soo, a fund manager at LS Asset Management. “The smartphone market is unlikely to sustain its strong growth, as advanced markets are nearing saturation despite growth in emerging countries.”

Samsung has outpaced Apple — its biggest rival and also its biggest customer — with sales momentum bolstered by its Galaxy Note II phone-tablet hybrid in the fourth quarter. IPhone 5 sales were a little below expectations, analysts said.

While Apple introduced just a single new smartphone last year globally, Samsung bombarded the market with 37 variants adjusted to regional and consumer tastes, including both high-end and low-end smartphone models. By comparison, HTC of Taiwan released 18 models, Nokia of Finland released nine and LG Electronics of South Korea introduced 24.

HTC said Monday that its fourth-quarter profit had slumped about 90 percent as its sales had continued to trail those of the Galaxy range of phones and the iPhone.

Samsung gave its October-December earnings guidance before the full earnings release expected by Jan. 25.

Shipments of Samsung’s flagship phone, the Galaxy S III, which overtook the iPhone 4S in the third quarter to become the world’s best-selling smartphone, are likely to have slipped to about 15 million in the past quarter from 18 million in July to September, analysts estimate, but sales of about 8 million of the Galaxy Note II should more than make up for that, pushing overall smartphone shipments to about 63 million.

“The Note was selling well, boosting fourth-quarter profit, while iPhone 5 sales were less than expected,” said Song Myung-sub, an analyst at HI Investment Securities. “Samsung’s profit will drop in the current quarter because of decreased phone profits. It will launch the Galaxy S IV only in March or April, so, without new models, phone sales prices will fall this quarter. For the whole year, Samsung will launch new models faster than Apple and have the upper hand in the smartphone market.”

The new Galaxy, widely expected to be released within months, may have an unbreakable screen and full high-definition resolution, with 440 pixels per inch, as well as a better camera and a more powerful processor.

“Samsung’s smartphone shipments are likely to grow, even in a seasonally weak first quarter,” said Peter Yu, a BNP Paribas Securities analyst. “The early launch of the Galaxy S IV would drive second-quarter growth momentum.”

He predicted Samsung’s 2013 operating profit would grow 25 percent to almost $35 billion.

Samsung is expected to increase its smartphone sales by more than a third this year, and widen its lead over Apple as it offers a broader range of mobile devices, said Neil Mawston, executive director at Strategy Analytics, a market researcher, which forecasts Samsung will sell 290 million smartphones this year, up from a projected 215 million in 2012.

Apple is expected to sell 180 million iPhones, up from 135 million sold last year, Mr. Mawston said last week.

Kim Sung-in, an analyst at Kiwoom Securities, said he expected Samsung to ship 320 million smartphones this year and double sales of its tablets to 32 million.

Samsung said its operating profit in October to December had jumped 89 percent to 8.8 trillion won, or about $8.3 billion, from a year ago, just higher than an average forecast of 8.7 trillion won by 16 analysts surveyed by Reuters. That is 8.6 percent higher than its previous record of 8.1 trillion won in July to September.

Analysts expect profits from the mobile division will more than double from last year and increase slightly from the previous quarter, to about 5.8 trillion won. A recovery in chip prices and flat screens should also bolster earnings, helped by booming sales of mobiles carrying Samsung’s chips, microprocessors and flat screens.

Article source: http://www.nytimes.com/2013/01/09/business/global/samsung-forecasts-record-8-3-billion-profit.html?partner=rss&emc=rss