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Wall Street Perseveres With Its Cautious Optimism

Wall Street Perseveres With Its Cautious Optimism
3/28/2012 6:31 AM ET

Wall Street appears to be religiously holding on to hopes that the economic recovery will prove sustainable. The U.S. index futures are pointing to a modestly higher opening on Wednesday. The durable goods orders report to be released shortly ahead of the markets open may offer further clarity on the economic outlook. European markets are moving to the downside, while Asian stocks also ended mostly lower.

As of 6:30 am ET, the Dow futures are rising 18 points, the S&P 500 futures are adding 1.70 points and the Nasdaq 100 futures are moving up 2.75 points.

U.S. stocks showed nervousness for the better part of Tuesday's session before closing lower, as traders digested a weak housing report and another report that showed that consumer confidence unexpectedly fell.

The Commerce Department is set to release its durable goods orders report at 8:30 am ET. Economists expect a 2.9 percent increase in durable goods orders for February. Excluding transportation, orders may have risen 1.5 percent. In January, durable goods orders fell 3.7 percent month-over-month following three straight months of gains.

The Energy Information Administration is scheduled to release its weekly petroleum inventory report for the week ended March 23rd at 10:30 am ET. The inventory report released by the American Petroleum Institute late Tuesday showed that crude oil stockpiles rose by 3.6 million barrels to 351.5 million in the week ended March 23rd. Gasoline inventories also increased, while distillate inventories declined from the week ago levels.

In corporate news, PVH (PVH) reported fourth quarter results that came in ahead of estimates. The company's full year earnings guidance was also above estimates. However, the company's first quarter issued below-consensus guidance for its first quarter.

Dollar General (DG) said it has priced its underwritten secondary public offering of 25 million common shares at $45.25 per share, at a slight discount to its closing price of $45.75 on Tuesday.

Robbins & Myers (RBN) reported second quarter earnings of 84 cents per share compared to adjusted earnings from continuing operations of 58 cents per share last year. Sales rose to $256 million from $184 million in the year-ago period. The company raised its 2012 adjusted earnings per share guidance to $3.40 to $3.60 per share from $3-$3.20 per share. The results and the guidance were better than expected.

Oxford Industries' (OXM) fourth quarter results exceeded estimates and the guidance was also upbeat.

Sealy Corp. 's (ZZ) first quarter net income from continuing operations improved to 1 cent per share from break-even results in the previous year. Net sales rose 2.2 percent to $312.3 million.

H.B. Fuller (FUL), Mosaic (MOS), Paychex (PAYX), Red Hat (RHT) and Resource Connection (RECN) are among the companies due to release their quarterly results after the markets close.

Tyco (TYC) and Pentair (PNR) announced a deal to merge the former's flow control business with Pentair in a tax-free all stock merger. The Tyco unit is valued at about $4.9 billion, including assumed debt and minority interest.

The major Asian markets closed mostly lower, with sentiment clearly remaining bearish. The Chinese Shanghai Composite Index led the region's retreat with a 2.65 percent slump, weighed down by some lackluster earnings reports.

Japan's Nikkei 225 average languished below the unchanged line throughout the session before closing down 72.58 points or 0.71 percent at 10,183. Utility and pharma suffered a setback along with export stocks. Meanwhile, Sharp rose over 15 percent on the news that Foxconn will make a 133 billion yen investment in the company.

After a tentative start, Australia's All Ordinaries recovered in late morning and rose steadily thereafter, closing up 39.90 points or 0.91 percent at 4,432. Consumer staple, energy, healthcare and material stocks posted strong advances.

Hong Kong's Hang Seng Index ended down 161.49 points or 0.77 percent at 20,885. Retailer Li & Fung tumbled over 5 percent after it announced a stock offering.

European stocks are trading lower despite Italian Prime Minister Mario Monti's assurance that the eurozone debt threat has largely been defused. The French CAC 40 Index is little changed and the German DAX Index are receding 0.29 percent, while the U.K.'s FTSE 100 Index is slipping 0.22 percent.

Italy today auctioned 8.5 billion worth of 6-month bills at benign yields. Meanwhile, revised estimates released by the U.K. Office for National Statistics showed that the U.K. economy contracted at a steeper than initially estimated rate in the fourth quarter. The GDP growth came in at -3 percent sequentially compared to the -2 percent reading estimated initially. Earlier in the day, INSEE confirmed the French economy's fourth quarter expansion at 0.2 percent.

Commodities are seeing weakness amid mixed trading by the dollar.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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