Markets & Finance

Stocks Open Higher


Stocks opened higher Friday as markets recovered from the previous session's skid and traders took in lower-than-expected inflation numbers.

The Dow Jones industrial average rose 17.44 points, or 0.17%, to 10,523.27. The broader Standard & Poor's 500 index was up 1.74 points, or 0.15%, to 1,179.19. The Nasdaq composite index rose 7.72 points, or 0.37%, moving to 2,078.28.

After reaching six-week highs on Thursday, oil futures eased back in early trading Friday, dropping 60 cents to $47.89 a barrel. S&P MarketScope cites profit taking, but expects more volatility as traders square positions before the long U.S. holiday weekend.

Friday's headline economic report was a reading on wholesale inflation. The U.S.

producer price index (PPI) sank by 0.7% in December, with the core index rising 0.1%, both well below median estimates. On a year to year basis, the PPI is up 4.1%, vs. 5.0% in November.

U.S. business inventories rose 1.0% in November, above median estimates, with sales rising by 0.4% as well. Meanwhile, U.S. industrial production rose 0.8% in December, also above estimates.

In corporate news, Marsh & McClennan (MMC) offered to settle out of court for $600 million with the New York State Attorney General's office. Spitzer seeks $750 million, however, and a public statement of contrition, says the Wall Street Journal.

Beer companies Coors (RKY) and Molson agreed to increase the special dividend given to Molson shareholders as part of the merger. Shareholders of Molson, which is traded on the Toronto index, will receive $5.44 Canadian vs. $3.26 Canadian. Press reports have indicated that rival SABMiller is interested in makeing a competing bid for Molson.

A Johnson & Johnson (JNJ) spokeswoman reported that 300 stents, used for heart care, were withdrawn from the market due to defects.

After the close of trading Thursday, Sun Microsystems (SUNW), the server maker, posted a small second-quarter profit of only 1 cent per share, meeting average estimates.

Semiconductor company Cree (CREE) posted second-quarter earnings of 32 cents vs. 17 cents last year, falling one cent short of analyst estimates. Cree also said its profit margins had declined.

Paper producer Bowater (BOW) said to expect a fourth quarter loss of 45 to 55 cents a share, well below Wall Street expectations.

Treasury Market

Treasury prices continued to fall after stronger-than-expected industrial production, and despite the healthy inflation numbers. Yields on the benchmark ten-year note rose to 4.22%.

In currencies, the dollar moved lower after strengthening on the back of the inflation data. The euro traded at $1.311.

World Markets

European stock markets were higher Thursday.

In London, the Financial Times-Stock Exchange 100 index gained 20.50 points, or 0.43%, moving to 4,820.80.

Germany's DAX index rose 9.74 points, or 0.23%, to 4,221.88.

In Paris, the CAC 40 index went up 17.40 points, or 0.45%, to 3,851.51.

Asian markets finished mixed Friday. Tokyo's Nikkei average rose 80.17 points, or 0.71%, to 11,438.39.. In Hong Kong, the Hang Seng index fell 78.50 points, or 0.58%, to close at 13,494.78.


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