The broad indices all ended with solid gains, led by Caterpillar (CAT), which was up 3% to close at $82.71, even though the construction equipment maker reported a decline in first-quarter profit to $880, or $1.31 a share, from $1.586 billion, or $2.37 a share, a year earlier. The company also lowered its profit outlook for 2013 to $7 a share on revenue ranging from $57 billion to $61 billion, from the company's previous profit outlook range of $7 to $9 a share, on revenue ranging from $60 billion to $68 billion.
On a much more positive note, Caterpillar Controller Mike DeWalt said during the company's earnings conference call that the company's direct sales in China "were up in the quarter. All-in, including machines, power systems and parts, we were higher than the first quarter of 2012."
According to a transcript provided by Thomson Reuters, DeWalt added that the company had "made quite significant progress" in lowering its inventory in China, and said "While inventory reduction is expected to continue into the second quarter, we do expect to begin increasing production in China during Q2." Adding to the China growth theme, DeWalt said "for the first time since the first quarter of 2012, our order backlog increased from the prior quarter-end."In economic news on Monday, the National Association of Realtors reported that existing home sales in the United States declined by a seasonally adjusted 0.6% to an annual rate of 4.92 million in March from a downwardly revised rate of 4.95 million in February. The March sales pace was still up 10.3% from a year earlier. Once again, the NAR blamed declining supply for the slower sales pace. NAR Chief Economist Lawrence Yun said "the good news is home construction is rising and low mortgage rates are continuing to keep affordability conditions at historically favorable levels. The bad news is that underwriting standards remain excessively tight, while renters are getting squeezed by higher rents."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV