Updated with Microsoft earnings, AIG pay package rejection, Bernanke speech details
NEW YORK (
) -- Here are the top stock market headlines for the morning of Friday, Oct. 23, 2009.
Friday's Earnings Roundup
- Microsoft (MSFT) - Get Report reported a third-quarter profit of $3.6 billion, or 40 cents a share, which was down from the year-ago quarter but still impressed analysts who expected, on average, that the software giant would post earnings of 32 cents a share. Revenue sank 14% from a year ago to $12.92 billion, although that number also beat the Thomson Reuters consensus target of $12.4 billion.
- Amazon.com (AMZN) - Get Report shares were set to surge over the $100 level after the company late Thursday reported a third-quarter profit of $199 million, or 45 cents a share, up sharply from a year ago and well ahead of the Thomson Reuters average estimate of 33 cents a share. Sales spiked 28% to $5.45 billion, above the consensus target of $5.02 billion. Amazon also offered a rosy outlook for the fourth quarter, saying it expects operating income between $300 million and $425 million and revenue between $8.12 billion and $9.12 billion.
- Honeywell (HON) - Get Report notched a third-quarter profit of $608 million, or 80 cents a share. Excluding items, Honeywell earned 76 cents a share, falling from year-ago levels but exceeding the Thomson Reuters average estimate of 72 cents a share. Revenue came in at $7.7 billion, down 17% from a year ago and below the consensus target of $7.88 billion. Looking ahead, Honeywell forecasted full-year earnings of $2.85 a share on sales of about $31 billion. Analysts currently expect earnings of $2.78 a share on sales of $31.46 billion.
- Schlumberger (SLB) - Get Report posted a third-quarter profit of $787 million, or 65 cents a share, which was down roughly 50% from a year ago but still beat Wall Street's consensus target by two cents. Revenue sank 25.2% to $5.43 billion, coming up just shy of the Thomson Reuters average estimate of $5.48 billion. Schlumberger CEO Andrew Gould said he believes "the worst" is behind the company.
- Whirlpool (WHR) - Get Report reported third-quarter earnings of $87 million, or $1.15 a share, which was cut nearly in half from a year ago but beat the Thomson Reuters average estimate of 77 cents a share. Sales fell 8% to $4.5 billion, also ahead of estimates.
- Ingersoll-Rand (IR) - Get Report said it had third-quarter earnings of $217 million, or 65 cents a share, down slightly from a year ago. Adjusted earnings totaled 70 cents a share, beating the Thomson Reuters average estimate of 61 cents a share. Revenue dropped nearly 20% from a year ago to $3.48 billion and fell short of the $3.55 billion consensus.
Friday's Early Headlines
- Existing Home Sales Data to Show Improvement -- Existing home sales, the lone economic report of the day, is scheduled for release at 10 a.m. EDT. Economists polled by Reuters expect the National Association of Realtors to say existing home sales rose to 5.35 million units in September from 5.1 million in August.
- Bernanke to Speak on Financial Regulation -- Federal Reserve Chairman Ben Bernanke delivered a speech on financial regulation and supervision after the financial crisis during a convention held by the Boston Federal Reserve on Cape Cod in Massachusetts. Bernanke said it remains critical for the Congress to close regulatory gaps and provide supervisors with additional tools for anticipating and managing systemic risks. He recommended that Congress should ensure that all systemically important financial institutions are subject to a robust regime for consolidated prudential supervision.
- Pay Czar Rejects AIG Pay Packages: Report -- The Wall Street Journal reports that the Obama administration's pay czar Kenneth Feinberg rejected much of the pay packages for American International Group's (AIG) - Get Report top employees, including those in the financial-products unit. Feinberg said the compensation packages were inconsistent with "public interest," the report said.
- U.K. Economy Continues to Shrink -- Bloomberg reports that U.K. gross domestic product unexpectedly shrank 0.4% in the third quarter. Not one of 33 economists surveyed by Bloomberg had forecasted a contraction. With the third quarter's disappointing GDP read, the U.K. is now mired in its worst recession on record.
- EU OKs Merck/Schering-Plough Merger -- Merck's (MRK) - Get Report acquisition of Schering-Plough (SGP) received approval Friday from the European Union. In a statement, the European Commission said it "concluded that the proposed transaction would not significantly impede effective competition" in Europe. Merck's acquisition of Schering-Plough would make it No. 2 in the world in prescription drugs, behind Pfizer (PFE) - Get Report
- Chrysler Financial to Wind Down Before 2012 -- The Associated Press reports that Chrysler Financial, once the exclusive lending arm of the automaker, will liquidate and go out of business by Dec. 31, 2011, according to a letter from the U.S. Treasury Department. The long-anticipated move will cost the battered Detroit area thousands of jobs, the report said.
-- Written by Robert Holmes in New York
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