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Dow higher on Greek debt deal, Kraft Foods, Home Depot in focus

21st Feb 2012, 2:48 pm by Joyanta Acharjee
Dow higher on Greek debt deal, Kraft Foods, Home Depot in focus

US equity markets were mostly higher Tuesday, with the Dow crossing the 13,000 barrier for the first time in nearly four years, as investors grew more optimistic about Greece.

As at 2.19 pm EDT, the Dow Jones Industrial Average was up 0.09% to 12,962, the S&P 500 was up 0.10% at 1,362.65 and the NASDAQ was down 0.26% at 2,944.13.

Greece agreed on a second bailout, which will see the country receive 130 billion euros to avoid a debt default and make a bond payment in March. After hours of talks, eurozone finance ministers finalized the deal to cut Greece's debt to 120.5 percent of GDP by 2020, just a fraction above the target.

China's central bank said over the weekend that it would reduce the proportion of cash that banks must set aside by half a percentage point to 20.5% from February 24. The move to cut reserve ratios was done to encourage lending.

This is in contrast to the country's prior moves to tighten lending requirements over the last few years to control high inflation.

In corporate news, Kraft Foods (NYSE:KFT) - whose products include Oreo cookies, Philadelphia cream cheese and Oscar Mayer deli meats - reported Tuesday fourth-quarter net profit of $830 million, or 47 cents per share, against $540 million, or 31 cents, in the year-ago period.

Revenue for the period rose 6.6 percent to $14.69 billion, against $13.77 billion in the year ago period. Adjusted profit was 57
cents a share, which included a negative one cent impact from foreign currency.

Adjusted profit met forecasts of analysts polled by FactSet Research, while revenue fell short of a forecast of $14.8 billion.

Home Depot (NYSE:HD), the world’s largest home-improvement retailer, posted fourth-quarter profit that exceeded analysts’ estimates as warmer weather helped spur an increase in residential spending.

Net income in the quarter ended January 29 increased 32 percent to $774 million, or 50 cents per share, from $587 million, or 36 cents, a year earlier. Revenue advanced 5.9 percent to $16 billion. Analysts projected $15.5 billion, the average of 19 estimates compiled by Bloomberg.

Analysts projected 42 cents, the average of 24 estimates compiled by Bloomberg.

Macy's (NYSE:M) said Tuesday its fiscal fourth quarter earnings rose 12 percent, largely on strong holiday sales.

For the three months that ended January 28, 2012, the retail giant, which operates under the Bloomingdale's and Macy's banners, said that adjusted for $54 million in pre-tax gains related to the 2006 sale of Lord & Taylor, earnings were $1.70 per share.

Revenues for the latest quarter rose six percent to $8.72 billion, from $8.27 billion in the same period last year, as same store sales, or those of locations open at least one year, increased 5.2 percent.

Mylan (NASDAQ:MYL) said Tuesday that fourth-quarter earnings soared from a year-earlier period that was hit by litigation and other items as the pharmaceutical company's margins also improved.

Mylan - the world's third-largest generic-drug maker by sales - has seen its revenue jump in recent quarters as concerns about the economy spur interest in lower-cost health options. But the company's bottom line has been hampered by litigation and acquisition-related costs.

After the closing bell Tuesday, Dell (NASDAQ:DELL) is due to report its quarterly results. The computer maker is expected to report earnings of 52 cents per share.

No major economic data was released Tuesday.

Commodities

In NYMEX futures trading, crude for March delivery, in its final day of trading, rose $1.26 to $104.55 a barrel. The more active
April contract gained $1.29 to $104.89 a barrel.

Gold futures for April delivery climbed $21.60 to $1,747.70 an ounce.

Europe

European markets finished lower today with shares in Germany leading the region. The DAX was down 0.58% while Britain's FTSE 100 was off 0.29% and France's CAC 40 fell lower by 0.21%.

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