QUOTE OF THE DAY
“Exxon’s chemical segment is the best-run in the energy sector.They see themselves as the true integrated oil company and rightly so.”
Brian Youngberg, Edward Jones & Co. analyst Article, 1D
Billionaire investment lifts J.C. Penney
NEW YORK - Shares of retailer J.C. Penney rose more than 6 percent in aftermarket trading on Thursday after billionaire financier George Soros disclosed a 7.9 percent stake in the company.
Soros disclosed he owns about 17.4 million shares of the Plano, Texas, department store operator in a filing with the Securities and Exchange Commission. The SEC requires shareholders to disclose stakes of 5 percent or more in a company.
Shares gained 92 cents, or 6 percent, to $16.16 in aftermarket trading, after ending regular Thursday trading 5 cents higher at $15.24.
J.C. Penney earlier this month fired its Chief Executive Officer, Ron Johnson, after 17 months on the job and rehired his predecessor Mike Ullman. An ambitious turnaround plan by Johnson had backfired and caused sales to plummet.
The stake makes Soros the fourth largest shareholder in J.C. Penney. The top shareholder is activist investor William Ackman’s Pershing Square Capital, with a 17.8 percent stake.
- The Associated Press
Britain’s economy expands in quarter
LONDON - Britain’s economy avoided a triple-dip recession in the first quarter with expansion that exceeded economists’ forecasts and will provide relief to a government criticized for failing to foster a recovery.
Gross domestic product rose 0.3 percent in the period, the Office for National Statistics said Thursday in London. The median forecast of 37 economists in a Bloomberg News survey was for 0.1 percent growth. From a year earlier, GDP rose 0.6 percent, the most since the fourth quarter of 2011. The pound surged.
Chancellor of the Exchequer George Osborne’s austerity plan has come under pressure after Fitch Ratings downgraded Britain last week and the International Monetary Fund said the government should relax fiscal tightening. Wednesday the Treasury and the Bank of England extended their credit-boosting program as they warned that risks of renewed stresses in bank funding markets remain because of the euro-area crisis.
“It’s quite encouraging,” said David Tinsley, an economist at BNP Paribas in London and a former central bank official. “It probably eases pressure on the chancellor and enables him to push back on criticism of his strategy.”
- Bloomberg News
Entergy’s $161.4 million tops forecast
NEW ORLEANS - Entergy Corp. reported net income of $161.4 million for the first quarter on Thursday in contrast to a loss a year ago, helped by higher utility revenue.
Hefty one-time costs had weighed down its year-ago results.
The power company’s profit amounted to 90 cents per share for the three months ended March 31. It lost $151.7 million, or 86 cents per share, in the same quarter of 2012.
Excluding one-time items, the company’s adjusted profit was 94 cents per share. That beat Wall Street predictions. Analysts, on average, expected earnings of 81 cents per share, according to FactSet.
Revenue rose 9 percent to $2.61 billion from $2.38 billion, slightly ahead of analysts’ expectations of $2.6 billion.
Utility profits nearly doubled to $123.5 million, helped by price increases and higher demand for power stemming from colder weather compared with the year before.
The company’s wholesale commodity business posted a profit of $82.1 million, compared with a year-ago loss of $175.9 million.
The company reaffirmed that it expects an adjusted 2013 profit of $4.60 to $5.40 per share. Analysts expect $4.88 per share.
Entergy shares fell $1.50 to close Thursday at $68.62.
They are still near the high end of their 52-week range of $61.09 to $74.50.
Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas.
- The Associated Press
Fixed-rate mortgages near record lows
WASHINGTON - Average U.S. rates on fixed mortgages fell closer this week to their historic lows, increasing the affordability of buying homes and refinancing.
Mortgage buyer Freddie Mac, the Federal Home Loan Mortgage Corp., said the average rate for the 30-year fixed loan slipped to 3.40 percent from 3.41 percent last week.
That’s near the 3.31 percent rate reached in November, which was the lowest on records dating back to 1971. It was the key rate’s fourth-straight weekly decline.
The average rate on the 15-year fixed mortgage declined to 2.61 percent from 2.64 percent last week. That nearly matches the record low of 2.63 percent, also reached in November.
Low mortgage rates are helping drive a housing recovery that began last year. Home prices are rising. Sales of new and previously owned homes are up this year.
China signs off on 60-jet Airbus order
Airbus SAS won approval Thursday from China for orders of 60 planes valued at $8 billion, including 18 A330 wide-bodies that had been on hold amid Chinese opposition to a European Union proposal to tax carbon emissions.
The Chinese government gave its stamp of approval to the order Thursday in signing a general terms agreement at a ceremony in the presence of Chinese President Xi Jinping and French President Francois Hollande, who is visiting for two days, according to a statement by Airbus.
The order also includes 42 single-aisle aircraft in the A320 series. The agreement will allow Airbus to list in its backlog aircraft that may have already been the subject of firm contracts but lacked the final government backing required for Airbus to consider them certain.
Airbus had said during much of 2012 that it would be unable to start building 45 A330s that were the subject of firm orders from Chinese carriers, because the Chinese government opposed European Union plans to charge for carbon emissions and was refusing to provide final confirmations for those aircraft.
The European Union late last year backed down on its plan to tax emissions.
Business, Pages 26 on 04/26/2013