Du Pont to slash 1,500 jobs as profit plunges. Du Pont's (DD) shares were -3.5% premarket after the company's Q3 earnings badly missed expectations and it provided full-year guidance well below forecasts. EPS from continuing operations almost halved to $0.32, net profit plummeted to $10M from $452M a year earlier, and revenue slipped 9% to $7.39B. Du Pont announced a restructuring in which it plans to make pretax savings of $450M ($300M in 2013) and cut 1,500 jobs.
Obama, Romney pledge to forestall defense cuts. President Barack Obama and Republican challenger Mitt Romney pledged not to allow automatic defense cuts to go ahead on January 1. "It will not happen," Obama said during last night's presidential debate. Whoever wins, though, will have to come to an agreement with Congress to forestall the sequestration, which has got the defense industry mightily spooked.
Apple to launch iPad mini. Apple (AAPL) is today expected to launch the long-awaited iPad Mini, which, the 9to5 Mac Web site reports, will probably start at $329. Apple will also reportedly unveil a slight update for the regular iPad. The iPad mini could accelerate the trend of schools and colleges buying iPads en masse as education becomes a major focus for Apple: the company has dedicated sales teams, conducts regular meetings with school officials, provides financing for volume orders, and has a digital textbook initiative.
Top Stock News
Mayer impresses on first call as Yahoo earnings top forecasts. Yahoo's (YHOO) Q3 earnings beat expectations, with buybacks and cost cuts helping EPS increase to $0.35 from $0.23 a year earlier while revenue edged up 2% to $1.09B, boosted by a nice 11% rise in search revenue. On her first earnings call, CEO Marissa Mayer pledged to revamp Yahoo's mobile strategy, saying that half of the workforce should be focused on that area. Analysts liked what they heard and shares were +2.7% premarket.
TI profit increases 30% but outlook weak. Texas Instruments' (TXN) Q3 earnings also topped consensus as profit jumped 30% to $784M and adjusted EPS came in at $0.52, although revenue slipped 2% to $3.39B, hurt by weakening demand for chips due to economic concerns. TI gave guidance that was below expectations and the earnings call didn't contain much for chip investors to be excited about. Customer inventories remain lean and demand visibility short, while the industrial and telecom markets are soft. Shares dipped 0.5% premarket.
GE refinances debt to avoid choppy waters. General Electric (GE) has refinanced $5B worth of bonds that mature in February just in case Barack Obama or Mitt Romney are unable to avert the fiscal cliff. "If it's choppy, we are prepared," CFO Keith Sherin said. The conglomerate used part of the $7B worth of bonds it raised earlier this month for the refinancing.
Nokia plans to bolster cash position with €750M bond. Nokia (NOK) is looking to boost its cash reserves by offering a €750M convertible bond that will carry a coupon of 4.25%-5% and matures in 2017. The offering comes after Nokia's net cash position fell to €3.6B in Q3 from €4.2B at the end of Q2 and despite the company's debt carrying junk status. Trading in the bonds is expected to start on Friday. Shares were -6.4% premarket.
Chesapeake starts to repay lifeline loan. Chesapeake Energy (CHK) has reportedly paid off more than half of a $4B bridge loan after receiving $2.8B in cash from the sale of some of its oil and gas properties in the Permian Basin. The loan, made in May, was a lifeline for Chesapeake as it was staring at a $10B funding shortfall; so far this year, Chesapeake has sold around $12B of its assets.
Facebook ad sales growth faces "inflection point." Facebook (FB) is due to report Q3 earnings later, with analysts expecting EPS of $0.11 and revenue of $1.23B. Susquehanna reckons results will be in line but suggests that ad sales growth could be at an "inflection point." Less positive is Citi, which thinks Facebook has hit an "air pocket." Meanwhile, Netflix (NFLX) is expected to report a plunge in EPS to $0.04 from $1.16 but a 10.1% revenue increase to $904.89M.
Top Economic & Other News
Home values rise most since 2006. The Zillow Home Value Index rose 1.3% on quarter to $153,800 in Q3, representing the biggest rise since Q1 2006, although the recovery is uneven across America due to differences in foreclosure conditions and employment. Values declined in 17 of 41 states covered, with the biggest increases in Phoenix at +5.9% and the biggest fall in Atlanta at -2.2%.
BOJ veers towards easing. Facing increased pressure and a weakening economy, the Bank of Japan is leaning towards further easing at its policy meeting next week, Reuters reports, but there is not yet a consensus on what steps it should take. Economics Minister Seiji Maehara wants to attend again, although Finance Minister Koriki Jojima denied that the government has asked for a ¥20T ($251B) increase in asset purchases.
In Asia, Japan flat at 9014. Hong Kong closed. China -0.9% to 2114. India -0.4% to 18710.
In Europe, at midday, London -1.2%. Paris -1.1%. Frankfurt -1.4%.
Futures at 7:00: Dow -0.8%. S&P -1.1%. Nasdaq -1%. Crude -1.9% to $88.30. Gold -1% to $1709.40.
Notable earnings after today's close: ACE, AFL, ALTR, AMGN, BCR, BNNY, BRCM, BWLD, CBI, CHRW, FB, FBC, FBHS, FTI, GILD, HTS, ILMN, INVN, IRBT, JNPR, NBR, NFLX, NFX, NSC, PLCM, PNRA, QCOR, RFMD, STM, TPX, TSS, UIS, VMW, WYNN
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