Buy/Sell/Hold ETF Zooms 42%; Magna Reports 3Q Loss, Slashes Dividend; U.S. Factory Orders Down 2.5%; Walgreen Same-store Sales Rise 2%, Yahoo Shares Upgraded; Oil Rises 12% on Production Cuts; Archer Daniels Midland Doubles Profit; UBS Turns Profit; Verizon Cleared to Take Over Alltel;
The iShares MSCI Brazil Index (EWZ), an exchange-traded fund (ETF) that was the topic of the popular “Buy, Sell or Hold” feature a week ago Monday (Oct. 27), surged another 9.82% yesterday (Tuesday) and is now up 42% in the six days since Contributing Editor Horacio Marquez rated the ETF as a “Buy” in his column. The shares, which were recommended at $29.94, zoomed $3.81 each, or 9.82%, to close at $42.60, and have now gained $12.66 a share, or 42% since they were recommended by Marquez. They traded as high as $43.35 yesterday – an increase of 45% from their recommendation price.
Magna International Inc. (MGA), the largest auto-parts maker in North America, reported a $215 million third-quarter loss and cut its quarterly dividend 50% to 18 cents. The dividend cut reflects the “reduction in profitability and uncertainty about the timing of an industry recovery in our traditional markets,” Magna said in a statement.
U.S. factory orders in September fell three times more than forecast, Bloomberg reported, slumping 2.5% after a 4.3% drop in August. “There’s not a lot of hope on future orders and production,'' Guy Lebas, chief economist at Janney Montgomery Scott LLC, told Bloomberg. “The economy was on the edge of a precipice, and the credit crisis gave it a shove. Manufacturing will weaken because of slowing exports.”
October same-store sales at Walgreen Co. (WAG) rose 2% and pharmacy same-store sales rose 2.8%. As of Oct. 31, the company operated 6,544 drugstores, 600 more than it did a year ago, Reuters reported.
Shares of Yahoo Inc. (YHOO) got an unexpected lift when brokerage firm Collins Stewart raised Yahoo’s shares from “hold to “buy.” Collins Stewart cited a possible search deal with Google Inc. (GOOG) or Microsoft Corp. (MSFT), and set a target for $18 share, Reuters reported.
Oil prices jumped nearly 12% yesterday (Tuesday) as Saudi Arabia cut its crude exports. Light, sweet crude rose $7.59, or 11.88%, to settle at $71.50 a barrel. Oil had previously fallen more than 55% since hitting a record high $147.27 a barrel in July.
Archer Daniels Midland Co. (ADM) said yesterday (Tuesday) that its fiscal first-quarter earnings more than doubled. A food processor and ethanol producer, Archer Daniels Midland reported quarterly profit of $1.05 billion, or $1.63 per share, up from $441 million, or 68 cents per share, last year. Sales jumped 65% to $21.16 billion.
After four consecutive quarters of declining profit, UBS AG (UBS) posted a net profit of $252 million (296 million Swiss francs) during the third quarter. The Swiss bank benefited from a tax credit of $776 million (913 million francs) and a revaluation of credit positions that resulted in a $1.88 billion (2.21 billion francs) gain on its books, The Associated Press reported.
The Federal Communications Commission yesterday (Tuesday) approved Verizon Wireless' (VZ) planned $28 billion purchase of Alltel Corp., The Associated Press reported. Verizon is paying $5.9 billion and assuming $22.2 billion of Alltel's debt. Verizon also agreed to sell assets in 22 states.