BUSINESS BRIEFS
U.S. home sales plummet, despite big drop in prices
Advertiser Staff and News Services
WASHINGTON — Nationwide sales of existing homes fell more than expected last month, as economic fears made buyers leery even though prices plunged to the lowest level in more than four years. And the decline is expected to get worse because October's results reflect sales contracts signed before Wall Street's nosedive.
The National Association of Realtors said yesterday that sales of existing homes fell 3.1 percent to a seasonally adjusted annual rate of 4.98 million units in October, from a downwardly revised pace of 5.14 million in September. Sales had been expected to fall to a rate of 5.05 million, according to economists surveyed by Thomson Reuters.
BAILOUT NEWS HAS OIL PRICES UP 9%
SIOUX FALLS, S.D. — Oil prices jumped 9 percent yesterday, pulled along by a surging Wall Street that reacted to news of a U.S. government bailout for Citigroup.
OPEC President Chakib Khelil said that if the organization met today, a cut of 1 million barrels would not be enough to support oil prices.
Light, sweet crude for January delivery rose $4.57, to close at $54.50 a barrel on the New York Mercantile Exchange. Prices hit $55.30 at one point.
Oil futures have followed stock markets recently, using equities as a proxy for economic outlook and investor sentiment.
HP BEATS FORECAST WITH COST-CUTTING
SAN FRANCISCO — Hewlett-Packard Co. edged past Wall Street's forecast for the latest quarter, showing some resilience in troubled times, as strong laptop sales helped offset falling printer orders and weakness in some server lines.
HP CEO Mark Hurd, who has won over Wall Street by aggressively slashing HP's expenses, said the economy is getting "tougher and less predictable." He vowed that HP would emerge stronger because of the company's extensive and ongoing cost-cutting moves.
Profits slipped 2 percent, while revenue grew 19 percent, helped by a huge acquisition.
Severe cost-cutting will help Hewlett-Packard meet its financial targets as it digests that deal. HP is cutting 24,600 jobs, nearly 8 percent of its 320,000-employee workforce, in a major restructuring designed to save more than $1 billion a year.
EDMUNDS EXPECTS TINY BUMP IN SALES
NEW YORK — The auto Web site www.Edmunds.com said it expects a slight improvement in November vehicle sales compared with last month partly due to record-high sales incentives, but volumes will still be sharply lower from a year ago.
Edmunds estimates new-vehicle sales in November of 850,000 units, up 1.9 percent from October. The figure, however, is down 27.6 percent from sales in November 2007.
The company predicts a seasonally adjusted annual sales rate of 11.5 million for the month. The rate, known as SAAR, indicates what sales would be for the full year if they remained at the month's pace all year, with adjustments for seasonal fluctuations.
CAMPBELL SOUP SHARES DROP 8%
CAMDEN, N.J. — Campbell Soup Co.'s higher soup sales were watered down by commodity hedging losses in its first fiscal quarter, as the soup maker said yesterday that profits fell 3.7 percent even as more cash-strapped consumers reached for its brands.
Shares of the Camden, N.J.-based company tumbled 8 percent as investors worried about the nation's largest soup maker's ability to keep ahead of currency fluctuations and to translate a bigger thirst for soup into higher earnings.
The company lowered its outlook for the year on worries about currency translation, which affects companies with sizable portions of their business overseas as the U.S. dollar gains strength. Between 25 percent and 30 percent of Campbell's sales and earnings come from operations outside the U.S. In the most recent quarter, commodity costs hampered margins, even as sales rose 3 percent to $2.25 billion from $2.19 billion last year..
HORMEL REPORT FOR QUARTER DUE TODAY
The maker of Spam is scheduled to report its third-quarter financial results today,
Hormel Foods Corp., which also makes canned chili and Jennie-O turkey products, recently reduced its fiscal 2008 profit outlook, citing global economic weakness and higher costs.
Stephens Inc. analyst Farha Aslam gave Hormel an "equal weight" rating saying it's too early to buy even though the shares are priced low. Hormel shares rose 43 cents to close at $29.24 yesterday on the New York Stock Exchange.
