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Market Update

U.S. Indexes Rebound, VW Surpasses Toyota as Top Automaker


Author: Nichole Harper
ticker.com
Last Update: 2:08 PM ET July 28 2015

2:05 PM New York City, New York – U.S. market indexes staged a slight rebound but commodities prices continue to test new lows and European markets lacked directions. Sell-off in China intensified in smaller exchanges. Volkswagen surpassed Toyota as the world’s largest automaker.

Stocks rebounded on Wall Street and commodities hovered near multi-year lows as sell-off intensifies in China and European markets lacked direction.

Currencies and stocks looked at moves in commodities markets as oil traded volatile with a downward bias and precious and base metals drifted lower on the renewed worries that China statistics may overstate economic growth in the second largest economy of the world.

On Wall Street, Tollbooth Strategy Index gained 69.21 or 0.7% to 10,733.14.

S&P 500 index increased 19.27 or 0.9% to 2,086.86 and the Nasdaq Composite Index rose 34.87 or 0.7% to 5,074.75.

Crude oil in New York jumped 74 cents to $48.13 a barrel and gold slid $1.70 to $1,095.20 an ounce.

Volkswagen surpassed Toyota as the world’s largest vehicle maker in the first half of 2015. Volkswagen sold 5.04 million vehicles and Toyota, edging ahead of Toyota’s 5.02 million unit sales.

Weak emerging market sales for Toyota affected total sales and rising tax on smaller car in Japan also contributed to the overall weakness.

In addition, Volkswagen may find it difficult to maintain its momentum with more than 120 production facilities and 310 models and nearly one third of sales in China where outlook for additional gains is limited in the near future.

Volkswagen is scheduled to release its earnings on Wednesday and Toyota is to release on next Tuesday.

Toyota also forecast flat sales in the fiscal year ending in Mach 2016.

U.S. Movers

Ford Motor Company (F) rose 12 cents to $14.70 after the auto maker reported revenues in the second-quarter ending in June slid 0.1% to $37.1 billion form a year ago period.

Net income in the quarter surged 44% to $1.9 billion or 47 per diluted share compared to $574 million or 15 cents from the same quarter last year.

Honeywell International Inc (HON) increased 1.9% or $1.97 to $103.61 after the aerospace products maker agreed to acquire the Elster unit of U.K.-based engineering company Melrose Industries plc for about $5.1 billion or £3.3 billion in cash.

The transaction is expected to close in first-quarter of 2016.

Honeywell forecasted revenues for the year in the range of $39 billion to $39.6 billion and earnings per share between $6.05 and $6.15.

Pfizer Inc (PFE) gained 1.6% or 55 cents to $34.89 after the biopharmaceutical company revenues in the second-quarter ending in June dropped 7% to $11.85 billion from a year ago period.

Net income in the quarter plunged 10% to $2.63 billion or 42 cents per diluted share compared to $2.91 billion or 45 cents from the same quarter last year.

Pfizer forecasted revenues for the year between $45 billion and $46 billion and diluted earnings per share in the range of $1.38 to $1.47.

European Markets

The seasonally adjusted UK service sector index jumped 2.7% in May from a year ago month, the Office of the National Statistics reported today.

Separately, the statistics bureau said in a preliminary estimate, second-quarter U.K. GDP jumped 0.7% from 0.4% in first-quarter but declined from 2.6% in a year ago period.

In London trading, FTSE 100 index rose 21.91 or 0.4% to 6,527.04 and in Frankfurt the DAX index rose 34.88 or 0.2% to 11,475.47.

In Paris, CAC 40 index increased 27.40 or 0.6% to 4,955.18.

BP Plc increased 1.7% to 393.77 pence after the U.K.-based oil and gas explorer reported total revenues in the second-quarter ending in June declined 35.5% to $61.80 billion from $95.83 billion in a year ago period.

Net in the quarter swung to a loss from a year ago to $5.78 billion compared to profit of $3.43 billion and diluted loss per share to 31.83 cents from diluted earnings per share of 18.15 cents.

BP reported replacement cost loss in the quarter of $6.3 billion and Deepwater Horizon oil spill, an additional non-operating pre-tax charge of $9.8 billion was included in the result for the second-quarter.

Kering SA soared 6.2% to €173.60 after the France-based luxury goods retailer said revenues in the first-half ending in June surged 17% to €5.51 billion or $4.71 billion in a year ago period.

Net profit in the quarter soared 123.3% from a year ago to €423.1 million compared to €184.5 million and diluted earnings per share climbed to €3.36 from €1.46.

The group''s gross margin in the first-half jumped 13.2% to €3,399 million form a year ago period.

The retailer said revenues in Gucci segment climbed 11.8% and Bottega Veneta posted first-half revenue soared 19.7% while Yves Saint Laurent again posted strong first-half revenue growth of 38.2%.

Orange SA increased 0.8% to €15.07 after France-based telecom operator said revenues in first-half ending in June edged down 0.2% to €19.56 billion from €19.59 billion in a year ago period.

Net profit in the period surged 89.3% form a year ago to €1.10 billion compared to €581 million and diluted earnings per share jumped to €0.39 from €0.21.

Orange said the number of mobile services customers in the period climbed 6.9% to 189.8 million while customers in Africa and the Middle East climbed 12.4% to 102 million.

The mobile company forecasted operating profit for the year in the range of €11.9 billion from €12.1 billion excluding Jazztel and Méditel business.

Asian Markets

Nikkei average in Tokyo declined following another day of route in commodities complex and in China indexes.

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc