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MENAFN - ProactiveInvestors - Australia - 12/11/2012

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(MENAFN - ProactiveInvestors - Australia) Investors took some money off the table in the last couple of trading hours in the U.S. on Friday, pushing the major indexes off their highs.

By the close the Dow Jones had inched four points higher (0.03%) to 12,815, while the NASDAQ rallied nine points (0.32%) to 2905.

Concerns for the upcoming fiscal cliff dampened the optimism from the positive impact from consumer sentiment rising to its best level in five years.

Obama and the House

In a statement that began at 1:05pm ET, Obama called for the House to pass an extension of middle-class tax cuts quickly, for Americans earnings under 250,000. He pointed out that the Senate has already passed this, and said he would sign the extension if the House acts.

Obama also offered to compromise, but stayed firm on his key positions, and invited both Republican and Democratic congressional leaders to come to the White House next week.

The fiscal cliff refers to the more than 600 billion in tax hikes and spending cuts due to take effect in January, unless the Democrats and Republicans agree on a budget compromise.

Concerns about this problem were brought to light on Thursday by a report from the Congressional Budget Office that said if the fiscal cliff were fully implemented, the US economy would likely contract by 0.5% in 2013 and the unemployment rate would rise to 9.1%.

U.S. Economic News; Consumer Sentiment Strong

Also in US economic news Friday, with the election over and despite the approach of the fiscal cliff, the University of Michigan/ Thomson Reuters consumer sentiment index was strong, up 2.3 points to another recovery best of 84.9 at the mid-month preliminary reading in November - a level not seen since July 2007.

And despite strength in the dollar, import prices rose a sizable 0.5 percent in October following very sharp fuel-driven gains of 1.1 percent and 1.2 percent in the two prior months. The consensus estimate was for a 0.1% increase.

Bloomberg analysts said that today's report "shows some pressures but won't raise alarms for outsized readings in next week's producer and consumer price reports."

Wholesale inventories rose a steep 1.1 percent in September in a build that is easily offset by a 2.0 percent jump in sales at the wholesale level. The level of wholesale inventories is one of three components that are plugged into the business inventories report. Analysts expected a 0.3% rise in wholesale inventories.

China / Europe News

In other economic news abroad, China overnight released several reports that said industrial production rose 9.6% in October from a year earlier, while retail sales climbed 14.5% last month from a year earlier. Both results exceeded estimates.

As well, the China Association of Automobile Manufacturers reported that auto sales rose 6.4% to 1.3 million vehicles, rebounding from September's 0.3% contraction.

Europe is expected to remain in focus over the weekend as on Sunday a parliamentary vote will take place in Greece on the country's 2013 budget, and euro zone finance ministers are meeting Monday.

U.S. Corporate News: Groupon tanks

In corporate news, shares in Groupon (NASDAQ:GRPN) tanked more than 28% Friday, after the daily deals site late Thursday reported quarterly results short of analyst estimates.

Meanwhile, shares in online travel site Kayak (NASDAQ:KYAK) advanced more than 27% as late Thursday, the company agreed to be acquired by Priceline.com (NASDAQ:PCLN) in a 1.8 billion deal.

Zipcar (NASDAQ:ZIP) shares soared in early deals Friday, a day after it posted strong third quarter results and raised its full-year sales guidance.

Lions Gate (NYSE:LGF) shares rose Friday, a day after reporting it swung to a second quarter profit, as revenue nearly doubled on the home release of "The Hunger Games" film, as well as on box-office sales on several feature films.

But J.C. Penney (NYSE:JCP) shares were down as it reported a net loss of 123 million, or 56 cents per share for the quarter that ended October 27, hit by 34 million in restructuring charges. On an adjusted basis, the retailer posted a loss of 93 cents per share - far above what analysts expected. Comparable sales also fell 26.1%.

Shares in the retailer were lately down more than 3% on Friday.

Warner Chilcott PLC (NASDAQ:WCRX) reported a higher profit in its third quarter, despite lower revenue, and also boosted its full year profit forecast higher. The Dublin-based pharmaceutical company now expects an adjusted net income of 3.75 to 3.85 a share, up from its prior forecast of 3.55 to 3.65 a share. Shares in the company were up more than 7% in pre-market trading.

Covidien PLC (NYSE:COV) shares also rose as the company's fourth quarter results topped Street estimates.

And private equity firm Apollo Global Management (NYSE:APO) swung to a profit in its third quarter, with total economic net income after taxes coming in at 98 cents a share.

Vancouver-based telecom company Telus Corp's (TSE:T) (NYSE:TU) has boosted its quarterly dividend by over 10 per cent as it reported third quarter profit rose 7.7 per cent while operating revenue also grew.

Apple (NASDAQ:AAPL) shares regained some ground Friday, after closing at a five-month low on Thursday, as analysts were bullish on the stock.


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