Local business news in brief
Mar 23, 2007 at 12:24 PM
Stocks mixed after big run-up
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NEW YORK - Wall Street finished mixed Thursday, nudging the Dow Jones industrials higher for a fourth straight session but moving cautiously as investors awaited new data to assess whether their hopes for an interest rate cut are justified. A surprise warning that cell phone maker Motorola Inc. will post a loss for the first quarter also made the market uneasy as it looked ahead to earnings reports that begin next month. Investors seemed uncertain about where to take stocks a day after the Federal Reserve issued an economic assessment interpreted as opening up the possibility of a reduction in short-term rates. The statement unleashed a wave of buying that boosted the Dow by 159 points Wednesday, but Thursday's session was erratic, with the Dow weaving in and out of positive territory throughout the day. Investors remained optimistic about the statement but reined in their buying as they took note of climbing energy costs, which made it look unlikely that inflation will cool enough to provoke a rate cut, and as market experts debated whether the Fed's slight change in language truly suggested a shift in policy. "At the end of the day, I don't think it means a heck of a lot," said Stephen Massocca, president of Pacific Growth Equities. "The market received it very, very well, but ultimately the Fed is news-dependent." Still, falling unemployment claims and strength in markets overseas kept stocks from sinking after this week's surge. The Dow has had its best four-day point gain since May 2005; whether it continues the streak will depend much on Friday's report on existing homes sales, inventories and prices for February. The blue chip index rose 13.62, or 0.11 percent, to 12,461.14. Broader indicators slipped. The Standard & Poor's 500 index fell 0.50, or 0.03 percent, to 1,434.54. The technology-dominated Nasdaq composite index declined 4.18, or 0.17 percent, to 2,451.74. , pulled lower in large part by Motorola's warning. "Surprisingly, the market's holding on to yesterday's gains," said Peter Cardillo, chief market economist at New York-based brokerage house Avalon Partners Inc. "The market is doing quite nicely - we're not really giving anything up here. It shows that technically, the market has gained momentum." Market watchers aren't discounting the possibility of further volatility, however, given the potential for Friday's housing data to move the markets and as oil prices continue to rise, reminding investors that inflation is still high and that Americans may need to cut back on discretionary spending. On Thursday, oil prices climbed more than $2 to $61.69 a barrel on the New York Mercantile Exchange. U.S. retail gasoline prices have surged about 20 percent over the past two months as stockpiles decline ahead of the peak driving season. Giving investors some relief, though, was the Labor Department's report that the number of laid-off workers seeking unemployment benefits fell to 316,000 last week, the third consecutive decline - usually a good sign that consumers are finding work and likely able to keep spending. Bonds fell sharply after the jobs data, pushing up the yield on the benchmark 10-year Treasury note to 4.59 percent from 4.54 percent late Thursday. The 10-year yield was slightly higher than that of the 2-year, which many market participants took as a positive development. Prior to Wednesday, short-term yields had exceeded long-term yields since August 2006, in a pattern that some say portends a recession. The dollar rose against other major currencies, while gold prices climbed. Investors also monitored a Senate committee hearing on subprime mortgage lenders, which make loans to people with poor credit. The hearing didn't reveal much new information about whether the sector's troubles are widespread, a worry that has been a big factor in stocks' recent volatility, but investors are likely to continue watching to see if regulators express the need for federal intervention. "People are going to want to verify as the days unfold that this subprime thing is contained to a few situations, and that there's no larger contagion that's going to spread," Massocca said. In addition to subprime woes, oil prices and the benchmark interest rate - which the central bank has kept on hold at 5.25 percent for six straight meetings - investors also focused on a slew of outlooks and earnings reports Thursday. As earnings season nears, experts expect corporate financial results to play a bigger role in market movements. Technology companies came under pressure after Motorola warned it will swing to a first-quarter loss due to declining sales. The cell phone maker fell $1.24, or 6.6 percent, to $17.50, a level not seen in nearly two years. Palm Inc. fell $1.71, or 8.8 percent, to $17.74, as investors' speculation diminished that the smart phone and handheld device maker could be bought by Motorola. Barnes & Noble Inc. reported a rise in fiscal fourth-quarter results, but the figure missed expectations. Rival book, music and movie seller Borders Group Inc. said it swung to a fourth-quarter loss and announced plans to close nearly half its Waldenbooks stores. Barnes & Noble fell $1.10, or 2.8 percent, to $37.90, and Borders fell 73 cents, or 3.4 percent, to $20.70. KB Home, one of the nation's largest homebuilders, said its first-quarter profit fell 84 percent, but the results came in ahead of Wall Street's lowered expectations. KB Home fell 54 cents to $47.25. The Russell 2000 index of smaller companies was up 0.58, or 0.07 percent, at 808.05. Advancing issues narrowly outnumbered decliners on the New York Stock Exchange, where consolidated volume came to 3.02 billion shares, compared to 3.13 billion shares Wednesday.
LMR Plastics recognized by John Deere
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GREENEVILLE - For the second consecutive year, LMR Plastics has earned recognition as a partner-level supplier and was also named Commercial & Consumer Equipment Division Supplier of the Year in the John Deere Achieving Excellence Program. The partner-level status is Deere & Co.'s highest supplier rating. The Greeneville-based company was selected for the honor in recognition of its dedication to providing products and service of outstanding quality, as well as its commitment to continuous improvement. Company officials accepted the award during ceremonies held Feb. 20 in Davenport, Iowa. Representatives from John Deere visited LMR on March 16 to recognize employees for their achievement. Suppliers who participate in the Achieving Excellence Program are evaluated annually in several key performance categories including quality, cost management, delivery, technical support, and wavelength, which is a measure of responsiveness. John Deere Supply Management created the program in 1991 to provide a supplier evaluation and feedback process that promotes continuous improvement. "Our responsibility is to perform at an exceptional level that results in outstanding customer satisfaction. To be selected Supplier of the Year is a testament to the dedication of the entire LMR team," said Bob Leonard, president of LMR Plastics. LMR Plastics supplies plastic components to John Deere's operations in Greeneville; Horicon, Wis.; Augusta, Ga.; Fuquay-Varina, N.C.; and Gummersbach, Germany. The company manufactures and supplies custom plastic injection-molded products to companies in a variety of industries. A privately owned company, LMR Plastics was founded in 1973 and has operated under the Leonard family ownership since September 1996.
NETWORKS updates 2007 Scorecard
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BLOUNTVILLE - Sullivan County's joint economic development efforts so far have helped attract 81 jobs and $2 million in capital investments, all from new businesses or industries. Richard Venable, CEO of the NETWORKS – Sullivan Partnership, updated the Scorecard during Thursday's monthly NETWORKS board meeting. The results, through March 19, were up six jobs from last month's report. The Scorecard's annual goal is for 600 jobs and $45 million, made up of 200 jobs and $15 million from new businesses and industries and 400 jobs and $30 million from existing businesses and industries. Venable also said NETWORKS had 34 active prospects and picked up a new one Wednesday. The 34 would generate more than 744 new jobs and more than $47.6 million in new investment. Venable said he hopes to announce by sometime next month the location of a corporate headquarters off Airport Parkway near the Magneti Marelli building or elsewhere in Sullivan County.