Tag - Ipi

What looked like a sleepy, mild opening dip turned into an ugly downside press, with small-cap stocks pulled down this morning by sloppy corporate profit reports, declines in Asian equities and yet another weak tone on the commodities front. At 9:54 a.m. ET, the Russell 2000 (NYSE:IWM) was down 6.28, or 1.30%, at 476.00, slipping through intraday chart support along the 480 line.

Economic news overnight out of Europe was bleak, with eurozone industrial production coming below the forecast and the Bank of England projecting a sharp economic contraction next year. Despite the gloomy news, European shares weren’t taking a big hit, but they weren’t exactly charging higher either and for the most part turned lower ahead of the U.S. open. Asian stocks slipped about 1.4% overnight, including a 3.1% slide in India and a 1.4% slump in Japan.

There are no economic reports on tap today in the United States, but banks and government offices are back at work today after the Veteran’s Day holiday Tuesday, which could help volume levels. The international trade data Thursday morning could spark volatility in foreign exchange markets, but the big data event this week comes with Friday’s retail sales report. Treasury Secretary Henry Paulson will hold a media briefing this morning to discuss the $700 billion rescue plan, and comments from that press conference could move financial stocks and the market in general. The presser is slated for 10:30 a.m. ET.

Speaking of retail sales, the big drag on market psychology early today came from electronics giant Best Buy Co. Inc. (NYSE:BBY) which dramatically slashed the forecast for 2009, yet another numbing sign that companies are girding for a very difficult consumer spending environment not just now, but for several months to come. BBY shares were off 10% shortly after the open.

Other individual stocks taking a hit from soft earnings/outlooks this morning include Intrepid Potash Inc. (NYSE:IPI) as the fertilizer firm missed the estimate . . .

Small-cap stocks are expected to open slightly lower Wednesday, pressured by weak earnings results, lowered corporate outlooks and another pullback in Asian stocks overnight. Stock index futures were down about 0.6% ahead of the U.S. open, which suggests a Russell 2000 (NYSE:IWM) opening near 479.50.

Stock futures were hovering near steady levels, but took a turn lower when Best Buy Co. Inc. (NYSE:BBY) lowered its 2009 outlook dramatically. BBY shares were down some 12% in pre-market trading.

Soft themes popped up in on several earnings reports heading into the open, including a variety of businesses such as fertilizer company Intrepid Potash Inc. (NYSE:IPI), which missed the forecast; NBTY Inc. (NYSE:NTY) as the manufacturer of nutritional supplements also missed the forecast; and small-capper sausage and restaurant operator Bob Evans Farms Inc. (Nasdaq:BOBE) lowered its outlook and was off about 2.5% in pre-market trading.

Japan’s Nikkei was down 1.3% overnight, and an index of Asian stocks was off 1.4%; more severe declines were seen in India, which tumbled 3.1% and are down 9.5% . . .

www.amwater.com
(Nasdaq:AWK)
Scheduled for the week of April 21
$1.6 billion estimated proceeds
$4 billion estimated post-money valuation

Water is necessary for life. We can engineer around petroleum and probably will one of these days, but we will not be able to figure out a substitute for water. Someday, the Great Lakes region will be America’s Saudi Arabia.

Rather than buy Cleveland real estate right now, you could consider shares in American Water Works. It’s an old-line water utility that’s been around in one form or another since 1886. The company now serves customers in 32 states and one Canadian province. Right now, it’s 100% owned by RWE, a German water utility. RWE has been trying to lighten its American Water Works stake for a while and has been hampered by the lousy stock market. This offering is for 40% of RWE’s position, and the company says it would like to sell more of its stock in the future.

The deal might be a tough sell for those who can’t navigate financial statements. American Water Works has been losing money on a GAAP basis, reporting a loss of $342.8 million in 2007 on revenues of $2.2 billion. However, part of that loss came from $509.3 million in non-cash goodwill impairment charges. The company . . .