Two varied factors led to the mixed opening of trading session on Wall Street yesterday. So, on the one hand, a proceeding oil rally put pressure upon key stock indexes.
Yesterday oil price in New York reached next record-breaking high level 72.49 dollars for barrel. And already today at tenders in Asia oil prices have hit a new maximum - June futures for oil WTI grew up to $73.50 for barrel then on a background of profit-taking some drop in oil quotations has begun.
Let's notice that as a whole the fundamental background does not exclude the further rise in oil prices. One of factors of growth was expectation of fuel deficit in the market of the USA, which were caused by prohibition to use methyl-tributyl gasoline additive, which should be replaced by ethanol, since May, 1st.
Besides the situation around the Iranian nuclear program has not yet settled. Thus yesterday minister of power of Iran declared that OPEC was glad with high oil prices.
Moreover, on the eve a leader of Venezuela Ugo Chaves declared that the price for barrel could reach $100.
But on the other hand, growth of investors’ optimism is promoted by positive corporate reports. So, profit of Altria Group Inc. increased in the first quarter of 2006 owing to, basically, tax privileges.
The profit of the company, which affiliated structures are Philip Morris USA, Philip Morris International and Kraft Foods Inc., grew up to $3.48 billion, or $1.65 per a share from $2.60 billion, or $1.26 per a share in the first quarter, 2005. Thus experts forecast profit’s rise up to $1.27 per a share.
American Altria Group is the world's largest manufacturer of cigarettes under such marks as, for example, Malboro. Foreign sales of the company have hiked owing to the markets of Indonesia and Colombia, growth of proceeds in these countries offset decline in the given parameter in Spain and Germany.
Besides director-general of the company Luis Kamijeri decided to rise in the price for Malboro cigarettes in the USA on 5 cents after the company increased its share in the tobacco market, having pressed competitor Reynolds American Inc.
On results of the first quarter net profit of the company of cargo and mail delivery United Parcel Service Inc. was up 10% owing to growth of parcels.
UPS got net profit at a rate of $975 million, or $0.89 per a share for the accounting period against $882 million, or $0.78 per a share a year earlier. Experts forecast net profit at a rate of $0.88 per a share.
UPS sales made $11.5 billion in the first quarter at the forecast of $11.127 billion, and the operational profit was up 12.3% up to $1.6 billion.
The world's largest gold miner - Newmont Mining Corp. informed that its net profit in the first quarter rose up to $209 million, or on 46 cents per a share against $84 million, or on 19 cents per a share in the first quarter 2005.
The proceeds in the first quarter raised up to $1.15 billion against $945 million a year earlier whereas analysts expected $1.22 billion. Profit on proceeding operations made $213 million, or on 48 cents per a share in comparison with $85 million, on 19 cents per a share in the same period of the last year.
And Bank of America Corp. net profit in 1 quarter went up to $4.99 billion from $4.39 billion in 1 quarter 2005.
As a result experts came to conclusion that the further growth of key stock indexes is restrained by high energy prices. So, the analyst Art Hogan from Jefferies and Co. notices: "If oil price were not such high, we would receive rally".
As a result Dow-Jones index of New York stock exchange was up 64.12 points and was closed at a level 11342.89. NASDAQ index fell 8.33 points and is at a level 2362.55. S&P 500 index was up 1.53 points and is at a level 1311.46.
And 30-year U.S. Treasury notes’ yield grew 0.008 in comparison with the previous closing and makes 5.137.
We recommend while to keep position outside of the market. For the next purchase of futures for stock indexes it is necessary to wait for realization of descending correction. The further rise of oil quotations can cause falling of quotations of stock indexes.
