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Microsoft Struggling Microsoft Struggling

April 30, 2013 - Analysts at McAdams Wright Ragen have relegated Microsoft Corporation based on the company’s earning of the third quarter, which seems to have frozen on the same figures in the recent quarters. The analysts do not doubt the company’s growth, which they say is stable and they also believe that the products of Microsoft which are related to its cloud technology, are gaining significant recognition. But even then the recent quarterly reports of the company that Microsoft market for its PC is declining.

Microsoft’s financial report which was showed to the investors said that the company is managing its expenses better, which was also backed by the analysts at McAdams Wright Ragen.

Microsoft has also reduced its predictions for the current year 2013 and estimates revenue to fall from $80.3 billion to $ 78.6 billion and a drop in their earning per share from $3.07 to $ 2.90.

The analysts of McAdams Wright Ragen said this drop is the estimation is based on the a low hope that people will adopt Windows 8 tablet. Other reasons why Microsoft reduced its revenue estimates for Microsoft Server and Tools and Microsoft Business Division is because of the ongoing uncertain economic conditions said the McAdams analysts and to further add, this was also done keeping in mind the company’s transition en route for more multi year subscription revenues and licensing.

Despite the fact that the analysts at McAdams Wright Ragen have downgraded Microsoft Corporation, but they still have high hopes for its future and performance in the long term. Analysts kept their share price tag at $ 34 each and said that Microsoft Corporation should take steps to show its dominant worth in the mobile computing space, because that is on hype these days.

McAdam’s analysts are very confident that Microsoft will show significant progress in the coming future but what concerns them is the shift that the ecosystem would take to other platforms if it is not successful in establishing itself in the mobile space. The increasing demand of the new touch enabled devices may raise the demand of Windows 8 during the second half of this year according to them.

Analysts view Microsoft Corporation capable of providing exclusively hybrid cloud services which owes to its long and remarkable history in the enterprise sector.  Though they believe Microsoft Corporation will still have business in this area but Windows 8 ecosystem is still a strong concern. Shares of Microsoft Corporation have gone down to 72 % according to recent statistics.

Durable Orders Fall in U.S. by more than 5% Durable Orders Fall in U.S. by more than 5%

April 25, 2013 - Durable Goods orders for March in the U.S. dropped by 5.7%, the largest drop in the past seven months, which adds to evidence that U.S. manufacturing has cooled off during the latter part of the first quarter this year.

Lower prices in commodities and weak markets overseas, have slowed the demand for companies like Caterpillar, Inc, indicating a cooling of manufacturing the last month of the first quarter.

Durable goods orders, which are bookings for products meant to last a minimum of three years dropped following a revised gain of 4.3% for February.

The February gain was less than what had been originally estimated, reported the U.S. Commerce Department on Wednesday.

The category that is less volatile that excludes equipment for transportation dropped unexpectedly for the second straight month. Companies are feeling a pinch, with customers reining in their spending on inventories and equipment due to concerns that the federal budget cuts that took effect across the board in March and slower growth internationally will slow down the largest economy in the world.

However, gains in auto and housing are helping others and supporting even more expansion. Most stocks were up on Wednesday, which extended a rally in the S&P 500 for the fourth consecutive day, as companies from Apple to Boeing reported their earnings.

While the data about orders indicated a cooling of business investment during the first quarter following a climb of 11.8% based on an annualized rate in the final quarter of 2012, it is still a rising trend.

Overseas, the latest figures for early in the second quarter showed that Europe was not making much progress in emerging from its deep recession.

Sprint Loses Customers but Beats Expectations Sprint Loses Customers but Beats Expectations

April 24, 2013 - Sprint Nextel Corp, the third biggest wireless carrier in the U.S., reported a loss in the first quarter that was narrower than expected, even though the company saw more than 560,000 subscribers leave.

The loss for the first quarter reached 21 cents per share for the company based in Overland Park, Kansas. Analysts predicted that Sprint would lose 34 cents per share. Sales for the company increased by less than 1% from the same period a year ago to end at $8.79 billion compared to Wall Street analysts’ estimates of $8.74 billion.

Over the last 12 months, shares at Sprint have more than tripled as the business has found itself amidst a bidding war. SoftBank Corp, a Tokyo-based company agreed to pay Sprint $20 billion to have a 70% share, but earlier in April, Dish Network offered to pay $25.5 billion. Both of the deals have the goal of building Sprint into a company that can better challenge Verizon and AT&T.

The company forecasted its operating profit for 2013 at the high end of the range it had previously made of between $5.2 billion and $5.5 billion prior to amortization and depreciation.

Estimates had predicted Sprint would lose 512,000 customers. Sprint has continued to make improvements to its network, while offering a larger range of smartphones to catch its competitors. The average phone bill during the first quarter for Sprint’s contract customers was up from $61.47 during the fourth quarter of last year to $62.47.

Sprint also sold over 5 million smartphones during the quarter including more than 1.5 million iPhones from Apple, which was down from the 2.2 million it sold during the fourth quarter of 2012

Sprint narrowed its loss in the first quarter to $643 million from last year’s first quarter loss of $863 million.

Shares and Dollar Up as G20 Accepts Japan Stimulus Policy Shares and Dollar Up as G20 Accepts Japan Stimulus Policy

April 22, 2013 - On Monday, the dollar increased to nearly 100 Yen and stocks were up after it was announced the G20 had accepted the bold stimulus policies of Japan. That helped to offset the gloom from the outlook on global growth.

The G20 released a statement following two days of meetings that said it took into consideration the possible side effects that extended period of stimulus can produce but did not single out Japan. Some had feared the G20 would mention Japan directly.

However, the move gives acceptance to the third largest economy in the world that the re-inflation of their economy is one of the keys to global recovery.

The move by the G20 also removed any obstacles that were remaining for further weakness in the yen, setting the stage for the symbolic 100 yen to the dollar.

Both the dollar and euro were up against the yen, while the euro eased back slightly against the dollar.

Stock markets in Europe were up for the second consecutive session following increases in Asia and the rise in Wall Street on Friday. Stocks were helped by a spike in the blue chip index in Italy after the long awaited political stalemate moved closer to being resolved.

The FTSE MIB Milan Index was up 2% on hopes that Italy’s re-election of Giorgio Napolitano, as president will produce a new government within a few days ending months of political freeze.

Gold rebounded from the sharp selloff experienced last week, though investors’ sentiment remained uncertain following the biggest ever one-day loss in dollar terms that the precious metal has ever experienced. Spot gold was up over 2% to $1,427.20 per ounce, well over the low of two years of $1,321.35 that was touched during trading last week.

Profits up at GE despite Problems in Europe Profits up at GE despite Problems in Europe

April 19, 2013 - The largest industrial group in the U.S. by market capitalization, General Electric, reported a rise of 14% in profits for the first three months of 2013. That increase came even though results in its businesses in Europe were much worse than anticipated.

GE’s earnings per share were up 17% to 35 cents, which was in line with expectations by Wall Street analysts.

GE said that U.S. and emerging economies demand was in line with its expectations, but Europe continued to drop as the economic crisis in the region deepened. Revenue in the company’s industrial businesses fell 17%.

The CEO of GE, Jeff Immelt, said the water and power division of GE had suffered quite badly. He said more pressure was attributed to the water and power services in Europe. Because of that, Immelt said the company’s margins were negatively impacted.

Revenues from the water and power division fell by over 26% and GE’s profits in that sector dropped by 30%.

Overall, the group said its profits grew by 14% to $3.5 billion boosted in part from strong performances in aero-engines, which saw an increase of 9% to over $936 million and equipment for locomotives.

The company’s financial services sector, GE Capital, reported an increase of 9% in profits to $1.94 billion. That was helped by smaller tax charges and a profit of $690 million from real estate, up from just $56 million during the same three months in 2012.

The tax rate for the group fell to 12% from the rate of 17% during the same period a year ago. Immelt said the first half of 2013 would be a tough period for the water and power division partly because of the comparisons to last year when the demand for wind turbines from GE boomed in the United States, as developers placed orders prior to the a tax credit they feared would expire. That division, said Immelt, is expected to grow during the second six months of 2013.

Euro Falls but Gold Bounces Back Euro Falls but Gold Bounces Back

April 16, 2013 - On Tuesday, the Euro was down at the start of trading in Europe following economic sentiment that was downbeat from Germany. Stocks extended their declines and oil futures remained down despite the price of gold recovering.

Economic expectations from Germany deteriorated during April, falling for only the first time in the past five months, according to a survey compiled by ZEW.

After the results of the survey were revealed, the euro dropped to $1.302 versus the dollar, a low for today’s session. One analyst said the new survey highlights the fears investors have that the recovery in Germany will not last long.

Confirmation that consumer price inflation in the eurozone dropped to 1.7% a low of 31-months during March indicates that the Central bank in Europe has room to lower interest rates even more. Inflation in the UK remained steady at 2.8% between February and March, while Sterling and the Bund remained steady.

In Spain, the government’s funding costs fell sharply on Tuesday at an auction of its Treasury bills. The Treasury in Spain sold $6.63 billion of six and 12-month notes, which topped the target. At the same time, Greece sold nearly 2.14 billion in Treasury bills that were 13-weeks.

Gold jumped off its low of two years Tuesday having been hit hard over the past two trading session. Spot gold hit $1,382.60 per troy ounce up over $35 from Monday’s close. Since April 12, the precious metal lost close to 13% of its value.

Oil futures continued to struggle as Brent crude for June delivery was just below the $100 per barrel price.

Futures on the U.S. market were higher, which indicates a higher start to the day on Wall Street.

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