Trader Talk

Lehman, Goldman, Housing Start Numbers Better Than Expected

Good reports from Lehman and Goldman , and housing starts are above expectations. Core PPI up 0.5 percent is higher than the 0.3 percent expected, but that is being pushed aside in favor of the more bullish housing starts data.

Lehman up 13 percent pre-open, earnings of $0.81 vs. estimates of $0.72 (for the quarter ending in February). Cynics will note that this is more than 50 percent below the earnings for the same period last year. Despite all the worries about Lehman, Wachovia's comment to their clients this morning is noteworthy: "...if Lehman can survive, we believe it will by default gain material market share in mortgages now and especially in the future if the business turns."

Goldman Sachs up 6 percent, earnings of $3.23 vs. estimates of $2.58. NYSE Euronext approved a $1 b buyback and raised their dividend 20 percent, to $0.30 a share. Speaking of dividend yields, several banks are now paying double digit yields: Countrywide , 14.7 percent, National City , 11.1 percent, and Wachovia Bank , 10 percent.

Ford among the most actively traded stocks pre-open, up 3 percent, on reports that India-based Tata Motors will be signing a $3 b deal to buy Jaguar and Land Rover. This has been rumored for some time.

Yahoo is backing their earnings estimates for the quarter and the full year, up 4 percent.

Delta pilots say they can't reach a seniority deal with Northwest Airlines. Unlikely this will scuttle a deal, but Delta clearly want to avoid the problems that US Air had when it merged with America West (they're still arguing about pilot seniority--three years after the merger!).

Questions?  Comments?