Russell falls as Dow again rises
The Russell 2000 is in the red while the Dow is looking to yet another record close following news of mixed economic data and a lower-than-expected rise in construction spending. Among small caps, news of a restructuring plan is hurting shares of Delta Galil Industries Ltd. (Nasdaq: DELT), while strong quarterly results lifted Datawatch Corporation (Nasdaq: DWCH).
At 11:57 a.m. ET the Russell 2000 had lost 2.15 points, or 0.26 percent, to 827.55. The Dow Jones Industrial Average was up 11.70 points, or 0.09 percent, to 13,132.64. That’s above Friday’s record close of 13.120.94.
Clothing maker Delta Galil Industries Ltd. is downsizing, the Israeli company announced on Sunday. Delta plans to close some of its manufacturing facilities in Israel and Jordan, while expanding operations in Egypt. The restructuring plan, to take place over the course of the year, will cost between $10 million and $12 million and will include the dismissal of approximately 600 workers in Israel. Delta said the shakeup is in response to continued erosion of selling prices and increased competition. Shares are down $0.38, or 4.81%, to $7.52.
Shares of Chelmsford, Mass.-based Datawatch Corporation are gaining on news of an increase in revenue and net income. Revenues for the second quarter of fiscal 2007 ended March 31 were $6.15 million, a 14% increase compared with $5.4 million during the same period a year earlier, the maker of business computer software products said before the opening bell. The net income jumped 57% to $458,000 or $0.08 per share, compared with $291,000 or $0.05 per share a year ago. That’s above analysts’ estimated earnings of $0.02 per share. Datawatch stock is up $0.62, or 17.46%, to $4.17.
Carpet and rug manufacturer The Dixie Group, Inc. (Nasdaq: DXYN) reported before the start of trading that its first-quarter earnings declined due to a fall in carpet sales. The net income for the quarter ended March 31 was $237,000, or $0.02 per share, compared with net income of $926,000, or $0.07 per share, in the same period a year earlier, the Chattanooga, Tenn.-based company said. Wall Street was looking for earnings of $0.06 per share. The Dixie Group said that the decline is due to a 60% fall in orders from The Home Depot Inc. (NYSE: HD) while overall sales outperformed those of the carpet industry as a whole. Shares are down $0.73, or 5.70%, to $12.07.
Personal spending in the U.S. rose just 0.3% in March, the Labor Department said before the start of trading. That’s below expectations of an increase of 0.5%. Adjusting for price increases, consumer spending actually declined 0.2%, the worst performance in more than a year. Spending rose a revised 0.7% in February.
However, personal income in March climbed 0.7%, beating expectations of a rise of 0.6%.
Total annualized construction spending in March was $1.188 trillion, an increase of 0.2%, the Commerce Department said after the opening bell. Economists were looking for a rise of 0.3%.
