Russell ekes out a gain
The Russell 2000 index and the Dow managed a tiny gain despite early losses following news of a fall in U.S. housing starts during May. The Russell 2000 added 2.06 points, or 0.24%, to finish at 848.34. The Dow Jones Industrial Average moved up 22.44 points, or 0.16%, to 13,635.42.
U.S. housing starts fell 2.1% in May to a seasonally adjusted annual rate of 1.474 million, the Commerce Department reported before the opening bell.
Economists were projecting a decline of 3.5% to an annualized rate of 1.474, following April’s rise of 1% to 1.506 million units. On a year-over year basis, housing starts are 24% lower compared with May of 2006.
The statistics suggest that the problems plaguing the housing sector, which has been hit by falling prices and foreclosures due to delinquent sub-prime borrowers, have not gone away.
Housing starts measure the number of residential units on which construction has begun.
Among specific small-cap companies:
Shares of NCI Inc. (Nasdaq: NCIT) ended the day in the winners’ column following news that the provider of IT services to the U.S. government has received a $2 million contract. According to the terms of the deal, NCI will deliver a web-based solution to enforce workflow requirements and integrate financial management functions at the U.S. Air Force, the Reston, Va.-based company announced after Monday’s close. Shares gained $0.57, or 4%, to close at $16.45.
Immersion Corp. (Nasdaq: IMMR), which makes touch screen technology, is being sued by Microsoft Corp. (Nasdaq: MSFT) for an alleged breach of a sublicense agreement. In 2003 Microsoft settled a lawsuit with the San Jose-based company over the rumble technology used in the Xbox game controllers. The software giant now claims that part of the agreement requires the Immersion pay a minimum of $15 million for any amounts received from a settlement of a different legal dispute with Japanese electronics maker Sony Corp. (NYSE: SNE). That litigation was concluded on March 1, and now Microsoft wants its payments. Immersion argues that it has no such obligations. Shares fell $0.37, or 3%, to end the day at $13.03.
Shares of Harbin Electric Inc. (Nasdaq: HRBN) added $1.01, or 7%, to $16.01, on news that the maker of electric motors will buy rival Harbin Taifu Auto Electric Co. Ltd. for $4 million. The acquisition will add about $4.5 million in sales and contribute roughly $1.3 million in net profit for the second half of fiscal 2007, the Chinese company said after Monday’s close. The deal should be finalized within the next three weeks.
