Bears pleased with Burger King breakdown, S & P 500 and Dow Jones Industrial look forward to autumn

Burger King quarterly profit fell to $ 49 million

In brief: Burger King recorded a decrease in profits. U.S. stock market remains in the red zone. Dow Jones declines. Bears rejoice.

Burger King, operator of fast food restaurant chain, reported a decrease in net profit for the fourth fiscal quarter to end June 30 from $ 58.9 million, or 44 cents per share, previous year to $ 49 million, or 36 cents per share. Coompany’s revenue for the period decreased by 1% to $ 623 million.

The negative dynamics of the indices results from decreasing sales in restaurants around the world. Yesterday’s trading session in the U.S. markets showed contradictory tendencies. In the first minutes of trading, S & P grew by+0.9% compared to the trading closing on Friday, but then, all of a sudden, closed by a decrease of -0.4% at around 1,067 points, staying near zero mark for most of the session, while sales resulmed only in the last half-hour of trading. The fact that a “gulf” occured in the last half-hour trading session is a fairly negative sign. As a rule, in the first and last half-hour big players come on stage, and it is their actions that allow making suggestions as to the future trend in the market. The optimistic start of trading in the U.S. was due to bidders’ positive reaction to emerging news on M & A major transactions. It should be reminded that last week PHP Billiton announced plans to acquire Potash Corp., while Dell and Hewlett-Packard were competing for takeover of 3PAR company. Later in the week, the market players looked back to the risk of an economic slowdown in the U.S. and to the possible second round of recession.

Alex Korneev
2010-08-24 15:11, Economics.

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