Oracle Tops Estimates

Oracle topped estimates by a penny on Thursday, but investors will have to wait until Monday to see what the market thinks of the results.

U.S. stock exchanges will be closed again on Friday, extending the longest NYSE close since the Great Depression. But market officials said they will test the exchanges on Saturday and resume trading Monday morning at 9:30 a.m. Eastern Time.

Oracle earned 9 cents a share in the quarter ending August 31, a penny better than estimates and much better than the miss some analysts had feared. Revenues of $2.24 billion were slightly below estimates and last year’s revenues of $2.26 billion, but license revenues of $731 million were slightly better than the company’s lowered guidance from a month ago.

Oracle did not provide forward guidance, and said it would hold a conference call when the market reopens. The company also reported that seven of its employees in the World Trade Center are missing, and another employee was on Flight 93, which crashed in Pittsburgh.

Also on Thursday, troubled [email protected] raised $35 million by selling to American Greetings. Excite paid more than $400 million in cash and stock for the company less than two years ago.

The day also had some economic news; unfortunately, it continued the recent string of bad news. Jobless claims jumped much more than expected, and the Michigan consumer sentiment survey – taken before Tuesday’s massive terrorist attack on the World Trade Center and the Pentagon – came in well below estimates to its lowest level since 1993, and all aspects of the report showed weakness. The future expectations reading came in at 77.2, a level that in the past has been associated with recession. It will be two weeks before investors get their first sense of the effect of Tuesday’s disaster on consumer sentiment; many economists expect consumer confidence to worsen because of the disaster.

U.S. bond and commodity markets reopened on Thursday. U.S. treasuries rallied strongly, as investors priced in at least a half-point rate cut by the Federal Reserve. The Fed followed up on yesterday’s massive $38 billion liquidity injection with an even bigger $70 billion today in an attempt to buoy the markets.

U.S. Treasury Secretary Paul O’Neill told reporters that the Treasury Department was working to minimize disruption to the financial system. He said he expected some short-term problems, particularly with transportation and supply issues, but he added that “prospects for a rebound remain unchanged.”

“We have every reason to maintain our confidence in the U.S. economy,” O’Neill said. “… If anything, this evil act strengthens our resolve.”

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