Stock News Briefs: Alcoa Earnings Rallies Stock; PepsiCo Beats 3Q Estimates; IBM Investigated For Antitrust

Alcoa Earnings Rallies Stock; Retailers Post Strong September; Initial Jobless Claims Hit 9-Month Low; ECB and BOE Leave Rates Unchanged; PepsiCo Beats 3Q Estimates; CEO: China Auto Market to Cool; U.S. Government Investigating IBM for Antitrust; Shell To Deploy Floating Gas Plant;

• Aluminum producer Alcoa Inc. (AA) reported its first quarterly profit in a year, prompting investment banks to raise the company’s target stock price. The company attributed its surprise profit to higher aluminum prices and cost cutting measures. Since the financial crisis began squeezing global demand, Alcoa cut its production by 20% and its workforce by 30%, Reuters reported.

• About four-fifths of U.S. retailers beat Wall Street expectations for September sales, helped largely by a late-school start and some signals of economic improvement, MarketWatch reported. “It clearly points to trends stabilizing,” KeyBanc retail analyst Ed Yruma told MarketWatch. “We are cautiously optimistic. Traffic has improved. Gross margin has improved. We’ve seen some underlying improvement in weakest areas including the West Coast. Promotions seem to have subsided year over year.”

• The number of new jobless insurance claims unexpectedly fell to a nine-month low last week, the Labor Department reported. Initial claims for state unemployment benefits dropped by 33,000 to a seasonally adjusted 521,000 in the week ended Oct. 3. “The labor market is improving, but rather slowly,” Cary Leahey, economist at Decision Economics in New York, told Reuters. “Both the initial and continuing claims numbers suggest that October ought to be a better month for payrolls than September.”

• The European Central Bank (ECB) left its primary interest rate 1.0%, a move mirrored by the Bank of England, which left its primary interest rate in place at 0.5%. ECB President Jean- Claude Trichet said interest rates are “appropriate,” and gave little indication of intent to raise it in the near future. “The outcome of the monetary analysis confirms the assessment of low inflationary pressure over the medium term,” Trichet told reporters, Bloomberg reported.

• PepsiCo, Inc. (PEP) posted a higher-than-expected third-quarter profit, with net income rising to $1.72 billion, or $1.09 per share, from $1.58 billion, or 99 cents per share, a year earlier, Reuters reported. The company applauded the increased sales volumes of snacks and beverages, and said it will continue expanding its food and beverage roster. “We expect these (investments) to ramp up next year as we begin to realize the benefits of the integration of our two anchor bottlers,” Chief Executive Indra Nooyi said in a statement.

• After expanding more than 40% in 2009, China’s auto market will cool off next year, says the chief executive of China Auto Logistics Inc. (CALI). This year’s growth has been a “one-time event” bolstered by the county’s economic recovery and government stimulus spending, Shiping Tong told Bloomberg. “That kind of growth isn’t very healthy,” Tong said. “I don’t expect it to grow at the same rate. A growth rate of 15% is healthy.”

• The U.S. Department of Justice has begun a preliminary antitrust investigation into whether tech giant IBM Corp. (IBM) abused its monopoly position over competitors around the world, sources told The New York Times. The investigation was triggered by complaints by the Computer and Communication Industry Association, which is backed by IBM competitors Microsoft Corp. (MSFT) and Oracle Corp. (ORCL), The Times reported.

• Royal Dutch Shell plc (RDS-A) said it plans to deploy the world’s first floating liquefied natural gas plant - vessel “much larger than an aircraft carrier,” Bloomberg reported. The vessel will be deployed to the Prelude and Concerto gas discoveries off the northwestern coast of Australia. Shell has a $31 billion budget for the project this year, and $28 billion in 2010.

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