Q1 2009 Numbers Look Good; Some Hope for Housing Sector; British Business Group Sees End to UK Recession
by Anne Szustek
Upbeat news from the business world on April 21: Q1 numbers are on track to beat analyst projections; gypsum wallboard maker USG shows signs of rebound, suggesting recovery in the construction sector; a British business group says the UK economy has bottomed out.
Numbers for the first quarter of 2009 were largely better than Standard & Poor’s and Thomson Reuters analysts projected, with the financial sector leading the way. “It’s miles apart from the fourth quarter of last year,” Thomson Reuters Director of Research Ashwani Kaul told BusinessWeek. An analyst for the S&P index said that first-quarter numbers outpaced estimates by 15.9 percent. As of Tuesday morning, the S&P 500 was 22 percent higher than in early March after six weeks of gains.
Shares of Chicago-based USG Corp. closed nearly 26 percent up from Tuesday’s opening bell on the back of better-than-expected first-quarter results. The company, the United States’ largest manufacturer of gypsum wallboard, posted losses of $0.42 per diluted share, rather than $0.74 as projected. This shows nearly flat performance year-on-year, a positive factor considering conditions in the construction industry. Another encouraging point: USG’s shares generally rise and fall in direct relation to new construction. This, on top of improving numbers for new home sales, could be an indication of a turnaround in new home construction.
The United Kingdom’s Confederation of Business Industry said Monday that Britain has seen the worst of this recession, with a “slow and fragile” recovery expected by this time next year, reports The Times of London. The CBI, a nonprofit organization that serves as the main lobbying group for U.K. business interests, believes that the cheaper British pound, low inflation, government spending and monetary policy like central bank intervention should work together to bring about “quarter-on-quarter growth of 0.2 per cent in April to June 2010.”