U.S. stocks closed mixed on Thursday ahead of Friday’s highly-anticipated jobs report for December, as investors look for clues as to whether the Federal Reserve will taper its bond-buying program sooner rather than later again.
The Dow Jones industrial average fell 17.98 points, or 0.11 percent, to close at 16,444.76. The S&P 500 Index edged up 0.64 of a point, or 0.03 percent, to end at 1,838.13. The Nasdaq Composite lost 9.42 points, or 0.23 percent, to finish at 4,156.19.
Alcoa Inc. (NYSE: AA) shares fell 3.65 percent to $10.30 in extended-hours trading on Thursday after the aluminum producer reported a fiscal fourth-quarter loss of $2.34 billion, or $2.19 a share, compared with a profit of $242 million, or 21 cents a share, a year ago.
Excluding items, Alcoa said it earned 4 cents a share, 2 cents below Wall Street expectations; however, revenue topped analysts’ estimates and fell 5 percent $5.6 billion, despite a 7 percent drop in realized aluminum prices year-over-year. Economists polled by Reuters had expected the aluminum giant to issue fiscal fourth-quarter earnings of 5 cents per share on revenue of $5.43 billion.
"We delivered strong operating performance in the fourth quarter, led by record downstream profitability, as our strategy to build-out the value-add businesses and lower the cost base in the commodity segment gains traction,” said Alcoa Chairman and Chief Executive Officer Klaus Kleinfeld. “In addition, we put a number of legacy matters behind us, clearing a path for Alcoa’s continued transformation in 2014.”
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For the fiscal 2013 year, Alcoa issued a net loss of $2.3 billion, or $2.14 per share, on revenue of $23 billion. Excluding items, net income for 2013 came in at $357 million, or 33 cents per share, up 36 percent from 2012.
“We started growing our value-add businesses and lowering the cost base of our commodity businesses at the height of the economic crisis,” Kleinfeld added. “Today, this transformation is paying off, with the value-add businesses driving 57 percent of our revenues and 80 percent of our segment profits.”
Alcoa also said the company ended the fourth-quarter with $1.4 billion cash on hand, up from $1.0 billion in the third quarter.
Ahead of the announcement on Thursday, the Securities and Exchange Commission announced Alcoa violated the Foreign Corrupt Practices Act (FCPA) when its subsidiaries repeatedly paid bribes to government officials in Bahrain to maintain a key source of business.
“As the beneficiary of a long-running bribery scheme perpetrated by a closely controlled subsidiary, Alcoa is liable and must be held responsible,” said George Canellos, co-director of the SEC Enforcement Division. “It is critical that companies assess their supply chains and determine that their business relationships have legitimate purposes.”
Alcoa and its subsidiary Alcoa World Alumina will pay a total of $384 million to settle civil and criminal charges. On Thursday, shares of the aluminum producer closed down 1.29 percent to $10.69 cents.
On the economic calendar for Friday, the U.S. Labor Department is scheduled to release its monthly nonfarm payrolls report for December, along with the U.S. unemployment rate. Economists polled by Reuters expect employers to add 195,000 jobs last month and for the unemployment rate to remain at 7 percent.