Local-based stock prices jump in first quarter

Local-based stock prices jump in first quarter

March 31st, 2012 by Mike Pare in Business Around the Region

LOCAL SHARES RISE IN FIRST QUARTER


Company, March 30 close and percent change from Dec. 30, 2011

• First Security, $3.39, up 44.2 percent

• Dixie Group, $3.99, up 35.7 percent

• CBL, $18.92, up 20.5 percent

• Unum, $24.48, up 16.1 percent

• Astec, $36.48, up 13.2 percent

• Mohawk, $66.51, up 11.1 percent

• Covenant, $3.20, up 7.7 percent

• Miller, $16.92, up 7.5 percent

• Dow, 13,212.04, up 8.1 percent

• S&P 500, 1,408.46, up 12 percent

Shares of Chattanooga area companies tracked rising broader markets in the first quarter with most local businesses posting hefty gains.

The Standard and Poor's 500 Index recorded its biggest first quarter advance, up 12 percent, since 1998. Nasdaq's gain, almost 19 percent, was its best to start the year since 1991.

Jim Campbell, managing partner of Campbell Asset Management in Chattanooga, said housing starts and retail activity were stronger in the quarter.

Campbell cited a pickup in the U.S. economy along with less attention on Europe's problems.

"We had great weather," he added. "That had a lot to do with it."

Chattanooga-based shopping center developer CBL & Associates Properties Inc.'s shares rose 20.5 percent in the quarter.

Government data showed U.S. consumer spending grew 0.8 percent in February, the most in seven months.

Meanwhile, Chattanooga-based carpet-maker Dixie Group reported a 35.7 percent hike in its shares in the quarter as housing starts picked up. Also, shares of Mohawk Industries, the Calhoun, Ga.-based floorcovering giant, climbed 11.1 percent.

Robert Nodes, the director of governmental affairs for the Greater Chattanooga Association of Realtors, said that home lending appears to be easing a little.

He said more people are talking about reforming rather than eliminating Fannie Mae and Freddie Mac.

Also Nodes said that interest rates continue to be historically low.

"I expect they'll go up, but as long as they don't get our of this world, they'll be lending there," he said.

First Security Group, parent of FSG Bank, recorded a 44.2 percent jump in its stock price in the quarter.

Going forward, Campbell expects the Fed to keep interest rates low. He also expects the Fed to buy longer-term treasuries again to meet its dual mandate to keep inflation tame and curb unemployment.

But, Campbell said the markets will see "an overhang" from Europe's problems and China's slowing economy.

"Non-U.S. focused companies will struggle," he said.