MARKET TALK: Allied Irish Has More Explaining To Do
07 Feb 12:52
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
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MARKET TALK can be found using code N/DJMT
12:51 (Dow Jones) Allied Irish Banks (AIB) will continue to pay a penalty in
the markets until management exactly quantifies its losses, says Steve Hussey,
vice president, fixed income, Allied Capital, London. The bank will also have
to "assuage investor concerns about its risk management and internal controls,"
he added. Investors will be looking to the company's earnings reports and the
outcome of an S&P review of the bank, which is expected to take about a month.
S&P has placed the bank's single-A-plus rating on CreditWatch Negative, while
Moody's Investors Service and Fitch Ratings have affirmed the bank's ratings of
Aa3 and double-A-minus, respectively. AIB shares up 4% to $20.58 after steep
selloff Wednesday. (MCG)
12:40 (Dow Jones) Aflac (AFL) decided not to make a splash at the Super Bowl
with its latest commercial featuring the infamous Aflac duck, instead opting
for a more diverse audience Friday at the opening ceremony of the Winter
Olympics. Dan Amos, chairman and chief executive, said the insurer hasn't
advertised on professional football telecasts for several years after a change
in broadcast contracts eliminated in-game trivia questions - a feature Aflac
sponsors on college football and baseball telecasts. Amos expects the latest
commercial to be a hit - it posted the highest score of any of the commercials,
so far, in consumer testing. The concept: the Aflac duck and a group of school
children visit the museum. (CUB)
12:28 (Dow Jones) Even if Thursday's rally in stocks holds up for the entire
session, "yesterday's poor market performance betrays an underlying weakness
which is likely to severely limit the potential of any near-term rally
attempts," says Halliard Lyons technician Dick Dickson. Meanwhile, gold stocks
sold off on heavy volume Wednesday, calling into question their recent
breakout. None has yet violated key support levels, so if volume dries up on a
further test, the breakouts may still be validated. (TG)
12:16 (Dow Jones) Mexican stocks are soaring after S&P raised the country's
foreign credit rating to investment grade. Investors have been waiting two
years for S&P to join competitor Moody's in its assessment. Mexico's key IPC
index is up 1.9%. (ADG)
12:07 (Dow Jones) ManTech International (MANT) is up after its IPO, a jump
analysts say should be expected for a defense contractor in a time of war.
"Defense companies fare better in a climate such as this as opposed to when
people are singing 'Where Have All The Flowers Gone,"' says John Fitzgibbon
Jr., an analyst with IPODesktop. (RJH)
11:51 (Dow Jones) PIMCO is not actually predicting any rate hikes by the Fed
at any point in the next six months. A research piece by Bill Gross simply says
that by keeping fed funds low, it is impairing longer dated rates' ability to
fall, and hurting recovery prospects. (MSD)
11:37 (Dow Jones) Digene (DIGE) better by 4.3%. Goldman calls reported 2Q
results solid, with sales momentum continuing in HPV tests. Gross margins much
stronger than Goldman expected in quarter, and valuation still attractive.
Goldman also says several milestones should help the shares in near-term,
including a potential FDA panel review of the DNA-Pap for primary cervical
cancer screening. Keeps outperform rating. Shares up 91c at $22.47. (TG)
11:24 (Dow Jones) Health care deals aren't in favor among IPO investors this
year. First Alliance Medical postponed its deal, which was to be the first of
the year. Then, last week, drug maker Zymogenetics (ZGEN) priced its deal low
and now trades 23% below its offering price in just four trading days. Now,
another drug company, NeoGenesis, has cut price terms on its deal, expected
after the close. Instead of selling its 6.2 million shares at between $12 and
$14, talk is now $9 to $10. (RJH)
11:12 (Dow Jones) BB&T (BBT) expects to post net income of $1.3 billion, or
$2.82 a diluted share, for 2002 and capital expenditures of $255 million during
the year. BB&T earned $1.1 billion in 2001, or $2.40 a share. BB&T said it
expects to spend $157 million of the anticipated $255 million in capital
expenditures on facilities, $64 million on furniture and $34 million on
software. Shares up 2.5% at $35.33. (DH)
11:01 (Dow Jones) Unsecured creditors to bankrupt Global Crossing (GBLXQ)
could recover 9% of face value in a best case scenario and 2% in a worst case
scenario, according to DebtTraders, an independent research firm. DebtTraders
analysts have a "sell" rating on the bonds, which closed last night at around 4
cents on the dollar. (JD)
10:52 (Dow Jones) Techs have been consistently, and mildly, weak Thursday,
while the Dow is on a seesaw. Cisco is weighing on overall tech sector, and IBM
is at bottom of DJIA. Financials are looking a little better - always a plus -
and wireless is getting a rare bounce. Wall Street anxious to hear what Enron
officials have to say, but the pods seem more anxious to hear themselves talk.
The Street will also be looking to see what the close brings - it hasn't been
pretty all week. DJIA up 33 at 9686, Nasdaq off 13 to 1799, and S&P 500 flat at
1083. (TG)
10:42 (Dow Jones) Hewlett-Packard (HWP) has scheduled for Thursday a second
meeting with company retirees to seek support for the company's merger with
Compaq Computer (CPQ). "We realize that there is still some concern about H-P's
ability to complete the merger successfully, and we appreciate your willingness
to hear our position and to challenge us with your questions," H-P CEO Carly
Fiorina wrote in a letter to H-P and Agilent retirees. "Your feedback has been
valuable in organizing a second meeting..." Agilent was spun off from
Hewlett-Packard in 1999. Hewlett-Packard held a meeting with about 300 retirees
Jan. 7. About two-thirds of those attending filled out a survey after the
meeting, and 70% of those said they were "somewhat" or "very" supportive of the
merger, according to company statements. H-P up 1.1% at $21.10. (BS)
10:32 (Dow Jones) Banc of America Securities analyst Leonard Yaffe cut his
rating on Pharmacia (PHA) to market performer from strong buy, citing slowing
growth of the drug maker's key medicines. "The key drugs in the aggregate grew
30% in the first quarter of 2001, exited 2001 growing 19%, and we anticipate
the key products to exit 2002 at a 12% pace," says Yaffe. Shares off 3% at
$36.80. (BMM)
10:20 (Dow Jones) NBTY received a partial settlement of $5.47 million from
some defendants in a vitamin price fixing litigation. NBTY received the
settlement in January from some defendants, which it didn't identify, and said
it is currently holding negotiations with other defendants. NBTY previously has
said it is a plaintiff in vitamin antitrust litigation brought in a U.S.
District Court in Washington, D.C., against F. Hoffman-LaRoche Ltd. (Z.ROC) and
others for price fixing. Some of the defendants have pleaded guilty in criminal
cases arising from the price fixing. Shares off 1.9% at $14.38. (CS)
10:15 (Dow Jones) Words of wisdom may be waiting. Investors interested in how
the ad environment is shaping up for 2002 may do well to tune in to Gannett
Co.'s (GCI) 11 a.m. conference call. Gannett boss Doug McCorkindale typically
delivers a blunt assessment of the economy, and has many pieces of information
at his disposal. As the nation's biggest newspaper publisher, Gannett can talk
reliably about ad spending from retailers, auto makers, and other sectors.
What's more, Gannett's tracking of classifieds might tell you something about
the job market. Company did not offer any earnings guidance in its 4Q earnings
report, but perhaps something more might emerge on the call. (BS)
10:07 (Dow Jones) The Dow Jones-Bank of Tokyo-Mitsubishi business barometer
roseby 0.5% in the week ended Jan. 26 on both a one-week and smoothed basis.
This was the fifth straight week of increase in the smoothed barometer, which
is an indicator of coincident economic activity and a strong sign that the
economy is recovering. (JM)
10:03 (Dow Jones) American Express (AXP) said its businesses are better
equipped to weather economic and market swings -- but analysts maintain their
"show-me" stance on the stock. Analysts Moshe Orenbuch at CSFB and Brad Ball at
Pru maintained their hold ratings on the shares after AmEx's semi-annual
analyst meeting late Wednesday. Orenbuch believes the company lost ground to
its peers last year, while Ball said "its ability to sustain or improve its
operating margin and grow revenues with a lower risk profile remains in
question." Shares off 1.4% at $33.30. (TAS)
(END) DOW JONES NEWS 02-07-02
12:52 PM |
