MARKET TALK: What's In A Name?
31 Jan 16:37
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
(Call Us: 201 938-5299; All Times Eastern)
MARKET TALK can be found using code N/DJMT
4:36 (Dow Jones) Maybe those folks who put together a Mirant Corp. (MIR)
promotional gewgaw last year knew more than they thought. When the former
Southern Energy decided to rechristen itself Mirant, it sent out one of those
"talking" cards that, upon being opened, announces that "Mirant (is) pronounced
like 'mirror,' with the emphasis on 'mir." Mirant's fortunes soared along with
those of other power companies last year, especially Enron (ENRNQ), but it now
trades at $10, from a 52-week high of $47.20, and the Atlanta-based firm is
facing tough questions about its own cash reserves. Besides being the proper
way to pronounce the first syllable of the company's name, some folks might
recall that "Mir" also happens to be the name of the Soviet-era space station
that had to be deorbited last year. (CCC/GC)
4:03 (Dow Jones) Stocks have spent the past two sessions in full recovery
mode. It doesn't hurt that the economic picture just keeps getting brighter.
That, and the growing belief that, hey, not every company is playing fast and
loose with their books. Unemployment rate huge tomorrow, Disney set for
tonight. DJIA gains 152 to 9915, Nasdaq Comp gains 19 to 1933, and S&P 500
closes up 16 to 1129 (preliminary). (TG)
3:48 (Dow Jones) The ability of buyers to stay interested after Wednesday's
strong run-up has some technicians talking about a rally that has more
near-term legs. Look for next resistance near 10200-10300 on DJIA, 2000 on
Nasdaq, and 1180 on S&P 500. Of course, payroll report may have something to
say about that Friday morning. (TG)
3:31 (Dow Jones) Firewall maker Check Point Software (CHKP), speaking at a
meeting with Wall Street analysts in New York Thursday, provided 2002 guidance
of between $1.26 to $1.45 on revenue of $530 million to $604 million. But, in a
clever move, it broke the range down into an unusual three-scenario outlook
based on weak, moderate and strong tech-spending projections. As a result, it
gets to keep a conservative view, while offering alternative upside views to
anxious investors who had punished its stock. The company also said it expects
revenue growth of 25% to 35%, assuming an economic recovery. Stock is at
$36.65, up 11.5% or $3.77. (RTR)
3:23 (Dow Jones) Online bookseller Barnesandnoble.com (BNBN) plans to report
its 4Q after the bell. The two analysts surveyed by First Call expect the
company to report a pro forma loss of 21c a share, at the low end of its own
guidance for a loss of 19c to 21c. No revenue consensus, but Barnesandnoble.com
itself has guided for $110 million to $135M. In the 4Q of 2000, the company had
$114M in revenue. Look to see how Barnesandnoble.com's revenue growth compares
with rival Amazon.com's (AMZN) 5% growth in book, music and video in the 4Q.
Barnesandnoble.com's stock was recently at $2.23, up 3%. (RS)
3:06 (Dow Jones) Nothing solid about these earnings. Solid-waste company
Republic Services (RSG) reported lower-than-expected 4Q earnings and lowered
'02 guidance, making investors nervous about the upcoming results and '02
earnings for other waste players such as Waste Management (WMI) and Allied
Waste (AW). Shares of all three companies are lower amid an overall market
rally. (CCW)
2:54 (Dow Jones) Earnings season is winding down, but it's not over yet. Walt
Disney (DIS) and FMC chime in after the bell, along with Computer Sciences
(CSC), Eastman Chemical (EMN), and Barnes&noble.com (BNBN), among others. Also
after the bell, AMD and United Microelectronics (UMC) are expected to announce
a deal regarding a joint venture or possible investment by AMD. (TG)
2:45 (Dow Jones) "The risk that policy reversal, should it prove to be needed
in the near term, would foster significant market unsettlement seemed limited
in light of widespread expectations" of the market for rate hikes later in the
year, the FOMC said in the minutes. (MSD)
2:26 (Dow Jones) Stocks have pretty much reversed Tuesday's big selloff,
posting solid gains again as evidence grows the economy has turned, or is darn
close. P&G's strong quarter puts that at top of DJIA, while Intel comes next
after upbeat analyst comments. Consumer electronics, nonferrous metals, and
aluminum are best-acting groups, but wireless, footwear and pollution control
act poorly. Big, big, big day for stocks Friday - employment report. DJIA up
another 90 at 9852, Nasdaq Comp edges up 12 to 1925, and S&P 500 higher by 8 to
1121. (TG)
2:11 (Dow Jones) The Fed's Dec. 11 rate cut was a "close call" according to
the just released minutes of that meeting. Hoenig dissented at that meeting.
The FOMC said future rate hikes wouldn't rattle the markets much. Hoenig, in
his second dissent of the year, called the then-2% fed funds rate "quite
stimulative." (MSD)
2:05 (Dow Jones) CVS has set the bar low for its 4Q, to be reported on Feb.
5, and Lehman says the firm should easily hit its view of 23c a share. Firm
continues to have little visibility into 2002, and key issues to be resolved
include shrink, service, and store execution. The competitive environment is
also expected to remain tight, and weakness has been seen in pharmacy comps.
Keeps buy rating, given attractive 2002 P/E of 16.3. Shares up 0.4% at $27.
(TG)
1:52 (Dow Jones) S&P reports that defaults hit record-highs in January - 41
issuers with combined $31.3B in rated bonds defaulted, "surpassing even the
largest peak in any preceding monthly period," writes S&P MD Diane Vazza. S&P
expects defaults to peak in the first half. (JNP)
1:27 (Dow Jones) Always one to watch, the next report on January capacity
utilization (Feb. 15) could be especially telling. Jack Schannep, of
TheDowTheory.com, says it's the best indicator to look at to find when a
recession is over. Four of the last five recessions ended the same month that
utilization bottoms (the other was a month late), and with December at 74.4%,
it has only been lower in two prior recessions. If January's reading is up,
then the recession ended in December, he believes. If it's down, then watch for
the mid-March report for February to know when the recession has ended. Either
way, he says the bull market is intact, and advises clients to stay fully
invested. (TG)
1:13 (Dow Jones) American International Group (AIG) recovered nicely Thursday
after its stock was hit hard by concerns about a relationship between one of
its units and PNC Financial Group (PNC). On Tuesday, PNC said it would have to
restate its 2Q and 3Q results after the Federal Reserve raised concerns about
its accounting treatment of three structured transactions. Keefe Bruyette &
Woods analyst Cliff Gallant upgraded AIG to buy from an outperform, citing the
recent stock decline as a buying opportunity since AIG said the transactions
won't have a "material" impact on its balance sheet. Shares of AIG recently
traded up $2.21, or 3.1%, at $73.50. (CUB)
1:05 (Dow Jones) Carolina Group's IPO after the close will be unusual for two
reasons. First, the company, which is the Lorillard tobacco tracking stock of
Loews (LTR), will be the first tracking stock since Alcatel Optronics came
public on Oct. 20, 2000. Second, it's a tobacco company. The last
tobacco-related IPO was back in May 1998, from Havana Group (HVGP), a cigar and
pipe retailer. (RJH)
12:58 (Dow Jones) Mortgage rates rose slightly this week but remained
affordable, Fredddie Mac says. Fixed-rate 30-year mortgages averaged 7.02%,
with 0.7 point, up from 6.96% last week. And 15-year mortgages averaged 6.51%,
with 0.7 point, up from 6.44% last week. (JSX)
12:40 (Dow Jones) The dollar is having a good day all around, with the yen
taking the biggest beating and Swissy falling in line with the sliding EUR. EUR
is $0.8591; USD/JPY is Y134.20; EUR/JPY is Y115.32. (JRH)
12:34 (Dow Jones) Publicly-traded hospital companies could report
higher-than-expected profits next year, depending how much Medicare
reimbursement rates rise in fiscal 2003. President Bush is expected to present
his fiscal 2003 federal budget proposal on Feb. 4. Sources cited by Merrill
Lynch analyst A.J. Rice said hospitals should be pleased, adding that the
proposal is not expected to include any effort to limit increases to the
Medicare inpatient reimbursement rate over the next few years. When the 2003
fiscal year begins on Oct. 1, it is possible that hospitals could receive as
much as a 3% increase in reimbursement rates. And since Rice's long-term
forecasts for investor-owned hospital chains call for a rate hike of 2%, a
better-than-expected reimbursement rate could lead to an upside earnings
surprise in 2003. (JJO)
12:21 (Dow Jones) The covered unemployment rate that measures the total
number of jobless receiving unemployment insurance benefits as a percentage of
all the workers covered by the program declined to 2.6% in the week ended Jan.
12 and stayed there in the following week. The Jan. 12 week was the survey week
for the January employment report and the rate was below the 2.9% level in the
December survey week and below the 3.1% peak recorded in the November survey
week. (JM)
12:09 (Dow Jone) Nymex heating oil bounces, lending support to rest of
complex, as ice storm plagues Midwest, and intense cold spreads in the northern
quarter of the Northeast and the deep South. Natural gas rise supportive, and
shortcovering and new buying cited. +94 pts to 51.85c/gal (MSX)
11:53 (Dow Jones) Utility Oklahoma Gas & Electric, an OGE Energy (OGE) unit,
has been hammered by a severe ice storm in the last 24 hours. About 185,000 of
its 700,000 customers are without power, and some could be off for a week. The
utility has also seen significant transmission damage, spokesman Brian Alford
says. "This is likely to be the worst storm in this company's history," he
says. OGE off 0.8% at $21.90. (JDK)
(END) DOW JONES NEWS 01-31-02
04:37 PM |
