MARKET TALK: No Bloodbath, But Not A Week To Remember
05 Apr 16:03
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
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4:03 (Dow Jones) Some tech trepidation in tech heading into the weekend,
while the 6.7% gain in 3M accounts for blue-chip advance. Tough week for major
averages, and volume remains soft. Trading range seems to be firmly in place,
with Middle East (and oil) and upcoming 1Q results the wildcards. Drugs may be
the last area of the great '90s' bull market to fail. DJIA adds 39 to 10274,
Nasdaq Comp off 20 to 1770, and S&P 500 falls 3 to 1122 (preliminary). (TG)
3:41 (Dow Jones) With currency trading restricted to established ranges, the
dollar was steady against the euro - but lost ground to the yen - Friday, as
market participants continued to limit trading activity, keeping their
attention focused on the ongoing developments in the Mideast. Major new U.S.
economic data had little impact on the market, with the March employment report
coming in close to expectations. EUR is $0.8787; USD/JPY is Y131.67; EUR/JPY is
Y115.73. (JRH)
3:24 (Dow Jones) Consumer credit expanded by $7.1 billion in February, not
much changed from the revised $7.08 billion increase in January (had been $12.8
billion increase). Auto sales continue to spur credit increases. (JM)
3:12 (Dow Jones) The fallout from Thursday's preannouncement of a 1Q loss at
Knight Trading Group (NITE) continues. Following other analysts' negative
comments on Knight, Salomon Smith Barney has downgraded its risk rating on the
stock to speculative from high risk reflecting the uncertainty surrounding the
trading company, while keeping its performance rating at neutral. Salomon's Guy
Moszkowski said questions include whether Knight can "effectively compete and
add value" in a changed trading environment. He said the "lack of a permanent
CEO is another risk issue." Knight has a "strong balance sheet," he says, but,
"We need greater clarity on (Knight's) strategy and how this strategy will
translate into dollars and reverse the deteriorating trend." Knight shares are
off 2%. (GFC)
2:58 (Dow Jones) Kmart (KM) has sought bankruptcy court approval of a new
pact with Chairman James B. Adamson, who was also named chief executive last
month. The discount retailer asked the court to approve Adamson's employment as
CEO under a new agreement. Adamson's compensation will essentially remain
unchanged under the new 25-month agreement, except that he can now participate
in Kmart's key employee retention plan. Adamson will be paid a $1 million
annual base salary, along with a $4 million success payment if the company
emerges from Chapter 11 by July 31, 2003. The success payment would decrease by
$7,299 each day until April 30, 2004, after which no success fee would be paid.
Adamson would also be eligible for an annual bonus equal to 125% of his base
salary under the company's key employee retention plan. The amount could
increase or decrease depending on the level of achievement of performance
goals. KM off 8% at $1.26. (DE)
2:34 (Dow Jones) Brean Murray says Jabil (JBL) has been true to its word in
becoming more acquisitive recently, but also says the company is not abandoning
its organic growth strategy. The company has targeted specific customers in
attractive end-markets that could ultimately result in strong organic growth,
Brean Murray says. Reiterates strong buy, $30 target. JBL off 2% at $22.47.
(TG)
2:15 (Dow Jones) A Dow Jones/CNBC survey of 21 out of 22 primary dealers
found that 11 expect some sort of rate hike to result from the June 25 and 26
FOMC meeting. Nine believe the Fed will move its overnight target rate from
1.75% to 2% in June, while two - Barclays Capital and Daiwa Securities - expect
a half percentage point jump, to 2.25%. The remaining 10 banks think that the
Fed will hold steady at the meeting. (MSD)
2:04 (Dow Jones)Arnhold technician John Roque still a fan of Archer Daniels
Midland (ADM). He notes the higher lows since September of 2000 and, except for
a period in August/September of 2001, the higher highs. The shares are
supported buy an upward sloping 200-day moving average. He also likes the fact
that virtually nobody is interested in the stock, which may change as the
shares begin to act better. His target is $18. ADM off 0.7% at $14.06. (TG)
1:53 (Dow Jones) Oil prices are tumbling Friday and dealers suggest this will
support the USD as it takes away a potential impediment to a U.S.-led worldwide
economic recovery. EUR is $0.8798; USD/JPY is Y131.72; EUR/JPY is Y115.91.
(JRH)
1:39 (Dow Jones) The 10-year yield was technical toast after it failed a test
of 5.471% resistance on Monday - the second failure at that level since March
15. Friday's move below 5.231% points the yield down to 5.056%, perhaps by the
last week of this month. The long-term implication is a move below 4.00%. First
things first, however. (SC)
1:19 (Dow Jones) SBC is the second-worst performer on the DJIA. It has
nothing to do with this, but, hey, it's Friday: The company just completed a
survey on the list of calls consumers would most like to block from their home
phones. Number one on the list? Hannibal Lecter from 'The Silence of the Lambs'
(note to respondents - that's a fictional character). Number two was the IRS
(note to respondents - that's definitely not a fictional character). Coming in
fifth place was 'the boss' (and we don't mean Springsteen). "Consumers are
annoyed by the prospect of an unwanted phone call whether it's from a fictional
killer, an IRS agent or simply an unknown caller," SBC says. We assume most
consumers also aren't crazy about answering survey questions about caller ID,
either. (TG)
1:04 (Dow Jones) Bristol-Myers Squibb (BMY) paid Chairman and Chief Executive
Peter Dolan a salary of $1.03 million and a bonus of $1.31 million during 2001.
Dolan became chief executive of the drug maker in May 2001 and was elected
chairman in September 2001. In his previous job as president of Bristol-Myers
during 2000, Dolan was paid a salary of $736,431 and a bonus of $609,948. The
document indicated that the company's 2000 executive bonuses were paid 50% with
stock options. Bristol-Myers former Chairman and CEO Charles Heimbold's salary
was $1.1 million and his bonus $2.6 million in 2001, the proxy said. In 2000,
Heimbold was paid $1.4 million in salary and $1.29 million in bonus, with 50%
of the bonus in options. (CS)
12:53 (Dow Jones) Beleaguered accounting concern Arthur Andersen may announce
layoffs as soon as Monday, people familiar with the matter said. The deepest
cuts are likely to be among the many hundreds of administrative employees that
support Andersen's worldwide network, most of whom are based in Chicago, they
said. Although the firm may soon shed as many as 7,000 of its 28,000 U.S.
employees, no firm decision has been made yet on layoffs. "Cuts will begin next
week," said one person familiar with the matter. "There's been lots of numbers
bandied about in the press, but there's no final number." (JAW)
12:38 (Dow Jones) Cost cutting and better than expected ramp up of the new
lotteries in Taiwan and Jamaica will help slot-machine maker and lottery-system
operator Gtech Holdings (GTK), said CIBC World Markets analyst William Schmitt.
He raised his 2003 earnings estimate on Gtech to $3.37 a share from $3.18, and
boosted his price target to $57 from $52. Shares of Gtech were up $1.63, or
3.2%, at $53.19 Friday. (DDO)
12:20 (Dow Jones) Nymex crude continues slide for a second straight session,
giving up some of the "war premium" built into prices amid Mideast turmoil. The
price drop follows President Bush's tough speech about Mideast Thursday and
decision to send Powell to region next week. "The market is putting a lot of
faith in the ability of the U.S. to make a difference" in ending the fighting,
one analyst says. Another analyst says that prices had increased by about $5 on
fears of an Arab-Israeli war and a U.S. attack on Iraq, and that oil prices
should be trading around $21.00/bbl, based on current supply-demand
fundamentals. While not as bearish in their assessment, other analysts
generally agree that prices will continue to head lower as war fears ease. May
crude breached psychological support at $26.00 to hit a low of $25.80. Now down
60c at $25.98. (MXF)
(END) DOW JONES NEWS 04-05-02
04:03 PM |
