MARKET TALK: Fed's Ferguson Quiet On Economy
08 Jan 12:49
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
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12:49 (Dow Jones) Fed's Ferguson skips commenting on the U.S. economy in his
speech, and weighs in on his disinterest in more transparency in Fed
activities. He also pours water on inflation targeting as a tenet of U.S.
monetary policy. (MSD)
12:42 (Dow Jones) Meredith (MDP) CFO Suku Radia reiterated Tuesday at a
Salomon Smith Barney Media Conference that the company expects earnings for the
2Q, ended Dec. 31, 2001, to be in the range of 13 cents-17 cents a share. Radia
says the company doesn't have enough visibility to comment on the full year due
to the current economic uncertainties. The CFO said a forward-looking
advertising update and guidance for fiscal 3Q will be provided on Jan. 29. (CC)
12:34 (Dow Jones) After months of waiting, there is some news regarding the
hordes of lawsuits by doctors against various health insurers now pending in a
Miami federal court. A panel of federal appeals court judges is slated to hear
oral arguments tomorrow from attorneys representing managed care companies
hoping to overturn a ruling that forces some doctors to arbitrate their
lawsuits against health insurers and allows others to proceed with their
litigation. The U.S. Court of Appeals in the 11th Circuit in Atlanta issued a
stay in June after some HMOs, including Humana (HUM), Pacificare Health (PHSY),
UnitedHealth Group (UNH), and Wellpoint Health (WLP), appealed Moreno's ruling.
A final decision is likely before May and could meaningfully effect the
provider track litigation, according to Morgan Stanley Dean Witter analyst
Christine Arnold. (JJO)
12:25 (Dow Jones) Enterprise Oil (ETP) is up 23% at $26.15, after the company
confirms it has received "unsolicited approach from a third party regarding
possible offer." One analyst in London says, "We don't have a clue who the
third party referred to by the company is and we're checking the market for
short sellers (of other stocks)." (TRF)
12:17 (Dow Jones) AOL Time Warner's (AOL) warning of lower-than-expected 2001
and 2002 results Monday came with a small surprise. The company said its
results would no longer include iPlanet, a software joint venture with Sun
Microsystems (SUNW) that arose from AOL's acquisition of Netscape back in 1999.
Apparently, it was a lucrative little operation: it contributed to AOL $400
million in revenue and $320 million in cash flow during 2001. One analyst
called the elimination of such numbers "rather disconcerting." (PDL)
12:03 (Dow Jones) Goldman Sachs (GS) priced 14.1 million shares of its own
common stock at $93 a share in a self-underwritten overnight block trade. The
shares were all sold by Sumitomo Mitsui Banking Corp. and the Kamehameha
Activities Association, which both filed to sell the shares last year. Shares
traded off 3% recently to $92.92. (RJH)
11:53 (Dow Jones) Creditors of Sun Country Airlines have filed an involuntary
Chapter 7 bankruptcy petition against the company. The creditors filed the
petition Tuesday with the U.S. Bankruptcy Court in Wilmington, Del. They allege
the Mendota Heights, Minn.-based low-fare carrier generally isn't paying its
debts. The airline had stopped scheduled flight service Dec. 8, 2001, according
to its Web Site. (DE)
11:41 (Dow Jones) Scotia Capital analyst Peter Misek raised his rating on
Hummingbird (HUMC) to buy from hold and increased his target to C$43 from C$32.
Misek cited channel checks, signs of pipeline improvements and the strong
growth posted by fellow software company Cognos (COGN) in December as the
reasons for his rising optimism. He described Hummingbird, a Toronto software
provide, as a "survivor" and said, at its current price levels, the stock
represents a compelling buying opportunity. Hummingbird is up 6% at $20.26.
(SEW)
11:33 (Dow Jones) Investors preparing for the earnings season might want to
keep this in mind: CSFB's quantitative analysis group studied the average
trading patterns of S&P 500 companies that warned in 2000 and 2001. Looking at
a sample of 1,004, they noted an average 4.8% decline upon announcement
compared to the respective sectors, although the companies recovered on average
about 2.1% two to 30 days after the warning. On the other hand, companies that
issued positive profit guidance (a smaller sample at 379) saw prices jump 2%
initially, before rising 3.7% two to 30 days after the news. (KT)
11:27 (Dow Jones) While the major averages are mixed, the bias in stocks
Tuesday is to the downside. Less than a quarter of the 86 Dow Jones industry
groups are moving higher, and none by more than 1.3%. On the downside, the coal
sector is off by better-than 12%, largely on a 19% pummeling of Massey Energy
(MEE), which offered a weak outlook and got cut at Merrill. Speaking of
Merrill, wireless is the second-worst performer, a group Merrill downgraded.
Heavy machinery, tires and metals round out bottom five. DJIA off 45 at 10152,
Nasdaq Comp up 11 to 2047, and S&P 500 eases 3 to 1161. (TG)
11:17 (Dow Jones) Merrill Lynch analyst Jay Cohen remains optimistic about
Ace Ltd. (ACE) despite the Bermuda reinsurer warning Tuesday that it will miss
4Q expectations due to a $80 million after-tax increase in losses in its
European commercial property business. Cohen says the higher level of property
losses is likely due in part to normal quarterly volatility of property claims
activity. "We do suspect that Ace - and others - will use the 4Q to address any
lingering reserve issues to ensure that these problems do not bleed into 2002
when earnings expectations are higher," Cohen said. (CUB)
11:05 (Dow Jones) Enron (ENE) bonds are being quoted at a dollar bid of 23
and an offering price of 24, says Harold Rivkin, H. Rivkin & Co., Princeton,
NJ. The bonds have traded up by a couple of points inthe last few days on
reports of bids for the company's trading operations, he adds. (MCG)
10:54 (Dow Jones) Charter Communications (CHTR) expects to spend roughly $2.4
billion during 2002 as the company continues its system rebuilds and upgrades
for customers to access to advanced service technology. Charter also said two
of its subsidiaries, Charter Communications Operating LLC and CC VIII Operating
LLC, amended their credit lines to provide for the deferral of principal
payments and the delay in the reduction of certain credit lines. In
consideration of the amendments, the interest rates on the credit lines were
increased and the companies paid a consent fee to lenders who agreed to the
amendments. (CC)
10:44 (Dow Jones) With a quote of 98.325, Feb. fed funds see a 30% chance of
a 25-basis-point cut by January FOMC meeting. That's down from about a 32%
chance which was priced in at Monday's close at 98.33%. Down the road, fed
funds see about a 25 basis point tightening by July. (CMN)
10:38 (Dow Jones) This year should bring stability for the optical components
group, says UBS Warburg's Joseph Wolf, as opposed to the dramatic decline in
fortunes of 2001. The analyst likes Agere Systems (AGRA) for its valuation and
integration and JDS Uniphase (JDSU) for its market leadership. Finisar (FNSR)
is expensive, Wolf said, but he likes the company's position in the datacom and
metro sides of the industry. (JDB)
10:31 (Dow Jones) Motorola (MOT) will use Cirrus Logic's (CRUS) 802.11b WLAN
chips in its Wireless Enhanced TV Viewer. Cowen says the financial contribution
to Cirrus is unclear now, but the deal does help validate the company's
technology. Shares up 2.4% at $14.35. (TG)
10:21 (Dow Jones) Sharper declines in manufacturing shipments reported in
Richmond Fed index, at -25 in Dec., from -15 in Nov. Services revenues,
however, rose, +7 in Dec. vs. -6 in Nov. Despite manufacturers' recent declines
in activity, most were more optimistic about their futureprospects, Richmond
Fed reports. (JNP)
10:11 (Dow Jones) Factory inventories declined a steep 0.9% in Nov. after a
0.7% decline in Oct. These sharp inventory declines represent a big drag on 4Q
GDP and likely will offset flat or slightly positive final sales to insure
another quarterly decline in real GDP. (JM)
(END) DOW JONES NEWS 01-08-02
12:49 PM |
