MARKET TALK: Dollar Spooked On Air India Reports
28 Feb 14:30
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
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2:29 (Dow Jones) The dollar lost some ground as cable television reports of a
suspicious person aboard an Air India flight to New York. EUR/USD rises to
daily high of $0.8687, and USD/CHF drops to 1.6984 francs. No impact on stocks.
(JEN/TG)
2:18 (Dow Jones) In response to concerns about Treasury price fluctuations in
the minutes preceding the official release time of its business index,
NAPM-Chicago denies that there was any premature release of the data.
Kingsberry, NAPM-Chicago's fax service, reports no early release in it's fax
records. Sharp movements lower in bond prices before that time raised eyebrows
among government bond traders. (SV)
2:03 (Dow Jones) Looks like it might be shaping up as another discouraging
day for the bulls. Blue chips still stronger, though way off highs, and techs
have turned south. Financials are actually trying to lend a hand, but semis and
airlines are not. Data simply point to recovery, but it seems Wall Street is
getting less and less impressed with that notion. Now, more signs of an
earnings recovery would be a different story. DJIA up 40 at 10167, Nasdaq Comp
off 10 at 1742, and S&P 500 edges up 3 to 1113. (TG)
1:54 (Dow Jones) Yet another version of economic stimulus legislation is
percolating in the U.S. Congress. House Republicans are looking at writing a
fourth stimulus plan that would extend unemployment benefits, provide federal
healthcare aid and include a bonus depreciation provision for businesses. House
Ways And Means Chairman Bill Thomas, R-Calif., called this "a little stimulus"
and has been discussing the matter with Republican leaders, but it isn't yet
clear if or how lawmakers may proceed. (MHA)
1:43 (Dow Jones) The Nasdaq Comp dropped 71.8% from March 10, 2000, to Sept.
21, 2001, during which time it saw seven rallies of 10% or more, which were
followed by new lows in price, qualifying them as bear-market rallies, notes
SSB's Louise Yamada. There were eight declines following these seven rallies,
ranging from -14% to -42%. The technician's research indicates the character of
the 71% drop has occurred only once in the past 100 years in the stock market.
The Sept. 3, 1929, to July 8, 1932, fall of 89% on the DJIA saw eight
bear-market rallies, followed by nine declines to lower lows. That period was
also similar in its bubble characteristic and in its deflationary environment,
she says. (TG)
1:26 (Dow Jones) With consumer confidence on the mend and favorable skiing
conditions, Vail Resorts (MTN) could finish its fiscal year with skier visits
near last year's levels, said Merrill Lynch analyst Hayle Kissel. The company
says skier visits dropped 6% in the fiscal 2Q. Vail's acquisitions should add
$7M-$9M in Ebitda in fiscal 2002, and lower labor costs - particularly salary
and hiring freezes - will cut out $4M in expenses. MTN up 0.6% at $18.51. (TG)
1:15 (Dow Jones) Fed Gov. Susan Schmidt Bies will deliver her first-ever
speech since joining the Fed at 1:30 p.m. EST Thursday, the Fed announced. This
will be one to watch, especially as it's on a particularly hot topic. The
official title of the speech: "Strengthening the Financial System Through Sound
Accounting And Disclosure." (DAL)
1:09 (Dow Jones) J.P. Morgan says Moody's and S&P's confirmation of Cendant's
(CD) solid investment-grade debt rating supports its view that the stock's
recent "guilt-by-association" selloff was overblown. But "Cendant is still a
high-risk stock in our view, and we expect this will continue to be reflected
in the multiple," says analyst Amanda Tepper, who repeated her buy rating but
"adjusted" her price target to $23 from $30. CD up 1.7% at $17.80. (CCW)
12:57 (Dow Jones) Canadian Imperial Bank of Commerce's (BCM) 1Q earnings of
88 Canadian cents a share beat the 60 cents BMO Nesbitt analyst Ian De Verteuil
had expected. He attributed about half of the upside surprise to help from the
bank's overall tax rate. Discounting this help, though, Verteuil said at first
glance the bank's results still seemed relatively strong, benefitting from good
capital market fees, solid trading revenue and the bank's cost controls. He
also suggested that the bank's healthy dividend increase is "probably a sign
that things look good for the year." A negative was the uptick in new impaired
loan formations at the bank. BCM up 2.9% to $32.46. (BED)
12:50 (Dow Jones) Merrill Lynch says with the upward revision to 4Q growth,
1Q GDP will now likely stand at 3.5%, and that 4Q productivity will be revised
from 3.5% to 4.0%. That 4% productivity rate will likely hold into the 1Q as
well, Merrill Lynch says. (MSD)
12:39 (Dow Jones) Even though Alliance Gaming's (ALLY) stock has been dancing
near its 52-week high, Goldman Sachs analyst Steven Kent says there is upside
potential in the shares. The strong pipeline of games to be introduced over the
next 12 months should drive the slot business. Alliance's new operating systems
also allow the slot machines to be more competitive with other manufacturers,
he said. (DDO)
12:30 (Dow Jones) It is time to "take back your recession call," ClearView
Economics' Ken Mayland says to the NBER in an open letter. He says whatever
slowdown occurred simply was of insufficient duration to meet the true
definition of recession. (MSD)
12:19 (Dow Jones) The dollar's gains on the morning's strong data have
dissipated, and euro and Swiss franc are back at their daily highs versus the
dollar even as the Dow heads up. What's going on? The market hasn't forgotten
the Greenspan factor, says Erste Bank's Joe Francomano. "The market had built
up a long dollar position expecting a rosy scenario" which the Fed chairman
simply didn't deliver, he says. That's overshadowing data for now and causing
traders tosquare up positions. EUR/USD at $0.8972. USD/JPY at Y133.95. (JEN)
12:05 (Dow Jones) If you've finished off that latest John Grisham tome and
are looking for something new to read, here's a hot tip: the National Bureau of
Economic Research website just published a new working paper with the title
"The Effects of Website Provision on the Demand for German Women's Magazines."
Happy reading. (MSD)
11:50 (Dow Jones) Philip Morris (MO) Chairman and Chief Executive Geoffrey
Bible realized $44.3 million in profits from the exercise of stock options in
2001. Bible earned a salary of $1.9 million and a bonus of $3.3 million in the
year ended Dec. 31, compared with a salary of $1.8 million and a bonus of $3
million the previous year. Bible also was granted 1.8 million stock options in
2001, compared with 1.4 million options the previous year. The newly granted
options have exercise prices ranging from $47.765 to $51.20 a share and expire
between June 25, 2004, and Jan. 31, 2011. MO up 0.4% at $52.48. (RG)
11:32 (Dow Jones) Cue the Rod Serling voiceover: SVT Inc. (SVTV) dumped Ernst
& Young as its auditor and hired...Arthur Andersen. SVT, which was formed
through a recent merger and is involved in software development in India and
the U.S., said Ernst & Young's opinions on the predecessor firm didn't include
any adverse opinions or disagreements. SVT shares were recently changing hands
at $5. (CRW)
11:25 (Dow Jones) Merrill Lynch analyst Jay Cohen says investors shouldn't be
concerned by a brewing dispute between Chubb (CB) and one of its surety bond
customers, UtiliCorp United (UCU). Chubb has asked UtiliCorp to provide
collateral for $570 million in surety bonds. "While we see this as a large
amount, we do not know what the exposure is net of reinsurance," Cohen says.
"In addition, the company noted that this amount far exceeds the combined
amount of all other similar surety bonds for which Chubb has requested
collateral. In other words, it appears to be an exception." Cohen said the
company is not challenging the validity the underlying contracts and it should
be a nonissue for the stock. CB off 0.4% at $75, UCU flat at $21.93. (CUB)
11:09 (Dow Jones) "If the U.S. story plays out according to the expectations
of the FOMC, 2002 will be a very dull and quiet year for monetary policy," says
SSB's Robert DiClemente. (JCC)
(END) DOW JONES NEWS 02-28-02
02:30 PM |
