MARKET TALK: Online Brokers Need More Days Like These
04 Mar 15:01
Edited by Thomas Granahan
Of DOW JONES NEWSWIRES
(Call Us: 201 938-5299; All Times Eastern)
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3:01 (Dow Jones) It's starting to look like February may not have been a hot
month for online trading. Closely-held Datek Online Holdings says trading
activity at its Web-brokerage unit fell 9.9% from January and 21.6% from
February 2001. Gregory Smith, an analyst at J.P. Morgan H&Q, says the
sequential drop is "in line with our expectations for a 5%-10% drop in trades
across the industry." Other Web brokers are soon expected to announce their
February trading numbers. It "was clearly a slow month" for small-investor
activity, Smith says. "While the recent market performance thus far in March is
encouraging, we think some level of staying power will be necessary to attract
mainstream investors back into the market." (GFC)
2:54 (Dow Jones) With quality rallies from the DJIA and Dow Transports, on
the heels of the AMEX Market Value Index, Prudential's Ralph Acampora makes
this pronouncement: "I can now say that the bottom in September wasn't 'A'
bottom, but it was 'THE' bottom. That September low will not be retested
anytime soon." He says the breakout on the DJIA "gives us an easy upside target
of 11767." (TG)
2:47 (Dow Jones) S&P says a decision by the NYSE to review the listing of
Williams Communications Group's (WCG) shares has no impact on the company's
double-C-credit rating or status on the "negative watch" list. The listing is
under review because the shares have had an average closing price below $1 for
the last 30 days. The possibility of bankruptcy and decline in value of the
company are reflected in the current rating, S&P said. (JD)
2:38 (Dow Jones) Here's a perfect example of why investors shouldn't
necessarily take placeholders - the expected filing amounts on proposed IPOs -
seriously. Citigroup (C) has filed tosell 210 million shares of Travelers at
between $16 to $19 a share, giving the deal a value of $3.68 billion. Add to
that a concurrent $850 million debt offering, and you have a deal worth $4.53
billion. When Travelers first filed the IPO its placeholder was for a deal
worth up to $1 billion. Citigroup's Salomon, naturally, is leading the
Travelers IPO. (RJH)
2:31 (Dow Jones) Here's how US Bancorp Piper Jaffray sees the Oracle (ORCL)
situation: despite its revenue difficulties during the past several quarters,
the company has been much more stable on the bottom line as a result of
impressive cost management. But, as Piper has long cautioned, that can't last
forever, and it now appears Oracle has hit a wall on this front. Oracle will
now have to generate improved revenue growth to hit its margin and EPS targets.
The company's struggles are partly the result of a tough economy, but Piper
also notes Oracle continues to lose share to PeopleSoft (PSFT) and SAP, which
is a long-term worry. ORCL off 14% at $13.79. (TG)
2:15 (Dow Jones) Instead of receiving thanks for keeping the world out of a
deep recession, American consumers are seen as global spendthrifts. Merrill's
Bruce Steinberg points out that bears believe an inevitable payback lies ahead,
paving the way for a barely visible recovery or even a double-dip recession.
But, he says, the problem with that way of thinking is that there's little
evidence the U.S. consumer is stretched, along with plenty of evidence that the
U.S. savings rate is understated. (TG)
1:58 (Dow Jones) UBS Warburg ups price target on Mohawk (MHK) to $77 from
$72, and 1Q EPS view to 75c from 65c. Says continued strength in the housing
market and mild winter weather is contributing to better-than-expected sales
trends for residential floor coverings. Mohawk's acquisition of Dal-Tile is now
expected to close on March 20, which UBS says should contribute marginally to
Mohawk's 1Q earnings. MHK up 3% at $64.84. (TG)
1:46 (Dow Jones) U.S. Transportation Secretary Mineta Monday said the
Transportation Security Administration has begun the process of actively
recruiting more than 30,000 federal security personnel to perform airport
screening duties and other functions at U.S. commercial airports. (JCC)
1:22 (Dow Jones) Retailers report February sales on March 7. Prudential says
low inventory levels are likely to negatively impact comps for several
retailers, and says diversified names, like Abercrombie (ANF) and Gap (GPS),
should continue to perform poorly. Women's and off-price retailers should show
stronger performance, while across the industry, Pru still concerned about lack
of newness, and sees little this spring to generate much excitement. Continues
to recommend Ann Taylor (ANN), Intimate Brands (IBI), and Limited (LTD). (TG)
1:10 (Dow Jones) Ried, Thunberg and Co. economist Larry Greenberg isn't
worried about a dollar slide, but he argues that the U.S. currency doesn't need
to keep rising to show its strength. The market may realize this, and that
could be a reason USD hasn't surged in response to healthy economic data
recently. Another factor is lingering uneasiness - with post-Enron fallout, the
low U.S. savings rate, and the high current-account deficit, Greenberg says.
(JEN)
12:58 (Dow Jones) Friday's rating cut by Moody's provides no new insight into
earnings or cash flow prospects of Computer Associates (CA), SG Cowen notes,
saying both remain sound. Keeps strong buy rating, bases on stable earnings
prospects and low valuation. CA up 0.6% at $17. (TG)
12:43 (Dow Jones) SoundView encouraged to see optimism among top management
of Amkor (AMKR) at recent Investor Day. Keeps strong buy rating, seeing
improving fundamentals and clearer path for company's strategy and
implementation. Suggests investors accumulate the shares toward firm's 12-month
target of $30. SoundView believes chip unit volume has continued to go up, with
average selling prices stabilizing. Also says customerorders continue to
exceed forecasts. AMKR up 12% at $18.71. (TG)
12:29 (Dow Jones) The Bear Stearns High Yield Index returned 0.17% last week,
the first week of positive returns after four weeks of consecutive losses. The
year-to-date total return measured by the high-yield bond index improved to
-0.70%, according to Bear Stearns. (JD)
12:12 (Dow Jones) AT&T Wireless' (AWE) comments Friday about increasing
pricing pressure has spooked Goldman Sachs into downgrading the U.S. wireless
sector to market underweight. Specifically, Goldman lowers its ratings and
estimates on AT&T Wireless (AWE), Nextel Communications (NXTL), Nextel Partners
(NXTP) and Sprint PCS (PCS), all of which are down significantly, with NXTP off
the most, percentage-wise, down 9%. "Although short-term fundamentals remain
strong at NXTP, we are increasingly concerned about Nextel Partners' ability to
grow into its capital structure to pay down its large debt obligation." (GS)
12:03 (Dow Jones) Lehman looks for non-manufacturing ISM index to move higher
in February, like nearly every other purchasing managers index, rising to 51.5
from 49.6 in January. Employment index will probably stay below the 50
threshold for the 12th consecutive month. Thinks factory orders will be up 2.1%
in January. Manufacturing inventories likely to have fallen 0.3%.(MCG)
11:54 (Dow Jones) "We are likely to exit the Enron era with better disclosure
of management decisions and their marked-to-market cost, tighter reporting
timelines, greater investor and regulatory scrutiny of accounting reports, and
stricter guidance designed to encourage common sense accounting rather than a
simple adherence to a regulatory checklist," say Lehman Brothers analysts in
their "Washington Weekly" report. (JCC)
11:46 (Dow Jones) In tennis as in stocks, the follow-through is crucial, and
all eyes are on how stocks do Monday after Friday's rally. Bullish calls traded
actively during Friday's rally, and the CBOE's equity put/call ratio fell to
0.53, lower than any reading all February and the first time in 11 sessions
this ratio's 21-day moving average has moved lower, to 0.725, according to
Schaeffer's Investment Research. Monday morning, defensive puts started out
active as investors stayed cautious, but call trading is catching up as stock
gains add up. The CBOE's equity put/call ratio began to ease from near 0.70
early on to about 0.60 recently. (KT)
11:39 (Dow Jones) Deutsche Bank says bond investors are putting "Enronitis"
behind them, looking more to prospects for economic recovery and compelling
relative value opportunities. But, spread volatility remains and investors are
wary. Recommends investors take advantage of relatively wide spreads in Tyco
International (TYC) and Bank of America (BAC). (MCG)
(END) DOW JONES NEWS 03-04-02
03:01 PM |
