MARKET TALK: Biggest E-Mail Virus Of Year On The Loose
14 Mar 12:56
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
12:55 (Dow Jones) A new e-mail virus, likely originating in Japan, ripped
through Asia overnight and then hit the United Kingdom and the United States as
new business days began Thursday. Dubbed "Fbound.C" by anti-virus companies,
the virus is responsible for the biggest outbreak so far this year. Fbound.C
causes no damage other than clogging up e-mail servers. It spreads by mailing
itself out to everyone in a victim's Outlook e-mail address book if he clicks
on its attachment, patch.exe. The infected message carries a subject line with
one of a number of randomly generated Japanese phrases but, occasionally, reads
"important" in English. No text appears in the body of the message. (RR)
12:44 (Dow Jones) The rate gap between a 30-year mortgage and a one-year ARM
has increased two full points, the widest level in a year, Freddie Mac said.
That means more homeowners may pay more attention to a one-year ARM, now that
30-year mortgage rates have jumped To 7.08%, with 0.7 point, for the week
ending March 15 from 6.87% a week ago. (JSX)
12:35 (Dow Jones) While Albertson's (ABS) posted 4Q earnings Wednesday that
beat Wall Street's expectations by 4c, UBS Warburg's Neil Currie is downgrading
the grocery chain's shares to reduce from hold. At a time when food retailing
is more competitive than ever, Albertson's appears more focused on cutting
costs than growing sales, Currie says, noting that 4Q sales were weaker than
expected. In contrast to comments at its last investor conference, which
stressed the reinvestment of cost savings towards improving the top line, "at
this time we believe the company is more committed to protecting its margins
and pursuing a 'profitable' sales growth strategy," Currie says. He'll seek
clarification at thecompany's analyst conference next week. ABS off 0.4% at
$31.58. (JMC)
12:18 (Dow Jones) The House Ways and Means Committee approves a
pension-reform bill on a bipartisan 36-2 vote. The measure gives employees the
ability to sell 401(k) matching contributions made in employer stock after
three years. (JCD)
11:57 (Dow Jones) While a dichotomy exists between improving economic
statistics and the view of major corporate chieftains, Banc of America Capital
Management's chief economist says the upticking economy should lift S&P 500
operating earnings by 10% this year, in contrast to last year's 18% plunge.
Lynn Reaser says sector strategy in stocks should favor industries and
company's most sensitive to economic recovery, although investors need to be
watchful given the current price levels for many of these names. (TG)
11:47 (Dow Jones) USD now showing some vitality, squeezing EUR and pushing up
on yen. EUR is $0.8820; USD/JPY is Y128.90; EUR/JPY is Y113.75. (JRH)
11:37 (Dow Jones) Stocks looking half decent at midday, shrugging off some
mild early weakness. A bevy of economic readings didn't do much to sway stocks,
which took a well-deserved break (blue chips, at least) Wednesday. A pretty
bland group of sectors is leading the way Thursday - forest products, heavy
machinery, mining, restaurants, and paper products look the best - while the
broad technology arena is showing a glimpse of life. The technicians who
haven't already turned over to a bullish stance are getting close. DJIA up 38
at 10540, Nasdaq Comp adds 6 to 1867, and S&P 500 higher by 2 to 1155. (TG)
11:21 (Dow Jones) Plenty of businesses that have fallen on hard times - from
tech companies to airlines - stand to gain substantial tax refunds under new
tax legislation that allows companies to "carry back" losses five years instead
of two, tax and accounting experts say. Congress's Joint Committee on Taxation
estimates that the carry-back provision will cost roughly $8 billion this year
and afurther $7 billion next year. Robert Willens, accounting expert with
Lehman Brothers says, however, that those projections "seem to be understated,"
adding that the estimates "are sometimes widely off base." Lucent, alone, for
example, could collect far in excess of $200 million under the new law. (JAW)
11:08 (Dow Jones) IRS says people who need more time to complete their tax
forms "will find it easy to extend their filing deadline--they don't need an
excuse or even a stamp. Automatic four-month extensions are available by phone
(1-888-796-1074) or by computer, as well as through paper Form 4868." IRS
expects to receive more than 8.2 million extension requests. (JCC)
10:59 (Dow Jones) Simply put, it's not pretty in government bond land.
There's the corporate supply. And then there's the uncertainty over the Fed
that leads participants to conclude that while two-year notes are probably
cheap, it's not worth defending them at their current levels. The two-year
price is down 4/32, yield 3.52%. 10-year off 23/32, yielding 5.36%. (MSD)
10:54 (Dow Jones) What is it exactly? It's Wachovia's (WB), the bank created
by the merger of First Union and the old Wachovia last year, new insignia. It's
a bit more understated than other banks' emblems, like the ubiquitous little
red umbrella. It's simply a navy-ish box with a few flowing intertwining wavy
lines inside of it (they're green outlined in white) - and if you tilt your
head to the side, the lines look like interlocking W's on their side.
"Wachovia" is spelled out in all blue caps, beneath the box. Ken Thompson,
Wachovia's CEO, said they symbolize the intertwining of two companies -
Wachovia's color was blue and First Union's green - customers, employees,
capital and ideas. (TAS)
10:36 (Dow Jones) Pru says the tone from Atmel (ATML) management is becoming
increasingly bullish, with the company indicating a high level of confidence in
its ability to hit mid-single-digit growth in 2Q. Prudential doesn't see upside
in current quarter, but unit demand is healthy and demand from the consumer and
PC peripheral end markets seems to be quite good. Sees Atmel as relatively
inexpensive cycle play, keeping buy rating and $12 target. Shares up 5% at
$8.83. (TG)
10:24 (Dow Jones) A little-publicized tax break signed into law over the
weekend by President Bush could end up paying once high-flying companies - and
costing tax payers - billions. The temporary provision extends the period
during which businesses can "carry back" their net operating losses to five
years from two years previously. That means companies can take losses posted in
2001 and 2002 to win big cash refunds against some of the taxes they paid on
profits during the late 1990s boom. Lucent (LU), among the first companies to
take advantage of the new rule, says the new legislation "will generate a
significant cash benefit." CFO Frank D'Amelio says the cash benefit will be
"significantly better" than the unanticipated 6c-a-share charge the company
will take in the 2Q, which equates to about $204 million. "It could be several
hundred million dollars easily," says Robert Willens, an accounting expert at
Lehman Brothers. (JAW)
10:15 (Dow Jones) Charles Schwab (SCH) CFO Christopher Dodds says it would be
"difficult to envision a scenario" where the online and discount brokerage
firm's 1Q operating earnings beat the 4Q's operating earnings of 8 cents a
share. Street view was 10c. Results are likely to be hurt by a slump in
February trading volume and Schwab's expectations of paying bonuses to its
staffers. On a brighter note, Dodds says March has been a "pretty good month
for us" in trading activity so far. Schwab shares are off 3.7%. (GFC)
10:06 (Dow Jones) Morgan Stanley cuts Masco (MAS) on valuation, saying
there's $2-$3 of upside potential and $6 of downside risk. Higher rates could
pressure the shares, given that stock price is inversely correlated with rates.
Firm raised 2002 EPS view on strong sales trends, but believes much of the
positive news is in the price. MAS off 1.7% at $28.10. (TG)
(END) DOW JONES NEWS 03-14-02
12:56 PM |
