<font color=blue>MARKET SNAPSHOT---Solid, but quiet opening for markets
By Rex Nutting, CBS.MarketWatch.com
Last Update: 10:36 AM ET Aug 28, 2000 NewsWatch
Latest headlines
NEW YORK (CBS.MW) - In a broad-based rally on Wall Street, U.S. stocks opened modestly higher Monday.
The Dow Jones Industrial Average ($INDU: news, msgs) gained 53 points or 0.5 percent to 11,246. Advancers led decliners by 6 to 5. The Nasdaq Composite ($COMPQ: news, msgs) added 15 points or 0.4 percent to 4,057. Advancers led decliners 8 to 7. The S&P 500 index ($SPX: news, msgs) increased 6.10 points to 0.4 percent to 1,510.
Takeover targets were among the early gainers. GetThere (GTHR: news, msgs) added 5 3/16 to 17 3/8 on news that Sabre Group would offer $757 million for the company. Sabre Group (TSP: news, msgs) fell 3/4 to 29.
MMC Networks (MMCN: news, msgs) added 25 3/4 to 104 after Applied Micro Circuits (AMCC: news, msgs) said it would offer $4.5 billion in stock for the company. Applied Micro fell 13 to 175 9/16.
SpectraSite Holdings (SITE: news, msgs)gained 3 to 24 after it said it would lease 4,700 communications towers from SBC Communications (SBC: news, msgs).
Loews Cineplex (LCP: news, msgs) tumbled more than 40 percent after delivering a profit warning.
Internet stocks suffered from an analyst's pessimism for Yahoo (YHOO: news, msgs), which fell 7 7/8 to 126 3/8. Lehman Bros.' Holly Becker said the market is still not discounting "the difficult environment Yahoo is facing."
With both major indexes above psychologically important levels and investors confident the Fed will not raise interest rates any time soon, investors may be tempted to take some profits off the table and start the U.S. Labor Day holiday weekend early.
The Dow ended last week at its highest level since mid-April. The blue-chip barometer climbed 1.3 percent on the week but remains off 2.6 percent for the year.
The Nasdaq rose 2.8 percent for the week and is off just 0.7 percent for the year. The tech-laden index managed to close above the 4,000 mark for three straight sessions, a feat that hasn't been achieved since mid-July.
The Fed's statement following last week's policy-setting meeting -- which extolled the productivity miracle and its key role in containing inflation -- indicates the central bank is comfortable with how the economy's performing.
European markets were subdued Monday as a holiday in the U.K. kept order volumes low and as telecom stocks rallied for a third day boosted by takeover news.
The market will get a few economic releases of relevance this week, including the important employment report for August on Friday.
However, these reports aren't likely to generate much anxiety as markets are convinced the Federal Reserve won't make a move on interest rates ahead of the presidential election.
Headline deals
VoiceStream Wireless (VSTR: news, msgs), which is being acquired by Deutsche Telekom (DT: news, msgs), said late Sunday it will buy Powertel (PTEL: news, msgs) for $7.1 billion in stock and assumed debt look at sectors.
The U.S.'s eighth largest wireless phone carrier will offer approximately $5.9 billion in stock and assume $1.2 billion in debt for Powertel in a complex deal that will likely result in Deutsche Telekom owning both companies. See full story.
In the tech sector, integrated circuit maker Applied Micro Circuits will acquire semiconductor company MMC Networks in a stock deal worth $4.5 billion, the two companies announced on Sunday.
Under the terms of the deal, AMCC (AMCC: news, msgs) will issue 0.619 shares of its stock for each MMC (MMCN: news, msgs) share. See full story.
Earnings watch
Among the few companies reporting their quarterly results this week: Dycom Industries, Comverse Technology, Genesco, Zale, Cooper, Quanex, Pall, Neiman Marcus, Rex Stores and Casey's General Stores.
Projected earnings growth for S&P 500 companies in the third-quarter of 2000 currently stands at 17.3 percent, First Call said. That's down from 17.6 percent at the start of last week due to a string of downward revisions among the retailers. Estimates stood at 18.8 percent at the beginning of the third quarter.
Projected earnings growth for the fourth-quarter now stands at 15.9 percent, climbing from the 15.6 percent growth rate expected in the previous week but down from the 16.8 percent increase predicted on July 1, First Call said.
Treasury focus
Treasury prices were flat Monday after the Commerce Department reported a larger-than-expected 0.6 percent gain in consumer spending in July.
Incomes rose 0.3 percent as the personal savings rate hit a record low.
The 10-year Treasury note was up 2/32 to yield ($TNX: news, msgs) 5.723 percent and the 30-year bond sank 2/32 to yield ($TYX: news, msgs) 5.677 percent. See Bond Report.
Traders are already looking at Friday's jobs report for fresh evidence on the economy. See full story and view Economic Preview, economic calendar and forecasts and historical economic data. |
