March Nasdaq Hits Limit Down
10:49 (Dow Jones) March Nasdaq falls 65 points lower to 2475, hitting limit
down at 10:37 a.m., as the market was unable to find stable footing. A
10-min trading curb is in effect. If the market remains at limit down, a
2-min trading halt will occur. (DMC)
10:47 (Dow Jones) Tech boutique Adams, Harkness & Hill is becoming less
hopeful about some of the big names in business-to-business electronic
commerce. Ben Rose, the firm's B-to-B analyst, has downgraded the following
companies to market perform from buy: Ariba (ARBA), Commerce One (CMRC),
FreeMarkets (FMKT), Project Software, (PSDI), aka MRO Software, and
PurchasePro.com (PPRO). Rose's reasoning? Ariba's recent change in revenue
recognition means price competition among procurement software providers
will only increase. (RS)
10:43 (Dow Jones) Citadel Communications (CITC) stock and bonds are trading
higher following LBO firm Forstmann Little's announcement to acquire the
broadcast company. Shares are up 42%. Citadel's 9 1/4% notes due 2008 are up
to 101 from 98 1/2 Fri, while the 10 1/4% notes due 2007 are up to 104 from
103 1/2. (RTB/RJH)
10:39 (Dow Jones) March Nasdaq is drifting in morning trade, with the market
looking for direction. Focus for market is on Intel (INTC) and Juniper
(JNPR) earnings after the close. "What's important is the revenue stream,"
says one pit trader. After last week's gains, the pit trader says March
Nasdaq's upside might be limited. "I don't know how much farther it has to
go," he says. (DMC)
10:34 (Dow Jones) S&P is out with a new report that says creditworthiness of
U.S. banks and other financials will remain under pressure amid
bad/non-performing loan worries. However, financials are better placed to
handle this than in past cycles, S&P says. Elsewhere, non-U.S. financials'
outlook is stable but could be threatened by sharp downturn in some emerging
market banking systems. (GC)
10:31 (Dow Jones) Globalstar (GSTRF) high-yield bonds down 2 points at 8 bid
following announcement of suspended principal and interest payments, trader
said. Bear Stearns convertible bond analyst Yaw Debrah says Globalstar news
will have limited impact on broader market because satellite telecom
problems were already well known. (JD)
10:27 (Dow Jones) Merrill's Henry Blodget says AOL Time Warner's (AOL)
announcement about surpassing the 27 million subscriber mark portends good
things for the stock. Blodget says that based on this announcement, AOL
likely added 2-2.1 million subscribers in the 4Q, beating Blodget's fourth
quarter estimate of 1.85 million. "This performance is especially impressive
in light of a slowdown in consumer PC sales. AOL is clearly gaining share
from other ISPs." AOL is up 91 cents at $47.38. (GS)
10:17 (Dow Jones) High-yield bonds were a little weaker early, down 1/2 pt
to 1 pt across the board on profit taking and "a little money raising," says
trader, since "There are a lot of deals in the pipeline." (RTB)
10:14 (Dow Jones) Edison Intl's (EIX) Southern California Edison unit came
up with a novel way to conserve cash - don't pay the bills. The company is
suspending payment for $366 million in power bills due through Jan. 16. The
question remains, though, how patient will Edison's wholesalers be with the
company's delinquency? Meanwhile, PG&E (PCG) has said that it believes it
has sufficient cash to pay its expenses until early February, when a major
power bill comes due. (GS)
9:59 (Dow Jones) CS/First Boston analysts says "a consensus for tax cuts is
building rapidly in Washington," with the "new consensus" buoyed by the
surprisingly abrupt slowdown in economic activity and the extraordinarily
healthy state of the fiscal balance sheet. (JC)
9:49 (Dow Jones) March Nasdaq is near session lows after the market took out
initial support at 2516. Floor technical trader says next support seen at
2491, the previous low, and at 2483. Resistance seen at 2549, the pivot
point, with further resistance seen layered at 2568-78. (DMC)
9:47 (Dow Jones) Lower quality asset classes - high yield bonds, emerging
market debt and lower quality shares - are so far outperforming in January,
typically a very good month for these types of assets, notes Merrill Lynch
chief quantitative strategist Richard Bernstein. He recommends investors to
sell into strength in these asset classes in a note issued Tues. (JNP)
9:43 (Dow Jones) Nasdaq unable to hold early gains and drifts into negative
territory. Nasdaq off 10 at 2617. DJIA has been in the red for most of the
opening minutes, down 20 at 10505. Philadelphia Semiconductor Index is
losing 2% after some morning downgrades in the semiconductor industry and
ahead of Intel's earnings after the bell. (GS)
9:35 (Dow Jones) Look for a downwardly revised 1.5% GDP in the first quarter
and a half point rate cut at the upcoming Fed meeting, says Merrill Lynch's
Bruce Steinberg. (MSD)
9:31 (Dow Jones) Nymex crude seen continuing march above $30 a barrel,
opening 10-20 cents a barrel higher. OPEC ministers are gathering in Vienna
for Wed meeting where cut of 1.5 mln b/d is widely expected. Deeper cut
would be viewed as bullish and push prices higher, traders say. Feb crude,
up 14c to $30.19 in overnight ACCESS trade, faces resistance at $30.35,
while support is pegged at $29.85/bbl. (MSX)
9:18 (Dow Jones) Intel (INTC) reports its fourth quarter numbers after the
bell, and Merrill Lynch sees "some minor potential downside to our numbers
but not a major miss." Merrill's numbers: 4Q EPS estimate of 38 cents a
share on revenue of $8.78 billion. The firm maintains its accumulate rating
on Intel. (GS)
9:15 (Dow Jones) Last year's stellar performance by treasuries and dramatic
outflows from stock mutual funds bode very well for the Standard & Poor's
500, says Thomas Galvin, chief market strategist with Credit Suisse First
Boston. On average, the year after treasuries returned 20% - like they did
last year - the S&P 500 averaged a 17% gain. At the same time, mutual fund
outflows are a bullish sign, especially for the Nasdaq Composite Index,
because they indicate a tremendous buildup of money on the sidelines,
waiting to get back into the market. Given this, Galvin sees the S&P 500,
which closed Friday at 1318, rising to 1600 this year. (KJT)
(MORE) DOW JONES NEWS 01-16-01
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