MARKET TALK: PLD Chip Market Stabilizing, Hambrecht Says
Edited by George Stahl
Of DOW JONES NEWSWIRES
(Call Us: 201 938-5299; All Times Eastern)
MARKET TALK can be found using code N/DJMT
12:59 (Dow Jones) The North American market for programmable logic device
chips is stabilizing for Altera (ALTR) and Xilinx (XLNX), W.R. Hambrecht
says. Because of that, "the North American market will lead the
international markets to a recovery, starting in the December quarter and
continuing into 2002." The firm expects Xilinx and Altera to reaffirm their
quarterly revenue guidance in their respective mid-quarter updates. (GS)
12:45 (Dow Jones) Treasury will auction $14 bln in 4-week bills at 1:00 p.m.
EDT, $1 bln more than last week's sale, in order to raise $4 bln in new cash
and redeem $10 bln in maturing 4-weeks. (JEN)
12:33 (Dow Jones) Merrill Lynch is reducing its recommended allocation on
corporate bonds from overweight to neutral as part of defensive posture
towards spread products, says Merrill chief US fixed income strategist Ken
Hackel. Corporate bonds have performed strongly so far this year and 3Q
earnings announcements are likely to be disappointing. (JNP)
12:24 (Dow Jones) Datascope (DSCP) is facing a lawsuit that accuses the
company of making false and misleading statements. The suit alleges that an
SEC proxy falsely claimed Datascope would receive a federal tax deduction
for Chairman and CEO Lawrence Saper's bonus compensation; didn't provide
reasonable estimates of the number of employees eligible under an incentive
plan; and was coercive by saying Datascope may grant a bonus even if
shareholders didn't approve it. Saper received a bonus of $3.29 million in
2000, up from $771,300 in 1999. Of that amount, $1.49 million was subject to
shareholder approval. The company says the suit is without merit. (CS)
12:18 (Dow Jones) Oct. fed funds post fresh session highs, with contract up
4 bps at 96.67. Contract now showing slightly more than 70% chance of
another 25 bps rate cut at Oct. FOMC, trader says. Not until Oct. rises
above 96.75 will the market start to show odds for 50 bps move, he says.
(SPC)
12:05 (Dow Jones) Will the downbeat stock market reverse course within the
next year? Some online investors seem to think so. A new survey from Web
broker Datek Online Financial Services found that about 65% of the 324
respondents think there will be a market rally within the next 12 months.
About 15% think that the market will rally within the next six months, while
50% believe the rally will begin sometime between the next six and 12
months. (GFC)
11:57 (Dow Jones) In her speech to shareholders, Xerox's new CEO, Anne
Mulcahy, reiterated her commitment to returning Xerox to profitability in
the 4Q. Mulcahy noted that the company has cut its work force by 8,600 jobs;
its selling, general and administrative expenses by 7%; and its inventory by
$1 billion. Overall, she says, Xerox has achieved more than 75% of its
year-end $1 billion cost-reduction target. Company shares rose slightly on
the headlines, up 25 cents to $9.39. (GS)
11:45 (Dow Jones) Liquidity abounds, says Morgan Stanley economists. Since
the beginning of the year, holdings of liquid financial assets - checking
accounts, CDs, etc. - have risen $500 billion, a 12% increase. During the
same period, savings accounts for individuals account for $254 billion, they
write. (MSD)
11:24 (Dow Jones) In arguing for a new dividend policy, Drexler Technology
(DRXR) shareholder Ted Shrader compares his situation to that of a "'milk
cow', exploited and restrained in a corral of high expectation, rather than
as a legal partner, mutually concerned with employee welfare and company
integrity as well as its financial success." Shrader is asking fellow
shareholders to approve a recommendation that Drexler, which hasn't ever
paid a cash dividend, routinely share profits with shareholders in the form
of a cash dividend. Given the slew of delistings and liquidity problems in
the tech sector, at least Shrader has a corral to consider. (RG)
11:08 (Dow Jones) The DJIA is setting new lows, as the after-shocks of the
disappointing consumer confidence figure continues to shake the market. The
only Dow component in the green is AT&T (T). The market is close to erasing
all of Friday's 194-point gain. DJIA losing 141 at 10241. (GS)
10:52 (Dow Jones) High-yield bonds fairly active, with the tower
communications sector currently in favor and seeing some strength. Crown
Castle International's (CCI) 10 3/4% notes due '11 are up 3/4 to 97 3/4.
Wireless provider Nextel Communications (NXTL), which announced a
debt-for-equity swap Monday, is also higher, with its 9 3/8% notes due '09
up 1/2 to 76. (RTB)
10:49 (Dow Jones) Sungard Data Systems (SDS) has more downside risk than
upside potential at its current level, Robertson Stephens says. Because of
that, the firm is lowering its price target to $24 from $33 "to reflect our
expectations for slowing internal revenue growth." Robbie Stevens says
Sungard may miss revenue expectations but should meet 3Q and 4Q EPS views.
Sungard shares falling 77 cents to $24.50. (GS)
10:42 (Dow Jones) Sept. S&Ps just took out support lightly at 1172 to make
new lows at 1171, but contract still held better than Sept. Nasdaqs, which
has taken out three support levels so far, the latest one being 1550 to make
news lows of 1548. "Nasdaqs losses are always exaggerated," said one floor
trader, who said any reduction in consumer confidence impacts techs more.
(ZHS)
10:33 (Dow Jones) The drop in consumer confidence is "disappointing," and
tax rebates are apparently not having the effect that was hoped, notes a
Banc One Capital Markets economist. (MSD)
10:27 (Dow Jones) UBS Warburg analyst Gary Gordon boosted his rating on
Doral Financial Group (DORL) to strong buy from buy based on price. The
company's recent stock price plunge now puts it about 35% below Gordon's
12-month price target of $42. Although the San Juan mortgage lender faces
both interest rate and credit risk, Gordon said he remains confident the
company will achieve earnings projections. (JKM)
10:22 (Dow Jones) Sea of red spreads on Wall Street as more companies and
sectors go into the negative column. 70 of the 86 sectors that Dow Jones
tracks are suffering losses, with the oil drilling, precious metal and heavy
construction sectors leading the way. On the other hand, savings & loan
(Monday's biggest loser) and office equipment are the top gaining sectors.
DJIA now off 84 at 10298. (GS)
(END) DOW JONES NEWS 08-28-01
12:59 PM
*** end of story *** |
