MARKET TALK: Treasurys Hit, Stocks Get Boost On ISM
01 Mar 10:05
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
10:05 (Dow Jones) Tsys hurt after Feb. ISM index comes in very strong. 2-year
yield initially up 4 BP since report, to 3.13% from 3.09% immediately before
the report. 10-year yield up 2 BP since ISM report to 4.92%. Stocks reacting
favorably - DJIA up 83 to 10189, Nasdaq Comp adds 22 to 1753, and S&P 500 up 9
to 1115. (JNP/TG)
9:56 (Dow Jones) Morgan Stanley starts coverage of healthcare facilities with
an overweight rating. "Pricing for 2002 is largely a done deal. Medicare
increases of 2.75% and managed care increases of 6%-10% are a positive, in our
view. We believe pricing power remains strong for hospitals through 2003. Aging
of the population has been and should continue to be a positive for volume
growth, in our view." HCA (HCA), Triad (TRI), Tenet (THC) and Community Health
(CYH) are its top picks. (GS)
9:46 (Dow Jones) Williams Communications (WCG) shares halted at 13 cents
apiece pending news. Could the news be, oh, a bankruptcy filing, which the
company introduced as a possibility earlier this week? Or perhaps a
substantially dilutive recapitalization, that might make 13 cents a share look
very expensive? Meanwhile, shares of Williams Cos. (WMB), which could be on the
hook for as much as $2.2 billion, should Williams Communications file for
bankruptcy, are up. (CBN)
9:43 (Dow Jones) Merrill Lynch analyst Jay Cohen believes insurance rates for
private passenger automobiles will continue to rise, driven by continued margin
pressure at carriers and increasing cost of claims. (CUB)
9:38 (Dow Jones) Performance of Janus mutual funds appears to be improving.
Janus parent Stilwell Financial (SV) announced its end-February assets under
management rose to $186 billion from $185 billion a month ago. Even after
taking into account the $6 billion added as a result of an acquisition, the
decline in assets was limited to just $5 billion, or 2.7% of the overall
assets. Not a bad number considering that diversified domestic stock funds fell
2.9% on average and science and technology funds tumbled 14% during February,
according to Lipper. (YXH)
9:31 (Dow Jones) Hewlett-Packard (HWP) says a research firm has validated a
controversial survey in which 66% of H-P employees were found to support the
company's pending merger with Compaq Computer (CPQ). International Survey
Research reviewed the data from H-P's January survey, as well as the process
used to conduct the survey, and found that it "is valid and representative of
employees worldwide." "Based on the information we have reviewed, the survey
results - at a 95 percent confidence interval - have a maximum sampling error
of +/- 5 percent," said Leo F. Brajkovich, global director for the research
firm's organization development practice. "It is a valid sample of H-P globally
that indicates 66 percent of employees are somewhat or very supportive of the
proposed merger between H-P and Compaq." (BS)
9:25 (Dow Jones) New York Times reports today that Disney's (DIS) ABC made a
recent bid to hire David Letterman of CBS in a move that would've displace Ted
Koppel's "Nightline" program. Execs involved in the talks say Letterman was
seriously considering the offer. ABC and Viacom's (VIA) CBS disagree on whether
a deadline for discussions ended last night, so stay tuned. (CRW)
9:18 (Dow Jones) Most equity filings and issuance is behind last year's weak
pace, but there is one area that's ahead: shelf registrations. The 53 shelf
registrations filed this year total $69.3 billion, 9% above this time last
year, according to Dealogic. The biggest this year is a $10 billion shelf from
Merrill Lynch (MER). (RJH)
9:07 (Dow Jones) ABN-Amro kicks off EDS coverage with hold rating, citing
near-term concerns about free cash flow generation and increaseddebt levels.
If the company continues its solid earnings growth and strong business signings
while making noticeable progress toward its $700M-$900M free cash flow goal
this year, the outlook could become more optimistic. (TG)
9:02 (Dow Jones) Joan Solotar, a brokerage analyst with Credit Suisse First
Boston, is the latest to tweak her 1Q and full-year estimates for four
investment banks with November fiscal years. Basing her analysis on completed
filed deal volume and disclosed fees, she cut estimates for Goldman Sachs Group
(GS) and Lehman Brothers (LEH) and raised them for Bear Stearns (BSC) and
Morgan Stanley (MWD). The spate of analyst notes on this subject should ease,
given that the quarter for these firms ended this week. (CWM)
8:55 (Dow Jones) Adding up Thursday's sharp upward revision to 4Q GDP and
other recent stronger data to Friday's personal income report, these "above
consensus expectations" numbers show "a consistent trend of the consumer
becoming stronger and stronger," and spell "a pretty negative story" for
Treasurys, says Jim Caron, fixed-income strategist with Merrill Lynch in NY.
(JNP)
8:48 (Dow Jones) Following Novellus' (NVLS) mid-quarter update Thursday,
Robertson Stephens upgrades the stock to buy from market perform, "to reflect
the strong uptick in bookings from DRAM manufacturers and early logic adopters
of copper for both 200mm and 300mm." The firm also raises its price target to
$50 from $40. NVLS shares closed at $42.59 but traded recently at $44.10 in
premarket action. (GS)
8:43 (Dow Jones) U.S. auto sales figures for February come out later, and
numbers are expected to be down 8%, hurt by the weak economy and lower sales to
rental-car companies. Comparisons will also be affected by the fact that last
February was a particularly strong month for auto sales. GM sales seen down
10%, with declines at Ford (F) and DaimlerChrysler (DCX) possibly exceeding
15%, analysts say. (CRW)
8:37 (Dow Jones) January personal incomejumped a higher-than-expected 0.4%,
compared to consensus of 0.1%. It was the biggest gain since July. Spending was
in line with consensus at 0.4% The report showed that disposable personal
income, or income after taxes, rose by 1.6% in January after rising a revised
0.2% in December, reflecting in part a phase-in of Bush's tax cuts. (SV)
8:30 (Dow Jones) If you want to get excited about the uptick in stock futures
this morning, by all means do so. Just keep in the back of your mind the recent
tendency for early gains to disappear. Big corporate news is tough to find at
the moment, but that won't be true of economic data: personal income and
spending, the ISM manufacturing read, and the final tally on February's
sentiment cap off what has been a hectic week. Besides the steady stream of
encouraging news on the economy, there's something else to be thankful for, at
least if you like tech stocks: February is over. The Nasdaq Comp suffered its
second-worst February ever, falling 10.5% last month. Solid gains in equities
futures, Treasurys easing. (TG)
(END) DOW JONES NEWS 03-01-02
10:05 AM |
