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To: Dealer who wrote (53892)	7/16/2002 1:10:07 PM
From: Dealer	Respond to of 65232

Tech Stocks Rise, Led by Nextel; Dow Dips Tue 12:50pm ET Technology stocks bounced at midday on Tuesday after a trickle of upbeat earnings from companies like Nextel Communications Inc. , but a guarded speech from the Fed chief and lingering worries over corporate America kept other stocks under pressure.

To: Dealer who wrote (53892)	7/16/2002 1:27:06 PM
From: stockman_scott	Read Replies (1) \| Respond to of 65232

Goldman Sachs rebuffs Tyco, cites SEC concerns By Tim McLaughlin BOSTON, July 16 (Reuters) - Goldman Sachs, a key adviser on Tyco International Ltd.'s disastrous break-up plan, on Tuesday dropped Tyco from its list of recommended stocks on concern the troubled conglomerate faces new scrutiny from U.S. regulators. Goldman Sachs' change of heart, delivered in a terse research note, triggered a 10 percent drop in Tyco's (NYSE:TYC - News) stock and signals the venerable investment bank has rebuffed a onetime lucrative client. Tyco generated millions in investment banking fees for Wall Street during a 10-year acquisition binge in which former Tyco Chairman Dennis Kozlowski spent more than $60 billion to build one of the world's largest manufacturing conglomerates. Investors soured on Tyco after Kozlowski in late January unveiled plans, on Goldman Sachs' advice, to spin the company off into four units. The collapse of energy trading giant Enron Corp.(Other OTC:ENRNQ.PK - News) also inspired a sell-off in Tyco stock as seeds of doubt in its opaque accounting took hold in early January. Goldman Sachs cited a July 2 letter a congressional committee sent to the U.S. Securities and Exchange Commission concerning accounting at five companies, including Tyco. The Committee on Energy and Commerce made a specific request for "all records" in the SEC's 1999-2000 investigation of Tyco's accounting, which was then cleared. "The specificity of the request with regard to Tyco raises a concern in our minds that further scrutiny of Tyco's accounting practices could be forthcoming particularly in view of the political pressure on the SEC and its chairman, Harvey Pitt," Goldman Sachs wrote in a research note. As a result, Goldman Sachs analyst Jack Kelly changed his investment opinion on Tyco to "not rated" from the recommended list. Kelly, who has covered Tyco for several years, was not available for comment. Kelly's move is unusual and comes after another Goldman Sachs analyst slapped a "not rated" on Adelphia Communications Corp. (Other OTC:ADELQ.PK - News) because of accounting transparency issues. Tyco's stock fell $1.12 to $13.36 in afternoon trade on the New York Stock Exchange. The stock has tumbled nearly 80 percent this year, erasing about $90 billion in market capitalization. TYCO DECLINES COMMENT The SEC is investigating Tyco, but the company says the probe is contained to matters concerning Kozlowski, who resigned last month just before he was indicted on charges he avoided about $1 million in sales taxes on artwork purchases. The investigation is looking into compensation packages for senior executives and whether Tyco executives improperly used corporate funds to buy paintings and real estate. Tyco also fired its top lawyer last month, accusing him of hiding the criminal inquiry into Kozlowski from the board. The lawyer, Mark Belnick, also is accused of hatching a secret pay deal with Kozlowski that was unknown to the board. As far as Tyco knows, the SEC's investigation remains focused on those issues, and anything else that may arise from that line of inquiry, Tyco spokesman Gary Holmes said. Tyco declined to comment on the move by Goldman Sachs. Revelations that Tyco did not individually disclose hundreds of acquisitions helped clobber the decline of its stock. Investors also fled when they learned a Tyco board member received $20 million for himself and a charity for brokering Tyco's $9.5 billion acquisition of CIT Group Inc. last year. Goldman Sachs and other Wall Street investment banks got a black eye after Tyco's sweeping restructuring plan fell apart in April just three months after they peddled it.