The daily S&P news letter if anyone wants it....
Subj: Standard & Poor's Market Mailing
Date: 1/29/99 8:25:28 AM Pacific Standard Time
From: marketmail@lists.personalwealth.com (Standard & Poor's)
To: mikey00028@aol.com
Market Mail for Friday January 29, 1999 (10:07 am ET)
In this issue:
Stocks Edging Higher in Early Trading
Super Bowl Theory: The Real Story
S&P Reaffirms Accumulate on U.S. Home Shares
Cell Division -- Amgen Sets Split Following Higher 4th
Quarter Earnings
Stocks Edging Higher in Early Trading
NEW YORK, Jan. 29 (Standard & Poor's) - Stocks are mostly
higher on some favorable earnings reports and more
announcements of stock splits. However, tech stocks are
struggling on weakness in the volatile Internet sector.
U.S. equities have received a modest boost from a much
stronger than expected gain in fourth quarter GDP.
Overseas events remain a potential source of negativity,
with Brazil remaining in a fragile state as the local
currency, the real, declines further in early trade, off
1.59% to 1.99 reals per U.S. dollar. Finally, a who's who
in business and politics are meeting in Davos, Switzerland
for the annual World Economic Forum. The market will keep
a close eye on any significant comments made by
participants.
The Dow Jones Industrials are up 15 points to 9,296 and the
S&P 500 has added 3 to 1,268, while the NASDAQ Composite
has slipped 2 to 2,475. Trading volume has reached 101
million shares on the NYSE, where advancing issues lead
decliners by a 11-7 margin.
Eastman Kodak (EK) and Hewlett-Packard (HWP) are the best
performers on the Dow, offsetting weakness in Philip Morris
Cos (MO). In corporate news, Amgen Inc (AMGN) is surging
after posting fourth quarter earnings of $0.90 versus $0.67
in the year earlier period, well ahead of the consensus
analyst forecast of $0.84. The company also announced a
two for one stock split. Infoseek Corp (SEEK) is down
sharply despite posting better than expected second quarter
results of a loss of $0.39 (excluding charges) versus a
$0.17 loss in the year earlier period. Wall Street had
expected the company to lose $0.44. Including one-time
charges, SEEK lost $2.26 for the quarter. Gillette Co (G)
is surging after posting better than expected earnings of
fourth quarter earnings of $0.39 a share versus $0.36 a
year earlier.
Treasury Market
Bonds are down, but off their lows, as fourth quarter gross
domestic product (GDP) rose 5.6%, much stronger than
expectations. Final sales increased 6.0%, with consumer
spending climbing 4.4%. The chain price index rose by 0.8%.
Treasuries have been knocked back by the strong gain as
expected. Standard & Poor's MMS International notes that
the jump in the fourth quarter was the strongest since the
second quarter of 1996. The surge was mostly a function of
rebounds in exports and business investment. However, MMS
adds that despite the solid pace of growth, inflation
measures decelerated in the fourth quarter. The chain
weight deflator was up only 0.8% vs a 1.0% gain in the
third quarter, and that is the lowest rate since the third
quarter of 1959. MMS says that while there remains a lot
of momentum in the economy, they expect to see significant
slowing from the fourth quarter pace. Treasuries remain
depressed, but under other circumstances a 5.6% gain in GDP
might have ripped the market to shreds.
In addition, Fed watch is developing ahead of next week's
FOMC meeting, with Treasury markets jittery as fourth
quarter GDP was expected to show outstanding strength in
the domestic economy. Numerous comments were reported from
Davos, Switzerland, where Finance Ministry officials were
attending the world economic forum. Deputy Treasury
Secretary Summers stressed the importance of domestic
policies over changes to international structure or
regulation, while Ministry of Finance Vice Minister
Sakakibara again hinted that Japan may be turning the
corner.
World Markets
Major Asian markets finished higher, while other regional
bourses finished mixed to lower. Japanese shares rose
following Wall Street's high tech led surge, while a weaker
yen benefitted the export sector. Banking shares were also
in focus on news of another major financial sector
alliance, this time between Fuji Bank and Yasuda Trust.
Also positive was some better than expected economic data,
with the unemployment rate edging down to 4.3% from 4.4%.
The Nikkei 225 rose 1.09% to close at 14,499.25. The Hong
Kong Hang Seng Index added 1.56% to close at 9,506.90. The
South Korean Composite finished near unchanged at 571.43.
European market are broadly higher as investors take cheer
from Wall Street's impressive performance Thursday. Auto
stocks continue to benefit following Thursday's
announcement that Ford Motor (F), the world's second
largest carmaker has agreed to buy the car unit of Volvo AB
(VOLVY) for $6.45 billion. The telecom equipment sector
is benefitting from some better than expected earnings
results from Nokia Corp (NOK.A). The company's fourth
quarter net income surged 72%, although the company did
note that 1999 would be more challenging, and is off
sharply in European trade. The company also joined the
list of firms announcing a two for one stock split. The
French CAC 40 is up 1.88% at 4,278.51, the German DAX is
higher by 1.86% to 5,191.10, and the U.K. FTSE 100 has
edged up 0.73% at 5,915.3.
Latin American stocks are mostly higher, led by a 3.8% gain
in Brazil's benchmark Bovespa index. Investors continue to
evaluate the latest developments from Brazil, with net
foreign currency outflows on Thursday totalling $215
million. While the size of outflows has declined in the
latter half of this week, outflows of any size will keep
financial markets on edge. In an effort to make the real
more attractive, and reverse the net flow of foreign
currency, the central bank again increased its benchmark
money market rate to 37% from 35.5%. Other developments
include the agreement by major European telecoms to bring
forward payments for Telebras assets purchased, and the
decision to reduce the minimum maturity on foreign currency
loans to 90 days from 180 days. The Brazilian real has
opened near unchanged in early trade.
personalwealth.com
Super Bowl Theory: The Real Story
Psst! Want a sneak peak at how the market's gonna do this
year? Then watch this Sunday's big game. The "Super Bowl
Stock Market Theory" says the S&P 500 will gain for the
year when the winner is an original NFL team; whenever the
AFC emerges victorious, the S&P will decline for the year.
Laugh if you will, but the Theory has an astounding 84%
accuracy rate. So unless you're from Denver or shorting the
market, root with all your might for Atlanta to capture
this year's crown. (But before you call your book, er,
broker, remember that The Super Bowl Theory is for
amusement purposes only).
personalwealth.com
S&P Reaffirms Accumulate on U.S. Home Shares
Standard & Poor's reaffirmed its 4 STARS (accumulate)
recommendation on shares of U.S. Home (UH) and raised its
1999 earnings per share estimate for the homebuilder after
the company posted fourth quarter earnings per share of
$1.20 versus $1.00. S&P equity analyst Michael Jaffe notes
that the results were a bit better than expected, with
profits boosted by a 22% increase in homes delivered and a
strong performance at the company's mortgage unit.
personalwealth.com
Cell Division -- Amgen Sets Split Following Higher 4th
Quarter Earnings
Amgen Inc (AMGN) posted $0.90 versus $0.67 fourth quarter
earnings per share on 23% higher total product sales. In
addition, the company set a 2-for-1 stock split. Everen
upgraded the stock to near term market outperformer. Other
stocks featured in this morning's MarketMovers include
Gillette Co (G), HA-LO Industries (HMK), Nokia Corp
(NOK.A), LSI Logic (LSI), Scientific-Atlanta (SFA),
Uniphase Corp (UNPH), Infoseek Corp (SEEK), Lam Research
(LRCX), Mercury Interactive (MERQ), and Alpha Industries
(AHAA). personalwealth.com
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29-Jan-1999 10:07:05(01728932)Copyright 1999 Standard &
Poor's Investment Advisory Services LLC. The information
contained in this report may not be published, broadcast,
rewritten or otherwise distributed without prior written
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From: "Standard & Poor's"
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To: mikey00028@aol.com
Subject: Standard & Poor's Market Mailing
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