Paul Kangas' Stocks In The News
Monday, July 03, 2006
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PAUL KANGAS: There are more indications today that the economy is cooling down. The Institute for Supply Management`s index of factory activity fell in June from 53.8 -- or to 53.8 from 54.4 in May. Economists had expected a rise and say the fall suggests manufacturing may not be growing as strongly as anticipated. Also falling, construction spending, which dropped 0.4 percent in May, when economists had also expected a rise. That number fell in April as well. It is the first time in more than three years that there have been two straight monthly falls in that index.
Economists say it is not an encouraging trend.
CHARLES MCMILLION, CHIEF ECONOMIST, MBG INFORMATION SERVICES: It seems to indicate that the economy is slowing, perhaps more rapidly than most expected. So we expect second-quarter growth and second-half growth to be much, much different from the first quarter.
KANGAS: On Wall Street, those signs of a weakening economy strengthened the view that the Fed is likely to pause in hiking rates and that triggered a solid morning rally. The market also got a lift from fresh third-quarter institutional investment demand. The blue chips benefited from an upgrade on General Motors and takeover speculation about Alcoa. When trading ended early at 1:00 p.m., stocks were near their best levels of the day. The Dow Industrial Average closed up 77.80 at 11,228.02. The NASDAQ Composite was up 18.34 points, ending at 2,190.43. Standard & Poor`s 500 Index rose 9.99 to 1,280. 19. Over in the bond market, the 10-year note lost 3/32 to 99 25/32, putting the yield at 5.16 percent.
New York Exchange volume leader on 12.9 million shares, Lucent Technologies (LU) edging a penny higher.
Followed by Pfizer (PFE) with an $0.11 gain.
Then General Motors (GM) down $0.38 even though Banc of America upgraded it from sell to neutral on the positive aspects of a potential alliance with Renault or Nissan (NSANY).
Ford Motor (F) on those lower sales down $0.22.
EMC (EMC) a $0.03 loss there, fifth in Big Board volume.
Wal-Mart Stores (WMT), there you see it, down $0.60, as you heard. June same-store sales estimated at rising only 1.2 percent.
GE (GE) a $0.37 gain.
Exxon Mobil (XOM) rose $0.80 a share.
Home Depot (HD) losing $0.02.
And 10th in volume, Micron Technology (MU), up $0.34 a share.
Alcoa (AA) gained $0.73. A J.P. Morgan report suggests that Australian mining company BHP Billiton (BHP) or Rio Tinto (RTP) might try to make an acquisition bid for Alcoa.
Other mining stocks were strong, especially the gold miner Newmont Mining (NEM), up $2.59. Positive comments in this week`s Barron`s financial magazine. And London gold was around $622 an ounce today. New York gold trading was closed down.
But let`s look at some of the other gold stocks Anglo Ashanti (AU) up $1.48.
Freeport-McMoran (FCX) up $3.12.
And Glamis Gold (GLG) doing well, up $1.69.
Citigroup (C) edged up $0.72. This week`s Barron`s financial has an article that suggests if its CEO, Charles Prince, can`t boost the company`s growth at home or abroad, investors will demand a break-up of Citigroup Corporation.
Midway Games (MWY) up $1.35, nice percentage move. A private firm controlled my media mogul Sumner Redstone bought 69,000 shares in the stock, adding the 87 percent that the little company already owns.
Deluxe Corporation (DLX) tumbling $2.46. The company will take a second- quarter charge of $45 million, or $0.56 a share, resulting in a $0.09 to $0.11 per share loss. And that will also halve the 2006 earnings estimate from the company. All of this due to the abandonment of a software project. It just didn`t work out.
International Securities Exchange (ISE) up $2.03. The firm`s June average daily trading volume for equity and index options is up 44.6 percent from a year-ago.
NASDAQ`s most active, Google (GOOG) up $3.87.
Followed by Microsoft (MSFT) with a $0.40 gain.
A lot of plus signs here in the high-tech group. Intel (INTC) up $0.36.
Cisco (CSCO) gained $0.47.
And Apple Computer (AAPL), which was fifth in dollar volume, was up $0.68 a share.
Major loser, Millicom International (MICC) tumbling $12.10. The company has terminated talks to be acquired by China Mobile (CHL) for a price of $5.3 billion.
Hansen Natural (HANS), the energy drink company, up $7.84. The company`s alliance with Anheuser-Busch (BUD) appears to be going well according to analysts.
Qualcomm (QCOM) was down $0.61.
Yahoo! (YHOO) a $0.30 gain.
Oracle (ORCL), 10th in dollar volume, was up $0.32.
Merge Technologies (MRGE) plunging $5.01. The company`s CEO, CFO, and a senior vice president all resigned from the medical software firm over the weekend. The SEC has been investigating the company`s accounting practices.
Summit Bancshares (SBIT) up $6.01. Cullen/Frost Bankers (CFR) will acquire this company for cash and stock worth almost $28 a share, $27.83 to be exact.
And Encore Medical (ENMC) up $1.49. Nice move there. This company will be acquired by an affiliate of Blackstone Capital Partners for a price of $6.55 per share in cash.
And those are the "Stocks in the News" tonight.
