Paul Kangas' Stocks in the News
Monday, September 08, 2008
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PAUL KANGAS: The Fannie/Freddie rescue set off a euphoric opening rally on Wall Street which sent the Dow rocketing 320 points at the outset of trading. But then calmer heads soon prevailed and by noon, the blue chips had settled back to a 153-point gain. The market lost a bit more of its luster when the tech-laden NASDAQ market sank to an 18-point mid- afternoon loss, while oil prices edged a bit higher. Paced by the financials and a comeback in the techs, however, stocks rebounded to close near their highs of the day. The Dow Industrial Average ended up 289.78, at 11,510.74. The NASDAQ Composite gained 13.88, ending at 2,269.76. While the Standard & Poor's 500 rose 25.48 points to 1,267.79. Over in the bond market, the 10-year note rose 4/32 to 102 18/32, putting the yield at 3.69 percent.
In the belief that the Fannie/Freddie rescue will bolster the economy's financial base, the bank stocks rallied sharply, led by Bank of America (BAC), trading 36.4 million shares, and up $2.50 a share.
Then Citigroup (C) up $1.25.
Washington Mutual (WM) down $0.15. CEO Kerry Killinger has been ousted and replaced by Alan Fishman, who is coming over from Meridian Capital.
Wachovia (WB), another strong bank, up $2.24.
GE (GE) did all right, gaining $1.21 today.
And then Wells Fargo (WFC) with a gain of $2.36.
JPMorgan Chase (JPM) up nearly $2.
Ford Motor (F), a $0.14 gain there.
Lehman Brothers (LEH) lost $2.05. Company executives are reportedly talking with potential buyers for the company's asset management group, Neuberger Berman.
Then came Pfizer (PFE), 10th in volume, with a $0.63 gain.
Fannie Mae (FNM), the big loser of the day, down $6.31, 90 percent drop. And Standard & Poor's downgraded it, hold to sell, has a price target of $0.50 a share. And it is almost there.
And then let's have a look at cousin Freddie Mac (FRE), which plummeted nearly 83 percent. And incidentally, on both of these agency stocks, the common and preferred dividend will be suspended.
Then Home Depot (HD) up $1.57. An improving mortgage market good for home improvement stocks. Lowe's (LOW), the rival to Home Depot, was up $1.61. And the housing stocks themselves rallying nicely. KB Home (KBH), MDC (MDC), NVR (NVR), and Pulte Homes (PHM), Toll Brothers (TOL), all substantial gains.
Regions Financial Corp. (RF) up $1.15. Friedman Billings Ramsey brokerage upgraded it from underperform to market perform. And then Annaly (NLY), which deals in mortgage securities, up $1.56, Credit Suisse upgraded that stock from neutral to outperform.
UST Corp. (UST), up $1.35, but last Friday, as we reported, the stock jumped $13.55 on reports that Altria (MO) was going to make a buyout bid and that report turned out to be true over the weekend. The takeover price is indeed $69.50 a share in cash. Altria's stock edged $0.02 higher to $20.97.
Huntsman Corp. (HUN), the chemical company, down $1.88. Hexion Chemical has sued Huntsman to get out of its $28 a share buyout bid. And that trial began today.
Apple (AAPL) topped the NASDAQ actives, down $2.26.
Research In Motion (RIMM) losing $4.28. As you can see, the high-techs didn't fare so well.
Google (GOOG) down $24.30.
Oracle (ORCL), an $0.81 loss there.
Microsoft (MSFT) bucked the trend with a $0.47 gain.
Cisco (CSCO) up $1.11.
Qualcomm (QCOM) fell $1.39.
Intel (INTC) up $0.36.
Baidu.com (BIDU) gained $3.72.
And then Amazon.com (AMZN) moving up $1.97.
UAL (UAUA) closed down $1.38, but it traded as low as $3 today before it was halted on a report it was declaring bankruptcy, which turned out to be a faulty story in The Florida Sun-Sentinel. It really had to do with a 2002 bankruptcy filing which did happen. But this story is completely untrue today, and way out of date. So the stock rebounded rather sharply.
Gehl Corporation (GEHL), which makes light machinery, up $15.86. The French company Manitou will acquire it for $30 a share in cash. And then Dell (DELL) closed down $0.24. But after the close, it was announced that Chairman Michael Dell bought 4.8 million shares last week at an average price of about $20.50 per share. That's $100 million worth of Dell stock.
Those are the "Stocks in the News" tonight.
