Today's the monthly expiration of options on stocks and index futures, and though that is often a recipe for volatility, it looks like things will start off pretty steady this morning.
Stocks are cued for a bit of strength at the open. At 9 a.m. EDT, the
futures were up 2, having closed near fair value. If there is volatility, it will come later in the day, as people cut out of the office and trading gets thin.
Though generally pleased with the earnings coming in, many investors are pretty much sitting on their hands until next Thursday, when
will give his semiannual
testimony before Congress. Wall Street expects Big Al will clear up the uncertainty on whether the Fed will tighten or stay pat at the August meeting.
"It's the excuse of waiting for the Fed," said Jim Volk, co-director of institutional trading at
of the relative inaction. Economists have lately been flip-flopping on what the Fed is going to do, he added. "If the inflation numbers stay low and the economy doesn't really heat up, we're moving toward a Fed that stays on hold."
Rising tensions between mainland China and Taiwan may play a factor in the stock and bond markets today. Taiwan remains determined to abandon the "one China" policy that has kept the region relatively peaceful since 1949. The 30-year Treasury has seen something of a flight-to-quality bid on reports of Chinese military exercises in Fujian province, across the strait from Taiwan. It was lately up 13/32 to 91 3/32, putting the yield at 5.89%.
The Taiwan and Hong Kong stock markets both sold off today on worries that big trouble is brewing. The
Taiwan Stock Exchange Weighted Price
index fell 506.46, or 6.4%, to 7411.58. Hong Kong's
fell 213.65, or 1.5%, to 13,545.24.
Tokyo traders, wary of the possible Sino-Taiwanese trouble, took profits going into the weekend. The
dropped 183.56, or 1%, to 18,248.30. Shares of
led a decline in tech shares after
Warburg Dillon Read
cut its rating on the company to sell from hold.
European stocks had lately turned positive. In Frankfurt, the
was up 3.72 to 5622.98. In Paris, the
was up 2.75 to 4668.42. And in London, the
was up 2 to 6577.
Friday's Wake-Up Watchlist
Earnings/revenue reports and previews
(Earnings estimates are from
Air Products and Chemicals
warned it anticipates its fiscal third-quarter earnings will be below last year's earnings and analysts' expectations. The company, which plans to release its third-quarter results on July 23, expects earnings to be approximately 48 cents a share, excluding a charge of 4 cents a share for workforce reduction. The 12-analyst estimate expected the company to earn 56 cents.
reported second-quarter earnings of 78 cents a share, missing the 20-analyst estimate of 80 cents and down from the year-ago $1.20. The Peoria, Ill.-based company said it expects full-year 1999 sales and revenue to be slightly below 1998. Profit per share is expected to be 20% to 25% less than 1998, Caterpillar said.
reported second-quarter earnings after the close in line with analysts' lowered estimates. The razor-blade maker earned 26 cents a share, matching the 13-analyst view but falling below the year-ago 33 cents.
Newport News Shipbuilding
posted second-quarter earnings of 55 cents a share, excluding one-time items, above the two-analyst estimate of 52 cents and up from the year-ago 45 cents
posted second-quarter earnings of 33 cents a share, beating the three-analyst estimate of 30 cents, but down from the year-ago 35 cents.
posted second-quarter earnings of 88 cents a share, excluding nonoperating items, a penny ahead of the 14-analyst estimate and up from the year-ago 75 cents, excluding nonoperating items.
Morgan Stanley Dean Witter
to strong buy from neutral.
Mergers, acquisitions and joint ventures
has agreed to a wide-ranging marketing and distribution partnership with
, the big satellite broadcaster,
The New York Times
reported, citing executives close to the deal. The companies plan to announce the deal Monday at the
Satellite Broadcasting and Communications Association's
convention in Las Vegas, Nev., the
reported, citing the executives.
Offerings and stock actions
In new issues, last night
(RVST:Nasdaq) 5 million-share IPO midrange at $12. Elsewhere, last night
Donaldson Lufkin & Jenrette
(PDYN:Nasdaq) 6 million-share IPO above-range at $17.
is moving closer to creating a stock to track its
properties in an attempt to capitalize on the mania for pure-play Internet businesses,
The Wall Street Journal
said a U.S. grand jury investigation into its
unit ended without charges.
Inside Wall Street column, penned by Gene Marcial, says Jay Petschek of investment firm
Corsair Capital Partners
, thinks corporate travel management concern
will spin off its Internet business and take it public. Petschek, who has accumulated nearly 5% of Navigant shares, believes Navigant is in discussions to form alliances with several Internet portal companies, the column says.
Elsewhere, one unidentified New York money manager, who has been buying
stock, thinks a credit-card giant like
could be interested in acquiring CyberSource.
Take-Two Interactive Software
, a video-game company, garners positive mention in the column. Take-Two CEO Ryan Brant states that in 18 months the company's Web business will generate some $30 million in annual sales and about $100 million in three years, according to the column. Bob DeLean, an analyst at
, thinks the company's earnings will rise 25% to 30% annually over the next five years, and he expects earnings of 62 cents this year and 80 cents in 2000, compared with 37 cents in 1998, the column says.