TheStreet.com's MIDDAY UPDATE
November 10, 1999
Market Data as of 11/10/99, 1:18 PM ET:
o Dow Jones Industrial Average: 10,653.56 up 36.24, 0.34%
o Nasdaq Composite Index: 3,186.57 up 61.53, 1.97%
o S&P 500: 1,379.11 up 13.83, 1.01%
o TSC Internet: 848.49 up 9.48, 1.13%
o Russell 2000: 449.83 up 3.55, 0.80%
o 30-Year Treasury: 100 11/32 down 11/32, yield 6.097%
In Today's Bulletin:
o Midday Musings: Dow Moves to Plus Side as Nasdaq Maintains Record Pace
o Herb on TheStreet: Amazon.com, priceline.com, Premier Parks, IDT vs. IDT and More
There's plenty of commotion in Community -- and we're not just talking about all the great conversation on our message boards. In the next few weeks and months, you'll notice a lot of great additions and improvements to the Community section.
Be sure to keep an eye out for these great features: our new "StreetSector" boards, weekly "Hot Boards" listings, a "Post of the Week" award and much, much more.
For more on these exciting developments go to:
And as always, make sure to check out the great conversation happening on today's boards. From Microsoft to Pokemon to Cramer on breaking into business, we've got it covered.
"TheStreet.com" on Fox News Channel
Robert Friedman from the Mutual Series joins us again for "Stock Drill." Find out how his original stock picks did and which stocks he has his eye on now.
We'll get the "Word on TheStreet" on taking profits in this bull market and having a little cash on the sidelines. Gary and Adam tackle Microsoft after the big ruling last week and consider which company they think could gain the most if Mister Softee is severely penalized. And don't miss predictions-- especially with next week's Fed meeting on interest rates looming.
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Also on TheStreet.com:
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Dear Dagen: Dear Dagen: Readers Finger Futile Funds
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Midday Musings: Dow Moves to Plus Side as Nasdaq Maintains Record Pace
11/10/99 1:28 PM ET
Major proxies were narrowly mixed at midday, as investors tried to decipher the code of the latest
Producer Price Index
. With the exception of technology stocks, which, much like
no time for losers, strength was scattered and somewhat masked, across a number of sectors.
Though the headline number on the October PPI fell 0.1%, ducking under an expected 0.1% gain, the core rate, which excludes food and energy prices, rose 0.3%, skipping past the expected 0.1% rise, though down from last month's attention-grabbing 0.8% gain. The mixed numbers were having a glass half-empty/half-full effect on the market.
Dow Jones Industrial Average
spent the better part of the morning bouncing under its opening mark but was lately up 35 to 10,652, while the broader
was up 13, or 1%, to 1379. The small-cap
was up 4 to 450.
Among those who opted for a upbeat view of today's action was Barry Berman, head of stock trading at
Robert W. Baird
. "We've had a heck of a run for the last week and a half. Coming off that we are not seeing a big selloff and no big follow through," from yesterday, he said.
All that was seen of the
Nasdaq Composite Index
this morning was the dust it kicked up as it shot up 61, or 2%, to 3187. The Comp was powered at the top by
. NextCard was helped by a reiterated rating from
Donaldson Lufkin & Jenrette
, among other
TheStreet.com Internet Sector
index, which yesterday joined the Nasdaq in taking a break from its furious tarantella of consecutive records, was dancing again. The measure was on pace for another all-time high with its gain of 10, or 1.2%, to 849.
Healthy earnings from
last night were also lending a little extra confidence to the technology sector as well.
Financials weren't having any fun. The
American Stock Exchange Broker/Dealer Index
was sagging 2% as interest-rate sensitive stock slid collectively, though not steeply, lower. The
Philadelphia Stock Exchange/KBW Bank
index was falling 1.1%
As for the PPI's implications for next Tuesday's
meeting, Berman says the consensus is that a 25-basis-point rate hike was in the market, but beyond that, it's anyone's guess. "It depends on how the Fed views that, but clearly there is no panic" today, he said. "Every time you get a selloff, and doom-and-gloom-sayers, and the market finds support rather quickly, that just gives more confidence" going forward, said Berman.
But the bears have reasons for focusing solely on the empty portion of the glass too. A report from David Orr, chief economist at
, says the most important figure in today's report was the 0.4% jump in the core intermediate stage index. Orr says it has a "very good record of tracking periods of Fed tightening." Orr also mentions Fed head
past opinions of the intermediate-term core rate as a credible gauge.
Oil stocks continued to rise after Venezuelan Energy and Mines Minister Ali Rodriguez said
would probably extend oil production cuts beyond March to counterbalance a drop in oil demand in the second quarter. December crude oil futures were lately at $24.61. Strength in oil stocks was visible in
Royal Dutch Petroleum
, up 2.7%, and
, lately rising 4.3%.
, which reported an explosion at a refinery in Los Angeles this morning (see below), was rising 4%.
was up 2.4%, helped additionally by an announcement of a $1.1 billion
outsourcing pact with
Philadelphia Stock Exchange Oil Service
index was lately rising 2.6%, while the
American Stock Exchange Oil & Gas
index was up 1.5%.
New York Stock Exchange
, decliners were leading advancers 1,501 to 1,411 on 613 million shares. On the
Nasdaq Stock Market
leaders were beating laggards 2,011 to 1,721 on 878 million shares. New highs trailed new lows 48 to 88 on the Big Board, while on the Nasdaq, new highs were leading new lows 171 to 59.
The benchmark 30-year Treasury was down 14/32 to 100 9/32, its yield rising to 6.10%. (For more on the fixed-income market, see today's early
Wednesday's Midday Watchlist
Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified
Mergers, acquisitions and joint ventures
Amazon.com and NextCard set a strategic relationship under which NextCard will be the exclusive provider of a co-branded Amazon.com NextCard credit card. Amazon also has obtained a warrant to acquire up to 4.4 million shares of NextCard stock, a stake of about 9.9%. Amazon was in the news yesterday after saying it was launching four online stores.
joint newsroom wrote about the move in a story
also wrote about the news in a column
this morning. NextCard soared 16 15/16, or 53%, to 48 5/8 while Amazon.com added 2 1/4 to 73.
said they were in a deal to provide content for a portal. The alliance will provide CNET technology through a Commerce One market site. CNet was adding 1 7/16 to 51 1/4, while Commerce One was jumping 15 5/16 to 336 1/2.
A new joint venture company involving an Irish consortium and
said it planned to compete in Ireland's deregulated electricity market beginning in February. The company, known as
, said it would invest $264 million over the next three years. GPU shares were slipping 1/4 to 32 13/16.
Earnings/revenue reports and previews
, the Dutch business software firm, said it expects to return to profitability in 2000 and that sales and license revenue were improving in the fourth quarter,
reported. Baan shares were climbing 7/8, or 6.9%, to 13 5/8.
after the close posted first-quarter earnings of 24 cents a share, which beat the 32-analyst estimate by a penny and came in above the year-ago 17 cents. Yesterday Cisco said it was purchasing rival
in a $799 million stock swap.
joint newsroom wrote about Cisco's
earnings and its
acquisition of Aironet in stories yesterday. Shares of Cisco were popping 4 13/16, or 6.4%, to 78 15/16.
said it has adjusted its first quarter 2000 earnings downward, to reflect the sale of certain extended service plans. The company is now posting a revised first-quarter loss of 4 cents a share, a penny more than previously stated. CompUSA shares were sliding 1/8 to 5 3/4.
Federated Department Stores
reported third-quarter earnings of 56 cents a share, beating the 18-analyst estimate of 53 cents a share and the year-ago 50 cents a share. Federated shares were mounting 1 3/8 to 43.
reported third-quarter earnings of nine cents a share, missing the 13-analyst estimate by a penny, but up from a year-ago 8 cents. Shares of Kmart were edging up 1/4 to 9 13/16.
New Plan Excel Realty
reported third-quarter funds from operations of 51 cents a share, missing the single-analyst estimate of 53 cents and the year-ago 54 cents a share. New Plan Excel shares were sliding 1/16 to 16 1/2.
posted third-quarter earnings of 60 cents a share, beating the single-analyst estimate by a penny and up from the year-ago 34 cents. Shares of Oneida were falling 3/16 to 23 13/16.
reported third-quarter earnings of $1.11 a share, in line with the seven-analyst estimate and up from a year-ago 98 cents a share. Payless ShoeSource was gaining 1 1/8 to 43 1/8.
reported third-quarter operating net of 7 cents a share, falling short of the five-analyst estimate of 15 cents a share, but up from a year-ago 6 cents a share. The company said it expects to achieve $105 million in cost savings by the end of next year. Pennzoil-Quaker shares were adding 1/16 to 12 5/16.
reported third-quarter earnings of 33 cents a share, in line with the nine-analyst estimate but lower than a year-ago 46 cents a share. The company said it sees a fourth-quarter charge due to job cuts and unit sales. Sierra said recapitalization was not in its shareholders best interests and said it would proceed with a previously announced share buyback plan. Sierra Health shares were adding 11/16, or 11.3%, to 6 13/16.
reported third-quarter earnings of 44 cents a share, missing the 10-analyst estimate of 47 cents and down from the year-ago 49 cents. Last night,
joint newsroom covered Waste Management's
third-quarter earnings report. Shares of Waste Management were losing 1 9/16, or 8.8%, to 16 3/16.
Offerings and stock actions
wrote about the United Parcel Service IPO in a story
has decided to ax its IPO plans, citing unfavorable market conditions. Merrill was expected to price Centerprise Advisors' 10.5 million-share IPO on Wednesday in a price range of $11.50 to $13.50 a share.
set a 2-for-1 stock split of its common shares. A stock dividend will be distributed on Dec. 9 to shareholders of record on Nov. 24. Shares of Copper Mountain were hopping 4 1/8, or 5.2%, to 83 1/2.
board approved a 3-for-2 stock split. Dataram shares were climbing 1 3/8, or 7.4%, to 19 7/8.
Merrill cut its rating on
to near-term neutral from accumulate. Allied Waste shares were slipping 5/8, or 6.7%, to 8 5/8.
Credit Suisse First Boston
upped his rating on
American Home Products
to buy from hold. American Home Products was mounting 1 3/8 to 54 1/16.
Warburg Dillon Read
at buy. American Standard was sliding 3/16 to 38 3/16.
Bay View Capital
to intermediate-term accumulate from intermediate-term neutral and long-term buy from long-term accumulate. Bay View Capital was adding 11/16 to 14 3/4.
Merrill Lynch upped its price target on electronic manufacturing service stocks including
to 76 from 62,
to 77 from 62 and
to 91 from 82. Shares of Celestica were rising 6 7/16, or 10.2%, to 69 1/8, while Jabil was hopping 2 9/16 to 65 3/16. Solectron shares were jumping 4 1/4, or 5%, to 86 5/8.
raised its price target on
Electronic Data Systems
to 75 from 70 a share. The stock was up 5/8 to 64.
and set a price target of 150. Shares of Inktomi were mounting 6 5/8, or 5.7%, to 123.
Salomon Smith Barney
raised it price target on
to 85 from 70. Lehman Brothers was climbing 2 1/8 to 73 15/16.
upped its intermediate-term opinion on
to buy from accumulate. Methode shares were bouncing 2 3/4, or 13.5%, to 23 3/8.
to strong buy from buy. QLT said yesterday its losses widened in the third quarter because of higher marketing costs. QLT shares were adding 1 11/16 to 36 3/8.
Banc of America raised its ratings on
to buy from market performer. Shares of Seagate were mounting 1 7/8, or 5.4%, to 36 5/8, while Maxtor shares were rising 1 7/16, or 24.4%, to 7.
Credit Suisse First Boston upgraded
to buy from hold. Stanley Works shares hopped 1 1/4 to 30 11/16.
Donaldson Lufkin & Jenrette
raised its rating on
to buy from market perform. Yesterday, shareholders approved a plan to create a separate tracking stock for
. Staples shares were gaining 2 9/16, or 14.7%, to 20.
Banc of America upped its price target on
to 125 from 60. Visual Networks was soaring 8 1/2, or 13.9%, to 69 1/2.
announced a restructuring plan under which it will cut 200 jobs. The plan, which includes new initiatives focused on the Internet and advanced work group solutions, is expected to produce annual cost savings of about $20 million. Avid will take a charge of between $9 million and $10 million in the fourth quarter related to the revamping. Avid Tech was edging up 9/16 to 12 1/16.
this morning unveiled a new corporate Internet-access PC priced at $499. Compaq expects the new machine, called the iPaq (sound familiar?), to account for at least 15% of the corporate computers it sells over the next year. The boxmaker's stock was up 1 3/8, or 6.6%, to 22 1/8.
An explosion at a
refinery about 40 minutes from Los Angeles sparked a major fire late Tuesday, sending plumes of smoke billowing hundreds of feet and temporarily closing nearly schools and a freeway before it was contained. Shares of Tosco nevertheless were up 1 1/8 to 27 15/16.
Overshadowing the bad news for the refinery were upgrades this morning from
No injuries were reported in Tuesday's fire, the second major fire at a Tosco refinery this year. Tosco was fined over $810,000 by the federal
Occupational Safety and Health Administration
in August following its investigation into alleged violations which led to the February fire that killed four. The cause of Tuesday's fire is under investigation.
Herb on TheStreet: Amazon.com, priceline.com, Premier Parks, IDT vs. IDT and More
11/10/99 6:30 AM ET
A Greenberg State of Mind
pulls, or attempts to pull, another trick out of its hip pocket with yet one more "major announcement" -- this time that it'll start selling PC software (oh, wow) and that it's acquiring a tool catalog (watch out,
!). All I could think of after reading the press release was, "How're they gonna make any money by shipping a 500-pound table saw for $4.95 with an offer of free pickup if you decide you don't want it?" And why is the press getting suckered in by Amazon's every-other-week "major announcement expected" announcements?
And why are they reporting every new offering by
and not other retailers? And what's with priceline.com's new grocery auction service? I never quite could get into bidding for airline tickets, hotel rooms or telephone service. Now, bidding for zucchini? Hello! By the time you're finished clicking and bidding, especially with a 56K modem, and especially with
limited selection, you could've gone to the store and back -- even in New Jersey, where you bag your own groceries! And as long as my
keeps doling out those 15-bucks-off-per-$100-order coupons (seriously, for weeks now!), I'll be going back for more (yes, and smile while I bag. How
make any money is beyond me, but I'm all for grocery stores giving away food for free).
Roller Coaster Tycoon:
made its debut
here in August, short-sellers were suggesting that the company's third quarter would be a disappointment because of an early-in-the-season boom in season ticket sales, which would steal from late-in-the-season sales. At the time, the company said it was confident it would meet or beat Wall Street estimates. Well, when it reported late Monday, its earnings before interest, taxes, depreciation and amortization, or EBITDA, beat forecasts, but its earnings per share were light, as was its revenue, depending on which analyst you talk to. "At the end of the day, this is just a horrible business," opines one short-seller, who also calls it a "wealth-destroying business," because based on his calculations its return on capital is lower than cost of capital. The earnings press release, by the way, was a convoluted mess. I counted no fewer than 15 parenthetical explanations (excluding, including, actual, etc.) throughout the release. (What, are they taking lessons from me?! This is the king of parenthetically punctuated columns.)
Herb's Latest: Join the discussion on
calls the integration process all of its acquired companies go through. An
item here yesterday focused on Newell, but also mentioned
, prompting reader
to write, "Your 'cutesy' reporting on Tyco is becoming a bit redundant. Try sticking to the facts and being objective -- it might add to your credability
sic." Well, spelling "credibility" right might improve yours with me, William, and in case you didn't notice the item in question was about Newell, not Tyco.
writes, "Just like all journalists, you lie. I wonder if you have children? Most of us know it take nine months. But you blast Newell after seven months
of owning Rubbermaid. It takes two years or did you forget to read these remarks. Nice guy you are. Who do you know holding 11 million shares short." Nobody I know is rich enough to be short 11 million shares. The point of the item was that Newell's Rubbermaid-related charges keep rising beyond even the company's forecasts, which suggests Rubbermaid is in a heck of a lot worse trouble than even Newell expected. Can't wait to see the spin control Newell, which never did return my call or respond to the article, uses during meetings in New York this week with analysts.
here last September on
, a New Jersey venture capital firm, noted how it was having success investing in med-tech companies that were being acquired. Chalk up another one from the list mentioned in that story:
, which agreed Monday to be sold to
Johnson & Johnson
for $85 million in stock. (See, I can write something positive.)
We interrupt this program for the ultimate in IDT insanity:
, whose San Jose public relations firm, the
Integrated Device Technology
. She writes that her "IDT's products are memories and embedded processors and other semiconductor products for networking and telecom systems -- they have been in business in Silicon Valley for almost 20 years. There's often some confusion between my IDT and the
recently been writing about. And, the confusion causes my IDT even more problems when the other IDT is doing things that might be perceived as negative.
"Anyway, is there something appropriate that I can ask journalists, such as yourself, to do that might eliminate some of the mix-up? Specifically
can you note that you aren't discussing Integrated Device Technology, or
can you spell out the name of the other IDT? Is there something you can suggest that would not be burdensome to you and would help my IDT avoid the negative publicity of the other IDT?"
Your IDT can change its name. Reminds me of when I used to write about
California Micro Devices
, whose saga was detailed in this column and investors would confuse it with
. Sad fact is that our IDT is officially IDT Corp. Such is life in a world where investors click first and ask questions later.
Herb Greenberg writes daily for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, though he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He welcomes your feedback at
firstname.lastname@example.org. Greenberg also writes a monthly column for Fortune.
Mark Martinez assisted with the reporting of this column.
Copyright 1999, TheStreet.com