Friday, August 6, 1999

Ah, a fitting finale for a stinker of a week: Major indices bled out at the close; American Home Products ordered to pay phen-fen dieter $23.3 million; Hearst will buy the San Francisco Chronicle.

Author:: Thomas Lepri
Publish date:: Aug 6, 1999 4:50 PM EDT

Markets

No one's going to miss this week very much.

The stock market capped off a generally unpleasant week of losses today with more of the same. Stocks fell early amid some more market-unfriendly data from the

Labor Department

, and a midsession rally couldn't hold against the general sense in the market that interest rates will be going higher soon, and that the recent selloff hasn't run its course yet.

Read 'em and weep. The

Nasdaq Composite Index

dumped 17.64 to 2548.19, the

S&P 500

shed 13.38 to 1300.33, and the

Dow Jones Industrial Average

lost 79.79 to 10,714.03. The small-cap

Russell 2000

fell 1.71 to 428.04, and

TheStreet.com Internet Sector

index backed up 15.16 to 498.39.

The big European indices finished mixed, with France's

CAC

lower and Germany's

Xetra Dax

and London's

FTSE

ending on the plus side.

Asian markets plunged overnight, as Hong Kong's

Hang Seng

lost 87.28 to 13,167.06, and Tokyo's

Nikkei

shed 273.95, or 1.6%, to 17,084.24.

More markets news and commentary are available in

TSC's

Markets section.

Companies

A jury ruled that

American Home Products

(AHP)

must pay a Texas woman $3.3 million in compensatory damages and an additional $20 million in punitive damages for heart problems she suffered after using the diet drug phen-fen. More than 3,000 similar lawsuits have been filed against American Home Products, which made and marketed

fenfluramine

, one of the two drugs in the

fen-phen

cocktail.

Boston Scientific

(BSX) - Get Report

is recalling its Rotablator RotaLink Advancer and RotaLink Plus rotational atherectomy systems, which open constricted blood vessels by drilling away plaque from the vessel walls.

Chevron

(CHV)

said it will sign a deal with

Royal Dutch/Shell

(RD)

to build a pipeline to deliver Nigerian gas to West African countries suffering power shortages. In addition to Nigeria, these countries include Benin, Togo and Ghana.

General Motors

(GM) - Get Report

said it will resume its stalled talks with

Daewoo Motor

about a possible alliance -- including, perhaps, GM's taking a controlling equity stake in the troubled South Korean automaker. The two companies started talking in February of last year.

Publishing giant

Hearst

sat it will buy the

San Francisco Chronicle

. Hearst already owns the

San Francisco Examiner

Placer Dome

(PDG)

set plans to cut as much as 40% of the workforce of its South African joint venture. That could affect the jobs of up to 2,900 workers at the Western Areas gold mine near Johannesburg.

More news on companies and stocks are available in

TSC's

Stock News section.

Tech

America Online

(AOL)

signed distribution and co-branding agreements for its instant messaging software with Internet service providers

EarthLink

(ELNK)

and

MindSpring

(MSPG)

eBay

(EBAY) - Get Report

got hammered amid its latest Web site outage. The stock lost 9 3/4, or 10.5%, to 83 1/4.

Internet Gold

(IGLD) - Get Report

lost 1/8, or 1%, to 11 15/16 in its first day of trading, having been priced last night at $12 a share by lead underwriter

Lehman Brothers

Goldman Sachs

raised

Yahoo!

(YHOO)

to its recommended list from market outperform. The upgrade comes at a time when Yahoo! is trading at about a 45% discount to its annual intraday high of 244, set back on April 6.

More tech news and commentary are available in

TSC's

Tech Stocks section.

General News

The Labor Department released figures showing nonfarm payrolls up 310,000 for July, much higher than the 194,400 expected by economists and up from last month's revised increase of 273,000 jobs. As forecast, the unemployment rate remained steady at 4.3%. But average hourly earnings increased 0.5%, 0.2 percentage points above expectations and higher than the 0.4% clip from last month.

International

Deutsche Telekom

(DT) - Get Report

set plans to buy U.K. mobile telephone firm

One2One

from

Cable & Wireless

(CWP)

and

MediaOne

(UMG)

for about $11.2 billion. Telekom will also assume about $2.4 billion in One 2 One debt.

Nokia

(NOK) - Get Report

said it was in talks to sell its

Salcomp

unit, which makes mobile phone battery chargers, as part of its plan to focus on core telecommunications and Internet technologies.

Truckmaker

Volvo

(VOLVY)

made a bid to acquire the 78.4% it doesn't already own of Swedish rival

Scania

(SCV.A)

, valuing the company at about $7.4 billion.

Investor

, Scania's controlling shareholder, has agreed to sell its stake.

More international news and commentary are available in

TSC's

International section.

Elsewhere

Actor

Robert Downey Jr.

was sentenced to three years in prison yesterday for violating probation on a conviction on drugs and weapons charges. Municipal Judge Lawrence Mira rejected Downey's plea for another stint in drug rehabilitation, saying the troubled actor had manipulated doctors and psychiatrists during his seven previous rehab programs. Downey's case may not have helped by his blunt characterization of the matter: "It's like I've got a shotgun in my mouth, with my finger on the trigger, and I like the taste of the gun metal," he told the judge.