Monday, July 19, 1999

IBM, Microsoft earnings beat expectations; major proxies finish in the red as investors stay sidelined.
Publish date:


Another bunch of

strong earnings reports wasn't enough to bring investors off the sidelines and into stocks. All the major proxies finished in the red on light to moderate volume.


Dow Jones Industrial Average

lost 22.16 to 11,187.68; the

Nasdaq Composite Index

shed 34.10 to 2830.38; the

S&P 500

dumped 11.12 to 1407.66; the small-cap

Russell 2000

fell 3.89 to 461.37; and Internet Sector

index sank 21.97 to 616.76.

The transportation sector was a notable exception to the market's general weakness; the

Dow Jones Transportation Average

surged 61.97 to 3463.84.

The big European indices finished mixed, with Germany's

Xetra Dax

fractionally higher but France's


and the London


0.8% and 1.2% lower, respectively.

Asian markets went both ways overnight, as Hong Kong's

Hang Seng

dropped 98.11 to 13,447,13, while Tokyo's


added 284.28, or 1.6%, to 18,532.58.

More markets news and commentary is available in


Markets section.



(CSX) - Get Report

is in talks to sell its international container-shipping business to


, a unit of Danish shipping and oil concern

A.P. Moeller

, for about $800 million in cash and assumed debt,

The Wall Street Journal

reported, citing people familiar with the talks. Moeller declined to comment on the report, which it referred to as a "rumor."

CommNet Cellular


is being acquired by U.K. mobile phone firm

Vodafone AirTouch

(VOD) - Get Report

for $764 million in cash.

U S West


yesterday accepted

Qwest Communications'


$34.7 billion buyout offer.

Global Crossing


said it will proceed with its $11.1 billion purchase of


(FRO) - Get Report


Chairman and CEO

Victor M.G. Chaltiel

and CFO John King are resigning from

Total Renal Care Holdings


. The resignations came yesterday as the company warned that its second-quarter earnings will come in at 20 to 22 cents a share, far below the 10-analyst consensus of 35 cents.

More news on companies and stocks is available in


Stock News section.


AOL Europe

, a joint venture of

America Online




, set plans to offer free Internet service in the U.K. with a product called

Netscape Online

. The product will complement the venture's AOL and


brands in Britain.



yesterday agreed to acquire privately held integrated circuit maker

HotHaus Technologies

for $280 million in stock.







Carly Fiorina

president and chief executive officer. She'll succeed

Lewis Platt

, 58, who is retiring at the end of the year.


(IBM) - Get Report

reported second-quarter earnings of 91 cents a share, ahead of the 21-analyst view of 88 cents and up from last year's 75 cents.


(MSFT) - Get Report

reported fourth-quarter earnings of 40 cents a share, beating the 25-analyst forecast of 36 cents a share and up from the year-ago 25 cents. Earlier today, Microsoft agreed to sell the entertainment portion of its MSN Sidewalk directory service to

Ticketmaster Online CitySearch


for $240 million in Ticketmaster stock. The deal gives Softee a 9% stake in Ticketmaster.

More tech news and commentary is available in


Tech Stocks section.

General News

Sometime after the U.S. and Britain began their air campaign against Iraq last December, President

Saddam Hussein

offered his military a bounty for shooting down U.S. and U.K. planes patrolling the no-fly zones in the north and south of Iraq, U.K. Defense Secretary

George Roberston

said today. Meanwhile, Iraq said that U.S. air strikes killed 14 civilians and injured 17 others 200 miles south of Baghdad. The Pentagon acknowledged that it hit two air-defense sites, which it said fired on allied war planes, though it denied knowledge of any casualties.

Investigators last night changed the definition of their search for

John F. Kennedy Jr.

; his wife,

Carolyn Bessette Kennedy

; and his sister-in-law,

Lauren Bessette

, to "search and recovery" from "search and rescue."

Chinese President

Jiang Zemin


President Clinton

in a telephone conversation that China may use force if Taiwan tries to assert its formal independence, according to the state newspaper

China Daily



The Brazilian government filed with the

Securities and Exchange Commission

today to offer up to $7.4 million in debt and warrants from time to time. That gives Brazil a total of $10 billion on the shelf, when combined with the $2.6 billion in debt the country already has registered.

Having rejected a rival bid from

Telewest Communications



Cable & Wireless Communications


said it is in exclusive talks with



over the sale of the cable TV operations of its

Cable & Wireless Communications


Creditors of South Korean



said they will extend the payments on or restructure about $8.4 billion of debt that comes due this week. Fallout from a Daewoo bankruptcy would be severe, as the company has about 400 subsidiaries and 6,400 suppliers.

Sometimes the best defense is a good offense. France's

Elf Aquitaine

(ELF) - Get Report

made a $51 billion cash-and-stock counterbid for

Total Fina

(TOT) - Get Report

, two weeks after Total Fina made a $42.8 billion all-stock offer for Elf.

More international news and commentary is available in


International section.


Tickets for

Ricky Martin's

Oct. 24 concert at Atlanta's

Philips Arena

sold out this Saturday 30 minutes after they went on sale. Given the tickets' $97 price tag and Martin's largely preteen demographic, the show's intense demand is not a little puzzling, if not outright disturbing.

New York Yankees


David Cone

threw the 14th perfect game in modern major league history yesterday, beating the

Montreal Expos

yesterday 6-0.

Have a dumb question relating to finance? Great. Have a


dumb question? Even better. Send it to, and I'll do my best to answer every Saturday. Include your full name, and please, no questions seeking personal financial advice or regarding personal brokerage disputes. And this reminder: Because of the volume of mail, personal replies can't be guaranteed.