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Charles Schwab & Co., Inc.
Midday Market View(TM) for Friday, October 19, 2001 as of 1:00PM EDT Information provided by Schwab Center for Investment Research and Bridge ================================================================ U.S. INDICES (1:00 p.m. EDT) ---------------------------------- Market Value Change DJIA 9,091.88 - 71.34 Nasdaq Comp. 1,633.87 - 18.85 S&P 500 1,058.18 - 10.43 ---------------------------------- NYSE Advancing Issues 1,208 NYSE Declining Issues 1,636 NYSE Trading Volume 586 mln NASDAQ Advancing Issues 1,289 NASDAQ Declining Issues 1,840 NASDAQ Trading Volume 751 mln ================================== U.S. TREASURIES ---------------------------------- Value Yield Change 6-month bill 2.07% n/a 5-year note 3.76% unch 10-year note 4.56% unch 30-year bond 5.34% + 3/32 The tables above look best when viewed in a fixed-width font, such as "Courier." ================================================================ MARKETS LANGUISHING IN THE RED Stocks were trading near the day's lows, despite largely positive earnings releases, as many corporations remained cautious about future prospects. This morning's September Consumer Price Index data were generally in line with expectations, while the August trade gap narrowed. As of 11:56 a.m. EDT, the Dow Jones Industrial Average was down 0.8%, and the Nasdaq Composite Index was 1.3% lower. The S&P 500 Index was down 0.9%. Semiconductor, networking, wireless, transport and leisure were among the steepest decliners, while defense and select healthcare issues were higher. Shares of Microsoft (MSFT,57,f1) were lower after the software giant offered cautious 2Q guidance as it anticipates sluggish demand for its Windows XP operating system amid languishing PC sales. The Dow component reported a fiscal 1Q profit, excluding charges, of $0.43 per share, beating the First Call consensus of $0.39 per share on a 6% rise in sales. Including the charge for investment writedowns, net income actually fell to $0.23 per share. Going forward, Microsoft forecast profits for 2Q of $0.49-$0.50 per share, just shy of the $0.51 per share First Call consensus estimate. Network computer maker Sun Microsystems Inc. (SUNW,8.88,f1) reported a fiscal 1Q loss of $0.05 per share, excluding items, $0.01 better than the First Call consensus estimate, amid sluggish sales exacerbated by last month's attacks. Sun neglected to give guidance for the current quarter, choosing instead to wait for its regularly scheduled mid-quarter conference call. Shares of Corning (GLW,8.02,f2) were lower after the fiber optic cable giant reported 3Q profits, excluding charges, of $0.09 per share, triple the $0.03 per share First Call consensus estimate, but sales declined 21%. Corning forecast a 4Q loss of between $0.20-$0.25 per share, below the $0.06 per share First Call consensus estimate amid lethargic demand for telecom products. Internet auction vendor eBay Inc. (EBAY,53,f1&f4) posted 3Q earnings, excluding costs, of $0.12 per share, $0.01 ahead of the Street's mean forecast as revenues rose 71%. The company raised its 4Q revenue estimate by roughly $5 million and increased its 4Q earnings forecast by $0.02 per share but expressed concern about the potentially sluggish upcoming holiday season. ---------------------------------------------------------------- TREASURY AND ECONOMIC SUMMARY Bonds were mixed, with most of the strength confined to the short-end following this morning's relatively tame September Consumer Price Index, which rose 0.4%, according to the Labor Department. The core index, which excludes food and energy, rose 0.2%. Analysts per Dow Jones Newswires were expecting 0.3% and 0.2% increases, respectively. The rise in the overall CPI was mainly attributed to a 2.6% rise in energy costs as gasoline prices spiked higher during the month. However, energy prices have since declined substantially, and the relatively benign inflation backdrop remains conducive to further monetary easing. In other economic news, the August U.S. trade deficit shrank more than expected, coming in at $27.11 billion. Exports grew 1%, while imports declined 1.1% as business and consumer spending waned, according to the Commerce Department. Analysts per Dow Jones Newswires were expecting the trade gap to rise to $29 billion. ---------------------------------------------------------------- WORLD MARKETS European bourses remained in negative territory late in the day following the release of this morning's German IFO business sentiment index for September, which dropped to its lowest level in almost eight years. The IFO index fell to 85 from August's 89.5, below economists' expectations, and the future prospects component fell to 90.6 from August's 95.9. The report spawned escalating rhetoric among members of the euro-zone toward pressuring the European Central Bank into decisive rate-cutting action. The euro continued to drop against the dollar following this morning's relatively neutral U.S. inflation data. An upbeat earnings report from Nokia Corp. (NOK,19.87,f2) offered little in the way of a reprieve, even though the company posted a smaller-than-expected 3Q loss and forecast a recovery for wireless handset sales in 4Q. The Bloomberg European 500 Index was down 1.54% as of 11:56 a.m. EDT. William Johnson, Market Analyst ################################################################ Log in using the links below to: Access your account: https://investing.schwab.com/trading/start?SANC=CCBodyi&NeedCASelValue=Y View your Email Alert customization options: https://investing.schwab.com/trading/start?SANC=EAMyAlerts Perform research or request a market quote: https://investing.schwab.com/trading/start?SANC=Quotes Place a trade order: https://investing.schwab.com/trading/start?SANC=TradeStock To visit Schwab's home page, use this link: http://www.schwab.com/ ----------------------------------------------------------------- To unsubscribe or modify your Email Alert customization options, log in using the link below or copy and paste it into your browser's address window: https://investing.schwab.com/trading/start?SANC=EAMyAlerts Now you can receive graphics Email Alerts in HTML format, using helpful, full-color graphics and active Web links that connect you directly to information you want. Use the link below to log in and change your email format preference: https://investing.schwab.com/trading/start?SANC=EAEditEmailAddr ---------------------------------------------------------------- Notice: All email sent to or from the Charles Schwab corporate email system may be retained, monitored and/or reviewed by Schwab personnel. (0801-11482) Information provided by Bridge Information Systems. Copyright 2001 Bridge Information Systems. Charles Schwab & Co., Inc. ("Schwab") is a member of the NYSE, other major U.S. Securities Exchanges, and SIPC. Schwab is a specialist in various securities on the Pacific, Boston and Cincinnati Stock Exchanges and is subsidiary of The Charles Schwab Corporation, which is listed on the NYSE and trades under the symbol "SCH". Schwab Capital Markets L.P. is a member of the NASD and SIPC. Schwab Capital Markets L.P. is also a subsidiary of The Charles Schwab Corporation and is a market maker in approximately 4,900 securities. Schwab Center for Investment Research ("SCIR") is part of Charles Schwab & Co., Inc. The information contained herein is obtained from sources believed to be reliable, but its accuracy or completeness is not guaranteed. This report is for informational purposes only and is not a solicitation, or a recommendation that any particular investor should purchase or sell any particular security. Schwab does not assess the suitability or the potential value of any particular investment. All expressions of opinions are subject to change without notice. The Charles Schwab Corporation, Schwab, Schwab Capital Markets L.P. and its officers, directors, employees, consultants and/or members of their families may have a position in, and may from time to time, purchase or sell any of the mentioned or related securities including derivatives in such securities. 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