Layoffs! Here’s Who’s Involved
Stocks are
lower this midday. After six days of
gains, stocks pulled back on news of more layoffs. Outplacement firm Challenger
Gray & Christmas announced that layoffs levels for October exceeded 171,000. The
automotive industry issued pink slips to over 28,000 employees, while retail and
telecommunication sectors each cut 21,000.
Tyco International
(
TYC |
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PowerRating)
also announced plans to reduce their workforce by 7,200 employees as part
of restructuring that would include the consolidation of 219 facilities. It
reported a fourth-quarter loss of $297 million or 15 cents, down from 72 cents
in the year-ago quarter. American Airlines
(
AMR |
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PowerRating) announced its October load
factor was up 1.7% while traffic fell 1.7% as the company cut capacity 4.1%. Lastly,
Former HealthSouth
(
HLSH |
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PowerRating) CEO Scrushy was indicted on
charges of orchestrating one of the biggest accounting frauds in US corporate
history.
The Dow Jones Industrial
Average
(
$INDU.X |
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PowerRating) is +0.08% at 9867.05. The S&P 500
(
$SPX.X |
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PowerRating)
is down -0.17% at 1057.21. The Nasdaq
(
$COMPQ |
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PowerRating) is +.12% at
1970.20.
The day’s leading sectors are
AMEX Gold Bugs Index
(
$HUI.X |
Quote |
Chart |
News |
PowerRating), 2.00%, Gold and Silver Index
(
$XAU.X |
Quote |
Chart |
News |
PowerRating), +1.35%, GSTI Composite Index
(
$GSM.X |
Quote |
Chart |
News |
PowerRating), +.86%,
GSTI Multimedia Ntwking Index
(
$GIP.X |
Quote |
Chart |
News |
PowerRating), +0.85%,and Oil Service
Sector
(
$OSX.X |
Quote |
Chart |
News |
PowerRating), +0.73%.
Weak today are
Pharmaceutical Index [DRG.X|DRG.X]
-.83%, S&P Healthcare Index
(
$HCX.X |
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Chart |
News |
PowerRating),
-0.74% and Computer Hardware Index
(
$HWI.X |
Quote |
Chart |
News |
PowerRating), -0.64%.
No economic news releases
today.
10-year Bonds are +105
at 112 035.
Dollar is -.46 at 93.41.
Gold is -+.23. at
379.40.
Crude Oil is -0.27 at
28.63.
Volume is 581,000,000 on
the NYSE, and 1,008,000,000 on the Nasdaq.
Market breadth is positive,
with NYSE advancing issues over declining issues by 1.23 and down over up volume
by 1.17; Nasdaq advancing issues over declining issues at 1.07, and up volume
over down volume at 1.08.
Top Dow stocks are:
McDonalds [MCD|MCD],
+0.51 at 25.90, Eastman Kodak [EK|EK],
+1.65% at 24.61, Caterpillar [CAT|CAT],
+1.55% at 75.20, Hewlett Packard
(
HPQ |
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Chart |
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PowerRating), +1.14% at 22.9663, and 3M
(
MMM |
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Chart |
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PowerRating),
+0.95% at 79.54.
Stocks in the news:
Gillette
(
G |
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PowerRating) shares
are up 4% after the company announced third-quarter earnings of $416 million, up
from $354 last year. Sales of blades, razors and Duracell batteries were strong
and contributed to an 11% rise in revenue.
Hewlett-Packard
(
HPQ |
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Chart |
News |
PowerRating)
was upgraded by JP Morgan Securities from “neutral” to “overweight”. JPM
stated that it was expecting a steady economic improvement in 2004 and IT
spending should be up and would help decrease the competition from IBM
(
IBM |
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PowerRating)
and Dell
(
DELL |
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PowerRating).
Novell
(
NOVL |
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News |
PowerRating)
zoomed up 40% after announcing plans to purchase developer SuSE Linux for
$210 million. SuSE is Europe’s leading distributor of Linux. In a separate news
release, the company disclosed that IBM purchased $50 million worth of
convertible preferred stock.
Cephalon
(
CEPH |
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Chart |
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PowerRating) announced that it would purchase Cima Labs
(
CIMA |
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PowerRating) for
$515 million. Third-quarter earnings for Cephalon totaled $22.3 million on sales
of $190 million. It also raised its full-year forecast to $1.52 a share on sales
of $680 million. Cima Labs specializes in drug delivery technology.
PMA Capital
(
PMACA |
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PowerRating)
tanked 60% today after announcing it will record a $150 million charge relating
to higher-than-expected underwriting losses in its reinsurance
operations. Shortly following the news, S&P cut the company’s counterparty
credit and senior debt ratings to “BB-“.
If you have any comments or questions, please
feel free to email me.
kaig@tradingmarkets.com