What Investors Are Looking At Now

July 21, 2003
Vincent Mao

Stocks were
lower Monday. A third-quarter earnings
warning from Lexmark International
(
LXK |
Quote |
Chart |
News |
PowerRating), Merck’s
(
MRK |
Quote |
Chart |
News |
PowerRating)
lowered sales target of its popular cholesterol drug Zocor, and rising rates
combined to send the averages down. The 10-year note closed at the highest yield of the year. Investors are selling the earnings and are
worried about rising interest rates; mortgage rates, for instance are now just
over 6%. Financials and cyclicals held up the best; tech was the weak spot on
this light volume day. Smith Barney
upgraded Yahoo!
(
YHOO |
Quote |
Chart |
News |
PowerRating) from “in line” to “outperform.”

In economic news, the index of
Leading Economic Indicators for June rose by an expected 0.1%. This was
the third straight gain.

The 10-year U.S. Note
slid -1 18 at 113 035.

The dollar was -0.46 at
96.42.

Gold gained +5.00 at 351.50.

Crude Oil fell -0.11 at
31.67.

Volume was
1,220,076,000 on
the NYSE, and 1,446,378,000 on the Nasdaq.

Market breadth was negative,
with NYSE declining issues over advancing issues by 2.96, and down volume up
down volume by 3.81. Nasdaq declining issues over advancing issues is 1.96, and
down volume over up volume 2.99.

Top Dow stock(s) were:

Stocks in the news:

Business software maker,
Business Objects
(
BOBJ |
Quote |
Chart |
News |
PowerRating) was higher on large volume after the company said that preliminary second-quarter results
would be 17 to 18 cents a share on revenues of $127 to $127 million. Analysts
had expected the firm to earn 17 cents a share on revenues of $122 million. The
company also announced plans to buy privately held Crystal Decisions for $820
million.Â BOBJ closed at 23.15, up 2.89.

Dow component 3M
(
MMM |
Quote |
Chart |
News |
PowerRating)

reported second-quarter results that topped
estimates — $1.56 a share, or 5 cents ahead of
expectations. 3M also raised it full-year outlook from $5.90 to $6.05 compared
to analysts’ estimates of $5.91 a share.

Internet portal Yahoo!
(
YHOO |
Quote |
Chart |
News |
PowerRating)

received an upgrade from Smith
Barney. Smith Barney upgraded the stock from “in line” to “outperform” on the
belief that the company may put in an upside surprise during the second half of
the year. YHOO was up 1.15 to 31.05.

Checkpoint Software
(
CHKP |
Quote |
Chart |
News |
PowerRating)
is off by 14% after the company reported second-quarter earnings inline with
estimates but down from year-ago levels. Checkpoint reported income of 24 cents
a share compared to 27 cents a share a year ago. CHKP fell 2.65 to close at
17.15.

Computer printer and peripheral
maker Lexmark
(
LXK |
Quote |
Chart |
News |
PowerRating) is lower by almost 19% after the missed
second-quarter results by a penny. The company reported earnings of 77 cents a
share compared to 67 cents a share a year ago. Looking ahead, the company is
expecting third-quarter results between 63 and 73 cents a share compared to
analysts’ estimates of 80 cents a share. The company cited competition as well
as a weak IT spending environment.

Drug giant Merck
(
MRK |
Quote |
Chart |
News |
PowerRating)

reported second-quarter results that missed
estimates by a penny. The New Jersey drug company reported earnings of 83 cents
a share compared to 77 cents a share a year ago. Looking ahead, Merck sees
third-quarter results between $3.40 to $3.47 a share or within the Street’s view
of $3.41 a share. The company also lowered its 2003 sales estimate for its
top-selling Zocor drug to $5.4 to $5.7 billion from $5.9 billion. CAT fell 14.10
to close at 59.40.

If you have any comments or questions, please
feel free to email me.

Vincent Mao

vincentm@tradingmarkets.com

What Investors Are Looking At Now

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