Big IPO Week — Here’s What’s On Tap…
Stocks fell Monday
as investors focused on next week’s Fed meeting and the June 30 transfer of
power in Iraq and largely ignored significant merger news. Wachovia
(
WB |
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PowerRating)
will acquire Southtrust
(
SOTR |
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PowerRating) for $14.3 billion; Wachovia will swap
.89 for each WB share for each Southtrust share. Taser International
(
TASRR |
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PowerRating)
boosted its 2004 outlook, and now expects 150% growth.
The CEOs of Cisco
(
CSCO |
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Nortel
(
NT |
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PowerRating) met in Toronto on Friday, a signal that partnership talks
between the two companies are getting serious.
Oil prices eased as Iraq resumed exports after a
six-day stoppage due to sabotage. Crude fell $1.15.
The first manned commercial space flight flew
outside the Earth’s atmosphere. Launched from a larger plane, SpaceShipOne
entered space 62 miles above the earth and landed safely in Mohave, CA. Designed
by Burt Rutan (Voyager), the $20 million project was funded by Microsoft
co-founder Paul Allen.
The Supreme Court ruled that patients cannot sue
HMOs over coverage decisions. The decision blocks two lawsuits, one against
Aetna
(
AET |
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PowerRating) and the other against Cigna
(
CI |
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PowerRating).
Asset manager Pilgrim Baxter must pay $90
million to settle trading abuse allegations.
Two former Quest
(
Q |
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PowerRating) execs agreed to
settle lawsuits. Without admitting any wrongdoing, Augustine Cruciotti will pay
$150,000 and Stephen Haggerty will pay $30,000.
This is a busy week for IPOs, with $3 billion
coming in the next few days. Cendant spinoff Jackson Hewitt Tax Service,
the 2nd largest tax preparer in the US, is expected between $18-20. Also look
for SalesForce.com (CRM), a developer of customer relationship manager
software, outdoor merchandiser Cabela’s (CAB), expected between $15-17,
and luxury hotel REIT Strategic Hotel Capital, anticipated between
$15-17. After this week’s offerings, IPOs will exceed last year’s $15 billion
total at $15.9 billion year-to-date.
Three British naval vessels were seized by Iran
and eight crewmembers arrested; the vessels were in Iranian waters.
Tomorrow, look for earnings from Morgan
Stanley
(
WMD |
Quote |
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PowerRating). Analysts are looking for $1.06, up from 0.55 a year ago;
booming fixed income trading is expected to give earnings a boost. Also
tomorrow, Goldman Sachs
(
GS |
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PowerRating) will report; consensus is $1.95.
| Dow | -44.94 | 10371.47 |
| S&P 500 | -4.70 | 1130.32 |
| Nasdaq | -12.35 | 1974.38 |
Strong today were Hardware
(
HWI.X |
Quote |
Chart |
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PowerRating) +1.52%,
Semis
(
SOX.X |
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Chart |
News |
PowerRating) +0.89%,
Chemicals
(
RLX.X |
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Chart |
News |
PowerRating) +0.52%, Networking
(
NWX.X |
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Chart |
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PowerRating) +.40%.
Weak today were GoldÂ
(
HUI.X |
Quote |
Chart |
News |
PowerRating) -1.25%, Healthcare
(
HMO.X |
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Chart |
News |
PowerRating) -1.18%, Oil
Services
(
OSX.X |
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Chart |
News |
PowerRating) -1.09%.
10-year Notes were +080 at
108 195
The dollar
was +0.121 at 89.27
Gold was -0.60 at 393.50
Crude Oil was -1.15 at
37.77
Volume was 1.12 billion
on the NYSE, and 1.35 billion on the Nasdaq.
Market breadth was negative.
| NYSE | Issues | |
| Advancing | 1555 | Up Vol 420 |
| Declining | 1742 | Down Vol 645 |
| Ratio | 1.32 | 1.37 |
| Nasdaq |
||
| Advancing | 1373 | Up Vol 410 |
| Declining | 1734 | Down Vol 806 |
| Ratio | 1.10 | 1.69 |
Stocks in the news:
Simon Property Group will acquire
Chelsea Property Group for $3.5 billion. Simon will pay $66/share for each
Chelsea share and assume debt and preferred stock.
Wal-Mart
(
WMT |
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PowerRating) said it expects
sales to be on the low end of forecast for 4-6% growth.
Walgreen
(
WAG |
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PowerRating) posted higher
profit on stronger sales, reporting 0.33 vs. 0.29 a year ago.
Brice Wightman
bricew@tradingmarkets.com