eBay Catches A Bid–Here’s Why
Stocks were mixed on earnings
disappointments from several companies.
Volume picked up for a second day in a row.
J.P. Morgan Chase
(
JPM |
Quote |
Chart |
News |
PowerRating) missed by 0.14; revenues also missed
expectations. The company took a hit in bond trading. Last month, Morgan Stanley
missed as a result of its bond trading operations.
Motorola
(
MOT |
Quote |
Chart |
News |
PowerRating) reported
0.20, beating by 0.01, on $8.62 billion revenues, a little light. The company
guided slightly lower. Electronic Arts
(
ERTS |
Quote |
Chart |
News |
PowerRating) reported $0.31 vs. a
0.35 estimate. Net income was $97 million; the company lowered guidance. Note:
ERTS rarely misses on earnings.
Not all the earnings news was bad, though. The
following companies had rosier reports:
Pfizer
(
PFE |
Quote |
Chart |
News |
PowerRating) beat by a penny, but revenue was lighter than
expected. Pfizer makes Lipitor, the world’s best selling drug.
Eastman Kodak
(
EK |
Quote |
Chart |
News |
PowerRating) beat by 0.07,saying sales of digital products
rose +39%.
General Dynamics
(
GD |
Quote |
Chart |
News |
PowerRating) reported 1.60 vs 1.50 estimate. The
Gulfstream business rebounded.
United Technologies
(
UTX |
Quote |
Chart |
News |
PowerRating) reported 1.43, beating estimates. The
company expects double-digit earnings growth for 2005.
Rising raw materials costs are increasingly being cited in earnings reports.
Whirlpool
(
WHR |
Quote |
Chart |
News |
PowerRating) warned and said it would raise prices to combat
rising raw materials prices. On Monday, Kraft
(
KFT |
Quote |
Chart |
News |
PowerRating) said that rising
commodity costs caused a 3.8% fall in earnings. Swift Transportation
(
SWFT |
Quote |
Chart |
News |
PowerRating)
said that fuel costs are 30% than last year.
Overall, guidance this quarter has been weaker than expected. Energy and
industrials are two areas that have demonstrated pricing power.
New mortgage applications rose 7.9% last week.
The 10-year note broke below the 4% level.
In a report, J.P. Morgan noted that hedge fund
returns this year are “barely positive.”
eBay
(
EBAY |
Quote |
Chart |
News |
PowerRating) beat by a penny. Q3 net
rose 77% as listings rose and PayPal expanded to Europe.
Chiron
(
CHIR |
Quote |
Chart |
News |
PowerRating) reported non-GAAPÂ of 0.26. Amgen
(
AMGN |
Quote |
Chart |
News |
PowerRating)
beat by 0.02 and raised 2004 earnings and revenue guidance; sales or Enbrel and
Epogen were greater than expected. AMGN traded down after hours. Symantec
(
SYMC |
Quote |
Chart |
News |
PowerRating) beat by 0.02 and announced a 2:1 split. Brooktrout [
(
BRKT |
Quote |
Chart |
News |
PowerRating)
beat by 0.06. DeVry
(
DV |
Quote |
Chart |
News |
PowerRating) missed by 0.08 and was light on revenues.
California Insurance Commissioner John Garamendi
will file civil lawsuits against insurance companies next week. In Connecticut,
AG Richard Blumenthal has expanded his investigation of the industry. One trader
was heard to say: “Spitzer’s after the Dow, not the Nasdaq.” Most of the
companies under investigation trade on the Big Board.
Crude oil inventories rose +1.2 million barrels;
gasoline stocks fell -700,000 barrels; distillates fell -1.9 million barrels.
Oil closed a penny below its record high.
| Dow | -11.44 | 9886.18 |
| S&P 500 | +0.49 | 1103.74 |
| Nasdaq | +9.84 | 1932.74 |
Strong sectors were: Oil
Services
(
OSX.X |
Quote |
Chart |
News |
PowerRating) +3.35%, Gold
(
XAU.X |
Quote |
Chart |
News |
PowerRating)
+2.90% , Healthcare Providers
(
HMO.X |
Quote |
Chart |
News |
PowerRating) +2.71%.
Weak sectors were:Â Airlines
(
XAL.X |
Quote |
Chart |
News |
PowerRating)
-1.30%, Banks
(
BIX.X |
Quote |
Chart |
News |
PowerRating), -1.23% and Internet
(
GIN.X |
Quote |
Chart |
News |
PowerRating) -0.41%.
10-year notes were: +110
at 113 200
The dollar was -0.50 at
86.34
Gold was +3.60 at 423.10
Crude Oil was +1.71 at 54.35
1.64 billion on the Nasdaq.
Market breadth was positive.
| NYSE | Issues | |
| Advancing | 1769 | Up Vol 839 |
| Declining | 1523 | Down Vol 811 |
| Ratio | 1.16 | 1.03 |
| Nasdaq |
||
| Advancing | 1711 | Up Vol 977 |
| Declining | 1333 | Down Vol 640 |
| Ratio | 1.28 | 1.52 |
Stocks in the News
Motorola
(
MOT |
Quote |
Chart |
News |
PowerRating) reported 0.20, beating by 0.01, on $8.62 billion
revenues, a little light.
Electronic Arts
(
ERTS |
Quote |
Chart |
News |
PowerRating) reported $0.31 vs. a
0.35 estimate. Net income was $97 million; the company lowered guidance. Note:
ERTS rarely misses on earnings.
Ameritrade
(
AMTD |
Quote |
Chart |
News |
PowerRating) beat by 0.03.
Wyeth
(
WYE |
Quote |
Chart |
News |
PowerRating) beat by 0.06, reversing last year’s loss.
Cummins
(
CMI |
Quote |
Chart |
News |
PowerRating) beat and guided higher. The company makes truck
engines. CMI is at a 7-year high.
MGM Mirage
(
MGG |
Quote |
Chart |
News |
PowerRating) guided lower.
Harrah’s
(
HET |
Quote |
Chart |
News |
PowerRating) beat by 0.05.
Honeywell
(
HON |
Quote |
Chart |
News |
PowerRating) was in-line at 0.43. Q3 profits rose 8%.
Teradyne
(
TER |
Quote |
Chart |
News |
PowerRating) missed by 0.02 and said customers have sharply
lowered capital spending.
Lucent
(
LU |
Quote |
Chart |
News |
PowerRating) reported its first profitable year since 2000.
Countrywide Financial
(
CFC |
Quote |
Chart |
News |
PowerRating) had a big miss. Refinancing volume
fell 55%; net income fell 47%.
Monster.com
(
MNST |
Quote |
Chart |
News |
PowerRating) beat by a penny and beat on revenues.
XM Satellite
(
XMSR |
Quote |
Chart |
News |
PowerRating) announced a $650 million, 11-year deal with
Major League Baseball to broadcast games. A Lazard analyst said the company paid
two times what Sirius Satellite paid for NFL.
eBay
(
EBAY |
Quote |
Chart |
News |
PowerRating) reports tonight, with a 0.27 estimate. Analysts will
be looking at the revenue growth number.
Brice Wightman