Look What Met Life Is Buying

August 28, 2003
Brice Wightman

Stocks were
higher Thursday. A quick move up at the
open brought on by a better-than-expected GDP report was quickly aborted as
mixed reports on the job market had investors thinking twice. Second-quarter
GDP was upwardly revised to show that the U.S. economy grew at the fastest rate
in about a year. The growth in the economy was higher than expected and
continues to provide evidence to the economic recovery. However, the latest data
on the job market was a little disappointing as weekly jobless claims rose
slightly while help-wanted ads came in lower than expected.

After hitting a 16-month high
yesterday, the Nasdaq made a fresh new high. Semiconductor equipment maker Novellus Systems
(
NVLS |
Quote |
Chart |
News |
PowerRating)Â Bonds are rallying more than 2 points despite the
stronger-than-expected GDP report.

In economic news, GDP for
the second quarter grew by 3.1% compared to economists’ expectations of
2.9%. Weekly Jobless Claims for the week ended August 23 rose by 3,000 to
394,000. Economist had expected a drop to 300,000. Claims have remain under the
critical 400K level for five out of six weeks. The less volatile four-week
moving average inched up to 396,250 from a revised 395,750. This was the fourth
straight reading under 400K. Lastly, in a sign that job listing remains low, the
Help-Wanted Index in July remained at 38 compared to economists’
expectations of 39.

A hearing panel said that
specialist firm Labranche must turn over all its e-mails to the NYSE. Michael
LaBranche said that there were no smoking guns involved, and that “they’re going
to be reading about little league games.”

The SEC will investigate NYSE
Chairman Richard Grasso’s $140million compensation package.

The 10-year U.S. Note
was +315 at 111 230.

The dollar was -0.08 at
98.78.

Gold was -0.20 at 370.70.

Crude Oil was +0.24 at
31.50.

Volume was
1,159,128,000 on
the NYSE, and 1,451,008,000 on the Nasdaq.

Market breadth was positive,
with NYSE advancing issues over declining issues by 2.32, and up over down
volume by 2.85; Nasdaq advancing issues over declining issues at 1.54, and up
volume over down volume at 2.83.

Top Dow stocks were:

Stocks in the news:

Women’s clothing retailer
Chico’s FAS
(
CHS |
Quote |
Chart |
News |
PowerRating) gained almost 10% after the company reported
second-quarter results that topped analysts’ estimates. Late yesterday the
company reported earnings of 28 cents a share compared to 19 cents a share in
the year-ago quarter. The results beat analysts’ estimates by 2 cents. Revenues
jumped 39% to a record $173.4 million.

Biotech firms Amgen
(
AMGN |
Quote |
Chart |
News |
PowerRating)
and Genentech
(
DNA |
Quote |
Chart |
News |
PowerRating) settled a patent dispute. Under the terms, both
companies agreed to dismiss all claims and counterclaims. Amgen will also make a
one-time payment to Genentech and take a 5 cents charge in its third quarter.
Genentech said that its full year fiscal 2003 results will be boosted by about
20 cents a share. Shares of both companies are trading lower by about 1%.

The nations largest
post-secondary education company Apollo Group
(
APOL |
Quote |
Chart |
News |
PowerRating) rose 5% after the company’s optimistic 2004 outlook. The company is forecasting
fiscal 2004 earnings of $1.64 a share on revenues of $1.731 to $1.734 billion.
This is slightly higher than consensus estimates of $1.62 a share.

Pet supplies and services
retailer PetsMart
(
PETM |
Quote |
Chart |
News |
PowerRating) added nearly 12% after the company
reported better-than-expected second-quarter results and lifted its full year
outlook. The company earned 19 cents a share compared to 15 cents a share in the
year-ago quarter. The results topped analysts’ estimates by 2 cents. Revenues
jumped 11% to $725.8 million. PetsMart’s gross margins also climbed 1.13
percentage points to 29.7%. Looking ahead, the company sees full-year results
between 91 to 93 cents a share compared to an earlier forecast of 88 to 90 cents
a share.

Information technology product
distributor Tech Data
(
TECD |
Quote |
Chart |
News |
PowerRating) fell 0.57 after the company
reported a 50% drop in quarterly earnings. Due to workforce reduction and other
costs, the company reported second-quarter results of 30 cents a share compared
to 60 cents a share in the year-ago quarter. Excluding charges, the company
would have earned 34 cents a share. The results were below analysts’ estimates
of 37 cents a share. Looking ahead, the company sees third-quarter revenues of
$4.05 to $4.2 billion and earnings of 40 to 45 cents a share. Analysts are
expecting revenues of $4.02 billion and earnings of 41 cents a share.

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

Brice Wightman

bricew@tradingmarkets.com

Look What Met Life Is Buying

BUY THE FEAR, SELL THE GREED

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