NYSE --- Deb (fast)
Dell --- Greg (slow)
>> news after the bell from fannie mae. this is from fannie mae’s office of federal housing enterprise oversight. , on fayo is saying that fannie mae will likely meet the september 30 deadline to have a 30% capital surplus mandated by the regulator after the company violated rules. news from ofheo, saying fannie mae will meet the capital surplus by september 30. those shares slumped 11%, their biggest fall since 1987. deborah kostroun filed this report from the new york stock exchange.
>> stocks rose after the durable goods orders increased more than forecast, also helping copper prices rise to a record on speculation that demand may rise for copper. copper is used in manufacturing, wiring and construction. stocks like freeport-mcmoran and phelps dodge closed at a record. gold closing at the highest level in 17 years as energy costs soared. crude oil higher today, natural gas also closing at a record. even though the durable goods orders increased, didn’t see a major jump in many of those stocks. one analyst saying the durable goods report very positive but he thinks the focus is on where the economy is going and the biggest fear hanging over the market is gas prices and the effect they’ll have on the consumer. talking about gas prices, crude oil up $1.28, $66.35, leading oil refiners and integrated oil stocks higher on the day. the natural gas index at a record high and many of the natural gas stocks higher, as well. the higher energy costs impacting retail. retail, the biggest laggard of the 24 industry groups. retailers falling as oil prices gain spurring concerns that higher fuel costs may crimp consumer spending. we saw jet fuel prices coming in at a record. didn’t have an impact on many of the transports. transports, the biggest gainer in the s&p 500 as a group and in fact what you did see, railroad stocks performing the best. shares of fannie mae fell to an eight-year low after dow jones saying that investigators found new and pervasive accounting violations. shares down 39% this year. and n.r.g. rose after a report that the company is in talks to acquire the power company that supplies houston. i’m deborah kostroun at the new york stock exchange for bloomberg news.
>> michael dell, chairman of the world’s number one personal computer maker, was in new york today launching a rash of new consumer products, all part of the company’s strategy to boost sales from $49 billion to $80 billion within four years. greg miles was there and joins us with the latest.
>> the share price down 19% thus far this year. they need a boost. delegates only 15% of revenues from consumer products, getting the vast majority of its sales by selling to corporate america. having missed its sales goals in the latest quarter and it will also in the current quarter. michael dell introduced a new line of high-margin product including large cap tops, desktop p.c.’s and high-definition tv’s. michael dell talked to us about his new digital music player which costs only $99 and weighs 1.29 ounces. he said the music player can gain market share from apple’s ipod.
>> they’ve done very well and i think it will be hard for them to maintain that share particularly with the number of new competitors in the market but also, again, for customers who want a more open platform where the music they purchase can work on a variety of devices.
>> dell also stressed that the new high-end customers will get deluxe service to help them put together the systems that connect the p.c., tv set and latest software and imaging. dell said the company was taking action to improve its basic customer service which received the lowest ratings in seven years in a recent survey, but he said nonetheless the service quality remained high.
>> we weren’t happy about that.
>> do you acknowledge there are problems?
>> i think you could find a number of surveys that would show―and actually that survey, as well, showed that dell was in the lead position among peak competitors, although our score dropped, we were ahead of our p.c. competitors. there are plenty of surveys that show dell with a commanding lead in terms of support.
>> mr. dell said the story in oil prices are having no noticeable impact on demand for the company’s products and remained optimistic about sales of personal computers even though demand for desktop p.c.’s have slowed. th main reason, sales of laptop p.c.’s are soaring, filling the gap.
>> research in motion, maker of blackberry, said second-quarter profit rose 67% but subscriber additions missed analysts’ estimates. shares down over 2% in extended trade. shares of delphi closed lower today. the auto parts maker asking for aid to avoid bankruptcy. june grasso will have details.
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Listen Market briefing -- Ellen (slow)
Energy --- Brett (slow)
Interview: House majority leader
hurricanes could develop in a season that is already curbing energy production in the gulf of mexico. here’s natural gas at the end of trade. this is the current trade, 7.5%. it was up as much as 15%, ended the day up about 10%, the biggest fluctuation of any commodity around the world today. crude oil up 2%, $66.35, the latest trade. among other energy movers today, unleaded gasoline up 8%, heating oil up 3.5% and natural gas currently up 7.5%. in the stock market today, the dow ending higher, .2%. s&p up .1%. energy and computer shares giving a boost there. the nasdaq ending the day essentially unchanged. let’s take a closer ok at the energy trade today with brett gehrig.
>> this is already a very active hurricane season for the u.s. but it was a sobering reminder that the season isn’t over yet. the national hurricane center reported a storm system near jamaica in the caribbean sea was getting better organized and still has the potential to become a tropical depression by tomorrow. that was enough to spark a rally in all energy products of the you’re looking at the closing price for natural gas. at one point, gas surged 15% to $14.60 per million british thermal units.
>> markets are sending us a simple meanwhile. we have a supply problem. obviously, the double whammy with two months in the gulf knocking out significant supply and damaging infrastructure is going to have an impact in the short term.
>> the natural gas industry is still assessing damage to pipelines and processing facilities caused by hurricanes katrina and rita. most offshore production in the gulf of mexico remains shut. gasoline, crude and heating oil rose on speculation supplies will decline heading into the winter heating season.
>> inventories are a little bit above normal and heating oil stocks, as well, are in good shape, but if we have a cold november and december period and cold overall winter season, then we could be looking at higher prices as the season wears on. >> as of today, 11 refineries in louisiana and texas are closed because of rita and katrina. all offshore oil output in the gulf remains shut, as well. crude and distillate supplies in the u.s. fell last week according to the department of energy. gasoline stocks unexpectedly rose by nearly 4.5 million barrels. there is evidence of relief coming for high gasoline prices. near-term gasoline contracts are more expensive than those for delivery farther out. traders appear to be speculating that refineries will be up and running in the winter months as gasoline demand falls.
>> thanks so much. house majority leader tom delay calling his indictment on a conspiracy charge “a sham.” mark crumpton has more on that story. mark?
>> saying he has truth on his side, congressman delay is insisting he did nothing wrong. a grand jury in texas today charged delay in two political associates with conspiracy in an alleged campaign finance scheme. delay calls the indictment an act of blatant political partisanship by travis county, texas, district attorney, ronnie earle, a democrat.
>> district attorney ronnie earle told reporters that our job is to prosecute abuses of power. joining us are democratic congressman harold ford from tennessee and reserve bank of newlican tom tancredo. what is your reaction to the indictment of majority leader delay.
>> i have been in the past quite critical of majority leader delay and i have focused on a lot of things, i think decisions he made incorrectly. but i must tell you, in this one, something doesn’t smell good about this. especially this d.a.’s history where, 1994, he goes after kay bailey hutchison, indicts her, strings it out as long as he can and day after the court throws it out, he’s gone through six grand juries as i understand to get to this one never before getting any grand jury to go along with him. he goes to a democratic fundraiser not too long ago soliciting money on the basis that he’s going to get tom delay. something about this doesn’t smell right to me.
>> so, congressman tancredo, no question this is a political witch hunt in your opinion?
>> it certainly does appear that way to me. the issue will be played out in the courts i’m sure but right now, i got to tell you, there is something about this isout that does not smell right to me.
>> congressman ford, do you believe this is politics or there is merit to the conspiracy charge?
>> all i know are the facts. leader delay has been indicted by a grand jury out of texas dealing with campaign finance irregularities and abuses. he’s innocent until proven guilty. i pray for him and his family. he will go before a jury of his peers. in the meantime, we have work to do here, not focus and my inclination is to get back to work this afternoon and tomorrow and finish up a new energy bill, the budget work we have to do, figuring out how to pay for the katrina rebuilding effort and do everything we possibly can to keep taxes as low as possibl so we have a lot of work to do here and mr. delay stepped down and a new leader has been appointed by the republicans. mr. delay will have a chance to answer the charges.
>> if your opinion, now is not the time for the democrats to be gleeful about what’s going on concerning the congressman?
>> this has hurt the institution. any time a member of congress is indicted, it shines poorly on the entire congress and naturally republicans, although republicans may have a brighter negative shine, but the institution itself is affected and again, it this is innocent until proven guilty. i would hope my colleagues would refrain from saying there are politics. right now, leader delay faces a serious charge, a felony charge. and our job now is to get back to work and let him answer those questions.
>> congressman tancredo, talk to me about the republicans. mr. delay said today after his meeting with the republican leadership on the hill that they were united. do you get that sense?
>> it certainly seems so. the conference which was held about half an hour ago is one in which there was a great deal of support shown for the leader and for―here’s what is seems to me, anyway, here’s what the greatest amount of support was xind for―exhibited for and that was to go ahead on the agenda. i agree with my colleague that that is our task here. we have a lot of things to do. there are pressing issues, both of us are interested in getting things done. we, as republicans, have an agenda. it is imperative that we focus on that and move toward the accomplishment of those goals. that is the one thing that i did see everybody in that conference come together on so in that respect we see it the same way.
>> congressman ford, how important is it for the democrats --
>> not the same goals, but toward a direction of goals.
>> congressman ford, how important is it for the democrats not to seem that they’re going after blood in the water, not getting sidetracked by this?
>> i don’t think the burden is on democrats to show that. there was a development today and a serious one and for the life of me, i can’t understand why democrats are being asked how we’re going to react. tom delay was indicted. the congress will move o.he will have an opportunity to present his side and convince a jury that he did nothing wrong or hope that the state can’t convince the jury that he did anything wrong. he said the facts are on his side. we’ll find out. my job is what it was at 9:00 a.m. this morning and 9:00 a.m. yesterday was which to come to work and do the best i can for the citizens of tennessee and i can assure you that’s what every democrat in congress wants to do and i would imagine every republican, we all want to do what’s in the best interests of the country and we’ll have a robust debate about what’s best for markets , taxpayers and our future. tom delay’s stepped aside, he’s followed the rules and congress can return to work.
>> congressman harold ford of tennessee, a democrat, and congressman tom tancredo of colorado, a republican, thank you very much for your time this afternoon. ellen, that’s the latest.
>> mark, thank you. we’ll take a quick break. we’ll have news after the bell from fannie mae.
