Market briefing---Lane (medium)
NYSE---Deb (fast)
Nasdaq---Anthony (slow)
welcome to “world financial report.” i’m lane bajardi in new york. genentech reported a return to profit, last quarter. the world’s second biggest biotechnology company posting net income of 25 cents a share and that compares to a loss of 41 cents a year earlier. excluding costs genentech earned 31 cents a share, exceeding analyst expectations by a nickel. revenue came in 29% higher helped by greater sales of the company’s cancer drugs herceptin and retuxant.
>> we’ll dissect yahoo’s earnings report and outlook in just a few minutes. yahoo shares in extended-hours trading currently down over 5%, 1.83 at 33.46. full details coming up in a bit. stocks fell on concern second quarter earnings will fall short of expectations over the next few weeks. let’s run down the numbers. dow jones industrial average down 66 points at 9156.
>> one of the biggest drags on the stock market today as far as the dow and the s&p was altria group, philip morris falling on concern an appeals court may reinstate a $12 billion bond. deborah kostroun joins us from the new york stock exchange with more on the altria effect.
>> that’s right, lane, in fact altria not only the biggest decline in the dow jones industrial average but also the s&p tobacco index the biggest drag on the s&p 500, this on concern that an illinois court may reverse a decision that allowed the company to leave a smaller deposit, that while appealing a $10 billion judgment for misleading smokers and that of course in the light cigarette case, not only that we also had news coming out from r.j. reynolds and british american tobacco that they’ve held talks about merging their u.s. cigarette businesses, that according to “the wall street journal”. however, it looks like they would probably have a lot of regulatory hurdles but would be a big competitor for altria with the marketing as they would potentially combine those units. other things in other areas of the market we’re looking at today and that certainly coming from hospital chains like tenet health care as they formally got some s.e.c. opening a formal investigation, getting some subpoenas. we have been hearing rumblings about this for quite some time. tenet health care lower on the news. the rest of the hospital stocks generally mixed. also, jonathan gollub, equity strategist overseeing $495 million says computer shares are performing well as we head into the economic upturn, in fact, we did see semiconductors among some of the biggest gainers in the s&p 500. not only did we see the semiconductors performing quite well as you can see national semiconductor but also some of the oil services and also oil equipment, integrated oil, all performing quite well, helping the s&p 500. and then also one of the things one of the biggest drags that we did have, and that was from the pharmaceuticals, pharmaceuticals coming in just a little bit lower across the board―this was one of the biggest drags that we did see, restaurant stocks like ruby tuesday reported their earnings today , and generally just a little bit lower by the closing bell. back to you in the studio, lane.
>> deborah kostroun at the new york stock exchange. the nasdaq edged higher in the final minute of trading. the index has been higher five of the past six trading days. anthony massucci tells us about it.
>> the nasdaq just squeaking out a gain at the end of the day, up one point, up 5% for the weak and continues to be higher for the year. bill fry’s at thornburg investment helps manage $5.5 million says the market is in good shape considering today’s gain. he says every day that goes by without disappointing earnings is positive. he says this will bring back confidence. he’s looking to see greth from earnings over the―growth from earnings over the next few weeks. he did say that already he owns stocks in his portfolio where he’s hoping he gets that growth. microsoft one of the stocks that we’ve seen doing well lately. we spoke with dianne garnic at dresdner kleinwort wasserstein talking
>> mark herskovitz says this will put pressure on other companies. some analysts say dell might get in on the action. clearly the trend is against granting employees stock options. intel. here is a stock that continues to go higher. moving with the nasdaq today, up today and up for the week, the share price forecast was raised 12% at u. b.s. in―at u.b.s. in london. in a note they said that intel is one of their top picks heading into the earnings season. back to you in the studio.
>> anthony massucci at the nasdaq. major moves at the treasury department. peter fisher, u.s. treasury undersecretary who eliminated the 30-year bond will leave in october. the white house says he will be replaced by kenneth leet, a managing director at goldman sachs. on bloomberg television earlier today democratic senator jon corzine commented on leet’s lack of bond experience.
>> well, he’s been involved in financing arrangements for major corporations for most of his career. he started as a merger guy but actually did overall kind of corporate advisory work, so i think he has a pretty good grasp of bond markets and financial markets in general.
>> the bush administration also nominated susan schwab, dean of the university of maryland as secretary john snow’s deputy. if aproved by the senate she would be the highest ranking woman ever at the treasury department. the nominations come five months after snow replaced the ousted paul o’neill and provides him with his own team of advisors to confront a slow economic recovery, record budget deficits and new market regulations. the team would be in place as president bush seeks re-- re-election next year with an economy that has lost two million jobs. treasury secretary john snow testified on capitol hill and took questions from connecticut congressman chris shays on whether freddie mac and fannie mae should disclose more information after freddie mac ousted executives and issued an earnings restatement.
>> there doesn’t seem to be any current difficulty with their issuances, but clearly, there needs to be transparency.
>> freddie mac and fannie mae which own or guarantee fra% of the $-- 42% of the $7 trillion u.s. mortgage market may soon be the target of conflicting bills to shift oversight of the agencies. ed royce, a california republican plans to introduce a bill this week to create a new regulator for the government-chartered companies. the u.s. energy department report showed a rise and a small storm moved toward rigs in the gulf of mexico. gold futures sank 50 cents to a two-month low as some traders speculated u.s. stocks will extend this year’s rally and that reduces the investment appeal of precious metals. alcan chief executive travisan gen said he has no bid to pechiney’s board rejected the stock and cash offer as too low. still to come, a lot going on in the tech world. yahoo has just announced its second quarter earnings more than doubled.
