Market briefing---Matt (slowt)
NYSE---Deb (fast)
Motorola---Carmen (fast)
Currency market
F.S. Max---Cliff Bennett---Currency Strategist
welcome to “world financial report.” i’m matt nesto. deb custrun has been tracking the market action today and with the latest, let’s go to deb at the big board.
>> one of the things we also like to see when we see a rally like this, we like to see higher-than-average volume because it tells you have more players in the market and we saw that today. 1.5 billion shares. really tells us that we have maybe a few more players getting into the market, even though we are staring at the end of the year, many traders and analysts, many portfolio managers trying to close out their years and looking at the gains we’ve had and not wanting to make a lot of movement but when we have a market moving like this, you may see moving going on. and the dow beating the nasdaq as investors getting out of more expensive chip stocks like semiconductors. semiconductors, the worst performer in the s&p 500e s&p 500 today but the best performers year on date and the dow is outperforming the nasdaq this quarter. also, all the economic reports on manufacturing certainly helpful and that led many of the dow components to record highs today. united technologies, caterpillar and 3m hitting record highs in today’s session and of course many of those stocks , these are the people that make jet engines, elevators and post-it notes and safety equipment. energy, the biggest gainer in the s&p 500. however, not this year as energy has been one of the laggards. we have exxon-mobil, transocean and apache, some of the energy gainers that performed quite well. in addition to energy, we saw telecom, the ultimate laggard this year, one of the best performers in today’s session, as well.
>> thank you very much. we have one more confirmation of perhaps the worst-kept secret in the country today and that is whether or not boeing is going to go ahead with its new 7e7 dream liner, a quote from washington state senator patty murray saying she applauds boeing’s decision to go ahead with the new airline model and is happy that the assembly plant will be located in the seattle area. we will certainly be tracking the developments on this story that has been a long time in the works but there we have at least one more confirmation, if you will, somebody on the record saying that they are happy that boeing is going ahead with that 7e7 dream liner project. let’s get those closing numbers that deborah didn’t cover. the big picture will show you the dow and s&p rising the third time in four days, approaching a 19-month high now, the dow and s&p finishing close to their best levels of the day. a 100. 100-point gain for the dow. the s&p 500 up seven points, the dow far and away percentage-wise the best performer, a 1% gain, .6% higher for the s&p 500. the nasdaq the laggard of the three, tech stocks trailing big industrial names that were pushing the dow higher here today with the nasdaq up .3%. there’s the beneficiary volume -- motorola has named its new chairman and chief executive officer to replace chris galvin. the world’s second largest maker of mobile phones selected former sun micro president edward zander, an engineer chosen partly for his technical background. zander ends the hold that the galvin family has held on motorola since paul galvin, founder of the company, in 1928. carmen roberts has the story.
>> matt, motorola will begin the new year with a new man at the helm. on january 5, ed zander takes on what is expected to be a tough job leading a company falling behind competitors that has had a series of missteps such as a drop in sales and delay in shipping camera phones for the holiday season. still, motorola has shares rising 70% since mid april in anticipation of an improving economy.
>> bringing on a new c.e.o. is probably to take them to the next level but not where there’s a state of emergency or state of dire straits where he’s going to be the savior for this company.
>> maybe not a savior, but zander, who is credited with closing sun microsystems’ biggest sales agreements will have to win back mobile phone market share from number one new yorkia. he brings experience. he brings energy. and i think he brings a brooklyn background common sense that he’s going to stay away from vision and hopefully show us good performance, which is what shareholders deserve.
>> leon says zander needs to put things together and put several quarters of earnings out there without disappointments before he can put his personal signature for the long-term direction of the company. walter casey, technology analyst with banc one investment advisers managing $176 billion, including six million motorola shares, says zander’s job is tough as motorola is not well positioned in some of the industries and the industries themselves are competive and difficult. and zander’s background in computers and servers, says leon, means he’s not an expert on the wireless industry and its complex infrastructure and will have to rely on his team until he learns but leon expects the motorola president and chief executive officer, mike zafirovski, who was a prospect for the job, may leave. leon has a hold rating on the stock and he says a more important near-term catalyst for the stock is the planned i.p.o. for the semiconductor business in march. matt, back to you.
>> carmen, thank you. while she was giving you that report, more headlines crossing on boeing. this from the company itself saying that three models have been approved for sale to airlines and that the 7e7 dreamliner has been approved and will be offered to airlines and it has selected everett, washington, as the final assembly site. in other news today, the u.s. currencies slid again to another record low against the euro. the cost at one point in new york trade, 1.234 and a little bit more to buy each euro and that was just a couple of hours ago while new york trade was open and active. demand for dollars dropped off after the u.s. government said the gap in its current account was the third largest on record, $135 billion last quarter. traders have expressed concern that the size of the current account deficit will drive foreign investors away from dollar-denominated assets. in fact, purchases of u.s. treasuries by international investors would have dropped by $7 billion had it not been for foreign central banks and here to discuss the ongoing retreat of the dollar is cliff bennett of f.s. max in sydney, australia. good evening, cliff. what is behind this intervention that we’re seeing today from the hong kong monetary authority? why so much effort to defend the hong kong peg?
>> i think it’s common place in asia these days, the central theme to maintain stability in your currency and obviously people are seeing the hong kong dollar as perhaps an avenue to speculate with regards to the chinese yuan at a later date so certainly they’ve shown in the past in hong kong that they are a determined group and i think they will hold the peg on line but it is part of the u.s. dollar continuing to fall on a broad basis.
>> is it specifically only the hong kong monetary authority or are there other dollar buyers out well in the region?
>> no one’s too bullish the u.s. dollar out here in asia, matt. some people might be trying to pick the bottom in the dollar’s decline but it’s far too early for that so, no, there would certainly be widespread speculation against the dollar in just about every market at the moment but i think it’s still only just beginning to gather pace and i don’t see a turnaround any time soon.
>> cliff, i know we’re tight on time with the headlines on boeing eating up your i’m. thank you, as always, i’m sure we’ll have you on again soon. the benchmark stocks indexes headed for their first gains of the year and in fact, at a 19-month high. that is only a small slice of the picture because they’re also ready to post their first year of gains in the last four. our next guest sees that strength continuing on through 2004. stick around.
