Market briefing --- Mate (slow)
Nasdaq --- Julie (slow)
Tightened security --- Allan (slow)
welcome to “world financial report.” i’m matt nesto. let’s give you the numbers from the market . the dow, s&p and nasdaq, all up here today. bonds also up and the dollar down. a day that began with you a dark cloud of increased terrorist threats hanging over it. the volume light on the nyse and nasdaq, below average today. julie hyman was at the big board today, not the nasdaq, and joins us now with a day that kind of pulled a u-turn on expectations and finished higher.
>> hey there, matt. a change of venue for me, today and a change in the market , as well, as it started lower after the terror alerts in the past couple of days and rising by the end of the day’s session. talking to traders today, they said we’ve gotten a lot of terror alerts over the past couple of years and until there is an attack, the markets will be able to swallow the news. indeed, that’s what happened in the session. it was the fifth straight gain for the dow and also for the s&p, the longest streak for the dow since last december and for the s&p since may. so, really rising on good news that we had in the session from various companies on earnings, once again. procter & gamble leading the household products index higher in today’s session. fourth-quarter profit was up 44%, more than estimated by analysts.% they were helped by their beauty care business and developing business in china. as you can see there, procter & gamble up, clorox, kimberly-clark, as well as gillette all rising today, the household products makers doing well in the session today. we can switch over to the cable companies as they were a big gainer today. the media index, a big gainer today. cox communications leading the way after cox enterprises said it was offering $7.9 billion to take the company private and buy out the remaining stake in the company, $32 for each share, the offer price, 16% higher than cox’s close on friday, those shares up 20%, leading some investors to believe there could be a higher bid and pulling up the other cable companies as well. other companies doing well today, checking the financials as they experienced a turnaround. they were some of the worst hit earlier in the session and then rallied by the end of the day. prudential finished lower but citigroup and j.p. morgan managed to rise. another company that was doing well earlier today and then lost steam was j.c. penney. another measure of the consumer spending right now, j.c. penney said second-quarter profit was higher than expected. also announced a $3 billion stock buyback. back to you.
>> thank you very much. against that threat, the terrorist threat backdrop, new york stock exchange chief executive john thain today proposed that the 212-year-old institution allow for more electronic trading, a plan he expects will be reality within a year. allan dodds frank down on rouault wall street all day along amidst the tightened security. tell us about the day today.
>> john thain started the day determined to have a regular day on wall street. he planned to anounce the initiative that the new york stock exchange is taking as they had limited the number of trades you could make, electronic, to 1,099 shares they took that limit off but first he came out here to reassure people as security was very heavy. there were very many police officers with m-4 automatic weapons. cops were checking cars cars for blocks around. and in mid afternoon, john thain decided to hold the press conference he had planned last week although he knew of the terrorist threat regarding the stock exchange. when john thain spoke about the initiative, he made the point of saying they face a lot of competition, that’s a big threat here, too, the reality that other markets are trying to take their business. i don’t know if we can hear from john thain.
>> if we did nothing, there is an important group of our customer base who say they want to trade in a different way. they want to trade immediately, electronically and with certainty and anonymity. if we didn’t respond to that customer base, they would pull their volume off of the exchange and trade in other alternative markets that give them that electronic capability.
>> now, there you have it, competition is the big threat down here as far as these guys are concerned. one of the veteran specialists i talked to today said today was no different on the floor from any day since september 11, 2001. matt.
>> allan dodds frank, thank you, reporting from the stangeg in lower manhattan. looking at how the bonds in some of the other markets responded to the increased terror threat―treasury notes were up after the government said al qaeda may attack financial institutions in new york, washington or parts of new jersey just across the hudson river from mant. yields today at their lowest in about a week. you can see little change there in the 10-year note. similar small but modest increases for the five-year and two-year notes, as well. the director of research at mizuho securities in hoboken, new jersey, william quan, tells us that “this move up in bond prices ruins the bear market trend that had been developing in treasuries before the terror alert announcement.” investors were betting on a decline in the price of 10-year treasuries. the yield on the 10-year note, moving up inversely to the price, has moved up almost .2% or 19 basis points so far this year, gains, however, were pared after july’s manufacturing number rose, again, and a larger economic context, there are two reports that might change the outlook for bonds over the next two weeks. friday’s employment report, of course, a big one, and the federal reserve’s rate decision a week from tomorrow. friday’s employment report is expected to show that the jobless rate remained at 5.6% in july and the number of jobs added to the u.s. economy during the month leveled out at 243,000. next tuesday, the fed wisely expected to add another .25% increase to the benchmark rate, bringing us to 1.5%, matching a similar move, first we’ve seen in i think four years out at the end of june. you may recall that was when the central bank moved rates higher from 1% to 1.25%. oil prices were steady today. they’re still very much on the radar screen of investors since higher energy prices act to slow the economy. you can see, up two cents in new york trade today, above $43.50 a barrel, again. if you look at the price of oil over the past year, you’re 35% higher. gold prices in new york rose for a second day. again, terrorist concerns credited for that move. and the dollar was down today, moving lower against its big three rivals and also the swiss franc on concerns that any terrorist attack of size on the financial sector in the u.s. would hurt the economic outlook here. a couple of deals to tell you about―fifth third bancorp is buying first national bankshares of flo for $1.6 billion in stock, 41% more than first national’s closing price on friday.% the deal will help fifth third enter five markets in florida. combined the banks the have $6 billion in assets and 93 branches in the sunshine state. directt buying pegasus television satellitet unit for nearly $1 billion, adding 1.1 million customers. pegasus made 96% of its revenues from reselling directv’s services and in june, it sued directv, claiming it sought to destroy pegasus by stealing its business. the transaction is expected to close in four to six weeks and must be approved by a bankruptcy court. stocks bumped back from declined triggered by warnings of a possible terrorist attack. when we return, we’ll speak with peter tanous, president of lynx investment advisers about the terrorist threats, the markets and a lot more.
