SUSIE GHARIB: On Wall Street today, a home run for the Dow; it scored a triple-digit gain of 121 points. But the NASDAQ struck out, losing about 50. Then after the close, investors cheered Amazon.com, and Compaq. Both came out with results much better than estimates. In after-hours trading, Amazon’s stock skyrocketed four points, but Compaq was down slightly. Here’s Suzanne Pratt with details.

SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: While much of New York City was gearing up for game three of the World Series, Wall Street was hoping for a few hits from corporate America, namely Compaq and Amazon.com. After the closing bell, both companies posted earnings scorecards that should not disappoint investors. First, troubled Amazon.com reported a far narrower-than-expected loss of 25 cents a share for the third quarter. The online retail giant also turned in revenues of $638 million, nearly 80 percent more than a year ago, and on the high end of estimates. Compaq also beat the Street today with a third-quarter profit of 30 cents a share. That compares to only seven cents a share last year; and its chief executive is also forecasting a solid fourth quarter.

MICHAEL CAPELLAS, PRESIDENT & CEO, COMPAQ COMPUTER: You’ll see us continue to see grow very strongly on commercial PCs in the fourth quarter. So we see sequential growth in place. We see that the seasonal demand will pick up. We saw a lot of people soft in Europe. And we saw pretty solid growth sequentially in Europe, so we’ll continue to drive there. So we are feeling pretty comfortable that PC sales for us will be fine in the fourth quarter.

PRATT: Earlier in the day however, the news out of Xerox (XRX) was far less rosy. The struggling business machines maker reported a third-quarter loss of 20 cents a share, a penny worse than recently reduced Wall Street estimates, and far below last year’s profit. But in an effort to get Xerox back in the black, the company announced plans to eliminate jobs and sell up to $4 billion in assets. Analysts say the restructuring should help to ensure Xerox’s financial viability.

JACK KELLY, MULTI-INDUSTRY ANALYST, GOLDMAN SACHS: The real issue is how quickly they are going to get back to a lean, mean fighting machine. And I think at a minimum that’s probably you know two years from now. But they certainly have a good product line, but they have to be able to deliver that to the customers in a more cost-effective and timely fashion.

PRATT: So far, two-thirds of S&P 500 names have turned in third-quarter earnings. Year-over-year profit growth is running at about 16 percent, but it is expected to climb to as much as 19 percent, once all of the firms have reported. Suzanne Pratt, NIGHTLY BUSINESS REPORT, New York.

Nightly Business Report transcripts are available on-line post broadcast.  The program is transcribed by FDCH. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc., Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2000 Community Television Foundation of South Florida, Inc.



10/24/00: Goodyear Tires’ Tries To Steer Clear Of Falling Stock Prices

SUSIE GHARIB: Also reporting earnings today, Goodyear Tire and Rubber (GT), which is based in Akron, Ohio. And it hasn’t been a good year. It lost $0.04 a share in the third quarter. Analysts had expected a loss of only $0.02. Some air came out of the stock today, down $0.17 to $16.78. But as Erika Miller reports, Goodyear is trying to get back on track.

ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: Few corporate icons are as firmly rooted in American minds as the highflying Goodyear blimp. It has graced skylines since 1925, when the first one was launched as a floating billboard. Today there are seven Goodyear blimps worldwide, used mainly for publicity and filming sporting events. But they remain symbols of the lofty aspirations of the world’s largest tire company.

SAMIR GIBARA, CHAIRMAN & CEO, GOODYEAR: Now, we are really a global company competing in a global economy and in an age of technology and advanced technology. And we are trying to apply all of this to Goodyear.

MILLER: Goodyear is best known for its tires, but it is also a leading maker of consumer and industrial rubber products, things that are used in everything from passenger cars to heavy machinery. Despite its diverse product line, Goodyear has not benefited from the strong economy this year. Concerns about profitability have deflated its stock price. The shares were trading above $40 a year ago. Wall Street’s biggest concern is declining market share for Goodyear brand tires. Part of the problem is the strong dollar, which makes the company’s tires more expensive abroad, especially in Europe, Goodyear’s second biggest market. Goodyear also blames higher energy costs for making tires more expensive to produce. But industry analysts say some of the blame also lies with management.

SAUL LUDWIG, TIRE & RUBBER ANALYST, MCDONALD & COMPANY: Goodyear has faced significant internal issues. They’ve had problems in meeting dealer deliveries last year. They’ve had problems with execution of marketing strategies. They’ve had problems in managing inventories in a most effective manner. And these are things that have exacerbated some of their earnings problems this year.

MILLER: Goodyear says it has a handle on its problems and is taking steps to address them.

GIBARA: We’ve tended to be a manufacturer. We make great tires, the best tires you can find. But we haven’t done as much as I think we should in retailing these tires. And that’s where I see our future.

MILLER: Sales have been rising lately as new customers replace faulty Firestone tires. Consumers are also becoming more aware of differences among tire brands. To capture consumer interest, Goodyear is also introducing new products, like a tire that will not go flat. The company says this technology has the potential to be as revolutionary as radials. Chairman Sam Gibara insists Goodyear is on the road to recovery.

GIBARA: This company has a great opportunity to be successful. The issues that we have are industry based. They are issues that are industry wide. We are going to overcome them. We have taken the measures to do that and I think this company will do extremely well next year.

MILLER: If he’s right and Goodyear can regain investor confidence, it might once again fly as high as its famous blimps. Erika Miller, NIGHTLY BUSINESS REPORT, Akron, Ohio.

           

Nightly Business Report transcripts are available on-line post broadcast.  The program is transcribed by FDCH. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc., Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2000 Community Television Foundation of South Florida, Inc.



10/24/00: One On One With Sandra Pianalto, Chief Operating Officer of the Cleveland Fed

SUSIE GHARIB: Cleveland is home to a dozen Fortune 500 companies, but the city lags in small business growth. The Federal Reserve Bank of Cleveland is addressing that and other economic issues. Linda O’Bryon sat down today with Sandra Pianalto, Chief Operating Officer of the Cleveland Fed, and asked what’s the biggest concern facing Cleveland.

SANDRA PIANALTO, COO, CLEVELAND FEDERAL RESERVE BANK: Well, right now we’re more focused on the positive things that are happening in Cleveland. As you know, this city, 20 years ago, was underperforming all national economic measures. And today we are keeping pace with the national economic performance and outpacing many of the national economic statistics. So right now we’ve laid a good foundation to have a strong economy going forward.

LINDA O’BRYON, NIGHTLY BUSINESS REPORT CORRESPONDENT: Throughout this week, we’ve been hearing about public private/partnerships and how those have helped the economy along. How specifically is the Federal Reserve Bank of Cleveland addressing those sorts of issues?

PIANALTO: Well, a lot of your focus has been on the public/partnership that has developed this wonderful downtown area, but there are a lot of other quality of life issues that are so critical to economic performance. And the Federal Reserve Bank of Cleveland has been partnering with many organizations in the community to address issues such as small business creation. I mentioned that we were outperforming the national economy in many perspectives. But in our small business creation, which is so important to an economy, in fact, small business generates 65 percent of all new jobs, we haven’t been keeping pace with the national average. And what is so critical to small business creation is access to capital. Many businesses fail because they don’t have access.

O’BRYON: And there was a study showing that of 35,000 new businesses that started since 1992, only 6,000 of those actually survived. Was that due largely to the lack of capital?

PIANALTO: It’s, most small businesses fail because they do not have access to capital. So we came together with the Small Business Administration and the Council On Smaller Enterprises to start looking at where those gaps exist and why they—

O’BRYON: And how do you fill those gaps?

PIANALTO: Well, we’ve brought together the capital seekers as well as those that are interested in providing capital and developing tools for small businesses to use to make sure that they have the business plans necessary to get the capital that they need.

O’BRYON. And finally, looking at the overall economic scene in Cleveland from your perspective, do you think that the economy is diversified enough going forward?

PIANALTO: Yes. We still are very strongly manufacture based, but our employment, we’re still producing, we’re out producing in terms of manufacturing output, than we were many years ago. But we’re doing it with fewer people. And so our job base has been diversified where we have people employed in manufacturing but also in the service sector economy. So we are much more diversified in terms of our employment base.

O’BRYON: Thank you very much. Sandra Pianalto of the Federal Reserve Bank of Cleveland.

PIANALTO: Thank you, Linda.

Nightly Business Report transcripts are available on-line post broadcast.  The program is transcribed by FDCH. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc., Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2000 Community Television Foundation of South Florida, Inc.



10/24/00: How Cleveland’s Unions Are Organizing Industries

SUSIE GHARIB: Continuing our coverage of Cleveland, in the last couple of decades many of the city’s manufacturing jobs have moved out of town. So the area’s unions are now reaching out to organize new industries. Diane Eastabrook reports.

DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT: The Tree House Lounge is one small step in a giant effort to resuscitate organized labor in Cleveland. The Hotel Employees and Restaurant Employees Union recently organized all two of the pub’s bartenders.

KEN ILG, PRESIDENT, LOCAL 10: When I took over this local two years ago, we had one restaurant under contract. And so anything we get, no matter how small, is one more place than we had before.

EASTABROOK: Ken Ilg is the new face of union leadership in Cleveland. Young, educated and aggressive, Ilg has organized hundreds of workers, including concession employees at Jacobs Field and Cleveland Browns Stadium.

ILG: We’re looking to control the restaurant and bar industry in Cleveland.

EASTABROOK: Organized labor is trying again to tighten its grip on traditional union strongholds like Cleveland. Since the late 1970s, thousands of steel and auto manufacturing jobs have vanished from northeastern Ohio. In 1975, one in every three Cleveland workers belonged to a union. Today one in five does.

JOHN RYAN, EXECUTIVE SECRETARY, AFL-CIO: And then on November 4th we have the big solidarity walk.

EASTABROOK: John Ryan is also a new style union leader. The Executive Secretary for Cleveland’s AFL-CIO preaches organizing new industries and including women and minorities on union boards.

RYAN: Because it strengthens the entire labor movement. It is a fair thing to do but it’s a good thing for everyone to do. And that really has increased our ability to go out to every aspect of Cleveland and get more people involved.

EASTABROOK: Cleveland’s unions are also reaching out more to their community for help in organizing and they’re also becoming a lot more political. This get out the vote rally brings together area unions, minority groups and other organizations. The unions hope banding together with others will help them more effectively push for legislation favoring workers’ rights. Labor experts call Cleveland’s new brand of organized labor bold, but not yet a success.

NELS NELSON, MANAGEMENT LABOR RELATIONS PROFESSOR, CLEVELAND STATE UNIVERSITY: I think the verdict is still out. I think that it’s a very interesting experiment and see whether new aggressive leadership, new ideas, more sophistication is going to work.

EASTABROOK: Nelson says if this so called experiment does work, Cleveland could become a model for other cities. Diane Eastabrook, NIGHTLY BUSINESS REPORT, Cleveland.

Nightly Business Report transcripts are available on-line post broadcast.  The program is transcribed by FDCH. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc., Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. © 2000 Community Television Foundation of South Florida, Inc.




10/24/00: Paul Kangas' Wall Street Wrap Up

PAUL KANGAS: With the financial and consumer sectors leading the way higher, the Dow Industrial Average moved to a 123-point gain by 10:30 a.m., and that helped the NASDAQ Index rise nearly 30 points. Better-than-expected third-quarter results from well-known companies like Colgate-Palmolive (CL) and Kimberly-Clark (KMB) gave the blue chips more upward momentum for the rest of the morning, lifting the Dow to an impressive 155-point gain at the 10,425 level at noontime, while the NASDAQ Index was up 50 points. As the high-tech NASDAQ market sold off in afternoon trading, partly because of a sales warning from National Semiconductor (NSM), the Industrial Average saw its gain cut to only 49 points at 3:00 p.m. But buyers came back with renewed vigor in the final hour and the Dow bounced back with a closing gain of 121.35 points or 1.2 percent and now stands at 10,393.07. The NASDAQ Composite fell 48.90 points, closing at 3419.79.

Big board volume moved up a bit, 1.15 billion shares. And about a 6 to 5 ratio of up volume over down volume.

The Dow Transport Index up just about 34 1/4 points.

But the Utility Index sank almost 3 points.

The Closing Tick slightly positive, or bullish, at +291.

Standard & Poor's 500 gained 2 1/3 points.

The 100 rising just over 4 points.

MidCap 400 down just over 6 points.

Real mixture here.

And the Bridge Futures Price Index fell about 2/3s of a point.

New York Stock Exchange Composite gained exactly 4 1/4 points.

A small fractional rise in the Value Line.

Russell2000 Small Cap however, down 2.11.

And the broadly-based Wilshire 5000 dropped 12.13.

The bond market today moved lower, partly because it was deprived of the flight-to-quality buying that has so often supported it when stocks tanked; but the blue chip rally changed that. Debt investors were also quite cautious because of continuing turmoil in the Mideast. Although a modest easing in oil prices kept selling well in-hand, it actually helped tax free and corporate issues edge about 1/8 higher on average. But the Treasury market fell across the board.

The 5-year notes dropping 4/32.

The 10-year notes down 11/32.

And the 30-year bond down 12/32, bringing the yield up to 5.71 percent.

And the Lehman Brothers Long-Term Treasury Bond Index was down exactly 5 points.

Just like yesterday, the blue chips outdid the NASDAQ market and very nicely so. This is the fourth consecutive gain for the Dow and a good one, 121 1/3 points. The broader market higher by a 15 to 13 margin; 54 new highs for the year, 91 new lows.

Topping the active list, General Electric (GE) on 36.8 million shares, up $3.63, kind of a delayed response, a positive response to its acquisition of Honeywell, (HON) which added $3.38 to yesterday's nearly 4 point gain. And now that GE's chairman is delaying his retirement to put this merger together, I think they ought to honor him by renaming the new company, how about Honeywelch International?

Pfizer (PFE) down $2.38. Third quarter, $0.27, up from last year's $0.21, $0.02 above the Street estimate.

But there is concern about fourth quarter sales due to the weak Euro.

Nortel Networks (NT), here's a story, down $3.63 in the regular trading session. But the stock tumbled to $0.52, as low as that, in after hours trading. After the close, the company reported third quarter earnings of

$0.18. That was a penny above Street estimates. But revenues were quite disappointing to analysts.

Lucent Technologies (LU) fell $0.44, fifth in volume.

AT&T (T) down $0.75. I hear that the company will make an announcement tomorrow about all of this rumor of a break-up.

National Semiconductor (NSM) down $12.63. The company warned its sales in its fiscal second and third quarters may fall below the first quarter level.

Tyco International (TYC) up $281, big earnings out today, third quarter up 40 percent, $0.64 versus $0.46 last year. That was a penny better than expected.

Nokia (NOK), which had good earnings out last week, up $0.94.

And then Texas Instruments (TXN) falling $3, probably in sympathy with National Semiconductor (NSM).

There you see Colgate-Palmolive (CL) up $3.81. The company in with third quarter earnings, $0.44, up from last year's $0.38, a penny better than estimated.

DuPont (DD) rose $2.44, positive reaction to the news the company's in a partnership with shoe maker Nine West Group. It'll manufacture and distribute products.

ExxonMobil (XOM) coming down $2.31 even though third quarter earnings out today, $1.22, way up from $0.62, $0.06 above the estimates. But that was anticipated due to the recent jump in oil prices.

Hewlett-Packard (HWP) was the biggest point loser in the Dow today, off 588.

J.P. Morgan (JPM) the biggest point gainer, up $6.63.

Then Kimberly-Clark (KMB) rose $5. Late yesterday the company had third quarter earnings up nearly 13 percent, $0.84 versus $0.75, line with Street estimates.

CommScope (CTV) had a good day, up $4.13. Third quarter earnings came in better than expected, $0.43, up from $0.38 last year, $0.04 above the Street estimate.

Technitrol (TNL) up $15.69, third quarter $1.69, way up from $0.75 a year ago. That was $0.13 better than the Street estimate and Technitrol also announced a 2 for 1 stock split.

Laboratory of American Holdings (LH) up $18.06. Third quarter earnings, $0.94, triple last year's $0.32 and the Street was looking for only $0.81, so much better than expected. McKesson HBOC (MCK), one of the big losers, off $4.31. Lower than expected second quarter earnings, $0.22, a penny below estimates.

Newell Rubbermaid (NWL) down $2.81. Third quarter $0.47, in line, but the company warned fourth quarter will fall below last year's $0.54 a share.

And Northeast Utilities (NU) falling $2.25. Its merger with Con Edison (ED) is in doubt because of the regulators' burdensome conditions for approval.

NASDAQ trading, a loss of nearly 49 points in the Index, volume up from yesterday to 1.85 billion shares. About 18 stocks higher for every 20 lower.

JDS Uniphase (JDSU) down $6.13. JDS and, well, I think that's in sympathy with Nortel (NT) and the disappointing revenues.

Microsoft (MSFT) off $0.63.

Sun Micro (SUNW) lost nearly $1.

Cisco (CSCO) also down in sympathy with Nortel, off a $1.

And SDL (SDLI) plunging almost $16 a share. The company received a letter from the FDA warning of defects in the company's diode laser systems. They must be corrected before resumption of shipments.

Intel (INTC) off $1.31.

Juniper Networks (JNPR) off $6.75.

As was CIENA (CIEN).

Veritas Software (VRTS) down nearly $13 a share.

And Applied Micro Circuits (AMCC) down $10.88.

ADVANTA (ADVNA) had a good day, up $3.13. It's going to sell its mortgage business to an unnamed buyer and didn't even name the price. And it also had third quarter earnings better than expected, $0.62, up from $0.44 last year.

MarchFirst (MRCH), this is an Internet service provider, down almost $7. Third quarter earnings only $0.01, down from $0.16