PAUL KANGAS: A big day for earnings on Wall Street. A barrage of blue chip companies reported before the opening bell this morning and then Microsoft posted better than expected numbers after the market closed. First those Microsoft numbers. The software giant earned $0.43 a share excluding special charges. That was $0.04 higher than estimates. Revenues rose 6 percent. Microsoft said its fiscal second quarter earnings will fall short of expectations and analysts say the launch of Windows XP will be the key.

JOHN PURICELLI, SOFTWARE ANALYST, AG EDWARDS: The typical consumer is not going to open up their machine and put in new memory. So if they want Windows XP, they're going to have to buy a new PC to get it. The question is, how many of them are going to be in a buying mood and that's probably one of the reasons why we got a little bit of a guidance reduction in the December quarter.

KANGAS: Microsoft is still on schedule to debut Windows XP next Thursday, October 25th in New York City.

GHARIB: Well, Paul besides Microsoft, the other Dow components reporting today managed to meet or beat analysts' estimates. Here's Scott Gurvey with today's earnings scorecard.

SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: It was a mixed bag of earnings reports investors had to digest today. Most companies continue to report profits on or close to targets that have been significantly reduced in recent weeks. Coca-Cola (KO) shares gained 4 percent after the company reported a better than expected by a penny quarter. The company earning $0.41 a share. Coke says it is pleased with the results, especially in light of what it calls challenging conditions.

ANDREW CONWAY, FOOD ANALYST, CRED SUISSE FIRST BOSTON: The interesting thing about today's earnings and I think the future of Coca-Cola, is that their financial model and their business model is changing somewhat in that they are focused much more on developing the bottled water, juice, coffee, sports beverage business, complementing their core Coca-Cola brand.

GURVEY: General Motors (GM) handily beat Wall Street expectations in reporting earnings of $0.85 a share. But the auto maker's stock fell as the company lowered earnings estimates for the fourth quarter, in which GM says it will cut production 7 percent.

JOHN DENINE, CFO, GENERAL MOTORS: We expected this year to be weaker in the first half of the year versus the first half. So it's playing out pretty much as we expected. Now 9/11 changed that somewhat obviously and it certain got weaker but October is coming in much stronger than we expected. We still expect the fourth quarter to be down versus last year and we still expect next year to be down.

GURVEY: McDonald's (MCD) beat expectations in reporting fourth quarter profits of $0.42 a share. But the fast food giant warned that continued economic weakness could bring down demand in the quarter ahead. And Merck (MRK) reported a 6 percent increase in third quarter profits, meeting Wall Street's expectations. Merck is facing increased competition for some of its best-selling drugs and has been bringing new products to market.

BARBARA RYAN, PHARMACEUTICAL ANALYST, DEUTSCHE BANC ALEX BROWN: That is going to continue to be the story at Merck through next year, so next year we expect Merck will again report earnings growth that will be up single digits, and we will continue to see the impact of generic competition in bringing down some major products.

GURVEY: Nokia (NOK) and Gilette (G) are among the companies scheduled to release earnings reports tomorrow. Scott Gurvey, "NIGHTLY BUSINESS REPORT," New York.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. © 2001 Community Television Foundation of South Florida, Inc.

10/18/01: One On One With Philip Condit, Chairman & CEO, The Boeing Company

SUSIE GHARIB: Boeing (BA) stock fell $0.84 to $32.86 today on earnings news. It reported a 7 percent increase in earnings in the third quarter, and that's despite the loss of business after the September 11th terrorist attacks. It earned $0.88 a share. That was a penny better than revised estimates. Boeing's chief executive Phil Condit warned of lower revenues for 2002, and a cutback in airplane deliveries. When I talked with Condit from a production studio earlier today, I asked him to elaborate on the outlook.

PHILIP CONDIT, CHAIRMAN & CEO, THE BOEING COMPANY: I think the real key in there was we see commercial airplanes coming down, as you would expect given the decrease in air travel. We see our space and communication units going up and our defense and military aircraft unit going up. So there's a bit of balancing going on. It's why we built this portfolio that has breadth to it.

GHARIB: Let's talk, Mr. Condit, a little bit about the commercial airline part of the business. You said today that you're expecting airplane deliveries of 350 planes in 2002. Now, that's down from 522 for 2001. in talking to your customers, the airline companies, what sense do you have of what deliveries will look like in the year 2003?

CONDIT: We're just really beginning to get that picture. I think it pretty clearly will be down. Exactly how many is going to depend a lot on what happens over the next six months. So that's going to be a continuing conversation.

GHARIB: Some of the analysts in the investment community are talking about maybe 200 airplanes being delivered in 2003 or 250. Is that in the right ballpark?

CONDIT: I don't really know. I mean it can go down quite a bit like that. But, you know, until we get a little more clarity, we're just not adding anything to it other than saying we're going to go look and, by the way, come January we're going to try to give you our best shot.

GHARIB: You told analysts on the call this morning that you're dealing in a dramatically altered market but you're not going to change your corporate strategy and you're going to continue to grow the company. How do you run the business when there's been such a significant sales slowdown?

CONDIT: Well, I think the real key is that the first piece of our strategy has been to run healthy core businesses. That means when times are good you're driving for market share, you're driving for margin. When times are bad, you're taking every cost as variable. You're getting your costs down so that you continue to be profitable and that sets you up for the future. It's good management that does that and that's what we're doing.

GHARIB: How are you convincing your customers, the airline companies, to continue to put in orders, buy new planes when their customers are so fearful of flying?

CONDIT: Well, the reality is, of course, you can't convince somebody to buy a product they don't need. In some cases they're going to have older airplanes where the economics of continuing to operate that old airplane are outweighed by the economics, the good economics of the newer airplane. Or they're going to be adding new services and it's going to be different in different parts of the world. Seventy percent of what we sell in commercial airplanes is outside the U.S.

GHARIB: Let's talk a little bit about the defense side of your business. You have a sizeable defense business. How are you benefiting from this U.S. war against terrorism?

CONDIT: Well, what we're really doing is looking forward. Their space and com unit does a lot of satellites. We're the biggest satellite producer in the world. They're going to be a key part of the intelligence part of this war. We build the AWACs airplane and we have a brand new version of that called Wedge Tail (ph), which is a 737 based airborne warning and control system airplane. We're doing that initially for Australia, but a lot of interest now in the U.S. in the capabilities of that airplane.

GHARIB: Mr. Condit, just to wrap it up real quickly, you've announced 30,000 layoffs. Is this it or is it possible that there could be more?

CONDIT: It's possible there could be more. We've tried to give it our best shot. That's the best we know today. If the market goes deeper, then there could be more. That's part of making sure we're aligning our resources to the market.

GHARIB: Well, wish you the best of luck as you go forward navigating through this uncertain market.

CONDIT: Thank you very much, Susie.

GHARIB: Thank you very much for talking to NIGHTLY BUSINESS REPORT.

CONDIT: All right. Bye-bye.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. © 2001 Community Television Foundation of South Florida, Inc.

10/18/01: A Preview of the APEC

SUSIE GHARIB: The summit of leaders from APEC, the Asia Pacific Economic Cooperation Group, gets under way in Shanghai on Saturday. President Bush is there to represent the United States and at the top of his agenda, fighting international terrorism. But as David McGuffin reports, Asian nations at the summit are more concerned about facing their second economic recession in just four years.

DAVID McGUFFIN, NIGHTLY BUSINESS REPORT CORRESPONDENT: This model train factory outside Beijing expects its sales orders to drop by half this year thanks largely to North American orders that were canceled after the events of September 11. Without the terrorist incident in the U.S., we would have had $400,000 in foreign orders this fall, she says, but now they've been dropped because of the poor global economy. Those canceling purchases here include North American train and plane manufacturer Bombardier (BBD), cutting back on promotional spending, it, too, a victim of recent canceled orders from a devastated travel industry. Layoffs at the model factory have only been avoided because workers took a 20 percent pay cut and because in the context of Asia, Chinese companies are doing OK. Fueled by heavy government spending, the domestic market is still buoyant.

ZHAO LIN CHUAN, PRODUCTION MANAGER, JIN SHI LI FACTORY: For China, the multiples growth in terms of the consumer spending powers is amazing. If you walk around in terms of the private spending in terms of housing, in terms of car purchases, that's all on the rise. So I think China probably should be isolated when you analyze the impact.

MCGUFFIN: Other countries aren't so lucky.

JOHNNY CHEN, PARTNER, PRICEWATERHOUSECOOPERS: I think other regions will be, will have a tougher time. Hong Kong, including Japan, southeastern Asia. I think they one is really they have a very limited marketplace themselves. So they rely on a much heavily export oriented growth.

MCGUFFIN: The cross Pacific domino effect that has put most Asian countries into recession will be the focus of discussion when Asia-Pacific leaders meet here in Shanghai this weekend. The events of September 11 have dramatically altered the APEC agenda. Now, Pacific Rim leaders will be focusing on a coordinated effort against international terrorism and its damaging effects on regional economies. President Bush is expected to push hard for a strong and unified APEC statement against international terrorism. But for most leaders on this side of the Pacific, the threat of a deep recession is a far more important issue. Only four years after the Asian economic crisis, most governments here are short on cash to prop up weakened economies and interest rates in the region are already quite low, leaving them few financial tools to fight with.

CHEN: As we see the last few years, Japan is trying to come out of this gloom they have. It hasn't come out of it as well and many of the Southeastern Asian countries have really not made a step forward at all. So perhaps this is the opportunity for people, with the strong growth in domestic demand, China can become really the leader out of the Asian pack.

MCGUFFIN: And be the engine that drives East and Southeast Asian economies back to the dynamism that made them so popular a decade ago. For NIGHTLY BUSINESS REPORT, I'm David McGuffin in Shanghai.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. © 2001 Community Television Foundation of South Florida, Inc.

10/18/01: Commentary: APEC-What's In It For US?

SUSIE GHARIB: In tonight's commentary, the APEC summit and what's in it for the United States. Here's Barbara Hackman Franklin, President of Barbara Franklin Enterprises and former U.S. Secretary of Commerce.

BARBARA HACKMAN FRANKLIN, COMMENTARY: I'm just back from Shanghai, where the Asia Pacific Economic Cooperation, that's APEC, summit is beginning. President Bush and the heads of state of 20 other countries will attend. These annual summits focus on liberalizing trade. But September 11 adds a crucial new dimension. Hosting this meeting is a big deal for China and it wants no incidents. Shanghai was bustling with heightened security. Parts of the city are blocked off and airport security was tighter than anyplace I have been. Also, China has slapped strict visa controls on 30 Middle Eastern countries. It's closed the Pakistan border, increased patrols around the Afghanistan border and cracked down even harder on the Muslim leaders in the northwest province. These Muslims say they are separatists, but the Chinese call them terrorists. China is backing the U.S. in the war on terrorism, though it's not clear what this support means. And China may want something in return. President Bush is meeting with President Jiang and we should watch the outcome. A more cooperative relationship may emerge. Look for other results of this summit-a push for a new round of global trade talks, kudos for China as host if things go well, and most importantly, greater support for President Bush in the campaign to wipe out terrorism. I'm Barbara Hackman Franklin.

Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. 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. © 2001 Community Television Foundation of South Florida, Inc.

10/18/01: Paul Kangas' Wall Street Wrap Up

PAUL KANGAS: Stocks on Wall Street opened modestly lower today due to some carryover selling from yesterday's late anthrax-scare downturn, which sent the Dow Industrial Average to a 151-point closing loss, and the NASDAQ Index down 75 points. At 10:00 this morning, the Dow was off another 52 points while NASDAQ Index posted just a 5 point deficit. The market stabilized in mid morning and even improved a bit thanks in part to some solid earnings numbers, some of which you just heard about. At 11:30 a.m., the Industrial Average cut its loss to 26 points. NASDAQ was up 15 1/2 points with the help of bargain hunters in the tech sector. Word that a CBS television news employee had been confirmed as having the skin form of anthrax, revived bioterrorism fears in early afternoon and the Dow dipped to an 81-point loss at 2:00 p.m.,while the NASDAQ Index was down just 3 1/2 points. The resilience of the NASDAQ market for the rest of the session helped the blue chips firm up a bit and the Dow Industrial Average trimmed its closing loss to 69 3/4 points exactly, putting it at 9163.22. The NASDAQ Index managed to gain 6.38, ending at 1652.72.

Big board volume simmered down a bit from yesterday to about 1.27 billion shares and a lot more down volume than up volume, about an 8 to 3 margin.

The Dow Transport Index off 23.80.

The Utility Index fell 7.83.

And the Closing Tick just mildly bearish at -174.

Standard & Poor's 500 off nearly 8 ½ points.

3 2/3 point drop in the 100.

The MidCap 400 off just about 4 points.

And the Bridge Futures Price Index fell 1.15.

A loss of 5 3/4 points or nearly so in the New York Composite.

Just over a 3 1/2 point drop in the Value Line.

Russell2000 Small Cap off nearly 3 ½ points.

And the broadly based Wilshire 5000 down 74.69 or 8/10 of a percent.

The bond market was narrowly mixed today reflecting a little strength from the report of a 6,000 rise in the latest weekly jobless benefit claims along with the continuing safe haven buying prompted by concern about anthrax. A $0.50 per barrel decline in New York November oil futures was another positive for bonds, but a weaker US dollar and some profit taking were the negatives. Tax free and corporate issues ended mostly unchanged while the Treasury market was just a touch lower.

5-year notes losing 1/32.

A 2/32 drop in the bellwether 10-year note.

The 30-year bond off 1/32, very narrow losses.

But look here, a gain in the Lehman Brothers Long-Term Treasury Bond Index, up 3 2/3.

A mixed session on Wall Street, with the blue chips not faring very well. But the NASDAQ did all right, a little bargain hunting in tech stocks. The Dow losing 69 ¾ points exactly. The broader market for the second day in a row lower by a 19 to 11 margin. And more new lows than new highs for the year. That's the first time that's happened in about five sessions.

Spring PCS Group (PCS) topped the active list on 25.1 million shares, down $2. The company has reported a third quarter loss of $0.29 a share, not as bad as the $0.41 loss a year ago, but the company is cautious about the outlook. That seems to be hurting the stock.

EMC (EMC) rebounding only $0.03 after dropping $2.24 yesterday when it reported a third quarter loss of $0.12 a share.

AOL Time Warner (AOL) down $0.91.

Cablevision Systems (CVC) down $0.07. Today, AT&T (T) sold 19 million shares of Cablevision at a price of $36.05 a share.

Washington Mutual (WM) dropped $2.01. Both J.P. Morgan and Jeffries Brokerages downgraded that stock a notch.

AT&T Wireless (AWE) fell $0.20.

Texas Instruments (TXN) fell $1.91. The company reported a third quarter loss of $0.03 versus $0.33 in earnings last year and the company predicting fourth quarter revenues will be down 10 percent from the third quarter. Merrill Lynch downgraded the stock from "buy" to just "near term accumulate."

AT&T (T) down $0.73.

Followed by Compaq (CPQ) with a $0.24 loss.

And then G.E. (GE), tenth in volume, managed to gain a $0.10 a share.

Allstate (ALL) down $0.97. The company's third quarter operating earnings, $0.56, way down from last year's $0.71, but that was $0.02 above the Street estimate. The stock still lower.

Bausch & Lomb (BOL) up $2.74. The company's third quarter earnings, $0.30, way down from $0.70 last year, but believe it or not $0.07 better than the Street estimate.

Hershey Foods (HSY) edged up $0.81 on higher third quarter earnings, higher by 12 percent, $0.87 versus last year's $0.78 and a $0.01 above the Street estimate.

Merrill Lynch (MER) gained $1.06. Third quarter earnings tumbled to $0.44 versus $0.94 last year, but that was $0.03 better than expected.

UAL (UAL) down another $1.80. AFL-CIO flight attendants called for Chief Executive Jim Goodwin to resign after his comment yesterday saying that UAL could go out of business some time next year.

Union Pacific (UNP) gained $2.01 on higher third quarter earnings of $1.04 versus the previous year's $1 a share and that was $0.05 better than expected.

Right Choice Managed Care (RIT), look at that gain, the star of the day, up nearly $17 or 37 percent. Wellpoint Health (WLP) is going to acquire this company for $66 a share in cash or a little over 6/10 of one of its shares. That would only be worth about $62 today because Wellpoint's stock fell $5.62.

Olin (OLN) had a good day, rising $1.88. Morgan Stanley upgraded it from "outperform" to "strong buy."

Steris (STE) up $1.81. Now, this company makes infection prevention products. Second quarter earnings up 37 percent, $0.13 versus $0.10 the previous year, $0.02 better than expected. And listen to this, Steris expects 2002 fiscal earnings to be up 40 to 45 percent. The big percent loser of the day, MSC Software (MNS), dropping $2.75. The company sees third quarter earnings falling short of the $0.20 per share Wall Street estimate.

Titan Corporation (TTN) down $3.90. Its third quarter earnings sharply lower, $0.13 versus $0.21 the year before.

And IMS Health (RX) dropped $4.46. Third quarter earnings were a bit higher, $0.27 versus $0.24 last year, but that was lower than expected and FAC Equities Brokerage downgraded it from "strong buy" to just a "buy."

NASDAQ trading, a 6 1/3 point gain in the Index. Volume fell to 1.78 billion shares, well down from yesterday. About 15 stocks higher for every 20 lower.

Microsoft (MSFT) topped the active list and it closed at $56.75 after the close on those better than expected operating earnings. The stock was as high as $57.95 a share.

Intel (INTC) fell $0.52.

Cisco (CSCO) closed with a gain of $1.12.

Express Scripts (ESRX) down $7.74. This is a pharmacy benefits management company and it warned its fiscal 2002 results would be at the low end of estimates. U.S. Banc