SUSIE GHARIB: Two big stories this evening. A surprising jobs report and a new development in the Hewlett-Packard (HWP)-Compaq (CPQ) merger. A short while ago, the Packard family charitable foundation said that it intends to vote against the proposed $25 billion deal. The foundation owns 10.4 percent of HP. That plus the 7 percent stake held by the Hewlett family, which is also voting against the deal, could derail the merger. Analysts believe the families' stance on the deal could also sway other shareholders. In after hours trading, Hewlett-Packard shares rose roughly $1.50, Compaq shares were down - yes, they did rise $1.50, and Compaq shares were down by about a dollar.

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.

12/07/01: The Unemployment Numbers Rise & Wall Street Falls

SUSIE GHARIB: Now to our other top story: a big rise in the unemployment rate caused stocks to fall on Wall Street. The unemployment rate shot up to 5.7 percent in November, forcing many investors to rethink their outlook for the economic recovery. The Dow lost 50 points and the NASDAQ dropped 33. Erika Miller has more on today's disappointing jobs report.

ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: The euphoria that gripped Wall Street this week ended with a whimper. After the November employment report came in much worse than expected.

MICHAEL MORAN, CHIEF ECONOMIST, DAIWA SECURITIES: The report very much showed the economy is in recession, if there was any doubt before. We have soft labor markets right now.

MILLER: The unemployment rate jumped to 5.7 percent, the highest level in six years, 331,000 jobs were cut during the month, on top of the 468,000 lost in October. It's the worst two month job loss since mid-1980.

MORAN: The report was much worse than expected, I think, because economists were thinking that the effects of September 11, which showed a sharp pronounced hit in October, and then things would start to improve somewhat or at least be less negative during November. Instead, we saw another very poor month.

MILLER: Manufacturing bore the brunt of losses, though most major industries were hit. Still, some experts say the economy is on track for recovery next year.

BRUCE STEINBERG, CHIEF ECONOMIST, MERRILL LYNCH: I think once we get into the spring, a recovery will begin. And by the time we get to the second half of next year, I think that recovery will be very strong.

MILLER: Optimists point to today's University of Michigan consumer sentiment survey, considered a more forward-looking indicator. The index edged up to a preliminary reading of 85.8 in December. Plus, experts say the unemployment news could prompt Congress to pass a much-anticipated economic stimulus package. It may also encourage the Fed to continue cutting interest rates.

STEINBERG: The Fed will definitely be easing policy next week, probably by a quarter of a percentage point, taking the Fed Funds rate to 1.75 percent. There's a good chance of further Fed easing at the end of January, that will depend on how the economy looks at that time.

MILLER: Experts warn that even if the country mounts a sustainable recovery next year, the employment picture is likely to remain bleak. Some are predicting the jobless rate could head as high as 7 percent by summer. Erika Miller, "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.

12/07/01: The ITC's Proposed Steel Deal

SUSIE GHARIB: Some much needed help for American steel companies could soon be on the way. The U.S. International Trade Commission issued today its recommendations for tariffs and quotas on cheap steel imports. It's a move that could help some of the 25 U.S. steel makers forced into bankruptcy in recent years. Darren Gersh has more from Washington.

DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: The recommendations by the six members of the International Trade Commission ranged from quotas to tariffs on steel imports starting at five percent and going as high as 40 percent. The higher the tariff recommendation, one commissioner said, the more leverage the President will have to force other countries to curb a global glut in steel production.

DENNIS DEVANEY, ITC COMMISSIONER: A strong recommendation to the President will send a message of support and hope to American steel companies.

GERSH: The steel industry had hoped the commission would back tariffs as high as 50 percent. But a lawyer for major steel companies said the industry still needs action.

ALAN WOLF, STAND UP FOR STEEL: Import prices are so low and domestic prices caused by the import competition are so low we need tariff relief. We need it as soon as possible.

GERSH: But companies that use steel in their products say higher tariffs would make them less competitive.

JON JENSON, CHAIRMAN, CONSUMING INDUSTRIES TRADE ACTION COALITION: First of all, it'll make their costs of raw material more higher. And it will also increase the competition from abroad for the products they make.

GERSH: The President has until mid-February to make his decision on the commission's recommendations, but he has wide latitude to accept, reject or change them. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.

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.

12/07/01: How The Accounting Industry Could Be Held Accountable For Enron's Errors

PAUL KANGAS: Dynegy (DYN) wants Enron's (ENE) bankruptcy filing moved out of a New York City courtroom. It's filed a motion saying the case should be heard in Houston, where both companies are based. Meanwhile, Congress is preparing for hearings into Enron's failure next week. And, as Stephanie Woods reports, the accounting industry is part of that investigation.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: Enron's spectacular failure has many wondering how the firm kept millions of dollars in debt off its balance sheet. Congressman John Dingell says the accounting industry shares some of the blame.

REP. JOHN DINGELL (D), MICHIGAN: SEC has not been able to enforce the laws as they should have because of failures by accounting.

WOODS: Enron apparently took advantage of an accounting loophole that allows companies to withhold detailed financial information about some business partnerships. Congressional investigators are questioning why the Accounting Standards Board has failed to close the loophole. Dingell says he's not surprised it remains.

DINGELL: They have been constantly under attack for the efforts which they have made to improve accounting, to see to it's more truthful, to eliminate abuses and misbehavior, sweet deals and soft dealings and rascality like we have seen in connection with the Enron matter.

WOODS: Edmund Jenkins chairs the Financial Accounting Standards Board. He says the problem isn't the accounting standards, it's Enron.

EDMUND JENKINS, CHAIRMAN, FINANCIAL ACCOUNTING STANDARDS BOARD: Based on Enron's own words and their own filings with the SEC, they changed their financial reporting to bring it into compliance with generally accepted accounting principles with the standards that we have outstanding now.

WOODS: Still, Jenkins says the Board has renewed its efforts to clarify the rules governing how companies account for partnerships.

JENKINS: We started a new effort in this direction about two months ago and we're working on it as diligently as we can to try to solve this problem.

WOODS: Enron's collapse has investor confidence in the financial reporting system at its lowest point in years. The question now is if the Accounting Board can convince Congress and investors it's got the situation under control. Stephanie Woods, NIGHTLY BUSINESS REPORT, Washington.

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.

12/07/01: "Market Monitor" - Alan Ackerman of Fahnestock and Company

PAUL KANGAS: My guest market monitor this week is Alan Ackerman, Senior Vice President of Fahnestock & Company. Welcome back, Alan.

ALAN ACKERMAN, SENIOR VICE PRESIDENT, FAHNESTOCK & COMPANY: Good to be with you, Paul, as always.

KANGAS: Well, this rise of 3/10 to 5.7 percent in the November unemployment rate was worse than expected, as we know. But do you think we're in for some more of these negative surprises or this might be the worst of the worst?

ACKERMAN: I'm not sure that's the worst of the worst. I think that the economy itself is a little bit slower in responding than we'd like to see it. Clearly there's no economic stimulus package and that's going to affect consumer psychology. My feeling is right now that there are too many pink slips around. The government should have had this economic stimulus package in place and until they get it there's going to be a little more anxiety and perhaps unfortunately at Christmas a little more caution.

KANGAS: And a longer time for the economy to come back in a nice recovery? What is your date, sometime late next year or earlier?

ACKERMAN: Well, the average recession since World War II has been approximately 11 months. If this started in March, we ought to see this economy bounce back about between the first and second quarter of 2002. My feeling is it's a mild recession. We'll have a mild recovery. But I must say something else. Today is the anniversary of the attack on Pearl Harbor. And for those who are older and have had money in the market and watched the United States manage to keep itself afloat, this is an important day. But September 11 was an important one for younger people. It was a time when we also faced a surprise attack and when the United States needed to rally, we did just that. The Dow's performance and NASDAQ has been remarkable. But more than anything else, it shows a resolve and a solidarity and I think over the next few years that's going to be good for everyone not only here but abroad.

KANGAS: How do explain the resilience of the stock market with all this bad news, war and all?

ACKERMAN: I think what really happened is that the market dropped precipitously. We had the worst week since the Depression, as you know, in the week of September 22. My sense is that we saw an oversold position occur. We also saw something else happen no one had expected and that was energy prices collapsed. And we saw anywhere between a $50 billion and $100 billion savings not only here in America, but round the world. It's almost an invisible tax on economies. The thing that also helped this market rally was just a sense of resolve and the feeling that past is prologue. We managed to come back after WWII, we would come back now, as well. My feeling is that it was a liquidity led rally. It's a rally that has gotten ahead of itself. The economic underpinnings haven't kept up with the move upwards. So I think this market is going to back off a bit, cool off a bit. I think there's going to be a bit more selling ahead. But I think long-term stocks are retracting.

KANGAS: On your last visit with us as a market monitor June 22, the Dow was at 10,604. Of course, you had no way of seeing the World Trade Center disaster and all. But you were very guarded in your approach to the market. But you gave us Occidental Petroleum (OXY) at 28. It's now only about 2 points below that. It made a nice comeback. General Mills (GIS) at 43, now over 50. That's done well. And then a little one called Texas Biotech (TXBI). It was about $6.90, went to $8.50, now it's about $6.80. so are you staying with them all?

ACKERMAN: Paul, I look for that Texas Biotech to have a big pop into the new year.

KANGAS: OK.

ACKERMAN: Biotech stocks are doing a bit better and I think they've got some important clinicals ahead.

KANGAS: Any additions to the "buy" list despite your caution here?

ACKERMAN: Well, I would go for the first string team, and that would be Citicorp ©. I would also look at Ocean Energy (OEI). It'd also stay with Occi. I'd look for Mattel (MAT), which I think is going to have a very big year. They've refocused. They've got a great brand. They're going to show some real profits. They're about 20, 21 times earnings.

KANGAS: Right.

ACKERMAN: And the other is Washington Mutual (WM), which is selling below 10 times earnings.

KANGAS: Right. You gave us Wilmington Trust (WL), Washington Mutual, Ocean Energy about a year ago and they're all way up. And you continue to like them?

ACKERMAN: I continue to like them.

KANGAS: OK. All right, what about bonds here, yes or no?

ACKERMAN: I think I'd stay away from bonds for now although bonds may rally a little bit here in the short-term. But I think that it's equities is the place to be.

KANGAS: All right, Alan. As cautious as you are, they're still the place to be, right?

ACKERMAN: They're still the place to be and my hat's off to Harry Potter. Hopefully he'll wave his wand for both of us.

KANGAS: Very good, Alan. Thanks very much.

ACKERMAN: You bet.

KANGAS: My guest Alan Ackerman, Senior Vice President, Fahnestock and Company.

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.

PAUL KANGAS: Stocks on Wall Street have recently done quite well despite plenty of disappointing reports on the economy, but today's worse than expected jobs report was too much of an unpleasant surprise not to set off an opening sell-off which sent the Dow Industrial Average to a 40-point loss by 10:00 a.m., while the NASDAQ Index fell about 16 points. By most any standard, that early downturn was quite mild in the face of the news and on top of that the rise in the University of Michigan's December Consumer Sentiment Index also impressed investors. So they did enough buying to cut the Dow's loss to only 8 points by 11:00 this morning, when the NASDAQ Index was off just 9 points. The markets' comeback was partly thwarted by several different analysts who said the jobs report could be a sign that the economic recovery will be delayed until late next year. That and just normal pre-weekend caution caused the Dow Industrial Average to finally close with a loss of 49.68 points putting it at 10,049.46. This week the Dow rose twice but fell three times and it still gained 197.90 points, or 2 percent. Today the NASDAQ Index came in with a loss of 33.01 ending at 2021.26. But for the week, the index rose 90.68 points, that's 4.7 percent. Trading volume down a bit from yesterday at 1.24 billion shares, about a 7 to 5 ratio of down volume over up volume.

The Dow Transport Index was up 8.86.

Utilities gained 4.66.

And the Closing Tick modestly bullish +406.

Standard & Poor's 500 down 8 3/4 points.

Nearly a 5-point drop in the 100, a real mixture here.

MidCap 400 off 2.21.

Bridge Futures Price Index moved up 0.45.

New York Stock Exchange Composite down 2 2/3 points.

Just over a 2-point drop on the Value Line.

The Russell2000 off just over a point.

And the broadly based Wilshire 5000 off 76.70.

Bond prices surged higher early today in reaction to the big jump in November unemployment, but with year-end approaching, many investors who still have huge paper profits from the year-long rally in bonds are deciding to lock those profits in now that the Fed easing cycle in rates may be nearing an end.

As a result, tax-free and corporate issues fell anywhere between half point and a full point while the Treasury market was hammered across the board.

The 5-year notes down 16/32.

The 10-year notes tumbling 1 6/32.

And the 30-year bond off just over 2 points.

And the Lehman Brothers Long-Term Treasury Bond Index fell just about 23 3/4 points.

Once again, the market gave a pretty good accounting of itself despite the bad news on unemployment. The Dow Industrial Average actually up nearly 200 points on the week, down about 50 today. The broader market just mildly lower, by about a 16 to 14 ratio. 94 new yearly highs, only 30 new lows. Halliburton Company (HAL) topped the active list on nearly 56 million shares. The stock traded as low as $10.99, a major blow, after a jury awarded a $30 million verdict against Haliburton's Dresser Industry (ph) subsidiary in an asbestos exposure case.

AOL Time Warner (AOL) dropping $1.77. Merrill Lynch cut earnings estimates because of the weak advertising market.

Advanced Micro Devices (AMD) up $1.60. The company is forecasting a 10 percent rise in fourth quarter revenues over the third quarter and today First Boston and Salomon Smith Barney both increased earnings estimates.

EMC (EMC) down $0.81.

General Electric (GE) fell $0.61, fifth in big board volume.

Lucent Technologies (LU), a $0.30 drop.

Cendant (CD) was up $0.54.

But Motorola (MOT) down $0.46.

Qwest Communications (Q) fell $0.15.

And then Compaq (CPQ), before that news came out after the close, was up $0.21.

AMR (AMR) up $1.30. November air traffic numbers picked up considerably and there were some positive comments on the air group from Goldman Sachs.

Boston Scientific (BSX) fell $1.11. The company said it will provide additional information requested by the FDA regarding the company's Taxus IV (ph) clinical trial.

Calpine (CPN) up $0.88. It's in a pact with Pacific Gas & Electric whereby PG&E is going to pay all of its outstanding payables, which amount to about $265 million plus interest owed to Calpine.

Eastman Chemical (EMN) down $1.91. The company sees lower than expected fourth quarter earnings of between $0.05 and $0.20 a share due to the weak global scenario in business.

National Semiconductor (NSM) down $0.71. Even though Salomon Smith Barney upgraded it from "outperform" to "buy" today with a $45 a share target.

St. Jude Medical (STJ) down $2.81. Goldman Sachs downgraded this from a "trading buy" to just a "market performer."

Bunge Limited (BG) up $2.60. The company's chief executive officer gave an upbeat presentation earlier this week and the stock's been strong ever since. It's one of the major agribusiness firms.

Thomas Nelson (TNM) up $1.15. This is a major distributor of bibles and other religious publications. The Mario Gabelli Investment Group (ph) recently increased its stake in this company from 12.7 to 13.75 percent.

Sun International Hotels (SIH) up $2.15. The company says its bookings are picking up.

Gildan Activewear (GIL) down $1.70. The company's fourth quarter earnings sharply lower, $0.23 versus $0.58 a year ago. Sales dropped nearly seven percent and the company cut its 2002 estimate from the range of $2.15 to $2.25 all the way down to $1.80 to $2 a share.

Cooper Industries (CBE) down $6.25 in sympathy with Haliburton because this company could possibly have some asbestos liability.

And the same, apparently, with Georgia-Pacific (GP), although after the close, G.P. said there has been no change in its asbestos liability picture at all.

Nasdaq trading, a drop of 33 today. But up 90 on the week overall. Volume down a tad from yesterday at 1.9 billion shares. 18 stocks down for every 17 higher.

Intel (INTC) topped the active list, down $0.92.

Followed by Microsoft (MSFT), falling $0.82. The nine states still suing Microsoft over anti-trust charges today told a