Program: Tuesday, October 7, 2003

The Kozlowski/ Swartz Trial Begins
Market Outlook With Hugh Johnson, CIO, First Albany
Energy Forecasters Predict A Normal Winter & Normal Heating Bills
Commentary-The ECB Goes French
Last Word-"Husband-Sitters"
Paul Kangas' Stocks In The News
Market Stats

10/07/03: The Kozlowski/ Swartz Trial Begins

SUSIE GHARIB: Opening arguments were heard today in a Manhattan courtroom in the case of the former CEO and CFO of Tyco International. Prosecutors said that former CEO Dennis Kozlowski and his finance chief, Mark Swartz, looted the company for several years in a, "intricate, well thought out charade." If the two men are convicted, they could face up to 30 years in prison. Suzanne Pratt was in court and has details.

SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: Today, Dennis Kozlowski became the first CEO of a major company to face a jury in the post-Enron and WorldCom era. The former Tyco chief executive and his CFO, Mark Swartz, are charged with grand larceny and enterprise corruption. Assistant District Attorney Kenneth Chalifoux said, "this case is about lying, cheating, and stealing." In an opening statement that went on for more than two hours, the D.A. said the pair were entrusted with the assets of a company and they shamelessly violated that trust. The prosecution detailed how the men allegedly raided Tyco bank accounts of $170 million. But in the afternoon, the defense team fired back with its opening statements. Kozlowski attorney Stephen Kaufman said his client is not a liar, cheat, or a thief. He went on to say that Kozlowski had the full confidence of the Tyco board. And he said everything was done in the open. There was no second set of books. Swartz's attorney concurred, saying the former CFO "had nothing to hide." Meanwhile, perhaps in an effort to distance itself from the trial, Tyco's new management team today posted an ad in major U.S. newspapers. It said, "despite the distractions of the recent past, Tyco is a $37 billion company that sells real products to real customers around the world." Analysts say the timing of the ad was most likely intentional.

MICHAEL JAFFE, EQUITY ANALYST, STANDARD & POOR'S: Obviously the allegations that are coming out can cast Tyco in a somewhat negative light, and they want to make sure to say that this is not us. This is not the current Tyco, this took place under the old regime.

PRATT: Jury selection in the Kozlowski and Swartz case was surprisingly quick. Lasting only about a week when two weeks were predicted. Nevertheless, the trial is still expected to be quite lengthy, running anywhere from three to four months. Suzanne Pratt, 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: Market Outlook With Hugh Johnson, CIO, First Albany

SUSIE GHARIB: Well, it looks like Wall Street is breaking the October jinx. So far this October, the Dow is up more than 4 percent, and the NASDAQ is higher by 6 ½ percent. Joining us now to talk about that outlook, Hugh Johnson, chief investment officer and strategist at First Albany. Hi, Hugh.

HUGH JOHNSON, CHIEF INVESTMENT OFFICER, FIRST ALBANY: Hi, Susie.

GHARIB: Well, recently you turned very bullish. Give us your analysis on that.

JOHNSON: Well, it's - first of all the messages of the financial markets are very, very positive, very strong. It's not just that the stock market is going up, interest rates edging higher, but investors have been buying or migrating to the so-called bull market sectors like technology, consumer cyclicals and industrials, and away from the safer sectors of the market. So in addition to that, you have small companies that are outperforming large companies. These messages from the markets are very clear and very strong, and so that's the reason why I'm turning bullish. It's really in response to a market that's sending a very strong signal.

GHARIB: The other night our market monitor guest said that this - acknowledged that the market has been doing well, but looking ahead said that the growth spurt in the economy will fade once that this one-time effect of the tax cut fades out. And so that will mean that the stock market will be weaker next year. So do you think that the stock market rally that we're experiencing now is going to be short-lived?

JOHNSON: No, I don't, Susie. Bull markets last a long time. The median of the post-war bull markets is 39 months. There's no question that the stimulus has really brought us out of the gates really fast, the stimulus in the form of lower interest rates, tax cuts, and now of course the decline in the dollar. You looked at those ALCOA earnings, or mentioned them, they sell strong demand, that's a result of the declines in the dollar and a recovery in pricing power, also because of the dollar. That's all starting to pay off now. Now some of that is going to dissipate. We're not going to have a strong economy in 2004, 2005, as now. But I doubt very seriously if it's going to completely run out of gas. It will be positive growth but not as positive. It will be a good stock market, but not as good as it's been.

GHARIB: All right. Well, we know that when the economy picks up steam and does well, that means that interest rates also go up with it. So what will that do to the Wall Street rally?

JOHNSON: Well, right now interest rates are at a level that it's not going to snuff off the borrowing and spending that we're seeing. There's no question that when you get later in the cycle, later in the bull market, later in the business recovery, and at a higher level in interest rates, that interest rates will become a problem, and the bad news of rising interest rates will then more than offset the good news of earnings. But we're a long way from that now. I think we're many, many months away from that.

GHARIB: All right. All right. Let's talk about some stock recommendations. And give us the names of two, three stocks that you think if you buy them now - if an investor were to buy them now and hold them for a year, which ones would you select?

JOHNSON: Well, you pick the right sectors, Susie, it's important to get the bull market sectors or economically-sensitive sectors, so consumer cyclicals, a company like Staples (SPLS), the industrial sector, a company like General Dynamics (GD), which of course will benefit from increased spending on defense. And then the technology sector is always a leader in these stages of a bull market. Look at companies like Cisco (CSCO) and Intel (INTC). So I'm looking at large capitalization companies, but don't forget small cap. Now I think in time large will outperform small, but we're a ways away from that right now.

GHARIB: And in terms of disclosure your connection with these stocks and your firm's relationship?

JOHNSON: Yes. I'm obviously running an asset management company, we own all of these stocks and all of the portfolios in our asset management company, and my money is managed by the asset management company as well, so I own them as well.

GHARIB: OK. A follow-up on the technology stock. You obviously are buying up now more in technology. You think that this is an area that is safe now for long-term investors, individual investors to put their money?

JOHNSON: A lot of folks are worried about valuation, and there's no question price-to-earnings ratios have gone up in this bull market. They're all around - something around 25 right now. But the growth and earnings that I'm looking at for 2004 is going to easily, in my judgment, justify current levels of price-to- earnings ratios. They're not expensive, they're still fairly valued.

GHARIB: All right, a lot of good information. Thank you very much, Hugh.

JOHNSON: You're welcome.

GHARIB: We've been speaking with Hugh Johnson of First Albany.

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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: Energy Forecasters Predict A Normal Winter & Normal Heating Bills

SUSIE GHARIB: Fuel supplies are expected to be sufficient this winter to avoid a major jump in home heating bills. That's the word from the Energy Information Administration, which keeps track of energy supply and prices for the government. But as Stephanie Woods reports, the forecast hinges on a normal winter.

STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: More snow and ice than expected last year depleted fuel inventories and drove energy prices higher. The government's energy forecasters say demand this winter should be lower, but heating bills may still bring sticker shock to consumers depending on how they heat their homes.

GUY CARUSO, ADMINISTRATOR, ENERGY INFORMATION ADMINISTRATION: If you're using heating oil or propane, you might get a positive surprise. Natural gas, because of the way the system works, last year's high prices are now just feeding their way through the system. Natural gas consumers will be paying at least 5 percent more under their normal weather assumptions.

WOODS: If it's 10 percent colder than normal this winter, natural gas prices could shoot up 16 percent, because of low inventories. Prices at the gasoline pump are expected to be about $0.10 lower than last year average of $1.56 a gallon. But those prices may be volatile, too.

CARUSO: Markets will be tight for crude in this country this winter, and there's not a lot of cushion should something go wrong.

WOODS: Economists are watching Venezuela's labor market closely, given the strike there last year. This year, Nigeria is facing a strike that could hurt oil production. Production cuts by OPEC countries could also swing prices. A key factor will be how much oil flows from Iraq.

ROGER DIWAN, DIRECTOR, PFC ENERGY: If you have cold weather and no Iraq, you might have high oil prices. If you have warm weather and Iraq, you can have very low oil prices.

WOODS: Today's report says fuel supplies are adequate for this time of year. That has energy officials hopeful prices will stay in a normal range throughout the winter. 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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: Commentary-The ECB Goes French

SUSIE GHARIB: In tonight's commentary, big changes are on the horizon at the European Central Bank. Here's Lionel Barber, U.S. managing editor for the "Financial Times."

LIONEL BARBER, COMMENTARY: Henry Kissinger once asked, "if I want to speak to Europe, which number do I call?" Let's put Dr. Kissinger and his fellow Euro- skeptics out of their misery. The number to call is the European Central Bank in Frankfurt. And here's another piece of news: that voice at the end of the line will soon be French. Jean-Claude Trichet, a super-smooth technocrat who speaks fluent English, is about to take over as ECB president from Wim Duisenberg, the clodhopping Dutchman. Mr. Trichet will help to direct interest rate policy across the euro-zone. He will speak for the euro, doubtless in more Delphic terms than Mr. Duisenberg, who regularly wrong-footed markets. Five years ago, the German government and the Bundesbank resisted the appointment of a Frenchmen to the top job at the ECB. They insisted on going Dutch with Mr. Duisenberg as part of the price of giving up the Deutschemark. Now in matters of money, national sentiments still count. Look at Sweden's recent "no" to the euro and Britain's decision to still sit on the fence. But in continental Europe, the euro is a fact of political life. Ask Mr. Trichet. He's making the ultimate sacrifice, moving from gay Paris to Frankfurt. I'm Lionel Barber.

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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: Last Word-"Husband-Sitters"

SUSIE GHARIB: And finally, a solution to an age old problem: husbands who hate to shop. A German bar has opened a sort of kindergarten for men. Women can drop their husbands at the bar on Saturday morning and pick them up later in the day. For 10 euros, which works out to about $12 American, the men get a name-tag, a hot meal, two beers, televised football, and board games. Paul, the idea came from one of the bar's female customers who wanted something for her husband to do so she could shop in peace. And her husband says it beats sitting around in shoe shops.

KANGAS: Yes, well, that may be all fine and good, Susie, but I always remind my wife, the most expensive vehicle in the world to operate is the shopping cart. Remember that. (LAUGHTER)

GHARIB: I just don't get the name tag, why do they need the name tag? It really isn't kindergarten, now, is it?

KANGAS: Practically.

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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: "Paul Kangas' Stocks In The News"

PAUL KANGAS: Wall Street opened with a round of profit-taking following four straight sessions on the upside and hardly helping the mood was further weakness in the dollar. After 30 minutes of trading, the Dow was down 42 points and the NASDAQ Index lost about 10. Stocks showed a little improvement with the help of brokerage upgrades on Advanced Micro Devices (AMD) and McDonald's (MCD), along with optimism that ALCOA (AA) would report better-than-expected results after today's close. At noontime, the Dow posted a 20-point gain while the NASDAQ Index was up 6 points. Afternoon first brought renewed weakness, but when the selling had no depth to it at all, the market turned higher once again. The result was a closing gain of 59.63 points in the Dow Industrial Average at 9654.61. The NASDAQ Composite ended higher by 14.39 points, putting it at 1907.85. And the Standard & Poor's 500 Index gained 4.90 points to close at 1039.25. In the bond market, the 10-year note fell 23/32 to 99 29/32, putting the yield at 4.26 percent.

And for the second day running, Motorola (MOT) topped the big board active list, today trading 22.8 million shares, edging up another $0.56. It was up $1.22 yesterday in positive reaction to the company's plan to spin-off its semiconductor unit.

Micron Technology (MU) fell $0.49.

Then Lucent Technologies (LU) edging $0.02 higher.

NorTel Networks (NT), a $0.04 gain.

Fifth in volume was Eastman Kodak (EK), down $0.25. The company issued $500 million in unsecured notes due in the year 2013 today, and another $500 million of convertible unsecured notes of the year 2030. Sold that in private placements.

Moving along, Pfizer (PFE) lost a dime a share.

Followed by General Electric (GE), a $0.06 drop. GE's earnings due out Friday.

Corning (GLW), a $0.41 gain, a pretty good percentage move there.

AOL Time Warner (AOL) was down $0.12.

Tenth in big board volume, EMC Corp. (EMC) up $0.31.

McDonald's (MCD) up $0.59. As I touched on earlier, Smith Barney brokerage upgraded it from hold to a buy. It has been strong recently, you can see by that chart.

Boston Scientific (BSX) losing $2.22. UBS Securities downgraded it from buy to neutral and also cut its price target on Boston Scientific from $80 a share down to $75 a share.

CVS Corporation (CVS), the big drug firm, drug chain, up $1.48. Total sales in the five weeks ending September 27 rose 8.8 percent. And that should enable the company to post third-quarter earnings of $0.46 a share, up from the $0.43 per share Street estimate. Standard & Poor's repeated a buy.

WillBros Group (WG), that's a nice percentage move there, up 25 percent today with that gain of $2.60. One of the company's unit has been awarded a $100 million contract to construct pipelines in Iraq.

Industrial Distribution Group (IDG), up another $0.92. Good percentage move there. It was up $1.71 yesterday on a very positive mention in this week's "Barron's" financial magazine. A money manager by the name of Neil Goldman thinks the stock will triple over the next 18 months.

Fresh Del Monte Produce (FDP) tumbling $2.72. Today's "Wall Street Journal" highlighted the mounting competition in the pineapple business. Merrill Lynch, however, says still buy the stock here. And it has a target of $0.32 a share.

Russell Corporation (RML) in the apparel business, down $0.64, or 3.8 percent. J.P. Morgan downgraded it from neutral to underweight.

And on the upside, Advanced Micro Devices (AMD) edged $0.63 higher. As I touched on, UBS Securities upgraded it from reduce to neutral.

NASDAQ's most active big board issue was Microsoft (MSFT), down a nickel.

And then Intel (INTC) a $0.39 gain.

Amazon.com (AMZN) up $0.76.

Yahoo! (YHOO) fell $0.85.

Rambus (RMBS) up another $1.66. The stock very strong this week on a positive Supreme Court ruling regarding royalties that will come to the company.

Cisco Systems (CSCO) was up $0.20.

A similar rise in Dell Incorporated (DELL), up to $35.19.

Applied Materials (AMAT) was up $0.57.

Broadcom (BRCM) had a good day, rising $1.69.

Tenth in volume, Amgen (AMGN) up $1.28.

Regeneron Pharmaceuticals (REGN) had a terrible day, tumbling $3.81, or almost 21 percent. The company's experimental rheumatoid arthritis drug treatment showed little effectiveness in mid-stage trials. So bad news for the company.

LookSmart Limited (LOOK), look at that percentage loss, 52 1/3 percent with a drop of $1.58 a share. Microsoft's Internet division will end its licensing agreement in January of this coming year. That accounts for a lot of the company's revenues.

North Coast Energy (NCEB) down a $1.86. The company is reviewing a number of acquisition offers. But the problem is they're all below its current market price. So down she went.

Intrabiotics Pharmaceuticals (IBPI), a good gain of $2.13 there. Enrollment for the company's pneumonia prevention treatment is getting under way and there is obviously some optimism about it.0

And over in the American Exchange, Firstfed American Bancorp (FAB) up $1.51. Webster Financial (WBS) will acquire this company for $24.50 a share in cash, or about 6/10 of a cent of Webster stock, whatever you prefer. Webster stock would be worth today just about the same price that it closed at, $24.16.

And those are the "Stocks in the News" tonight.

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. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.

10/07/03: Market Stats

			                                 
					
                                      NET    PERCENT
                         CLOSE     CHANGE     CHANGE
DOW CLOSE              9654.61     +59.63       + .6
HIGH                                         9654.61
LOW                                          9536.02

NASDAQ COMP.           1907.85     +14.39        +.8
HIGH                                         1907.88
LOW                                          1878.59

VOLUME                                       1,284.7
PREVIOUS                                     1,005.1
UP VOLUME                                      823.2
DOWN VOLUME                                    438.0

DOW TRANSPORTS         2800.38      +3.71       + .1
DOW UTILITIES           252.78      -1.07       - .4
CLOSING TICK                                   +1040

S&P 500                1039.25      +4.90       + .5
S&P 100                 519.64      +2.60       + .5
MIDCAP 400              536.01      +3.10       + .6
REUTERS/CRB             244.13      +1.52       + .6

NYSE COMPOSITE         5876.56     +18.54       + .3
VALUE LINE               336.2      +2.05       0.61
RUSSELL 2000            520.77      +4.05       0.78
WILSHIRE 5000         10090.78     +50.50        0.5

U.S. TREASURIES
5-YEAR NOTE 3.125%
Sept. 15,2008         99 30/32     -12/32       3.14

10-YEAR NOTE 4.25%
Aug. 15,2013          99 29/32     -23/32       4.26

30-YEAR NOTE 5.375%
Feb. 15, 2031        103  4/32     -42/32       5.16

LEHMAN BROS.
LONG BOND INDEX        1721.09     -16.08


DOW CLOSE              9654.61     +59.63       + .6
ADVANCES                                        1951
DECLINES                                        1279
NEW HIGHS                                        349
NEW LOWS                                           6

                                      NET    PERCENT
NYSE MOST ACTIVES    4PM CLOSE     CHANGE     CHANGE
MOT    Motorola          14.06       +.56       +4.2
MU     Micron Tech       13.00       -.49       -3.6
LU     Lucent Tech        2.32       +.02        +.9
NT     Nortel Networks    4.51       +.04        +.9
EK     Eastman Kodak     21.10       -.25       -1.2
PFE    Pfizer            30.65       -.10        -.3
GE     GE                30.73       -.06        -.2
GLW    Corning           10.62       +.41       +4.0
AOL    AOL Time Warner   15.47       -.12        -.8
EMC    EMC               13.96       +.31       +2.3

NASDAQ CLOSE           1907.85    + 14.39       + .8
VOLUME                                       1,842.5
PREVIOUS                                     1,379.0
ADVANCES                                        1943
DECLINES                                        1201

NASDAQ ACTIVES
MSFT   Microsoft         29.14       -.05        -.2
INTC   Intel             29.95       +.39       +1.3
AMZN   Amazon.com        54.91       +.76       +1.4
YHOO   Yahoo!            38.93       -.85       -2.1
RMBS   Rambus            27.46      +1.66       +6.4
CSCO   Cisco Systems     21.00       +.20       +1.0
DELL   Dell Inc          35.19       +.22        +.6
AMAT   Applied Matl      19.88       +.57       +3.0
BRCM   Broadcom          30.85      +1.69       +5.8
AMGN   Amgen             66.21      +1.28       +2.0

AMEX CLOSE             1015.98     + 3.50       + .4

INDEX SHARES
DIA    DIAMONDS TRUST    96.69       +.49        +.5
QQQ    NASDAQ 100        34.65       +.24        +.7
SPY    S&P DEP.RECEIPTS 104.26       +.40        +.4

STOCKS IN THE NEWS
MCD    Mcdonald's        24.72       +.59       +2.5
BSX    Boston Scientif   62.96      -2.22       -3.4
CVS    CVS Corp          33.61      +1.48       +4.6
WG     Willbros Group    13.00      +2.60      +25.0
IDG    Industrial Distr   5.97       +.92      +18.2
FDP    Fresj Del Monte   23.68      -2.72      -10.3
RML    Russell Corp      16.19       -.64       -3.8
AMD    Adv Micro Device  12.79       +.63       +5.2
REGN   Regeneron Pharm   14.59      -3.81      -20.7
LOOK   LookSmart Ltd      1.44      -1.58      -52.3
NCEB   North Coast       11.75      -1.86      -13.7
FAB    FirstFed Amer     24.16      +1.51       +6.7