10/08/04:
The Latest Jobs Report Gives The Markets Labor Pains
LINDA O'BRYON: From Washington to Wall Street, the focus today was jobs and job creation. The Labor Department says 96,000 new jobs were added to the payrolls in September, a much lower than expected number. But it will be a critical number in the presidential election since jobs and the economy are a top priority to voters. It will also be a key point of contention tonight as President George Bush and Democratic challenger John Kerry face off in their second debate. We have two reports, beginning with Scott Gurvey in New York City.
SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: This last employment report before the election came in weaker than most economists had expected. They were looking for an increase of 140,000 non-farm jobs in September. But the Bureau of Labor Statistics said employers added only 96,000 workers to their payrolls. The data now shows four straight months of relatively weak job growth after three strong months in the spring. The unemployment rate in September held steady at 5.4 percent. Much of the discussion today centered on the impact of the four hurricanes which struck the nation in August and September. The Bureau said the weather did hold down employment growth, but not enough to materially change the report.
JOSHUA FEINMAN, CHIEF ECONOMIST, DEUTSCHE ASSET MGMT.: One of the places you might have expected to see an impact of the hurricanes was in the work week as people couldn`t work as much but we didn`t really see, we certainly didn`t see any decline in the work week, so that`s sort of suggestive that we didn`t get a big impact.
GURVEY: The Federal Reserve has been raising interest rates to keep the economy from overheating and Fed watchers say today`s report should not change current monetary policy.
WILLIAM DUDLEY, CHIEF US ECONOMIST, GOLDMAN SACHS: I think there`s nothing here that`s going to dissuade them from continuing to tightening monetary policy. The next meeting is the week after the election in November and they`ll do another quarter point and after that it depends on the data. But everything we`ve heard from Fed officials to date in the last week suggests that they`re still very much on course of a measured pace of tightening and until we hear otherwise that`s 25 basis points a meeting.
GURVEY: Economists say they expect job growth to remain in the range of 100,000 to 150,000 per month for the near term. The bond market is signaling that it expects interest rates to be 2 to 2.25 percent at the end of the year. 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. Copyright (c) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use.
10/08/04:
The Impact of Employment on the Race for the White House
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: This is Darren Gersh in Washington. With the release of the September jobs report, the campaign spin cycle is now set to high. Today the Bush campaign launched this new ad titled "nearly two million."
How does the president hit the nearly two million figure? Since August 2003, the Bureau of Labor Statistics estimates 1.7 million jobs have been created. The administration then adds a statistical revision of 138,000 jobs that the Labor Department won`t officially incorporate into the jobs numbers until next March. The result: 1.9 million jobs. Overall, administration officials say they are encouraged by 13 consecutive months of job growth.
STEPHEN FRIEDMAN, PRESIDENTIAL ASST., ECONOMIC POLICY: You`d always rather have a higher number any particular month, but when you look at the totality, it`s steady growth.
GERSH: But the Kerry campaign slices and dices the numbers differently, pointing out that the administration is still officially 816,000 jobs short of the number of Americans employed when the president took office. And if you don`t count government jobs, Democrats say the news is even worse: 1.6 million private sector jobs have disappeared. John Kerry calls the latest jobs report more bad news.
SEN. JOHN KERRY, DEMOCRATIC PRESIDENTIAL NOMINEE: The president is now officially the first president in 72 years to lose jobs on his watch.
GERSH: Unemployment was 4.2 percent when George W. Bush took office. In the recession, unemployment jumped to 6.3 percent but it has now fallen back to 5.4 percent. The administration also reminds voters that the economy has now overcome recession, 9/11 and corporate scandals.
FRIEDMAN: I think the president has said we`ve created more jobs in the last year than really all the other major economies in the world together.
GERSH: But in September, 418,000 workers are considered so discouraged, they`ve given up looking for work.
SEN. JOHN EDWARDS, DEMOCRATIC VICE PRESIDENTIAL CANDIDATE: You know that George Bush and Dick Cheney say oh, our unemployment numbers are getting better. One of the reasons is they claim they are getting better is because hundreds of thousands of people have given up. They`ve been on so long they`ve fallen off the lists.
GERSH: Spin aside, political analysts say the last jobs report before the election was not strong enough or weak enough to change many votes. Still, expect to hear a lot of talk about it in tonight`s debates. 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. Copyright (c) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use.
10/08/04:
Martha Stewart aka Prisoner #55170-054
LINDA O`BRYON: Lifestyle expert Martha Stewart is now prisoner 55170 054. She reported to the Federal prison camp at Alderson, West Virginia early this morning to start serving a five month sentence for conspiracy and making false statements. Prison officials say just like other new inmates, Stewart was subjected to a strip search when she arrived. Located 270 miles southwest of Washington, D.C., Alderson is referred to by locals as "Camp Cupcake" because it looks like a college campus and has no bars or locked doors.
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) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use.
10/08/04:
"Market Monitor"-Sam Stovall, Chief Investment Strategist for Standard & Poor's
PAUL KANGAS: My guest "market monitor" this week is Sam Stovall, chief investment strategist for Standard & Poor`s. Thanks for being with us Sam. Welcome.
SAM STOVALL, CHIEF INVESTMENT STRATEGIST, STANDARD & POOR`S: Thank you, Paul. Happy to be here.
KANGAS: Do you think the stock market sell off today was due mostly to the weaker than expected September jobs creation or were there other more negative factors?
STOVALL: I think primarily it was the impact of the less than expected growth in jobs, but also because energy was still a concern. I think that added to the overall worries. But primarily was the fact that Wall Street was looking for a very strong 145,000 increase in non-farm payrolls and what we got was less than 100,000. So as a result, I think it caused investors to question the health of the economy in general and the electability of President Bush in particular.
KANGAS: Does the bull market still live?
STOVALL: Well, I believe it still does because we did see a 20 percent advance off of the bottom established on October 9, 2002 and we`ve yet to see a 20 percent decline off of any high that we`ve reached since then. And I have to tell you also that this weekend we are going to be experiencing a major milestone or anniversary in this bull market.
KANGAS: I think we have a graphic that depicts the more or less standard nature of aging bull markets per se. We have it up here now.
STOVALL: That`s right. We are now going to be entering into the third year of this bull market. Going back to 1942, what we found is that the easy money was made in the first year with the S&P gaining an average of 38 percent. Times were still pretty good in the second year, gaining an average of 12 percent and because we did close 8 percent higher on October 8, than we did a year ago, the market is now 11 for 11 on second year bulls. But third year bulls are a little bit more tricky. What we have found is that the 10 bull markets going back to `42, six of them have either been flat or down and three of those observations actually turned into bear markets midway through.
KANGAS: So you`re a single digit bull at the moment apparently.
STOVALL: That`s right. We are still looking for economic growth in the year ahead. We still do believe that earnings growth will be on the positive side and that in general, the markets will work their way higher, but I don`t think it will be much more than about a five, six or seven percent advance.
KANGAS: But do you have some stock recommendations even under these conditions?
STOVALL: I absolutely do. I do not own any of these issues and also there is some consistencies in all four.
KANGAS: We have Aetna, the big insurance company.
STOVALL: Aetna, this is a company we see a 20 percent earnings increase for this company and a major turnaround situation that we think will last into 2005.
KANGAS: It`s had quite a rise but that doesn`t scare you off apparently?
STOVALL: Not necessarily. It is in the health care category which typically is defensive which should do relatively well in the more skeptical third year of a bull market.
KANGAS: OK. How about a second recommendation?
STOVALL: Well, we`ve got Alltel, also in the telecom services area, typically does fairly does well in this third year bull. Here`s a company offering a 2.6 percent dividend yield and above average S&P earnings of dividend rank and also we see good prospects for revenue cash flow and earnings growth.
KANGAS: As we can see by the chart there, the momentum of the stock price is definitely higher.
STOVALL: Absolutely. And then going into a momentum play, Ensco.
KANGAS: All right. Let`s have that up on our chart. There it is.
STOVALL: ... an international driller found in the S&P midcap 400. We see day rates and utilization rates rising in 2005. And here`s a company where we think that earnings are going to be doubling in the year ahead, so good growth prospects here as well.
KANGAS: We have time for one more recommendation.
STOVALL: Finally RPM International. Here is a company specializing in coding for the consumer and commercial marketplace. We`re looking for double digit earnings growth and they offer a 3.4 percent dividend yield. They`ve raised their dividend 31 consecutive years and this also has an above average S&P earnings and dividend quality rank.
KANGAS: We just have about 30 seconds left, Sam. The recent rise in precious metal stocks, gold and silver, does that portend an increase in inflation?
STOVALL: Well, certainly, historically that`s what it does signal. Our feeling is that it probably has more to do with the worldwide economic growth that we are seeing in the U.S., in Europe and in Asia and so it has more to do with worldwide demand than it does for fear of inflation.
KANGAS: More than... Inflation... More demand is the real reason.
STOVALL: Exactly.
KANGAS: Thank you very much.
STOVALL: Thank you Paul.
KANGAS: Sam, a pleasure to have you with us. My guest, Sam Stovall, chief investment strategist for Standard & Poor`s.
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) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use.
10/08/04:
Last Word: A Masterpiece Mistsake
LINDA O'BRYON: Finally tonight, it`s important to pay attention to details. That`s an embarrassing lesson a library in Livermore, California has learned. It paid $40,000 for a ceramic mural to be installed on its building honoring outstanding accomplishments in science and the arts buts the artist misspelled some of the names on it including Einstein, Shakespeare, Michelangelo and Van Gogh. In fact she managed to get 11 names wrong. The artist offered no apologies for the mistakes saying the library`s employees should have noticed them. The library now has to shell out another $6,000 to bring the artist in to fix those mistakes.
PAUL KANGAS: I can tell you one thing, that artist will make sure her name is spelled correctly on that $6,000 check.
O`BRYON: I`m sure you`re right
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) 2004 Community Television
Foundation of South Florida, Inc. ALL RIGHTS RESERVED. Terms
of use.
10/08/04:
Paul Kangas' "Stocks In The News"
PAUL KANGAS: Stocks tried to make an opening comeback from yesterday`s steep sell off, but disappointment over that jobs report capped any gains early on. By late morning, the Dow was down 37 points, NASDAQ off 15. Stocks eroded this afternoon on caution ahead of the presidential debate and oil prices closing at $53.31 a barrel.
The Dow Industrial Average came in with a closing loss of 70.20 at 10,055.20. This week, the Dow rose twice, fell three times for a net loss of 137.45 points. The NASDAQ Composite fell 28 1/2 points to 1919.97 today. It fell twice and rose three times this week, still at a loss of 22.23 points overall. Standard & Poor`s 500 Index lost 8 1/2 points to 1122.14 today.
Treasuries closed early ahead of Monday`s Columbus Day holiday for bond traders. The 10-year note rose 30/32, pushing the yield down to 4.13 percent.
Big board volume leader on 27.2 million shares, Lucent Technologies (LU) down $0.09.
Followed by Pfizer (PFE), down $0.19. Of course its Celebrex arthritis drug is now under scrutiny, but we`ll have more other news on Pfizer in just a moment.
Merck (MRK) down another $0.64. That`s a new 12-month low.
Then General Electric (GE) down $.21 despite those solid earnings.
Corning (GLW) down $0.25. That was fifth in big board volume.
Elan Corporation PLC (ELN), the Irish pharmaceutical down $1.39 on reports that European regulators are going to seek additional data on the company`s antigren (ph) drug but the company says so far there`s been no such request.
Texas Instruments (TXN) down $0.74.
Time Warner (TWX) $0.29 loss.
Wal-Mart Stores (WMT)lost $0.70.
And Disney (DIS), tenth in volume, managed to gain a dime a share.
Genentech (DNA) down $0.30, but this morning traded as high as $49.45 after CS First Boston upgraded it from "neutral" to "outperform" in expectations that the company`s cancer drug Avastin (ph), will show positive results in new clinical trials.
AT&T (T) down or I should say up $0.14. The company`s cutting another 7,000 jobs and it will take a $1.1 billion charge to cover severance costs. Analysts say the company`s slimming down to make it more attractive to potential suitors.
Alpharma (ALO) down $1.10. The company got a head start in launching its generic epilepsy drug before a Federal judge ruled on Pfizer`s request to block that drug. After the close, the judge denied Pfizer`s request and Pfizer itself decided to launch its own copycopy version of Nerontin (ph) in order to curb losses from the generic competition. What a story there.
Bowne & Company (BNE), it`s the financial printing firm, up $1.76. The company will sell its business solutions unit to its British partner called Williams Lee Group and the price is $180 million just in cash, not per share.
Haverty Furniture (HVT) doing well, up $0.80, traded as high as $18.81 during the day on optimism over the likelihood that sales of its furniture will increase due to the recent hurricane damage in the southeast.
Graftech International Limited (GTI) down $1.75. Company sees lower than expected third quarter earnings in the range of $0.11 to $0.13. Jeffries brokerage downgraded the stock from "buy" to just a "hold" rating.
Action Performance (ATN) down nearly $1. The company`s chief financial officer is resigning. Standard & Poor`s repeated an "avoid" rating on that stock.
And General Maritime (GMR) up $2.78. Analysts say the oil tanker business is booming and the company is cutting its debt and May even pay a cash dividend before too long.
Abercrombie & Fitch (ANF) up $1.48. It was up over $3 yesterday when it reported a 2 percent rise in September same store sales. Wall Street was expecting a 5 1/2 percent drop and then today, Wells Fargo upgraded it from "sell" to a "hold" rating.
Microsoft (MSFT) topped the active list down $0.18.
Followed by Intel (INTC), $0.69 loss.
Applied Materials (AMAT) down $0.95.
Cisco Systems (CSCO) $0.35 drop.
eBay (EBAY) fell $2.40.
Google (GOOG) coming down from a record closing high yesterday on some profit taking.
Sirius Satellite Radio (SIRI) down $0.30. The company`s making a secondary offering of its common stock priced at $3.87 a share.
Oracle (ORCL) was down $0.12. Some say the company`s considering lowering its $21 a share buy out bid for Peoplesoft.
Yahoo! (YHOO) down $0.61.
And Research In Motion (RIMM), tenth in dollar volume, off $1.65.
Lionbridge Technologies (LIOX) fell $3.04 a share. The company cut its third quarter earnings guidance from a Wall Street estimate of $0.09 a share all the way down to only $0.03 to $0.04 a share.
And then Blue Coat Systems (BCSI) off $3.57. The company`s chief financial officer said he`s planning to resign.
And those are the stocks in the news tonight.
10/08/04:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10055.20 -70.20 - .7
HIGH 10148.04
LOW 10036.32
NASDAQ COMP. 1919.97 -28.55 -1.5
HIGH 1949.34
LOW 1917.72
VOLUME 1,295.8
PREVIOUS 1,450.1
UP VOLUME 362.1
DOWN VOLUME 911.9
DOW TRANSPORTS 3336.00 -5.87 - .2
DOW UTILITIES 300.08 +1.01 + .3
CLOSING TICK +312
S&P 500 1122.14 -8.51 - .8
S&P 100 538.47 -3.81 - .7
MIDCAP 400 594.16 -4.17 - .7
REUTERS/CRB 287.60 +2.06 + .7
NYSE COMPOSITE 6636.42 -17.80 - .3
VALUE LINE 361.40 -3.62 - 1.0
RUSSELL 2000 575.65 -6.95 - 1.2
DJW 5000 10964.52 -83.40 - .8
U.S. TREASURIES
5-YEAR NOTE 3.375%
Oct. 15,2009 99 29/32 +19/32 + 3.40
10-YEAR NOTE 4.25%
Aug. 15,2014 100 31/32 +30/32 + 4.13
30-YEAR NOTE 5.375%
Feb. 15, 2031 106 28/32 +1 13/32 + 4.91
LEHMAN BROS.
LONG BOND INDEX 1749.95 +8.55
DOW CLOSE 10055.20 -70.20 - .7
ADVANCES 1612
DECLINES 1678
NEW HIGHS 135
NEW LOWS 24
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
LU Lucent Tech 3.39 -.09 -2.6
PFE Pfizer 29.80 -.19 -.6
MRK Merck & Co 30.34 -.64 -2.1
GE GE 33.74 -.21 -.6
GLW Corning 10.25 -.25 -2.4
ELN Elan Corp Plc 21.71 -1.39 -6.0
TXN Texas Instrument 22.05 -.74 -3.3
TWX Time Warner 16.40 -.29 -1.7
WMT Wal-Mart Stores 52.85 -.70 -1.3
DIS Disney 24.85 +.10 +.4
NASDAQ CLOSE 1919.97 - 28.55 - 1.5
VOLUME 1,675.1
PREVIOUS 1,744.3
ADVANCES 934
DECLINES 2108
NASDAQ ACTIVES
MSFT Microsoft 27.99 -.18 -.6
INTC Intel 20.55 -.69 -3.3
AMAT Applied Matl 16.21 -.95 -5.5
CSCO Cisco Systems 18.78 -.35 -1.8
EBAY eBay 92.59 -2.40 -2.5
GOOG Google 137.73 -1.12 -.8
SIRI Sirius Satellite 3.70 -.30 -7.5
ORCL Oracle 12.17 -.12 -1.0
YHOO Yahoo! 34.17 -.61 -1.8
RIMM Rsch In Motion 75.71 -1.65 -2.1
AMEX CLOSE 1285.20 + 6.70 + .5
INDEX SHARES
DIA DIAMONDS TRUST 100.70 -.78 -.8
QQQ NASDAQ 100 35.56 -.69 -1.9
SPY S&P DEP.RECEIPTS 112.51 -.97 -.9
STOCKS IN THE NEWS
DNA Genentech 47.25 -.30 -.6
T AT&T 15.18 +.14 +.9
ALO Alpharma 17.12 -1.10 -6.0
BNE Bowne & Co 15.00 +1.76 +13.3
HVT Haverty Furniture 17.90 +.80 +4.7
GTI Graftech Intl 11.90 -1.75 -12.8
ATN Action Perform 9.16 -.99 -9.8
GMR Genl Maritime 40.88 +2.78 +7.3
ANF Abercrombie &Fitch 36.57 +1.48 +4.2
LIOX Lionbridge Tech 5.44 -3.04 -35.9
BCSI Blue Coat Systems 16.10 -3.57 -18.2
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