12/17/04:
Pfizer Stock Falls Amid Celebrex Concerns
SUSIE GHARIB: A bombshell today from Pfizer, it said that
people who use its blockbuster drug Celebrex may be more likely to suffer a
heart attack. The news comes just two months after Merck pulled its rival
painkiller Vioxx off the market for similar reasons. For now, Pfizer plans
to continue selling Celebrex. But late today, the Food and Drug
Administration said it`s concerned about Celebrex and its class of drugs
and recommends doctors prescribe alternatives while it reviews the matter.
On Wall Street investors thought the best medicine was to sell the stock,
sending Pfizer`s shares plummeting. Suzanne Pratt reports.
SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRRESPONDENT: It certainly
seems like deja vu. Less than three months after Merck pulled Vioxx from
the marketplace, Pfizer could be facing a similar fate with its popular
arthritis drug Celebrex. Pfizer said today it has stopped using Celebrex
in a cancer study after patients showed double the risk of heart attack.
The trial called for higher daily doses of the drug than are typically used
for treating pain. But, a second study of the long-term use of the drug in
treating cancer showed no increased chance of heart damage.
TOM D`AMORE, PHARMACEUTICAL ANALYST, MORNINGSTAR: Celebrex is
Pfizer`s fourth biggest seller. Celebrex and another similar drug Bextra
(ph) represent, we estimate about 11 percent of operating income. So, it`s
meaningful.
PRATT: In a statement released this morning, Pfizer CEO Hank McKinnell
said quote, these clinical trial results are new. The cardiovascular
findings in one of the studies are unexpected and not consistent with the
reported findings in the second study, end quote. McKinnell went on to say
the company is trying to fully understand the results and share the new
information with the public. Pfizer also said the company has no plans to
withdraw Celebrex from the market. Celebrex is approved for use in the
U.S. for the treatment of pain and arthritis. Since its introduction in
1999, it has been prescribed to more than 27 million people. Shares of
widely held Pfizer fell sharply today after the negative study results hit
the market. Pfizer stock is now trading at its lowest level for the year,
off nearly 30 percent.
D`AMORE: We would recommend holding if you`re a Pfizer shareholder
right now. We think the worst news is out and the company has yet to give
a full response. We expect that on Monday and the outlook may be a little
better on Monday. And, we think the stock is a pretty attractive value
right here.
PRATT: Meanwhile, Pfizer`s Bextra painkiller, which in the same class
of drugs as Celebrex and Vioxx, is facing problems of its own. Doctors
writing in the "New England Journal of Medicine" today are asking
physicians to stop prescribing Bextra in light of the problems with Vioxx.
Suzanne Pratt, NIGHTLY BUSINESS REPORT, New York.
PAUL KANGAS: For more details on the Celebrex situation, this afternoon
Jeff Yastine talked with Pfizer`s chairman and CEO Hank McKinnell. Jeff
began by asking him how he first learned about the results of the two
cancer studies.
HANK MCKINNELL, CHAIRMAN & CEO, PFIZER: Well, we asked a special
cardiovascular review board to review the safety record in these two very
high dose long-term studies. We learned the results at 5 p.m. last
evening, one of which showed cardiovascular risk equal to placebo and the
other which showed elevated cardiovascular risk. We communicated these
results immediately to the FDA and to the European regulators and made the
information public to the prescribing physicians and patients this morning.
JEFF YASTINE, NIGHTLY BUSINESS REPORT CORRESPONDENT: I`m told the
company has no plans to pull Celebrex off the market. Why not?
McKINNELL: A decision to withdraw a drug is made in the context of all
the information known about this drug. These two high dose long-term
studies, they contradict each other to begin with and the one showing
cardiovascular risk also contradicts the great body of evidence we have
around the long term use of Celebrex when used as recommended.
YASTINE: Would anything happen or what would have to happen to
perhaps change your mind, to change Pfizer`s mind about Celebrex? Why not
pull it off the market just as a preliminary cautionary measure?
McKINNELL: Well, we have to remember why this class of medicines was
developed in the first place. It`s tragically true that more Americans die
of GI bleeds induced by traditional non-steroidals than die of AIDS in this
country, 16,500 versus about 15,000. There`s a very important medical need
for safe, effective treatment of the pain and inflammation of arthritis.
YASTINE: Is there any concern on your part just from a financial
perspective? I was reading in the "New York Times" they said about 11
percent of all new prescriptions that are written by primary care
physicians are for Celebrex. Some people, it might be a cynical comment,
some people might say this is the reason why you`re not pulling the drug
off the market.
McKINNELL: This is a very important medicine, meeting unmet medical
needs of millions of patients in the United States and Canada and in
Europe. It`s a needed medicine. Physicians need to be fully informed.
Patients need to discuss the risks and benefits of this class of medicines
with their physicians and many times they will choose Celebrex as the best
choice.
YASTINE: Let`s move on to Bextra which is another Cox 2 inhibitor.
The "New England Journal of Medicine" had an article, physicians there are
recommending that physicians stop prescribing your Bextra drug and I
believe the FDA last week required a warning label for folks with heart
ailments to be careful using Bextra. Is that another concern for Pfizer,
for you?
McKINNELL: Well, that`s not really correct. What we included with the
FDA and the Bextra label was a unique group of patients, those who have
just come off coronary artery bypass grafts who have been on heart lung
machines, who have been treated with an injectable form Bextra not yet
approved in the United States and very high doses of oral Bextra and of
course Bextra`s not approved in the United States for this indication.
YASTINE: Well, give us some perspective then on this. I mean there
might be a concern about folks jumping to the conclusion that between
Vioxx, Bextra and Celebrex that that`s it for Cox 2 inhibitors. Give us
some perspective as to why you think that obviously these drugs still have
a great deal of value for patients and for Pfizer.
McKINNELL: Well, these are very different chemical agents. Vioxx and
Celebrex and Bextra are from different chemical classes. They affect the
body in different ways. We have very large bodies of evidence around the
safety and effectiveness of these agents when they`re used as recommended.
The key of course is to have physicians and patients fully informed of the
benefits and the risks of treatment with any of these agents, and then we
leave to it the physician and patient to choose what`s in the best interest
of the patient.
YASTINE: All right. Well, I guess the jury is still out, but Mr.
McKinnell, I appreciate your time talking with us.
McKINNELL: Thank you.
YASTINE: Our guest, Hank McKinnell, chairman and CEO of Pfizer.
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.
12/17/04:
Fannie Mae Comes To A Head
SUSIE GHARIB: It`s D-day for Fannie Mae CEO Franklin Raines. The mortgage
giant`s board is expected to meet on Sunday to decide Raines` future. He`s
under pressure after a Securities and Exchange Commission finding this week
that Fannie Mae violated accounting rules, mis-stating billions of dollars
in profits. As Darren Gersh reports, not only is Raines` future unclear,
but also the outlook for Fannie Mae itself.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: Many investors
have great respect for Franklin Raines, but they no longer have much
patience for him.
CHARLES GABRIEL, SR. WASHINGTON ANALYST, PRUDENTIAL FINANCIAL:
Shareholders have just been looking for a return to some normalcy. They
would like some closure on all of these complaints against Fannie Mae and
they`d like a fresh start.
GERSH: The fate of the janitor`s son who rose to become CEO of one of
the largest companies in the world may be decided Sunday when Fannie Mae`s
board meets on personnel matters. On Wednesday, the SEC`s chief accountant
found the mortgage giant violated accounting standards relating to home
loan prepayments and complex derivatives. The company will now have to
restate $9 billion in earnings. In October, Raines told Congress he would
be accountable for any mistakes.
FRANKLIN RAINES, CEO, FANNIE MAE: That comes with being a CEO. I
accepted that burden on the day I took the job and I accept it today.
GERSH: For investors, the biggest issue may not be a new CEO, but a
new regulator Congress is expected to put in place with expanded powers to
set capital standards for Fannie Mae.
KEN POSNER, ANALYST, MORGAN STANLEY: I think the company`s returns
will be higher if the company needs less capital and they could be a little
bit lower if the company has to old more capital and that will affect the
growth rate. So I think people holding the stock should recognize that the
growth rate could be slower or quicker depending on where Congress and the
regulator ultimately come out on this question of capital.
GERSH: Morgan Stanley owns 1 percent or more of Fannie Mae stock and
has been compensated for investment banking business by Fannie Mae.
Sanford Bernstein analyst Jonathan Gray expects Raines to go. The question
is how much political risk will remain.
JONATHAN GRAY, SR. MORTGAGE FINANCE ANALYST, SANFORD BERNSTEIN: The
business itself I think continues to be a good business longer term. It`s
the possibility of real damage to the role of Fannie Mae and Freddie Mac by
the political process that might force us to a less optimistic investment
view.
GERSH: Gray owns Fannie Mae shares and an affiliate of Sanford
Bernstein received compensation for non-investment banking related
securities from Fannie Mae. Those who know Franklin Raines say he would
like to stay at Fannie Mae and make good on his promise to fix the problems
that have come to light. But it is not clear now whether he will get that
chance. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.
To Learn More about this topic, click
here.
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.
12/17/04:
"Market Monitor"--John Murphy, Chief Technical Analyst at stockcharts.com
PAUL KANGAS: My guest "market monitor" this week is John Murphy, chief
technical analyst at stockcharts.com and welcome back to NIGHTLY BUSINESS
REPORT, John.
JOHN MURPHY, CHIEF TECHNICAL ANALYST, STOCKCHARTS.COM: Thank you
Paul. It`s always a pleasure.
KANGAS: From the standpoint of a market technician like you are, do
you think that stocks are now on a strong or a rather weak footing?
MURPHY: Well, I would say somewhere in the middle. We`ve been in a
pretty decent uptrend since about August. And what I`ve been looking for
is a rally at least into January, which is normally the seasonal bulge that
we get each year and we`re about two thirds of the way through that. So I
generally like the market here, but I think we`re getting pretty close to
the end of this latest bull run.
KANGAS: Is this bull market, if we were a ball game, what inning would
we be in here?
MURPHY: Paul, I`d have to say maybe the bottom of the eighth inning,
something like that, bottom of the 8th.
KANGAS: You made a very good call with us when you here in February,
late February. You said you expected the market to move sideways, maybe
down a bit through August, which it did and then start up again and those
are right on, good calls, and I complement you.
MURPHY: Part of that was based on seasonal trends and not only August
but also the market turned up in October. This is a very normal seasonal
pattern for the market to peak earlier in the year and then turn up in the
fourth quarter. So far it`s played along that script pretty well.
KANGAS: How does the U.S. dollar look to you on a technical basis?
MURPHY: Well, it`s still quite bearish Paul. It`s a little overdone on
the down side here and we`re getting a little bounce in the dollar, but
generally speaking, I`ve been bearish on the dollar for the last two or
three years. And there are some negative side effects of that. For one
thing, it tends to raise inflationary pressures. It`s very good for
certain commodities like gold and oil and their stocks, but one of the
problems is it drives money to foreign markets and I think eventually it`s
going to start pushing interest rates higher.
KANGAS: You just answered my next question about interest rates. When
you were with us in late August you recommended the purchase of three
stocks. Let`s see how they fared. First of all you recommended Gillette
and Noble. Gillette up nearly 17 percent, 21 percent rise in Noble, two
very good calls. Late February is when you were with us. And then Wal-
Mart was not a great call although it was around 60 at the time. You said
if it pushes through 60 by an impressive manner, it would be good, but it
didn`t do that did it?
MURPHY: No, it didn`t. That was a very important. It was testing its
52-week high and as you point out it really wasn`t able to get through it.
So we kind of backed away from that stock.
KANGAS: And you`re out of these three now?
MURPHY: No, actually I`m still recommending Gillette. It`s one of the
stocks that we like, and also I still like the energy group.
KANGAS: OK and do you own any of these stocks personally?
MURPHY: No.
KANGAS: OK. What about some new recommendations John?
MURPHY: Well in the drug group actually, even despite today`s big sell
off Paul, I happen to still like the drug group, certain stocks in
particular, Abbott Labs, for example. The stock just this week hit a 52-
week high, in fact did another one today in the face of this drug weakness.
Johnson & Johnson, another stock which is also trading in a new 52-week
high. So even though there was a lot of damage in some sectors of the drug
group today, some of the stocks are actually holding up very well.
KANGAS: That`s an interesting call and you`re not afraid of the fact
that both of these have had very strong moves up recently.
MURPHY: It is true that they`re a little over extended here Paul, and
if you look at on the daily chart, which I know you are, but if you look at
it on a very long term basis going back several years, they still look
reasonably priced to me.
KANGAS: OK. We just have a minute left. Any other groups you like?
MURPHY: Yes, consumer staples, for example, General Mills. Here`s
another stock that is very quietly trading at new 52-week highs. I`m
sorry. It`s right up against its old high. Campbell Soup, 52-week highs
and Sara Lee. And Paul, most of the moves into these stocks have really
just begun over the last month or so and I think that`s a sign that the
market is turning just a little bit more defensive here.
KANGAS: OK, very good. Do you own any of these stocks personally
John?
MURPHY: No, I don`t.
KANGAS: OK. All right, we`ll be very curious to see how these
recommendations turn out. I hope they do as well as your last ones.
Thanks very much for being with us.
MURPHY: Thank you, Paul.
KANGAS: My guest "market monitor" John Murphy, chief technical analyst
at stockcharts.com.
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.
12/17/04:
Last Word-The Worst Gift Ever
JEFF YASTINE:
And finally tonight, we`ve all gotten some horrible holiday gifts, but
maybe not as bad as these, a sack of potatoes, a lava lamp radio? The
Illinois lottery conducted a survey asking state residents what was the
worst holiday gift they ever received and those were two on it. Also on
the list, a used address book, a toilet plunger and a gallon of anti-
freeze. But the lottery asked for the best gifts as well. Topping that
list, jewelry, money, a car and a vacation. Also on that best list, as you
might expect when the lottery does the survey, Paul, lottery tickets.
KANGAS: But only if have you the winning numbers.
GHARIB: I was going to say that. Who cares if you get a lottery
ticket if you`re not going to get anything out of it, right?.
To Learn More about this topic, click
here.
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.
12/17/04:
Paul Kangas' "Stocks In The News"
PAUL KANGAS: Wall Street opened modestly higher on news of a mild 0.2
percent rise in November consumer prices. The Dow rose 30 points at the
outset and NASDAQ gained three points. Then as Pfizer stock opened sharply
lower on that Celebrex news, the market headed down with the Dow off 55
points at noon and the NASDAQ down two points. Stocks remained broadly
lower as oil prices surged this afternoon and pre-weekend selling picked
up.
The Dow Industrial Average closed off 55 3/4 points at 10,649.92. This
week, the Dow rose in four of five of the days for a net gain of 106.70
points. The NASDAQ ended down almost 11 points at 2135.20 today. For the
week, it fell twice, rose three times and gained just over seven points
overall. Standard & Poor`s 500 Index nine points to 1194.22 today. In the
bond market, the 10-year note fell 5/32 to par and 11/32, putting the yield
at 4.21 percent.
Big board volume leader on a massive 211 million shares, News Corp.
A (NWS.A) moving up $0.44. The stock was added to the Standard & Poor`s 500
Index today, so you had a lot of index fund buying obviously.
Then Pfizer (PFE), you heard the story, down $3.23 and the low of the
day was $23.52.
General Electric (GE) in there with a $0.36 loss.
Merck & Company (MRK) lost $0.20. Of course the Pfizer news
underscored Merck`s Vioxx problems.
ExxonMobil (XOM) down $0.30. That was fifth in volume.
Lucent Technologies (LU) moved up $0.04.
Time Warner (TWX) $0.11 loss.
Sprint Fon Group (FON) gained a dime.
And Archstone-Smith Trust (ASN), Archstone-Smith, up $0.80. This is a
real estate investment trust and it too was added to the Standard & Poor`s
500 Index today, so you had some index fund buying. Also the company said
it`s going to pay a special $1 per share dividend to maintain its real
estate investment trust status.
Motorola (MOT) down $0.15, was tenth in big board volume.
AstraZeneca (AZN) yet another drug company, down $3.11 today. The
company`s lung cancer drug Iresa (ph) failed to prolong patients` lives and
the stocks of competing drug companies like OSI Pharmaceutical really did
well on that news. We`ll see OSI later.
Eli Lilly (LLY), still another drug on the weak side, off $1.38. The
company has added an emboldened warning on its label for its Stratera (ph)
drug regarding possible liver damage there.
Apria Healthcare (AHG) moved up $1.50. Wachovia Securities upgraded it
from "market perform" to "outperform" and Bank America initiated coverage
with a "buy" recommendation.
Nike B (NKE.B) moving up $5.80. Second quarter earnings jumped to
$0.97 versus $0.66 last year, a 46 percent increase and that was $0.11
above the Wall Street estimate, good day for Nike.
Actuant (ATU) which makes tools and things like that up $2.41. First
quarter earnings $0.71, way up from a penny last year. The Street estimate
was down there at $0.56, a lot better than expected.
CarMax (KMX) gained $2.61. Third quarter earnings flat, $0.17 versus
$0.18 last year, with the company predicting fourth quarter earnings will
move up to $0.19 to $0.23 a share.
Then Georgia Gulf (GGC) down $3.61. Company sees fourth quarter
earnings at the low end of Street estimates which range from $0.74 at the
low end to $0.89 at the high end.
And then LeapFrog Enterprises (LF) off nearly $2. The company sees its
2004 earnings significantly below its October guidance due to sluggish
holiday sales.
NASDAQ 100 (QQQ) topped the active list again, down a dime.
Microsoft (MSFT) $0.20 loss.
Intel (INTC) down a dime.
There you see OSI Pharmaceuticals (OSIP) up $21.28 in reaction to
AstraZeneca`s problems with its lung cancer drug. Now OSI`s Tarsima (ph)
drug however, has triggered apparently several class action lawsuits.
Cisco Systems (CSCO) down $0.41, fifth in dollar volume on NASDAQ.
Symantec (SYMC) $0.24 gain.
Google (GOOG) did well today, up $3.61.
Veritas Software (VRTS) $0.24 loss.
Sirius Satellite Radio (SIRI) moving up half a dollar.
And Apple Computer (AAPL) down $1.61, tenth in volume.
palmOne (PLMO) tumbling $9.44. Second quarter earnings were sharply
higher, $0.53 versus last year`s $0.14 but the company predicting third
quarter earnings will fall all the way down to $0.17 a share. That`s only
half of the Wall Street estimate.
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.
12/17/04:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10649.92 -55.72 - .5
HIGH 10739.33
LOW 10641.88
NASDAQ COMP. 2135.20 -10.95 -.5
HIGH 2150.85
LOW 2135.05
VOLUME 2,484.1
PREVIOUS 1,790.8
UP VOLUME 995.1
DOWN VOLUME 1,449.9
DOW TRANSPORTS 3751.07 +17.84 + .5
DOW UTILITIES 329.09 +.83 + .3
CLOSING TICK +744
S&P 500 1194.22 -8.99 - .8
S&P 100 567.37 -6.09 - 1.1
MIDCAP 400 651.66 -.22 - .0
REUTERS/CRB 287.19 +4.20 + 1.5
NYSE COMPOSITE 7098.15 -33.83 - .5
VALUE LINE 396.39 -.91 - .2
RUSSELL 2000 642.08 -.15 - .0
DJW 5000 11783.23 -63.81 - .5
U.S. TREASURIES
5-YEAR NOTE 3.50%
Dec. 15,2009 99 19/32 -3/32 + 3.59
10-YEAR NOTE 4.25%
Nov. 15,2014 100 11/32 -5/32 + 4.21
30-YEAR NOTE 5.375%
Feb. 15, 2031 108 -5/32 + 4.83
LEHMAN BROS.
LONG BOND INDEX 1761.45 -5.21
DOW CLOSE 10649.92 -55.72 - .5
ADVANCES 1650
DECLINES 1672
NEW HIGHS 190
NEW LOWS 23
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
NWSa News Corp "A" 18.65 +.44 +2.4
PFE Pfizer 25.75 -3.23 -11.2
GE GE 36.75 -.36 -1.0
MRK Merck & Co 31.59 -.20 -.6
XOM Exxon Mobil 49.80 -.30 -.6
LU Lucent Tech 3.77 +.04 +1.1
TWX Time Warner 19.39 -.11 -.6
FON Sprint 24.67 +.10 +.4
ASN Archstone-Smith 39.00 +.80 +2.1
MOT Motorola 17.00 -.15 -.9
NASDAQ CLOSE 2135.20 - 10.95 - .5
VOLUME 2,467.8
PREVIOUS 2,382.9
ADVANCES 1545
DECLINES 1592
NASDAQ ACTIVES
QQQQ Nasdaq 100 39.48 -.10 -.2
MSFT Microsoft 26.96 -.20 -.7
INTC Intel 22.77 -.10 -.4
OSIP Osi Pharmaceut 68.38 +21.28 +45.2
CSCO Cisco Systems 18.99 -.41 -2.1
SYMC Symantec 25.37 +.24 +1.0
GOOG Google 180.08 +3.61 +2.1
VRTS Veritas Software 27.75 -.24 -.9
SIRI Sirius Satellite 7.68 +.50 +7.0
AAPL Apple Computer 64.99 -1.61 -2.4
AMEX CLOSE 1409.21 + 1.31 + .1
INDEX SHARES
DIA DIAMONDS TRUST 106.53 -.46 -.4
QQQ NASDAQ 100 39.48 -.10 -.2
SPY S&P DEP.RECEIPTS 119.44 -.80 -.7
STOCKS IN THE NEWS
AZN Astrazeneca 37.10 -3.11 -7.7
LLY Eli Lilly 56.02 -1.38 -2.4
AHG Apria Healthcare 33.30 +1.50 +4.7
NKE Nike "B" 91.70 +5.80 +6.8
ATU Actuant 51.66 +2.41 +4.9
KMX Carmax 30.06 +2.61 +9.5
GGC Georgia Gulf 48.80 -3.61 -6.9
LF Leapfrog Entrprs 12.38 -1.99 -13.9
PLMO palmOne 33.11 -9.44 -22.2
|
