| 12/28/04:
Wall Street Rallies Amidst Consumer Confidence
SUSIE GHARIB: A big and surprising jump in consumer confidence
today triggered a burst of investor confidence on Wall Street.
The Dow gained 78 points and the NASDAQ rose almost 23. The
rally followed news that the Conference Board`s consumer confidence
index reached its highest level since July. As Suzanne Pratt
reports, the reading bodes well for consumer spending in 2005.
SUZANNE PRATT, NIGHTLY BUSINESS REPORT CORRESPONDENT: U.S.
consumers are ending the year in high spirits. That good mood
resulted in the highest reading on consumer confidence in
five months. The Conference Board`s index of consumer confidence
jumped to 102.3 in December, from a revised 92.6 in November.
Economists had been expecting a reading of 94. Not only are
consumers feeling a lot better about current conditions, but
they are also more upbeat about the future. LYNN FRANCO,
THE CONFERENCE BOARD: We`ve seen that they`re telling us business
conditions have improved. They are telling us that labor market
conditions have improved in December. They`re much more optimistic,
so it could be that we`re poised for a bit of a surge in economic
growth. PRATT: Some economists agree that rosy outlook
suggests a pickup in consumer spending going into 2005. Others,
however, see potential headwinds for spending in the year
ahead. ELISABETH DENISON, ECONOMIST, DRESDNER KLEINWORT
WASSERSTEIN: The consumer was lucky to have very low interest
rates the last couple of years, a fiscal stimulus. And this
is going to fade in 2005, so it will be tougher for them to
keep spending. PRATT: While a happy consumer is likely
to be good news for the overall economy, it does not guarantee
that businesses will be adding more jobs to payrolls. That
experts say is where the U.S. economy is still most vulnerable.
DENISON: The question is whether the pace of improvement is
fast enough to really keep up with the growth in the labor
force, to absorb all the entrants and to absorb the workers
that have lost their jobs over the last two years. So it really
depends on the pace of improvement rather than the fact that
we are in a state of rising payrolls. PRATT: Most economists
believe cheaper energy prices are at least partly responsible
for this month`s sharp jump in consumer confidence and they
say as long as prices remain lower, that should bode well
for sentiment in the New Year. 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.
12/28/04: One On One With Devinda Subasingha Sri Lanka's Ambassador To The U.S.
SUSIE GHARIB: The death toll continues to climb tonight from the catastrophic earthquake and tsunamis that hit southern Asia over the weekend. More than 59,000 people are now believed to have died and that figure is expected to go even higher. Aid agencies are struggling to cope with the scope of the devastation. Today the U.S. Agency for International Development added $20 million to the initial $15 million earmarked for relief. And other governments around the world are pledging to help as well. The major concern now is getting fresh water and medicine to the region to cope with the spread of disease, including malaria and dengue fever, which is already endemic there. Munich Re, the world`s largest reinsurer, estimates the economic cost of the devastation at more than $13 billion. Well, for a small, poor country like Sri Lanka, this has been a catastrophe. More than a million people are now homeless and the booming tourist industry, a mainstay of the economy, is in shambles. This afternoon, Darren Gersh talked with the Sri Lankan ambassador to the United Nations, United States rather, Devinda Subasingha, and began by asking him for an update on the damage and recovery effort.
DEVINDA SUBASINGHA, SRI LANKAN AMB. TO U.S.: The search and rescue efforts and the recovery that`s ongoing in parallel but I think we moved over into a more intense recovery phase. The damage, I think, is still yet to be assessed. Sri Lanka is about the size of the state of West Virginia and about 70 percent of our coastline has been impacted to one degree or another by this tsunami. The southern tier does have a lot of population and infrastructure and road transportation, all of it in large segments pretty much wiped out, similarly in the eastern province as well. So we`ll have to await the conclusion of the disaster assessments. The United States has a team on the ground as we speak.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: You were just over at the White House, a meeting of the National Security Council. Can you tell us what the response has been from the administration?
SUBASINGA: It`s been absolutely wonderful response. Sunday morning I was in contact with Deputy Secretary of State Armitage, who has been my counterpart on the Sri Lankan peace process which he has been supporting from the State Department and he responded immediately to the specifications we provided, search and rescue assessment and financial assistance. And I must say that it was instant. It was precise and it`s still unfolding.
GERSH: What type of aid does Sri Lanka need most urgently?
SUBASINGA: I think we still need that disaster assessment team to conclude its work very quickly, to get us a sense of what the assessment is and then start targeting the specific interventions. Clearly we need water purification tablets, those types of things to mitigate any water-borne diseases. We will going forward need a lot more medical equipment, medical supplies, but that I think will have to be staged as this process unfolds.
GERSH: Sri Lanka is a major exporter of apparel to the United States to companies like The Limited and Victoria`s Secret. To you knowledge, has that kind of business been disrupted? Will those exports have any problems as a result of the tsunami?
SUBASINGA: This is the largest export market that we have and apparel to those types of companies are our major export into the U.S. to the best that I know in terms of my knowledge of the location of the major facilities, no, I don`t think there would be any substantial disruption of those exports into the U.S. market.
GERSH: One of your country`s main industries is tourism and the area that was hit hardest by the tsunami is the southern part of the country, which is the prime tourist destination. How big of a setback is this disaster to your tourism industry and how quickly do you think it might be able to recover?
SUBASINGA: It has been a major blow. The southern coast has the major results. This was just the beginning of the winter tourist season. It was also Christmas holidays where many Sri Lankans were vacationing as well as a major Buddhist holiday on Sunday the 26th when the tsunami struck. I think there will be significant disruption. We have put a hold on new tourist arrivals until we sort out the capacity issues and the logistics issues and that probably will impact negatively on the upward growth that we had in the tourist arrivals. Last year we hit a record of half a million tourists which is huge by our standards and we were looking to exceed that this year but clearly that`s going to be disrupted.
GERSH: What is the reaction you`ve been getting from people here in the United States? Are you getting a lot of phone calls? Are people being very generous?
SUBASINGA: We are getting a lot of calls. The Sri Lankan expatriate community here in the United States has mobilized through churches, temples, associations and others to gather assistance, to pray and to commiserate with individuals that have lost friends and family. Beyond the Diaspora here in the United States, the U.S. population at large have been very responsive. We`ve gotten a lot of calls, a lot of e-mails volunteering as well as expressing condolences and support and that`s just across the board east to west north to south.
GERSH: Ambassador Subasinga, we`re thinking of your country at this difficult time and we want to thank you for your time with NIGHTLY BUSINESS REPORT.
SUBASINGA: Thank you, Darren.
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.
12/28/04:
The Outlook For Commodities In 2005
JEFF YASTINE: Yukos is vowing to sue those involved in this
month`s sales of its biggest production unit. The troubled
Russian oil firm said today it will seek at least $20 billion
in damages. The Russian government arranged the auction of
that Yuko unit, saying the firm owed $27 billion in back taxes.
Yukos calls that sale illegal, saying it violated U.S. bankruptcy
laws. The auction was won by a mystery company called the
Baikal finance group, which just days later was snapped up
by the Russian state oil firm Rosneft, Rosneft. Adding to
Yukos` problem, Standard & Poor`s today cut its debt rating
to default grade after the oil firm missed a loan payment
to a western bank. And speaking of oil, it`s just one of a
basket of commodities that made a comeback this year. Investors
poured money into everything from energy to precious metals
futures as their prices soared. But as Diane Eastabrook reports,
experts say that may not be the case for all those commodities
next year. DIANE EASTABROOK, NIGHTLY BUSINESS REPORT CORRESPONDENT:
Improving economies around the world, war and bad weather
helped fuel high commodities prices throughout this year.
Energy led the rally. Gasoline, home heating oil and crude
oil prices all soared 50 to 60 percent this year. Analysts
are bullish on the sector next year, but don`t expect to see
another huge price run-up. PHILIP FLYNN, ENERGY ANALYST,
ALARON TRADING: The price rises are going to be solid, but
they`re not going to be as shocking and the reason is, of
course, is because of the strong economy. EASTABROOK:
Continued expansion in China, India, and the U.S. is expected
to keep demand hot for industrial metals and could keep their
prices moving skyward. But analysts aren`t as bullish about
livestock. Last year, beef and pork prices soared due to high
demand from low-carbohydrate diets and from supply constraints
caused by a ban on Canadian beef. But analysts don`t think
either will put as much pressure on prices next year. Grain
prices are also expected to remain low in the first half of
next year because of bumper crops harvested last fall. But
some investors view the lower prices as a great buying opportunity.
DANIEL BASSE, PRESIDENT, AGRESOURCE CO.: The grain markets
look attractive to a lot of these hedge fund managers. And
with the dollar weakening, they`ll basically put their toe
in the water to see if there will be some weather problems
as we head towards spring and summer. EASTABROOK: Gold
remains a wild card. Some experts think prices for the precious
metal could fall next year, if the dollar starts to strengthen.
Economist Diane Swonk thinks prices for most commodities will
moderate next year, because fears over supply shortages didn`t
play out this year. DIANE SWONK, CHIEF ECONOMIST, MESIROW
FINANCIAL: People have calmed down. There isn`t the frenzy
and the fears that we saw pushing up commodity prices. Many
people forget commodity prices are sometimes as much speculative
as they are determined by fundamental supply and demand principles.
EASTABROOK: Swonk says obviously a severe shock to the global
economy like a terrorist attack or severe weather could cause
commodity prices to spikes next year. But she doubts that
commodities overall will be able to sustain the kind of high
price levels they did this year. Diane Eastabrook, NIGHTLY
BUSINESS REPORT, Chicago.
To Learn More about this topic, click
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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.
12/28/04:
Commentary: The Incredible Shrinking Social Security Fund
JEFF YASTINE: Tonight`s commentator takes a look at the controversy of Social Security and says it`s making the proverbial mountain out of a molehill. Here`s Charles Schultze, senior fellow emeritus at the Brookings Institution.
CHARLES SCHULTZE, SR. FELLOW EMERITUS, BROOKINGS INSTITUTION: Annual benefit payments under Social Security will soon exceed its tax revenues and the Social Security fund will begin to shrink. Some combination of revenue increases and benefit reductions will have to be made to restore balance. But Social Security faces a modest fixable problem, not a crisis.
According to Social Security actuaries, the financial gap over the next 75 years could be closed with an increase of a little under 2 percentage points in the current 12.4 percent combined employer-employee payroll tax or with a package of smaller tax increases together with benefit cuts. The Congressional Budget Office estimates a financing gap only about half that size. Several sensible schemes have been proposed for moderate changes in both payroll taxes and benefits that could close the gap, even with the higher estimate.
President Bush would preclude tax increases and divert some revenues away from the existing Social Security system to finance individual accounts. Part of future Social Security benefits would be replaced with higher but variable and risky returns from individual investments in stocks and bonds. This diversion itself would widen the financial gap and with no tax increases, closing it would require sizable cuts in traditional benefits for new retirees. The need to fix an essentially modest financial problem does not warrant making fundamental and risky alterations in the Social Security safety net that has served our nation well. I`m Charles Schultze.
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.
12/28/04:
The Business of A Bug's Life
SUSIE GHARIB: Here`s an interesting question. What do ants have in common with business? The answer is interesting, too and it involves mimicking insect behavior and using those patterns to solve all sorts of problems. From Cambridge, Massachusetts, Mont Fennel reports.
MONT FENNEL, NIGHTLY BUSINESS REPORT CORRESPONDENT: Studies show when shoppers enter a supermarket, most turn right and do U turns in crowded aisles. IcoSystem has taken consumer behavior patterns and combined them with patterns made by ants foraging for food. They`ve developed a computer model to help one beverage company place its product in better locations.
ERIC BONABEAU, FOUNDER, ICOSYSTEM: If you understand behavior, you can make people buy more.
FENNEL: Eric Bonabeau has been studying insect behavior for 13 years. He discovered when ants find food, they leave a trail of pheromones. The ant which returns from the food source first leaves the strongest scent, which the colony then follows like cars on a highway to get to their dinner as quickly as possible.
BONABEAU: Social insects have been around for millions of years and have been so successful and so efficient, we should really take some advice from them.
FENNEL: IcoSystem applies the concept of swarm intelligence to companies which route information over the Internet. It creates electronic ants which measure the flow of data bits and direct them to the path with the least traffic.
UNIDENTIFIED MALE: What this means to the consumer is that now you have the ability to store data files and retrieve them very quickly, very efficiently.
FENNEL: Mimicking insect behavior allows the Department of Defense to increase the effectiveness of unmanned aerial vehicles surveying enemy territory. Now instead of randomly overlapping paths wasting effort, the vehicles use virtual pheromone signals to communicate more effectively.
BONABEAU: The goal to make reconnaissance safer, cheaper, more robust.
FENNEL: But the company admits its lost potential clients because some companies believe creating technology out of insect interaction is wacky.
BONABEAU: It`s basically we got this crazy science and 95 percent of all people would be scared by that. Now we say here are the problems we can solve.
FENNEL: In the past three years, IcoSystem has done 50 projects for 20 clients, including Humana, Dupont and Intel. The private company`s revenue is growing 50 percent per year. It was profitable after just nine months in business.
UNIDENTIFIED MALE: What`s really exciting is that we`re creating some really valuable IP. We`re creating new things that nobody`s ever done before.
FENNEL: Some day that might include mimicking the way ants build their hill for planning cities and towns.
BONABEAU: Just places that are more functional and at the same time that people are very happy to live in.
FENNEL: After all it`s a bug`s life. Mont Fennel, NIGHTLY BUSINESS REPORT, Cambridge, Massachusetts.
YASTINE: I should have become an entomologist instead of an anchor (ph).
GHARIB: But then you would be bugging us.
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.
12/28/04:
Paul Kangas' "Stocks In The News"
JEFF YASTINE: A weaker dollar wasn`t of much concern to investors today. The Dow rallied about 70 points in the first half hour, with the bulls spurred on by that unexpectedly strong consumer confidence number. The NASDAQ also pushed higher, with technology favorites like eBay, Amazon, Adobe, Oracle coming in for a round of buying. The momentum continuing through the remainder of the session and the Dow closing up 78 1/2 points at 10,854.54. That`s a new high for the year. Over on the NASDAQ Composite, also a strong finish as well, up nearly 23 points to 2177.19 and the S&P 500 ending up over 8 points. The bond showed little change. The 10-year note edging up 2/32. That puts the yield at 4.3 percent.
And topping our list, Pfizer (PFE) tacking on $0.44, its fifth advance in as many days. Today the FDA OKing the company`s Vfend drug to treat blood infections in patients with low white blood cell counts.
Next is XTO Energy (XTO) rising $0.27. The stock added to the S&P 500 today after Oracle completed or has almost completed its takeover of Peoplesoft.
Lucent Technologies (LU) slipping up a fraction.
General Electric (GE) gaining $0.12.
ExxonMobil (XOM) up $0.17. Time Warner (TWX) ended $0.11 higher.
No change in Sprint FON Group (FON).
Qwest Communications (Q) down a fraction.
Liberty Media (L) up $0.07.
And Citigroup (C) up $0.04.
Here`s a look at Johnson & Johnson (JNJ) rising $0.23. J&J is being sued by a family alleging their daughter become blind because of an allergic reaction to children`s Motrin.
Elan Plc (ELN) rising $1.15. Elan`s chronic pain drug Prialt received regulatory approval today.
Coach (COH) climbing $1.22. The Piper Jaffray brokerage repeating an "outperform" rating on the leather goods retailer.
And shares in Diagnostic Products (DP) perked up $2.60. Its former COO will take over as president next week.
Commercial Metals (CMC) rising $3.05. Some investors believe the stock shares are undervalued compared to others in the sector. Last week the steel firm posted impressive first quarter profits and give an update outlook.
Shares in United Defense (UDI) rising $1.15. The company`s shipbuilding unit received a small contract from the Navy but it could ultimately be worth $50 million over a 10-year period.
United (sic) Health Services (UHS) rising, excuse me falling $1.18. A profit warning from the company. It says 2004 results will be lower than expected because of lower numbers of patient admissions.
And shares in Allied Capital (ALD) continuing their downward trek today, down more than 4 percent after a 10 percent decline yesterday. Its accounting practices are being investigated.
Over on the NASDAQ, the NASDAQ 100 (QQQQ) tracking stock ending $0.38 higher, a nice day for that one.
Microsoft (MSFT) up a dime.
Amazon.com (AMZN) up $2.38. Bear Stearns analyst boosted his revenue estimates and upgraded the stock. He thinks fourth quarter sales will be higher than expected.
Intel (INTC) falling $0.09.
And eBay (EBAY) climbing $3.30. CBS Market Watch carried an article about eBay and people using the service to unload their unwanted holiday gifts. The stock`s also a shade from its all-time high at around $118 a share.
Sirius Satellite Radio (SIRI) off $0.29. It got a "sell" rating from the Bank of America Securities today.
Google (GOOG) rising $0.85. It`s also close to its old all-time high set back in November.
Apple (AAPL) up $1.02 today.
Cisco Systems (CSCO) dropping $0.04.
Peoplesoft (PSFT) down by the same amount. Its co-founder and chairman Dave Duffield (ph) resigned about one week ago as Oracle and Peoplesoft prepare to merge.
Taylor Devices (TAYD) giving back $0.48. It nearly tripled yesterday. That was a play on the tsunami disaster last, over the weekend.
Analytical Services, Surveys (ANLT) rather, rising $1.42, another bet on reconstruction efforts in Asia.
Vermont Teddy Bear (BEAR) jumping $2. The company said holiday orders rose 29 percent.
And iPayment (IPMT) advancing about 6 1/2. It signed a deal with First Data today which should mean more processes through its payment computers.
And those are our 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.
12/28/04:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10854.54 +78.41 + .7
HIGH 10859.04
LOW 10773.92
NASDAQ COMP. 2177.19 +22.97 +1.1
HIGH 2177.19
LOW 2156.53
VOLUME 984.3
PREVIOUS 920.9
UP VOLUME 782.5
DOWN VOLUME 176.9
DOW TRANSPORTS 3811.62 +57.39 + 1.5
DOW UTILITIES 335.70 +2.04 + .6
CLOSING TICK +926
S&P 500 1213.54 +8.62 + .7
S&P 100 577.16 +3.30 + .6
MIDCAP 400 662.45 +8.00 + 1.2
REUTERS/CRB 284.27 +.89 + .3
NYSE COMPOSITE 7245.81 +48.54 + .7
VALUE LINE 403.87 +4.75 + 1.2
RUSSELL 2000 654.57 +10.23 + 1.6
DJW 5000 11981.40 +100.03 + .8
U.S. TREASURIES
5-YEAR NOTE 3.50%
Dec. 15,2009 99 10/32 unch. + 3.66
10-YEAR NOTE 4.25%
Nov. 15,2014 99 20/32 +2/32 + 4.30
30-YEAR NOTE 5.375%
Feb. 15, 2031 106 22/32 -1/32 + 4.92
LEHMAN BROS.
LONG BOND INDEX 1744.70 -.69
DOW CLOSE 10854.54 +78.41 + .7
ADVANCES 2469
DECLINES 874
NEW HIGHS 266
NEW LOWS 21
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
PFE Pfizer 26.94 +.44 +1.7
XTO XTO Energy 35.05 +.27 +.8
LU Lucent Tech 3.74 -.02 -.5
GE GE 36.69 +.12 +.3
XOM Exxon Mobil 51.05 +.17 +.3
TWX Time Warner 19.55 +.11 +.6
FON Sprint 24.83 unch. unch.
Q Qwest Comms Intl 4.54 -.03 -.7
L Liberty Media 11.05 +.07 +.6
C Citigroup 48.35 +.04 +.1
NASDAQ CLOSE 2177.19 + 22.97 + 1.1
VOLUME 1,590.7
PREVIOUS 1,484.9
ADVANCES 2291
DECLINES 855
NASDAQ ACTIVES
QQQQ Nasdaq 100 39.97 +.38 +1.0
MSFT Microsoft 26.95 +.10 +.4
AMZN Amazon.com 44.63 +2.38 +5.6
INTC Intel 23.28 -.09 -.4
EBAY eBay 116.16 +3.30 +2.9
SIRI Sirius Satellite 7.81 -.29 -3.6
GOOG Google 192.76 +.85 +.4
AAPL Apple Computer 64.18 +1.02 +1.6
CSCO Cisco Systems 19.26 -.04 -.2
PSFT Peoplesoft Inc 26.40 -.04 -.2
AMEX CLOSE 1426.38 + 1.68 + .1
INDEX SHARES
DIA DIAMONDS TRUST 108.41 +.64 +.6
QQQ NASDAQ 100 39.97 +.38 +1.0
SPY S&P DEP.RECEIPTS 121.18 +.66 +.6
STOCKS IN THE NEWS
JNJ Johnson & Johnson 63.76 +.23 +.4
ELN Elan Corp Plc 26.75 +1.15 +4.5
COH Coach 56.94 +1.22 +2.2
DP Diagnostic Prod 55.91 +2.60 +4.9
CMC Commercial Metal 51.25 +3.05 +6.3
UDI United Defense 48.94 +1.15 +2.4
UHS Universal Health 44.51 -1.18 -2.6
ALD Allied Capital 24.46 -1.15 -4.5
TAYD Taylor Devices 6.27 -.48 -7.1
ANLT Analytical Survey 3.97 +1.42 +55.7
BEAR Vermont Teddy Bear 6.50 +2.00 +44.4
IPMT iPayment 50.29 +6.56 +15.0
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