10/04/05:
President Bush Meets The Press And Defends Recent Decisions
SUSIE GHARIB: President Bush went on the offensive today,
defending his latest nominee to the Supreme Court, White House lawyer
Harriet Miers. He urged his conservative supporters in Congress to trust
his choice. In his first press conference since May, the president also
called on Congress to get to work on the 2006 appropriation bills and to
find money to pay for hurricane relief. He says America is big enough to
be generous and responsible at the same time.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Congress needs to pay
for as much of the hurricane relief as possible by cutting spending. I`ll
work with members of Congress to identify offsets to free up money for the
reconstruction efforts. I will ask them to make even deeper reductions in
the mandatory spending programs than are already planned.
GHARIB: President Bush also repeated his call for more oil refineries
to be built, especially in view of tight supplies and high gasoline prices
because of hurricanes Katrina and Rita. A dozen oil refineries along the
Gulf coast are still offline because of those hurricanes. And a government
report says that 90 percent of Gulf oil production and 72 percent of
natural gas production remain shut down. Stephanie Dhue reports.
STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Restoring oil
and gas production damaged by hurricanes Katrina and Rita is a slow
process. It may take into next year for some of the more damaged
facilities to be repaired. Interior Secretary Gale Norton says the
recovery is complicated by back-to-back storms.
GALE NORTON, INTERIOR SECRETARY: We have more competition for repair
boats and for the equipment that`s necessary to do repairs. We have more
problems getting people back out on platforms because of personal problems
that employees may be experiencing and because the ports through which they
ordinarily would be bringing people and supplies have been severely damaged
by the hurricane.
DHUE: The administration has turned to voluntary conservation measures
to ease energy prices. At his news conference today, the president talked
about conservation.
BUSH: There`s a bubble moving through the system, and one way to
deal with it is to be wise about how we use energy.
DHUE: But his emphasis was clearly on boosting supplies.
BUSH: So another way to deal with it is to recognize we`ve got tight
energy supplies and one way to deal with tight energy supplies is to
increase supply. And the only way to increase supply is to build
refineries.
DHUE: The Bush administration`s energy record has de-emphasized energy
efficiency. In 2001, the Department of Energy tried to relax the
efficiency standards for residential air conditioning units. The
administration opposed increasing Federal fuel efficiency standards for
cars. And the president`s current budget proposes to cut Federal
conservation programs by 27 percent.
BILL PRINDLE, When you look at the hard decisions they`ve had to
make on appliance standards, on building codes and on energy funding, we
don`t see any progress. In fact, we see steps backward.
DHUE: Just two months after passing an energy bill, a new
energy bill is making its way through Congress. It includes
ideas that didn`t make it in the first bill, including expediting
refinery permits and opening up public lands for oil exploration.
Stephanie Dhue, 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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/04/05: Investors Expect To Get A Charge Out Of Energy This Quarter
PAUL KANGAS: Energy companies are expected to fuel corporate profits in the
third quarter. Earnings season doesn`t officially begin until next week.
But Erika Miller has a preview of the likely winners and losers this
quarter.
ERIKA MILLER, NIGHTLY BUSINESS REPORT CORRESPONDENT: Higher gasoline
prices may be taking a big bite out of your wallet, but they`re doing
wonders for the coffers of energy companies. Earnings for the S&P 500 are
expected to be up sharply in the third quarter, thanks to soaring profits
at energy firms.
MICHAEL THOMPSON: For the S&P 500, it`s expected to be 17 percent
growth over the same quarter last year. And that`s very strong growth.
Keep in mind that over historic averages, the S&P earnings growth rate is
about 7 percent.
MILLER: Energy is expected to be the quarter`s star performer, up 72
percent. Many energy companies have benefited from higher prices for
refined products like gasoline in the wake of hurricanes Rita and Katrina.
But those storms have also had a negative impact on some energy companies.
BP for example warned today that third quarter earnings will be hurt by
more than $700 million because of damage to oil-producing facilities.
Experts predict many other companies will blame the storms for earnings
disappointments.
JOSEPH MacALINDEN, MORGAN STANLEY INVESTMENT MGMT: Some of these
will be treated as extraordinary items. Others will be buried in regular
operations. And overall, it will be a factor that will hold down earnings.
MILLER: Earnings are expected to be weakest at basic materials firms.
The sector is expected to show a 9 percent decline in profit growth.
THOMPSON: We`re seeing analysts take down their numbers in
anticipation of seeing some weakening due to higher operating costs,
because basic materials is a sector such as steel companies which are very
energy intensive.
MILLER: The big question is how will third quarter earnings be viewed
by stock investors? Some strategists expect the market to power higher.
MacALINDEN: We`re still in the game in terms of the bull market that
started in 2002, in October of that year. It`s getting a little long in
the tooth as cyclical bull markets go, but it is I think still got a lot of
energy left.
MILLER: Alcoa is traditionally the first Dow component to report
quarterly numbers. It will do so on Monday, marking the kickoff of third
quarter earnings season. Erika Miller, NIGHTLY BUSINESS REPORT, New York.
Nightly
Business Report transcripts are available on-line post broadcast.
The program is transcribed by eMediaMillWorks. Updates may
be posted at a later date. The views of our guests and commentators
are their own and do not necessarily represent the views of
Community Television Foundation of South Florida, Inc. Nightly
Business Report, or WPBT. Information presented on Nightly
Business Report is not and should not be considered as investment
advice. Copyright (c) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/04/05:
One On One With Sun Microsystems CEO Scott McNealy
SUSIE GHARIB: Sun Microsystems and Google announced a deal today to promote
and distribute each other`s software technologies. The two companies said
they would promote Java desktop and Open Office, Sun`s operating and office
software systems. Earlier today I spoke with Sun Micro CEO Scott McNealy
and began by asking him how Sun benefits from the Google relationship.
SCOTT McNEALY, CHMN & CEO, SUN MICROSYSTEMS: Sun`s goal here is to
continue to drive the adoption of open office, open Solaris and the Java
run-time. And finding a great distribution partner, a great brand to go
help drive that adoption, that ubiquity is absolutely critical. If
everybody writes to the client server a dot-net Microsoft environment, then
we`re probably not going to sell a lot of servers and storage and platforms
and middle ware all the rest of it. So this is a great partnership.
It`s driving a huge amount of adoption and specifically taking the
(INAUDIBLE) and adding the functionality of the very rich Google tool bar,
providing a very simple download for customers. This is a big win.
GHARIB: Now Mr. McNealy, how does Sun monetize this relationship?
McNEALY: We`re not talking about the details of monetizing this
relationship, but there`s obviously the cache of having a partnership with
Google. Obviously we`ll get paid if we drive downloads. And obviously as
they buy equipment from us, that will help too. So, you know, the
environment is a wonderful capability for us to really not just grow within
the Google base, but everybody who is delivering software as a service.
GHARIB: It sounds like you will be competing against Microsoft. You
also have a partnership and a relationship with Microsoft so how does the
deal with Google impact that partnership?
McNEALY: Welcome to my world where we partner and compete with just
about everybody out there. At some point the lines blur very significantly.
Partner and compete with IBM. We partner and compete with Microsoft. We
partner and compete with a lot of folks. Google actually is a very natural
and quite a peer partnership actually in the sense that we create the tools
and technologies that allow software as a service and they actually deliver
the service. They are the service providers. So that`s a very natural and
positive relationship. The better Google does, the better Java does. The
better Java does, the better Sun does.
GHARIB: You said at the press conference today that you`ve been
retooling and restrategizing Sun. So what is your strategy for Sun and how
does this Google deal fit into that?
McNEALY: So, we are very much focused on the software as a service,
as I said. We`re very much focused on open source, open interface,
community development and sharing and driving the developer tools and
lowering the barriers of entry for a developer to write to the Solaris,
Java and Open Office, Star Office platform. We do that on multiple hardware
platforms, Intel, AMD, Spark, on multiple operating environments including
Solaris. And we actually certify our standard platforms to run Windows and
Linux and then we do it with our Java enterprise system web services stack . That`s what we do. We`re very focused on the data center, on the
switch room, on the head end, on the service providers, people who have
large numbers of subscribers and we provide them the technology to allow
them to deliver their products as a service. That`s where we`re focused and
we believe that`s a good market and one where we`re the leader.
GHARIB: Now investors seem to be concerned about Sun`s ability to
turn itself around and the big question is is, when is Sun going to return
to growth? What would you say to investors?
McNEALY: I would say to the investors that I understand your issues.
We`re focused on that very aggressively and we`ve made a lot of progress.
In 16 straight years we`ve been cash flow positive from operations. We`ve
improved gross margin dollars as well as percentages last year. We brought
expenses down significantly and we improved the non-gap net income by $975
million year over year. We`re making very good progress. I don`t speculate
going forward but the recent history and the leading economic indicators
are looking very good and as the largest individual shareholder, I hear
your message.
GHARIB: OK. We appreciate it. Thank you so much Mr. McNealy. It`s a
pleasure talking to you.
McNEALY: Thank you.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/04/05: Third Quarter Mutual Fund Report With Russel Kinnel, Director of Mutual Fund Analysis for Morningstar
PAUL KANGAS: Even though the stock market did a lot of backing and
filling in the third quarter, some mutual funds still managed to make money
and to fill us in on them, joining us is Russel Kinnel, director of mutual
fund analysis for Morningstar and Russ, welcome back to NIGHTLY BUSINESS
REPORT.
RUSSEL KINNEL, MORNINGSTAR: It`s good to be back.
KANGAS: First, let`s take a look at the top performing fund
categories in the June-to-August period with a rise in energy prices that
are little surprised that the natural resources funds are right up there.
But our viewers may not have expected to see some of the other top
categories, such as Latin America funds. What was behind the strength
there?
KINNEL: Well, really it`s a similar story. In Latin America we had
Brazilian mining companies and Brazilian energy companies that were really
strong. So it`s really a continuation of that energy theme.
KANGAS: I understand. Well, moving along to the top individual funds
of the quarter, we see several foreign funds on the list led by Profunds
UltraJapan services with a 40 percent return. What can you tell us about
that fund?
KINNEL: Well, it`s a fund that leverages its bet on the market, so
essentially if the Japanese market goes up 10 percent, it might go up 20
percent. So it`s really volatile strategy. Obviously in Japan what`s going
on is people are excited that the reformers have won -- there was a
referendum on postal reform and that won. So the Japanese market has had a
nice rally here.
KANGAS: That`s interesting. Moving on to the top fund for the past
year, I guess there should be no surprise about it being an energy fund,
the Guinness Atkinson global energy with a return of almost 87 percent. Did
that fund do anything differently than the others in that category?
KINNEL: A little. It had maybe a little more in foreign energy
holdings. The only thing that did better than U.S. natural resources stocks
were foreign natural resource stocks like those of Brazil and some other
countries. So it really got the full boost out of rising energy prices.
KANGAS: Covered the whole gambit, in other words, yeah. Over the
past three years, the leader was a fund in an entirely different sector,
Profunds Ultramobile telecommunications services, but since this is a
leveraged fund, doesn`t that magnify the actual gains in telecom stocks?
KINNEL: That`s right. You may recall a few years ago telecom got
crushed and now we`re up to the three-year period where it has started to
rebound and so this fund is leveraging its wireless bet and so again it`s
an extremely risky fund because it`s leveraged to a very narrow volatile
sector.
KANGAS: And it was on the right side of the market obviously in that
period of time.
KINNEL: That`s right. It wouldn`t have been a bad one to hold.
KANGAS: Right. Now moving on to the largest funds in terms of
assets, we see that American Funds, Growth Fund of America came in with a
very nice return as did most of the others with the exception of Pimco
Total Return which of course happens to be the largest bond fund. Do you
think this marks the end of the long run of positive returns that the bond
funds enjoyed?
KINNEL: I hate to be the one to call an end to it because people
have been saying the bond market party is about to end any day now for
about three years. But the circumstances really look grim for bonds. On the
one hand you have rising inflation and at the same time you have a
ballooning Federal deficit because of the war and the hurricane rebuilding
effort. So it`s a pretty rough market for bonds.
KANGAS: OK. Russ, we understand that investors have recently cut
back the flow of money into mutual funds. Do you have any explanation for
that?
KINNEL: Well, I think it`s partly that the people are being more
cautious. Obviously there`s been a lot of bad news in the press lately with
the hurricanes and other things so I think maybe people are getting a
little more cautious in this environment.
KANGAS: OK, fair enough and do you think that the caution will
continue? We still have some pretty strong head winds, don`t we?
KINNEL: Yes, it certainly is possible. But at the same time the
markets in general have done OK this year so people probably won`t be too
scared off. I wouldn`t necessarily expect a lot of money to flood out of
the market.
KANGAS: OK, very good. Russ, I want to thank you for those excellent
insights into the mutual fund scene. My guest, Russell Kinnel, the director
of fund analysis for Morningstar.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/04/05:
"Paul Kangas' Stocks In The News"
PAUL KANGAS: After opening slightly lower, the stock market rebounded as
crude oil prices sold off rather sharply. At noontime, the Dow was up 30
points, NASDAQ had gained 11. After brokerage downgrades on Procter &
Gamble, Texas Instruments and Kodak, the upturn stalled. Then a full-
fledged sell-off began when Dallas Fed bank President Richard Fisher issued
an inflation warning which revived concern about higher interest rates.
The Dow industrial average tumbled to a 94 1/3 point closing loss, putting
it at 10,441.11. The NASDAQ Composite was down 16 points at 2139.36.
Standard & Poor`s 500 index dropped 12 1/4 points ending at 1214.47. In
the bond market, the 10-year note rose 3/32 to 99 even, putting the yield
at 4.38 percent.
The New York Exchange volume leader once again, Lucent Technology
(LU) trading 40.6 million shares today and the stock up $0.12.
Newscorp "B" (NWS) stock down $0.31.
Then Lexmark (LXK) tumbling $17.44, 28 percent drop as you heard.
The company slashed earnings guidance because of tough competition,
particularly from Hewlett-Packard.
Nortel Networks (NT) up $0.13.
General Electric (GE) was down $0.38, fifth in big board volume.
Procter & Gamble (PG) down $1.23. That hurt the Dow industrial
average. Citigroup has downgraded P&G from "buy" to "hold," citing higher
raw material costs. Also it cut its price target for P&G stock from $61
down to $59 just about where it is now.
Hewlett-Packard (HPQ) was down $0.35.
Texas Instruments (TXN) fell $1.87. Goldman Sachs downgraded it from
"in line" to "under perform."
Pfizer (PFE) lost a nickel.
ExxonMobil (XOM) down $1.94 on those lower oil prices and it didn`t
help that BP and one of its competitors was down $1.80 after saying its
third quarter profits will be cut by $700 million due to the fact that
hurricanes Katrina and Rita reduced its oil and gas production
considerably.
Then we see Phelps Dodge (PD) moving up $4.80, traded as high as
$138. A hedge fund called Atticus Capital, which owns 8.6 percent of Phelps
Dodge, the second largest shareholder, is urging the company to buy back
its own stock with some of its $2.5 billion cash hoard.
Eastman Kodak (EK) lost $0.94. JPMorgan downgraded it from "neutral"
to "under weight" because of the company`s weak profitability and also
because of its traditional businesses fading rather quickly.
Abbott Labs (ABT) moved up $1.53. The company got FDA approval to
market its arthritis treatment called Humira.
Walgreen (WAG) was up $0.95. The company had September same store
sales up a respectable 7.7 percent.
And Mylan Labs (MYL) gained $1.02. The company received final FDA
approval for its generic version of Pfizer`s Norvad product, which is used
to treat hypertension and angina.
TOO Inc (TOO), the young ladies` apparel retailer up $1.87. Company
boosted third quarter guidance from $0.39 to $0.41 to $0.43 because of
strong back to school sales. Wed Bush Morgan brokerage upgraded it to
a "buy" recommendation.
And then Nu Skin Enterprise (NUS) losing $2.25. The story here,
company cut third quarter earnings guidance from about $0.30 down to as low
as $0.25 because of declining sales in China. Standard & Poor`s downgraded
it to just a "hold" recommendation.
Dean Foods (DF) off $1.23. Prudential downgraded it from "over
weight" to "neutral" on valuation.
And then Protective Life Corp. (PL) up $1.11. Merrill Lynch upgraded
it from "neutral" to "buy" after recent weakness presented an opportunity
said Merrill.
Microsoft (MSFT) topped the active list on NASDAQ, down $0.52.
Google (GOOG) losing $7.68. You heard about the news of the
partnership with Sun Microsystems.
Intel (INTC) a dime loss.
Sandisk (SNDK) moved up $4.15 on apparent optimism over the
company`s new line of MP3 players.
Apple Computer (AAPL) down $0.69. That was fifth in dollar volume.
Dell (DELL) fell $0.58.
Research in Motion (RIMM) down $2.30.
Cisco (CSCO) a $0.07 loss.
And then Sun Micro (SUNW) itself edged a penny higher.
And Qualcomm (QCOM), tenth in volume, was up $0.56 a share.
Fox and Hound Restaurant (FOXX) up $2.80. An investment group called
Levine Lechtman Capital Partners will acquire it for $14 a share in cash.
And finally Amsurg Corporation (AMSG), which operates surgery
centers is going to cut its 2005 earnings guidance from as high as $1.34 to
a low of about $1.18.
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) 2005 Community Television Foundation
of South Florida, Inc. ALL RIGHTS RESERVED. Terms of use.
10/04/05:
Market Stats
NET PERCENT
CLOSE CHANGE CHANGE
DOW CLOSE 10441.11 -94.37 - .9
HIGH 10567.82
LOW 10434.79
NASDAQ COMP. 2139.36 -16.07 -.8
HIGH 2167.00
LOW 2139.00
VOLUME 1,729.8
PREVIOUS 1,549.6
UP VOLUME 460.2
DOWN VOLUME 1,246.6
DOW TRANSPORTS 3695.78 -40.81 - 1.1
DOW UTILITIES 429.35 -8.28 - 1.9
CLOSING TICK +255
S&P 500 1214.47 -12.23 - 1.0
S&P 100 559.81 -5.15 - .9
MIDCAP 400 712.88 -7.47 - 1.0
REUTERS/CRB 329.72 -3.50 - 1.1
NYSE COMPOSITE 7558.10 -68.13 - .9
VALUE LINE 407.65 -3.49 - .9
RUSSELL 2000 663.84 -6.71 - 1.0
DJW 5000 12168.10 -121.15 - 1.0
U.S. TREASURIES
5-YEAR NOTE 3.875%
Sept. 15,2010 98 13/32 +2/32 + 4.24
10-YEAR NOTE 4.25%
Aug. 15,2015 99 +3/32 + 4.38
30-YEAR NOTE 5.375%
Feb. 15, 2031 111 15/32 +9/32 + 4.60
LEHMAN BROS.
LONG BOND INDEX 1772.90 -3.53
DOW CLOSE 10441.11 -94.37 - .9
ADVANCES 1100
DECLINES 2199
NEW HIGHS 211
NEW LOWS 88
NET PERCENT
NYSE MOST ACTIVES 4PM CLOSE CHANGE CHANGE
LU Lucent Tech 3.43 +.12 +3.6
NWS News Corp "B" 15.98 -.31 -1.9
LXK Lexmark Intl 43.50 -17.44 -28.6
NT Nortel Networks 3.43 +.13 +3.9
GE GE 32.85 -.38 -1.1
PG Procter & Gamble 58.08 -1.23 -2.1
HPQ Hewlett-Packard 28.55 -.35 -1.2
TXN Texas Instrument 32.01 -1.87 -5.5
PFE Pfizer 25.24 -.05 -.2
XOM Exxon Mobil 60.55 -1.94 -3.1
NASDAQ CLOSE 2139.36 - 16.07 - .8
VOLUME 2,054.2
PREVIOUS 1,870.5
ADVANCES 1191
DECLINES 1834
NASDAQ ACTIVES
MSFT Microsoft 24.98 -.52 -2.0
GOOG Google 311.00 -7.68 -2.4
INTC Intel 24.50 -.10 -.4
SNDK Sandisk 52.34 +4.15 +8.6
AAPL Apple Computer 53.75 -.69 -1.3
DELL Dell 33.39 -.58 -1.7
RIMM Rsch In Motion 65.80 -2.30 -3.4
CSCO Cisco Systems 17.67 -.07 -.4
SUNW Sun Micro 4.20 +.01 +.2
QCOM Qualcomm 45.61 +.56 +1.2
AMEX CLOSE 1721.65 - 17.11 - 1.0
INDEX SHARES
DIA DIAMONDS TRUST 104.17 -1.11 -1.1
QQQ NASDAQ 100 39.30 -.26 -.7
SPY S&P DEP.RECEIPTS 121.22 -1.38 -1.1
STOCKS IN THE NEWS
BP BP Plc Adr 68.80 -1.80 -2.6
PD Phelps Dodge 134.50 +4.80 +3.7
EK Eastman Kodak 23.16 -.94 -3.9
ABT Abbott Labs 44.01 +1.53 +3.6
WAG Walgreen Co 44.14 +.95 +2.2
MYL Mylan Labs 20.40 +1.02 +5.3
TOO Too Inc 29.72 +1.87 +6.7
NUS Nu Skin Enterp 16.45 -2.25 -12.0
DF Dean Foods Co 38.22 -1.23 -3.1
PL Protective Life 42.37 +1.11 +2.7
FOXX Fox & Hound Rest 13.08 +2.80 +27.2
AMSG Amsurg Corp 23.10 -4.95 -17.7
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