News Corp Offers $5 B for Dow Jones

123jump.com Staff
01 May, 2001
New York City

Major averages climbed higher on several deal news in banking, publishing and steel indsurties. News Corp controlled by Rupert Murdoch offered $65 per share or $5 billion for Dow Jones. The company publication Wall Street journal said that the board has declined the offer. Microsoft is reported to be in a deal to buy for $1 billion 24/7 Real Media, an internet adveertising firm. A report on housing markets showed 4.9% declined in signed contracts for pending home sales.

[R]5:00PM NY – 11:00PM Frankfurt – 2:00AM Mumbai – Global Markets[/R]

U.S. bonds yields rose and 10-year bond closed at 4.64% and 30-year bond closed at 4.812%.

Oil in New York trading fell $1.31 to close at $64.40 per barrel, natural gas fell 14 cents to close at $7.71 MBtu and gasoline fell 1.47 cents to close at 224.47 cents per gallon.

Gold declined $6.20 per troy ounce to close at $677.50 and silver price fell 20 cents to close at $13.37 per ounce. Copper gained $20 per metric ton to close at $7,806.

Asian markets were closed on the account of holiday in India, China, Hong Kong, Taiwan, South Korea and Thailand. Japan was open today but in a thin trading fell 0.72% and Australia declined 0.3% in sympathy with the U.S. averages. NTT DoCoMo rose 2.2% on reporting earnings. The annual earnings were lower for the current year but the company forecasted higher profit for the current year.

European Markets were closed except in the U.K. and the Netherlands. FTSE 100 index fell 0.5% on weakness in banks, construction companies and retailers. Hanson Plc and Balfour Beatty Plc fell on worries of weaker earnings in the coming quarters on the account of declining housing market in the U.S. Punch Tavern stock fell 3.5% despite reporting 14% rise in earnings.

Latin American Markets were closed for the May Day. Argentina based Ternium SA agreed to purchase Mexico based steel-maker Grupo Imsa for $1.7 billion. Ternium ADR trading in New York gained 2.3% on the news. Ternium has steel mills in Argentina, Venezuela and Mexico. Mexico has recently seen several deals in steel industry as it attracted investment from Arcelor Mittal based in Luxemburg.


[R]11:30AM U.S. stock averages traded mixed on rate concerns.[/R]
U.S. stock market averages turned mixed, reflecting robust manufacturing data and weak housing report reignited concerns that the Fed Reserve may not cut interest rates in the near future. The Institute for Supply Management''s April manufacturing index came in at 54.7%, higher than the reading in March and above forecasts. In another report, the National Association of Realtors said pending sales of existing homes fell by 4.9% in March to their lowest point in four years.

Susquehanna Bancshares Inc. ((SUSQ)) agreed Tuesday to purchase Community Banks Inc. ((CMTY)) in a cash-and-stock deal worth nearly $860 million. Under terms of the deal, Community shareholders will receive either $34 in cash or 1.48 shares of Susquehanna common stock for each share of Community stock they own. Community Banks surged 34%.

MAF Bancorp ((MAFB)) surged 35% after National City Corp. said Tuesday it will buy the company for $56 per share, or $1.9 billion in an all-stock deal. The move is aimed to help National City to enter the Wisconsin market and expand its presence in Chicago. The price represents a 39% premium to MAF Bancorp''s Monday closing price of $40.15.

Among other stocks in focus today, Circuit City ((CC)) fell 11% after the company withdrew its first-half 2008 outlook and said its Q4 loss from continuing operations will widen. Citigroup later downgraded the stock to hold. In late morning trading, the Dow rose 33.49, or 0.26%, to 13,096.40. The Standard & Poor''s 500 index fell 0.35, or 0.02% to 1,482.02, and the Nasdaq composite index was off 3.05, or 0.12%, to 2,522.04. Bond prices dropped after the manufacturing data, and the yield on the benchmark 10-year Treasury note rose to 4.65%, up from 4.62% late Monday.


[R]9:45AM U.S. markets opened higher on deal news.[/R]
U.S. stocks opened in the positive, helped by deal news. Microsoft ((MSFT)) is reportedly interested in buying Internet advertising firm 24/7 Real Media ((TFSM)) which soared 19%. Much stronger-than-expected data on manufacturing activity also contributed to the early gains, easing fears about the U.S. economic growth. The Institute for Supply Management manufacturing index hit a 1-year high of 54.7% in April, topping forecasts of an increase by 51%.

Among earnings-related gainers, Manitowoc ((MTW)) gained 5.3% in early trading as the provider of lifting equipment reported late Monday reported QA1 net earnings of $64.1 million, or $1.01 a share, up from $29.7 million, or 48 cents a share a year ago, beating expectations of earnings of 87 cents a share on revenue of $809 million. Manitowoc also lifted its 2007 outlook. The company named Glen Tellock as a new CEO. On the side of the losers, Circuit City ((CC)) fell 10.6% after the company said it expects Q1 loss and withdrew its forecast for the first half of the year. Procter & Gamble ((PG)) weighed on the Dow with a decline of 2% amid a disappointing forecast.

Shares of apparel-maker Liz Claiborne Inc. ((LIZ)) tumbled 20% after quarterly earnings missed estimates. The Dow Jones industrial average was up 34.54 points, or 0.26%, at 13,097.45. The Standard & Poor''s 500 was up 1.65 points, or 0.11%, at 1,484.02. The Nasdaq Composite Index was up 1.75 points, or 0.07%, at 2,526.84.


[R]9:00AM U.S. stock futures pointed slightly higher ahead of manufacturing data.[/R]
U.S. stock futures indicated a moderately higher opening on Tuesday ahead of a reading on the nation’s manufacturing sector, which is expected to give further signs of the rate of economic slowdown. Investors were also awaiting the release of another batch of quarterly earnings, eager to learn whether the robust growth in corporate profits is likely to continue. The ISM’s index of U.S. manufacturing is due out after the opening bell, with economists predicting the April index will come in at 51.0. Reports on pending sales of existing homes in March and automakers’ sales figures in the month of April are also due out today.

Among pre-market headlights, Circuit City Stores ((CC)) slipped 8% in the pre-open after it withdrew its fiscal first-half 2008 outlook and said its Q4 loss from continuing operations will widen. Procter & Gamble Co ((PG)) reported a 14% increase in its Q3 profit, with earnings coming in line with expectations while sales, which rose 8%, came in better than expected. The company also lifted the lower end of its full-year forecast.

Automakers are scheduled to report weak U.S. sales for April. Ford Motor Co. ((F)) expected to posted 22% sales drop, followed by General Motors ((GM)) with 11% decline on sales, and Chrysler ((DCX)) with 10% decrease. Dow futures expiring in June rose 14, or 0.11%, to 13,130. The blue chip index has hit 37 record closes since the beginning of October, its latest coming on Friday. Standard & Poor''''s 500 index futures rose 3.30, or 0.22%, Tuesday to 1,491.70. Nasdaq 100 index futures rose 3.00, or 0.16%, to 1,882.25.


[R]8:45AM The FTSE 100 slips in light trading, Pub Taverns leads decliners.[/R]
The UK benchmark index was lower on Tuesday. The FTSE 100 was down 30.5 points at 6,418.7 by late morning.

Advancers

There were very few advancers in the market. Real estate stocks gained after well-received figures from shopping centre operator Liberty International, up 2.7 %. First-quarter profit was boosted by rising net rental income cmpared with a year earlier. Net asset value per share, a key gauge for property companies, also rose 4% during the quarter.

Other gainers included Hammerson which rose 1.1%, while Slough Estates, which was supported by continued bid speculation, firmed 1.5%.

Decliners

Punch Taverns leads the decliners, down 4.1%, after investors took profits in the pub group. Punch reported a 12% rise in profits and said second-half trading was in line with expectations

In the mid-caps, Aberdeen Asset Management lost 2.6% despite the fund manager announcing a sharp rise in interim profits. Technology commercialisation firm Angle announced it expects pre-tax losses to be 4.4 million pounds in the second half and 9.3 million pounds in the full year. Shares of Angle slumped almost 21%.


[R]8:00AM Procter & Gamble posted higher profit and lifted full-year outlook.[/R]
Procter & Gamble Co. ((PG)) announced on Tuesday a 14% increase in Q3 profit and lifted the low-end of its full-year profit outlook. The company posted quarterly profit of $2.51 billion, or 74 cents per share, compared with $2.21 billion, or 63 cents per share a year earlier. The upbeat results were contributed to strong sales of Olay skin care products and Tide laundry detergent.

The company’s Q3 financial results came in line with its own expectations, as well as with analyst estimates. P&G said it now expects to earn $3.01 to $3.03 per share this year, compared with a prior target of $2.99 to $3.03. Shares of P&G declined 1.7% during the quarter.


[R]7:45AM Japan finishes lower on profit-taking and weak U.S. close.[/R]
Japan finished lower on Tuesday. Markets in China, Hong Kong, India, Singapore, South Korea, Taiwan and Thailand were closed for a public holiday.

The benchmark Nikkei 225 index in Tokyo ended at 17,275.68, down 124.73 points, or 0.72%, from Friday. Trading was subdued on account of Golden Week. The market was closed Monday for a national holiday and will be closed again on Thursday and Friday. Sumitomo Mitsui Financial Group shed 1.9% after a downward revision of its earnings estimate for the year ended March 31. NTT DoCoMo added 2%, however, as it projected a profit rise for this fiscal year after reporting a double-digit net profit fall in the just-ended year.

In Australia, the benchmark S&P/ASX 200 index ended also down 20.2 points, or 0.3%, at 6,145.8. Resources stocks led the decline, with BHP Billiton down 1.2% and Rio Tinto down 2.1%. Symbion Health gained 4.4%, though, after receiving a takeover offer from a consortium comprising Healthscope, Ironbridge and Archer Capital.