Penn National Deal Falls, Yahoo Talks

123jump.com Staff
03 Jul, 2008
New York City

Tech stocks fell for the second day on the weak chip makers and tech services companies. Nvidia plunged 30% after it issued lower revenue and gross margin guidance. The chipmaker will also take a charge of $150 millino in the second quarter. Citigroup, Cowen and Goldman Sachs lowered pricce traget and investment rating on the stock. European markets closed higher on the hopes that latest interest rate increase may not be followed by another rate hike in the near future.

[R]2:00PM New York – Tech stocks remain weak but broader market averages edge higher.[/R]

U.S. stocks edged higher but rebound in stocks appears to be temporary. Euro fell after the ECB raised rates and investors hope that rate hike in the near future are not likely. U.S. lost 62,000 jobs in June and total job losses in the first half are approaching 440,000.

The purchase of Penn National Gaming Inc is cancelled by two private equity groups Fortress Investment and Centerbridge Partners LP. The deal valued the company at $6.1 billion and current tight credit market conditions have led several high profile deals to collapse.

Dow Jones Industrial Average gained 75.31 or 0.67% to 11,290.82 and S&P 500 gained 0.85 or 0.07% to 1,262.37.

Dow Gainers and Losers

Of the 30 stocks in Dow Jones Industrial Average 17 stocks gained and 13 declined.

AIG Group led the decliners in the Dow Jones Industrial Average with a loss of 1.72% or $0.46, to $26.29 followed by losses in Bank of America of 1.64% or $0.37, to $22.17, in Hewlett-Packard of 1.31% or $0.57, to $43.04, in Intel Corp of 1.29% or $0.27, to $20.66 and in AT&T Inc of 1.09% or $0.36, to $32.53.

General Motors led the gainers in the Dow Jones Industrial Average index with a rise of 4.21% or $0.42, to $10.40 followed by increases in American Express of 2.61% or $1.04, to $40.66, in JPMorgan Chase of 2.61% or $0.89, to $35.49, in General Electric of 1.92% or $0.51 to $27.02 and in United Tech Corp of 1.89% or $1.13 to $60.83.

Stock Movers

Health Net declined 12% after Goldman Sachs lowered its rating to ‘sell’. The stocks fell $3.09 to $22.55. Health Net Inc ((HNT)) in the last one year traded as high as $53.61 in October 2007 and as low as $25.64 in July 2008. Based on the yesterday’s closing price the company has a market cap of $2.43 billion.

Aetna lost 7% or $2.69 to $37.14 after Goldman Sachs lowered its rating to ‘sell’ from ‘neutral’ and cited challenging market environment. Aetna Inc ((AET)) in the last one year traded as high as $59.76 in December 2007 and as low as $39.79 in July 2008. Based on the yesterday’s closing price the company has a market cap of $18.13 billion.

Microsoft raised 10 cents to $25.98 after it resumed its talks with Yahoo Inc which rose 47 cents to $21.35. Yahoo may be split three businesses sold to TimeWarner, News Corp and Microsoft according to media speculation. Microsoft Inc ((MSFT)) in the last one year traded as high as $37.06 in November 2007 and as low as $25.88 in July 2008. Based on the yesterday’s closing price the company has a market cap of $241.68 billion.

MSCI Inc investment products and analytics provider said second quarter revenues rose 22% to $108.2 million from $88.7 million a year ago. Net income in the quarter falls 6% to $18.6 million or 18 cents per diluted share compared to net income of $19.9 million or 25 cents per share, a year ago.

MSCI rose 86 cent or 2.7% to $32.81 after it reported earnings. MSCI Inc ((MXB)) in the last one year traded as high as $39.95 in December 2007 and as low as $21.03 in March 2008. Based on the yesterday’s closing price the company has a market cap of $3.20 billion.

S&P 500 Index Movers

Of the stocks in S&P 500 index, 243 increased 254 declined and 3 remained unchanged.

Nvidia Corp led the decliners in the S&P 500 index with a loss of 29.34% or $5.29, to $12.74 followed by in losses in Zions Bancorp of 15.08% or $4.77, to $26.85, in AK Steel Holdings of 8.21% or $4.65, to $52.00, in Regions Financial of 6.52% or $0.69, to $9.90 and in Southern Energy of 6.41% or $3.05, to $44.56.

Yahoo Inc led the gainers in the S&P 500 index with a rise of 3.74% or $073, to $21.66 followed by increases in Amgen Inc of 3.36% or $1.64, to $50.48, in Kohl Corp of 2.97% or $1.22, to $42.33, in Raytheon Co of 2.93% or $1.65 to $57. Safeway Inc of 2.53% or $0.71 to $28.73.