Wall St. Breakfast's Pre-Market Snapshot:
U.S. Futures As of 8:42 AM ET
S&P 500: +2.00; 1,457.00
NASDAQ 100: -1.50; 2,040.25
Dow: +22; 13,069
NIKKEI 225: -2.48%; 15,197.09 (-386.33)
HANG SENG: -3.88%; 27,665.73 (-1,117.68)
SHANGHAI SE COMPOSITE: -2.40%; 5,187.74 (-127.80)
BSE SENSEX 30: -0.90%; 18,737.27 (-170.33)
FTSE 100: +0.07%; 6,309.20 (+4.30)
CAC 40: -0.29%; 5,507.91 (-16.27)
XETRA-DAX: -0.42%; 7,779.28 (-33.12)
Commodity Futures (Reuters/Jefferies CRB)
Oil: -1.55%; $94.83 (-$1.49)
Gold: -2.29%; $815.60 (-$19.10)
Natural Gas: -2.24%; $7.72 (-$0.18)
Silver: -2.99%; $15.08 (-$0.465)
U.S. Breaking Newssee today's Wall Street Breakfast for earlier news
IBM to Pay $5B for Cognos
IBM said Monday it has agreed to acquire Canadian business intelligence software developer Cognos for $58/share, or about $4.9 billion, a 9.5% premium to its Friday close of $52.98. "Customers are demanding complete solutions, not piece parts, to enable real-time decision making," said Steve Mills, IBM senior VP. The acquisition, IBM said, fits within its strategy to combine information integration, content and data management and business consulting services. The deal ends recent speculation as to who would buy Cognos, the last remaining large, pure business-software company, after SAP agreed to buy Business Objects in October and Oracle bought Hyperion Solutions earlier this year. All three firms make software that analyzes vast amounts of data to help businesses make more intelligent decisions. IBM will incorporate Cognos into its Information Management Software division; the unit will be headed by Cognos CEO Rob Ashe. While software is still the smallest of IBM's three main businesses, it is also the biggest profit driver. IBM shares are up 0.2% Monday. Shares of Cognos are up 7.6% to $57.
Commentary: Cognos CEO Gains Insight From New Market • Cognos: Virgin 'Middleware' Territory • Cognos' Missing Enterprise 3.0 Strategy
Stocks to watch: IBM, COGN. Competitors: ORCL, SAP. ETFs: SWH, PSJ
Earnings call transcript: Cognos F2Q08 (Qtr End 8/31/07), International Business Machines Q3 2007
Tyson Swings to Q4 Profit, But Tanks on Disappointing Guidance
Tyson Foods returned to profitability in its fiscal fourth-quarter, recording net income of $32 million, or $0.09/share, compared to a loss of $56M ($0.17) last year. However, EPS were a penny short of analysts' average estimate. Tyson is down nearly 12% to $13.00 in thin pre-market activity on disappointing fiscal 2008 guidance. Tyson warned it expects it will incur about $300M in additional grain costs for its chicken segment and said "the current beef environment is extremely difficult as well." Tyson's fiscal 2008 outlook for EPS of $0.30 to $0.70 is well below analysts' average forecast of $1.02. Despite the challenging market conditions, CEO Richard L. Bond said Tyson is much stronger and better positioned, and believes its strategies are right for long-term success. Fiscal Q4 revenues rose 6.3% to $6.88B, topping expectations of $6.73B. Full-year sales of $27B set a new record. All four of its operating segments were profitable in Q4. Shares of Tyson Foods lost 2% to $14.75 on Friday and if the pre-market trading level holds, Tyson will be down over 45% since peaking this summer.
Commentary: Tyson Guides Down • Smithfield Foods: King Pig Among Pork Producers • Oil Majors Quietly Investing In Renewable Fuel Sector
Stocks to watch: TSN. Competitors: PPC, SFD, HRL
Honeywell Inks $1B Avionics and Maintenance Deal with AirTran
Monday morning Honeywell International Inc. announced it has signed a $1 billion avionics and maintenance deal with AirTran Airways, covering its entire fleet, including new aircraft. The deal will last through 2030. Honeywell will supply up to 150 new Boeing 737s with avionics, which means installing the hundreds of electronic systems involved with the operating of an aircraft. AirTran had 128 aircraft in its fleet as of February 2007; its latest deal with Honeywell applies to future maintenance for up to 250 aircraft. The maintenance will include such operations as lighting, mechanical components, Auxiliary Power Unit and wheels/brakes. AirTran AirTran Senior Vice President of Operations Steve Kolski called the deal "win-win" for both companies, while Honeywell V.P. Mike Madsen said that as the OEM, his company is "able to provide a comprehensive maintenance program with strong technical support and rapid turn-times, all of which enable AirTran to significantly reduce their investment in spares and spend more time flying." AirTran flies predominantly short-haul flights on the eastern seaboard. Both companies' shares were unmoved in the pre-market.
Commentary: Honeywell Reports Slight Miss • Honeywell Not Hindered by Housing; Foster and Fluor Are Also Buys • 21 Airline Stocks to Keep You Flying High This Summer
Stocks to watch: HON, AAI
Earnings call transcript: Honeywell International, Inc. Q3 2007 Earnings Call Transcript
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Asian Headlines (via Bloomberg.com)
Asian Stocks Tumble on Speculation Subprime Losses at HSBC, Banks to Widen Asian stocks tumbled, sending a regional index to its biggest drop in three months, on speculation HSBC Holdings Plc and other banks will report increased losses related to U.S. subprime mortgages.
Yen Climbs Above 110 Per Dollar to 1 1/2-Year High as Carry Trades Reduced The yen strengthened against all 16 of the most-traded currencies, rising beyond 110 per dollar for the first time in 1 1/2 years, as investors reduced holdings of higher-yielding assets bought with loans in Japan.
China Trade Surplus Climbs to Record $27 Billion, Adding Tension Over Yuan China's trade surplus rose to a record $27.05 billion in October, adding fuel to U.S. and European complaints the yuan is undervalued.
India's September Industrial Production Grows at Slowest Pace in 11 Months India's industrial production grew at the slowest pace in 11 months in September as decade-high interest rates crimped consumer demand and a stronger currency made exports less competitive.
Japan Is Carefully Watching Markets, Ministry of Finance's Tsuda Says Japan's government is carefully watching ``various financial markets,'' the Finance Ministry's top official said, after the yen surged against the dollar and stocks fell.
Currency Controls Return as Korea, India, Colombia Fight Dollar's Freefall Central banks from Bogota to Mumbai are imposing foreign-exchange curbs to take control of their soaring currencies from traders dumping the dollar.
European Headlines (via Bloomberg.com)
European Stocks Drop, Led by Nokia, Technology Companies; BP, Total Fall European stocks fell for a fourth day, the longest losing streak since July, after Credit Suisse Group recommended trimming holdings of technology companies and declining oil prices pushed energy shares lower.
Rexel to Buy Hagemeyer for a Sweetened $4.5 Billion, Sell Parts to Sonepar Rexel SA, the world's largest distributor of electrical equipment, agreed to buy Hagemeyer NV with a sweetened offer of 3.1 billion euros ($4.5 billion) to expand in Europe as the U.S. market slows.
Telefonica Net Rises 39 Percent to Record on Latin America, Lower Taxes Telefonica SA, Europe's second- largest telephone company, said third-quarter profit increased 39 percent to a record, beating analysts' estimates on growth in Latin America and lower taxes.
BHP Plans $30 Billion Share Buyback Should Purchase of Rio Tinto Succeed BHP Billiton Ltd., the world's largest mining company, said it would buy back $30 billion of shares should it win control of Rio Tinto Group.
Pearl Closer to Acquisition of Resolution as Standard Life Drops Rival Bid Pearl Group Ltd. moved closer to buying U.K. insurer Resolution Plc for 4.93 billion pounds ($10.3 billion) after Standard Life Plc abandoned its rival offer.