Wall St. Breakfast's Pre-Market Snapshot:
U.S. Futures As of 8:45 AM ET
S&P 500: +4.00; 1,538.50
NASDAQ 100: +9.00; 2,077.50
Dow: +35; 13,936
NIKKEI 225: 16,312.61 (09/21)
HANG SENG: +2.74%; 26,551.94 (+708.16)
SHANGHAI SE COMPOSITE: +0.56%; 5,485.01 (+30.34)
BSE SENSEX 30: +1.70%; 16,845.83 (+281.60)
FTSE 100: +0.40%; 6,482.80 (+26.10)
CAC 40: +0.02%; 5,701.69 (+1.04)
XETRA-DAX: -0.13%; 7,784.56 (-9.87)
Commodity Futures (Reuters/Jefferies CRB)
Oil: -0.77%; $80.99 (-$0.63)
Gold: +0.43%; $742.10 (+$3.20)
Natural Gas: -1.22%; $6.01 (-$0.07)
Silver: +1.28%; $13.795 (+$0.175)
U.S. Breaking Newssee today's Wall Street Breakfast for earlier news
Yamana Gold Sweetens Bid for Meridian
Yamana Gold has increased the cash component of its offer by C$0.50 to acquire Meridian Gold, whose shareholders now stand to receive C$7.00/share in cash plus 2.235 shares of Yamana common stock. In a joint press release, the companies said their respective Boards of Directors agree to unanimously recommend Meridian shareholders accept the revised offer. Yamana extended the offer period to midnight Oct. 12. Yamana said it will fund the cash portion of the transaction using currently available debt facilities. Yamana's revised offer now represents a spot premium of 37.7% (based on closing prices on the Toronto Stock Exchange) compared to its original proposal on June 27. Financial advisors to both firms say the revised offer is fair from a financial standpoint. Goldman Sachs and BMO Capital Markets are advising Yamana, while Genuity Capital Markets, Canaccord Capital and J.P. Morgan are advising Meridian. NYSE-listed shares of Meridian were last up 6.2% to $36.40 in thin pre-market trading, after losing 0.7% to $34.27 on Friday. Yamana Gold was last up 1.1% to $12.75, also thinly trade in the pre-market; Yamana lost 0.4% to $12.61 on Friday.
Sources: Press release, MarketWatch
Commentary: Our Favorite Stocks to Watch as the Gold Bull Kicks Back into Action • Northern Orion, Yamana, Meridian: The Golden Dynasty Soap Opera • Yamana-Northern Orion-Meridian Merger Doesn't Look Likely to UBS
Stocks/ETFs to watch: AUY, MDG, NTO
Alcatel-Lucent To Optimize Chinese Mobile Networks For Undisclosed Sum
Networking giant Alcatel-Lucent said in a press release Monday morning it will provide network optimization services to affiliates of China Mobile and China Unicom. Financial terms were not released. As of Friday's close, China Mobile and China Unicom boasted market caps of $290 billion and $22.3 billion respectively. Alcatel said it will "provide tailor-made service solutions to help... enhance network coverage and performance and improve resource utilization" for China Mobile affiliates in Shanghai, Guizhou and Shanxi provinces and for a China Unicom affiliate in Inner Mongolian province, with an expected completion date at the end of 2007. Alcatel shares have fallen more than 36% YTD, as the company has struggled in the wake of its cross-Atlantic November 2006 merger with Lucent.
Sources: Press Release, Thomson Financial News, MarketWatch [edited press release]
Commentary: Alcatel-Lucent: Exercising The Power Of No • Alcatel-Lucent Cuts Outlook, Shares Drop • Still Time to Pull the Switch On Telecom Equipment?
Stocks/ETFs to watch: ALU, CHL, CHU. Competitors: CSCO, ERIC, NT. ETFs: BDH, IGN
Earnings call transcript: Alcatel-Lucent Q2 2007
Seeking Alpha's news briefs are combined into a pre-market summary called Wall Street Breakfast. Get Wall Street Breakfast by email -- it's free and takes only seconds to sign up.
Today's Market (via Sam Collins, ChangeWave.com)
Recap of Last Week's Action
Despite some lagging sectors, such as consumer stocks, on Friday the stock market completed its best two-week period since 2004. Much of that had to do with the Fed's interest rate cuts on Tuesday, but even the week before, technology stocks were strong, and oil stocks have steadily moved up in reaction to a stream of all-time daily highs in crude oil.
Last week, the gains in technology stocks were extended as a result of Oracle's (NYSE:ORCL) better earnings and the announcement of a share buyback by Texas Instruments (NYSE:TXN). Both the Dow Jones Industrial Average and the S&P 500 (SPX) were up 2.8% last week, and the Nasdaq gained 2.7%.
Friday opened higher as a result of strong earnings from ORCL and Nike (NYSE:NKE) and, despite some volatility as a result of options quadruple-witching day, the market managed to hold onto its gains. The Dow Industrials up were 53 points at 13,820, the S&P 500 gained seven to close at 1,526, and the Nasdaq added 17 points at 2,671.
Volume on the NYSE topped two billion shares with positive breadth at 5to-3. The Nasdaq traded almost 2.4 billion shares with advances ahead by 4-to-3.
On Friday, crude oil prices fell after another high on Thursday; the November Crude oil contract closed lower by 16 cents at $81.62 a barrel. However, the Amex Energy SPDR (NYSEARCA:XLE) hit another new high reaching $76.30 to close at $75.70, up 22 cents.
Gold (December contract) fell $1 to $738.90 but closed 2.9% higher for the week. The Philadelphia Gold/Silver Index [XAU] fell by 68 cents and closed at $171.56. The XAU made a new high on Friday at $171.18 but by closing lower executed a minor reversal which if it is followed by selling, could take the XAU down to its first support at $160.
What the Markets Are Saying
It was quite a week for stocks. Energized by Tuesday's unexpected large cut in interest rates, the markets had an explosive reaction to it. This run has taken the markets to the top of the thick resistance band at S&P 1,490-1,540, but with the internal indicators now overbought, it is likely that profit taking will occur and the markets will trade within that zone for at least several weeks.
Today's Trading Landscape
No economic reports are due, and there are just a few earnings due today: Analogic (NASDAQ:ALOG), Financial Fed (NYSE:FIF), Learning Tree (LTREE), Navisite (NASDAQ:NAVI), Synnex (NYSE:SNX), and YM Biosciences (YMI).
The market will begin to focus on Q3 earnings, and pre-announcements may influence trading. The UAW is threatening a strike at General Motors (NYSE:GM) if there is no agreement today; an announcement is expected at around 11 a.m.
Asian Headlines (via Bloomberg.com)
• Asian Stocks Rise for a Fourth Day, Led by BHP; Hong Kong Exchanges Surges Asian stocks rose for a fourth day, led by Cnooc Ltd. (NYSE:CEO) and Rio Tinto Group (RTP), on expectations lower U.S. interest rates will underpin global economic growth and sustain demand for commodities.
• Hong Kong, Asia Stock Exchange Shares Advance Amid Merger Speculation Hong Kong Exchanges & Clearing Ltd. shares rose to a record and Singapore Exchange Ltd. had its biggest gain in seven years on speculation overseas market operators will buy stakes in Asia's surging bourses.
• Orica Agrees to Purchase Bolt Manufacturer Excel Mining for $670 Million Orica Ltd., the world's biggest industrial explosives maker, agreed to buy Excel Mining Systems LLC for about $670 million to add to its range of products used to shore up shafts in countries from the U.S. to China.
• Singapore's Consumer Prices Increase at Fastest Pace in More Than 12 Years Singapore's consumer prices rose in August at the fastest pace in more than 12 years, suggesting the central bank will maintain a policy of allowing its currency to appreciate to damp inflation.
European Headlines (via Bloomberg.com)
• Dollar Falls to Record Low Against Euro Before Housing, Confidence Reports The dollar fell to a record low against the euro and declined versus the yen on speculation economic reports will show U.S. growth is losing momentum, adding to pressure on the Federal Reserve to cut interest rates again.
• U.K. Had Largest August Budget Deficit on Record on Increase in Spending Britain had a larger budget deficit than economists forecast in August as spending jumped, increasing pressure on the government to save money as income from financial services dwindles.
• French Jobless Rate May Be Revised Higher to 9 Percent for Second Quarter French unemployment may have reached 9 percent in the second quarter, more than originally reported, according to a revised estimate by Insee, the national statistics office.