Jim Cramer Blog

After six days of climbing, the S&P 500 was down today, along with the Nasdaq and Dow. Stocks were affected by a scare that the Fed might be preparing to raise interest rates again for the first time since last June. Fed Chairman Ben Bernanke, speaking via satellite at an international money management conference in South Africa, suggested that the economy was set to rebound even though the housing slump might continue for some time. Coupling that with the news from the Institute for Supply Management (ISM) and there were concerns that rates might be on their way up.

The ISM released its May index of business activity in the non-manufacturing sector. The new reading of 59.7 beat both April's number and Wall Street expectations of 56. New orders were at 57.4 and employment was at 54.1, both up from April. Numbers higher than 50 indicate expansion, while numbers lower indicate contraction.
After yesterday's meeting with News Corp (NYSE: NWS) Chairman Rubert Murdoch, the Independent Association of Publisher's Employees, which is the union that represents Wall Street Journal employees, has reached out to other potential buyers. One surfaced as billionaire investor Ron Burkle has indicated that he might be interested in purchasing Dow Jones (NYSE: DJ). Union president Steve Yount indicated that Burkle was the first person to respond, but that overtures were made to a few potential buyers.
Avaya (NYSE: AV) has agreed to a buyout from TPG Capital and Silver Lake Partners. The total value of the sale is $8.2 billion, or $17.50 per share. This deal has been in talks for some time, and while it is no surprise that it has come to fruition, there was speculation about when the offer would be made.
Housewares retailer Bed Bath and Beyond (Nasdaq: BBBY) lowered its guidance for the quarter, saying that a consumer spending drop-off was responsible for the company failing to meet expectations for the first time since it went public in 1992. In today's announcement, Bed Bath and Beyond released earnings expectations of 36-38 cents per share, down from the 39 cents it said was "reasonable" on its previous conference call. While the company said that same-store sales would be up, the growth is now only expected to be 1.6% instead of the 3-5% previously suggested.
Amazon.com (Nasdaq: AMZN) shares rose 4.6% after the company said it would increase its investment in Chinese Internet company Joyo.com. Proctor & Gamble (NYSE: PG), meanwhile, rose 0.46% after it reiterated its previous guidance.

By the BullMarket.com Staff

Labels: AMZN, AV, BBBY, DJ, NWS, PG

By the BullMarket.com Staff
The Dow, Nasdaq, and S&P 500 all started the week up despite some concerns that China and the factory orders report would drive U.S. stocks down. New highs again marked the close of both the Dow and S&P 500, and all three indices are on track to post their best quarter in at least three years. Stocks in Shanghai took another tumble as the government continues to try and control the stock market. The Shanghai Composite Index dropped -8.3% overnight, but the effect seemed minimal as most other Asian markets closed up, including five record highs. Factory orders grew in April, but the gains were weaker than expected. New orders increased by only 0.3%, which was the smallest gain in three months. Analysts had expected gains of up to 0.8%. While the overall gains were weak, analysts were encouraged by the 2.1% growth for non-defense capital goods excluding aircraft. This sub-metric is considered a good read on business investment.

M&A news once again dominated the headlines. Palm Inc. (Nasdaq: PALM ) signed a deal with private equity firm Elevation Partners for the firm to buy 25% of the smartphone manufacturer. As part of the deal, two Palm executives will resign and shareholders will receive a special $9 per share distribution. Analysts have noted that Palm is facing more competition in the smartphone market lately and it will only get worse as Apple's (Nasdaq: AAPL) iPhone prepares to release at the end of the month. Palm is also adding former Apple hardware engineer Jon Rubenstein to its board as executive chairman. Mr. Rubenstein has settled with the SEC in an investigation surrounding his role in Apple's backdating issues. He paid a fine without admitting guilt. Mr. Rubenstein most notably ran the iPod division from 2004-2005.
Private equity fund Lone Star V LP has entered into an agreement to buy Accredited Home Lenders (Nasdaq: LEND) for $15.10 per share, or a total of approximately $400 million in cash. This is a 10% premium over the stock's Friday close of $13.76. Accredited offers loans to high-risk borrowers, more commonly known as subprime mortgages. This industry, of course, recently suffered a well-publicized collapse.
Telecommunications equipment company Avaya (NYSE: AV), meanwhile, is said to be near closing its deal with private equity firms TPG Capital LLP and Silver Lake Partners. While the deal is not finalized and Avaya could still fall to another suitor, the private equity group seems to be in the leading position.
News Corp (NYSE: NWS) Chairman Rupert Murdoch met with the Bancroft family, who own a controlling interest in Dow Jones (NYSE: DJ), publishers of the The Wall Street Journal. The Bancroft family has been reluctant to meet with Mr. Murdoch, who has made overtures of late trying to buy the company. While the family has been reluctant to sell its stake, this meeting may represent a warming towards the purchase.
According to reports, American Express (NYSE: AXP) is planning to sell its private banking unit within the next one to two weeks. The unit could be worth between $1 and $2 billion. While no suitors have been named publicly, analysts believe that a large international bank could be the purchaser.
Struggling Puerto Rican lender Doral (NYSE: DRL), who last month agreed to be bought out by a private equity fund run by Bear Stearns (NYSE: BSC), has received a rival bid. Privately held FBOP Corp. has made an offer of $1.41 per share in order to take an 80% stake in the lender. This is more than twice what Bear Stearns offered in May.

Labels: AAPL, AV, AXP, BSC, DJ, iPhone, LEND, NWS, PALM

Lower volume marked the beginning of the summer, as the Dow, S&P 500, and Nasdaq all closed up. Gold and silver were up, while oil, on news that the Nigerian oil workers' strike was over and a new president sworn in, fell more than -$2. While last week's reports showed that both new and existing home inventories are up, year-over-year prices dropped almost -1.5% from Q1 2006 according to the S&P/Case-Shiller Home Price Index. Consumers, meanwhile, continue to remain confident, with the Consumer Confidence Index for May coming in a better-than-expected 108.0.

The news continued to be dominated by discussion of M&A activity. Alcan (NYSE: AL) and Alcoa (NYSE: AA) are at the center of a maelstrom of speculation following the latter's failed attempt to purchase the former. Some analysts are now predicting that Alcan will reverse the tables and try to make a bid for Alcoa. Theories are being tossed around as to whether there are other potential buyers for either company, as demonstrated by the fact that Alcoa options for July have risen.
The FTC opened an investigation today, examining the proposed Google (Nasdaq: GOOG) acquisition of DoubleClick. The deal, which is worth approximately $3.1 billion, was originally criticized by competitors Microsoft (Nasdaq: MSFT ) and Yahoo (Nasdaq: YHOO), but both companies have since made moves that mimic Google's purchase. Representatives from Google have stated that they expect the deal to fly through the regulatory phase and be approved by year's end.
Apartment REIT Archstone Smith (NYSE: ASN) has agreed to be acquired by Tishman Speyer and Lehman Brothers (NYSE: LEH) in a deal estimated at $22.2 billion. The buyers have agreed to acquire Archstone for $60.75 per share in cash, a premium of 22.7% on May 24th, before news of the deal broke.
Avaya (NYSE: AV - News) is reportedly beginning the process of putting itself on the market and speaking with potential suitors. So far, the company is speaking both with Silver Lake Partners, a private equity firm, and Nortel Networks (NYSE: NT - News), a technology company. The company seems to be a promising target for a buyout based on its lack of debt and high level of cash flow. The stock finished up 15.3%.
Barclay's (NYSE: BCS ) may have some competition in its purchase of ABN Amro (NYSE: ABN). The Royal Bank of Scotland is reportedly making a move to purchase the smaller investment bank, offering more than Barclay's. While ABN Amro does not seem interested in pursuing the RBS deal, the would-be suitor is threatening to bring the deal straight to the shareholders if it feels that management does not give it enough attention.
VeriSign (Nasdaq: VRSN) announced today that Stratton Sclavos has resigned as CEO of the company, but no reason was given for the move. William Roper, Jr., a former independent director, has been named as CEO and president. VeriSign has also postponed an analyst call that was scheduled for June 6th.

By the BullMarket.com Staff

Labels: AA, ABN, AL, ASN, AV, BCS, GOOG, LEH, MSFT, NT, VRSN, YHOO

Wall Street backtracked Tuesday to trade mixed, after excitement waned over new takeover deals and resilient consumer confidence and investors decided to play it safe ahead of upcoming data.
A sharp decline in oil prices also dampened energy company stocks and weighed on the Dow Jones industrial average, which had risen more than 50 points early in the day and later turned lower.
Initially, stocks rose after a consortium of banks led by Royal Bank of Scotland PLC said it will bid 71.1 billion euros, or $95.5 billion, for the Netherlands' ABN Amro, besting an offer from Barclays PLC. Other takeover news included an announcement that Tishman Speyer Properties and Lehman Brothers Holdings Inc. are buying Archstone-Smith Trust for at least $13.5 billion.
But with the minutes from the Federal Reserve's last meeting scheduled to be released Wednesday, a report that could provide some insight into future interest rate moves, investors pulled back. Wall Street also digested strong consumer confidence data, and a report on housing prices. By midafternoon trading, the Dow slipped 18.37, or 0.14 percent, to 13,488.91. The blue-chip index has fallen for the fifth time in six sessions.
Broader stock indicators were mixed. The Standard & Poor's 500 index fell 0.76, or 0.05 percent, to 1,514.97, while the Nasdaq composite index added 7.32, or 0.29 percent, to 2,564.51.
Bonds fell after the consumer confidence data, with the yield on the benchmark 10-year Treasury note rising to 4.88 percent from 4.86 percent late Friday. Yields have remained higher in recent sessions as fixed-income investors bet the Fed won't lower rates in the near future. On Tuesday, the consumer appeared strong; the Conference Board said its Consumer Confidence Index rose to 108.0 in May, up from a revised 106.3 in April and above the average analyst estimate. Also, the Dallas and Chicago Federal Reserves both reported expansions in regional manufacturing activity.
But the housing sector looked weak after the Standard & Poor's housing index indicated that U.S. home prices declined 1.4 percent in the first quarter compared to a year ago, the first time since 1991 that prices posted a quarterly drop. U.S. retail gasoline prices have eased slightly from their record high of $3.227 a gallon, on average, but remained high Tuesday at $3.201, according to AAA. Crude oil futures plunged $2.05 to $63.15 a barrel on the New York Mercantile Exchange.
In response, Exxon Mobil Corp., one of the 30 Dow components, fell $1.33, or 1.6 percent, to $82.18.
After it was reported that Archstone was being bought, the stock rose $5.60, or 10 percent, to $60.83.
In other takeover news, The Wall Street Journal said technology retailer CDW Corp. and telecommunications equipment company Avaya Inc. are private equity takeover targets. Avaya rose $1.99, or 14.5 percent, to $15.66, and CDW rose $7.17, or 9.5 percent, to $82.73.
And late Monday, engineering and construction company URS Corp. said it will buy competitor Washington Group International for $2.6 billion. Washington Group rose $11.93, or 17 percent, to $81.90, and URS rose $2.41, or 5.1 percent, to $49.30.
The technology sector, which has been weaker than the rest of the stock market in recent months, got a boost Tuesday after Vodafone Group PLC said it narrowed its full-year loss. U.S. shares of the world's biggest mobile phone company rose $1.10, or 3.7 percent, to $31.66.
Bookseller Borders Group Inc. is scheduled to release first-quarter results Tuesday after the markets close. Borders fell 15 cents to $23.26.
Advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where volume came to 1.11 billion shares.
The Russell 2000 index of smaller companies was up 5.30, or 0.64 percent, at 835.23.
The dollar slipped against other major currencies, and gold prices climbed.
Overseas, Japan's Nikkei stock average rose 0.48 percent. Britain's FTSE 100 was up 0.55 percent, Germany's DAX index was up 0.54 percent, and France's CAC-40 was down 0.25 percent.

Source: AP

Labels: ASN, AV, BCS, CDWC, LEH, URS, VOD, XOM

Symbol
Name
Last Trade
Change
Volume
Related Info
CTCI
CT COMMUNICATIONS
31.31 2:13PM ET
9.73 (45.09%)
1,380,559

SCOX
SCO GRP INC (THE)
1.58 2:04PM ET
0.41 (35.04%)
1,451,125
TATTF
TAT TECH LTD
20.39 2:12PM ET
3.77 (22.68%)
442,550

BDY
BRADLEY PHARMACTCL
22.65 2:08PM ET
4.21 (22.83%)
2,054,513
CLN
CELSION CORP
6.64 2:01PM ET
0.84 (14.51%)
379,000
WNG
WASHINGTON GRP INT#
82.74 2:08PM ET
12.77 (18.25%)
2,590,900


SMTX
SMTC CORP
4.47 2:13PM ET
0.59 (15.21%)
787,417
TGM
TARGETS TRUST XXV
7.25 11:06AM ET
0.95 (15.08%)
2,000

ARCI
APPLNC RCYCL CT AMER
4.19 2:12PM ET
0.54 (14.79%)
3,400
AV
AVAYA INC
15.69 2:08PM ET
2.02 (14.78%)
40,383,563

ADG
ALLIED DEFENSE GROUP
9.17 1:48PM ET
1.14 (14.20%)
74,300

INSP
INFOSPACE INC
23.74 2:13PM ET
3.15 (15.30%)
3,591,181

ACEL
ALFACELL CORP
2.42 2:13PM ET
0.29 (13.62%)
435,773

LPTH
LIGHTPATH TECH INC
5.69 2:13PM ET
0.68 (13.57%)
28,074

NSHA
NASHUA CORP
9.91 1:49PM ET
1.09 (12.36%)
35,308

SHMR
SHAMIR OPTICAL INDUS
10.10 1:54PM ET
1.10 (12.22%)
29,267

Labels: ACEL, ADG, ARCI, AV, BDY, CLN, CTCI, INSP, LPTH, NSHA, SCOX, SHMR, SMTX, TATTF, TGM, WNG