Wednesday, July 29, 2009

7/29/09 am MSFT and Yahoo Near Search Deal

Post #26 The following is brought to you by Intellivest Securities Research, Inc. The following is not intended as advertising by a broker-dealer and is not a research report. Click at the 7/23/09 Blog to find a description of this week's profiled company, AXP American Express Company. AXP closed Tuesday at $27.68 -0.70 or 2.47% on volume of 19,516,511 NYSE. Fin Times p24 today says AXP Amex's decline of 2.5% to 27.68 was "in the wake of a brokerage downgrade."

A read of Wednesday's 7/29/09 print editions of: Wall Street Journal, Investors Business Daily, Financial Times, USA Today, and Atl Journal Const yielded the following stories about Dow Jones 30 component companies:

The current divisor for the Dow found at today's page C4 of The Wall St. Jrnl is .132319125 unchanged.

WSJ front page A2 "Microsoft, Yahoo Near Search Deal" says Yahoo and MSFT are close to sealing an Internet search partnership ending a protracted dance and uniting the rivals against Google. MSFT last year made a failed $47.5 billion akeover bid for Yahoo. With this deal, MSFT would final get huge volumes of queries that run through Yahoo's search engine. Yahoo would use MSFT's Bing search engine technology on its own sites. MSFT and Yahoo cmbined accounted for less than half of Google's 65% share of searches in the US market in June. MSFT handled 8.4% of searches in June and Yahoo accounted for around 20%.

WSJ pB4 "GE Says Efforts on Course to Shrink Finance Unit, Post Profit" says GE said it is on track to post a profit for the year with the help of tax breaks despite growing losses in Britsh mortgages and commercial real estate. GE said GECC won't need additional capital this year or next. GE said they project for GECC to report profit of $2 billion this year; for the first six months, GECC had profits of $1.1 billion. WSJ pC14 "Overhead" says GE Capital head Mike Neal gave an analyst call yesterday that was shorter than one in March that took more than 5 hours. Related story at Fin Times p15 "GE finance arm reassures its investors" and Inv Bus Daily pA2. NYT pB2 "No Breaks Needed for GE Capital" says GECC has $25 billion of receivables due from American consumers.

WSJ pB6 and AJC pA8 says IBM will acquire SPSS Inc. a Chicago based copany that makes software to help businesses spot future trends as well as shifts in consumer patterns and behavior for $1.2 billion. WSJ story says this month INTC Intel closed an $884 million acquisition of software maker Wind River Systems Inc. The IBM acquisition is also noted at WSJ pC5 "Small Stock Focus" and front page and pA4 of Inv. Bus. Daily, at NYT pB3, and USA Today p4B.

WSJ pC1 "Stocks Pause After Run Up as Oil Falls" says the Dow Jones Industrial Average slipped yesterday due to declines in XOM Exxon Mobil and CVX Chevron and similar theme at pC5 "Large Stock Focus" "Exxon, BP Decline; Aetna Bounces Back."
Similar theme at Fin Times p24 "Technology a bright spot as energy and utilities fall back" that notes the IBM acquisition of SPSS and also AXP Amex's decline of 2.5% to 27.68 in the wake of a brokerage downgrade. Story also notes a bright spot in the Dow was GE being up 1.6% to 12.52 because it said its finance unit doesn't need more capital. Similar theme at NYT pB7 "Wall St. Ends a Cautious Day Mixed" saying XOM Exxon Mobil led the markets lower as oil prices stumbled falling $1.15 to 67.23 a barrell.

WSJ pC5 "Options Report" "Traders Tinker With Pfizer, Merck to Lock in Gains" says option traders adjusted positions in PFE and MRK as shares in these issuers gave back some recent gains.

WSJ pC5 "Merrill, UBS Are Fined in Closed End Fund Case" says FINRA fined Merrill, now owned by BAC BofA and UBS AG a combined $250,000 for supervisory failures that led to unsuitable short term sales of closed end funds purchased at the funds' ipo's.
Fin Times p15 "BofA defends plan to close branches" says BAC plans to shrink its network of more than 6,100 retail branches in the US.

USA Today p1B "BofA paying Parmalat $100M over suits" says BAC will pay this amount to settle lawsuits surrounding the Italian dairy company's bankruptcy in '03. Lawsuit alleged that BAC knew of Parmalat's financial troubles while selling Parmalat's bonds.

JPM JPMorgan Chase will become the lead underwriter in a $550 Million offering by Vornado Realty Trust that would qualify for TALF funds per a story at WSJ pC6.

Inv Bus Daily pA5 "Qualcomm, Verizon in Machine to Machine wireless Venture" says Verizon Wireless, a venture of VZ Verizon communications and Vodafone has formed a joint venture with Qualcomm to offer m2m wireless services to companies in sectors such as health care, manufacturing and utilities. For example, a utility could remotely monitor power usage at homes without visiting them.

Inv Bus Daily "3M in Small Club of firms Raising Payout 50 Years" says MMM is only 7% off a 52 week high after recently finding support at its 50 day moving average. Story mentions PG procter & Gamble and MMM has only a few issuers that has raised its dividend for more than 50 straight years. In Feb, MMM nudged its quarerly payout from 0.50 per share to 0.51 yielding 2.9% without a payout ratio of 49% of estimated '09 earnings. IBM closed at 117.28.

Front page of NYTimes main section has a story "Wooing a Federal Agency with Billions to Invest" says JPM Morgan, Blackrock and Goldman were disqualified after winning a bid to manage $50 billion of retirement funds for Pension Guarantee Benfit Agency due to irregularities in the bidding process.

Finally, AJC pA7 "coke is it on NWA flights" says Nortwest is changing from Pepsi to KO Coke now that Delta has absorbed Northwest.


Tuesday's Dow closing numerator was 1203.67 down 1.56 from Mondays's Dow closing numerator of 1205.23. This is the sum of all 30 closing prices. A short cut to the Dow numerator is to multiply the closing Dow by the Divisor.

Now, if you divide the Dow numerator decrease of 1.56 by the divisor you get 11.79, the decrease in Tuesday's Dow numerator.

The average closing price (the closing numerator divided by 30) of Tuesday's Dow Jones was 40.12 down .05 from Monday's average closing price of 40.17. The median closing price of Tuesday's Dow Jones was 40.49 up 6.04 from Monday's Dow Jones median closing price of 34.45.

The highest closing price Tuesday was IBM $117.28 -0.35 0.3% 5,747,369 NYSE and the lowest closing price Tuesday again was Alcoa AA $11.26 -0.04 0.35% 32,274,587 NYSE.

The lowest volume Tuesday was again TRV Travelers $43.35 -0.19 0.44% 3,305,278 NYSE and the highest volume was BAC BofAm $13.34 +0.25 1.91% 240,783,873 NYSE.

If Tuesday morning before the market opened you had purchased $100 of each of the Dow 30 shares (assuming you could buy fractional shares and assuming no transaction costs) and sold at the close you would have lost $150 ($120,510 - $120,360).

Tuesday's Closing Dow closing numbers:
Symb/Last/Change/% Change/Vol./Market

T $25.52 -0.21 0.82% 24,556,906 NYSE
AA $11.26 -0.04 0.35% 32,274,587 NYSE
AXP $27.68 -0.70 2.47% 19,516,511 NYSE
BAC $13.34 +0.25 1.91% 240,783,873 NYSE
BA $43.25 +1.01 2.39% 7,830,640 NYSE
CAT $42.9 +0.04 0.09% 16,692,615 NYSE
CVX $68.34 -0.51 0.74% 10,768,638 NYSE
CSCO $21.93 +0.09 0.41% 39,981,298 NASDAQ-GS
KO $49.39 -0.13 0.26% 8,039,133 NYSE
DIS $26.37 -0.08 0.3% 10,791,425 NYSE
DD $30.1 -0.26 0.86% 8,731,556 NYSE
XOM $71.89 -0.86 1.18% 22,999,164 NYSE
GE $12.52 +0.20 1.62% 105,449,604 NYSE
HPQ $41.98 +0.14 0.33% 11,604,479 NYSE
HD $25.39 +0.23 0.91% 11,669,821 NYSE
INTC $19.37 -0.10 0.51% 59,987,096 NASDAQ-GS
IBM $117.28 -0.35 0.3% 5,747,369 NYSE
JPM $38.08 -0.05 0.13% 28,993,257 NYSE
JNJ $60.92 -0.35 0.57% 8,994,013 NYSE
KFT $28.47 +0.21 0.74% 7,221,452 NYSE
MCD $56.47 +0.50 0.89% 8,722,862 NYSE
MRK $30.02 -0.75 2.44% 22,543,752 NYSE
MSFT $23.47 +0.36 1.56% 70,226,438 NASDAQ-GS
PFE $16.03 -0.59 3.55% 75,239,509 NYSE
PG $55.71 -0.07 0.13% 8,137,074 NYSE
MMM $69.88 -0.03 0.04% 4,391,745 NYSE
TRV $43.35 -0.19 0.44% 3,305,278 NYSE
UTX $52.44 +0.33 0.63% 5,224,779 NYSE
VZ $31.4 +0.40 1.29% 16,819,492 NYSE
WMT $48.92 -0.05 0.1% 11,801,535 NYSE