Message-ID: <12516915.1075845228688.JavaMail.evans@thyme> Date: Thu, 7 Jun 2001 16:21:09 -0700 (PDT) From: stocktalk@netstocks.com To: alewis@enron.com Subject: Internet Stock News: Renewed Signs of Economic Weakness Mime-Version: 1.0 Content-Type: text/plain; charset=ANSI_X3.4-1968 Content-Transfer-Encoding: 7bit X-From: Internet Stock News @ENRON X-To: alewis@enron.com X-cc: X-bcc: X-Folder: \Lewis, Andrew H.\Lewis, Andrew H.\Inbox X-Origin: LEWIS-A X-FileName: Lewis, Andrew H..pst INTERNET STOCK NEWS [tm] http://www.netstocks.com ISN Weekly - 06/7/01 ______________________________________________________________________ TABLE OF CONTENTS 1. Internet Stock Outlook 2. In the News 3. Insight of the Week 4. Earnings News 5. CEO Talk ------------------------------------------------------------ EUROTECH (AMEX:EUO) LAUNCHES AD ON CNBCTV EUROTECH's revolutionary encapsulant EKOR(TM) created for Chernobyl's containment problems has many worldwide nuclear industry applications and is solving the "NOT IN MY BACKYARD" issue now plaguing DOE cleanup programs. To read more visit www.ibc.tv ------------------------------------------------------------ 1. INTERNET STOCK OUTLOOK By Jerry Yeung Rising five of the past six sessions, the Nasdaq Composite Index pulled within striking distance of its May 22 peak of 2328.05. For the week, the tech-heavy index has risen 114.56, or 5.3%, to close at 2264 Thursday - hurdling resistance at 2250. All the while, the market has ignored renewed signs of economic weakness and more warnings on the corporate front. Instead, investors focused on the increased likelihood of more interest rate cuts and shadowy signals that the worst of the downturn may have passed. Confirming economic weakness alluded to in April durable goods orders, new and existing home sales and purchasing managers' data for May, Tuesday's numbers showed April factory orders fell a bigger-than-expected 3.0% and first-quarter productivity was revised lower to minus-1.2%. 25-Basis Point Cut Expected at Next Meeting In response to such weakness, the futures market has priced in a 100% chance of a 25-basis point cut in interest rates when the Federal Open Market Committee (FOMC) meets June 26 and 27. The market is giving just slight consideration to a 50-point cut - likely in recognition of the 250-points already slashed from the Fed funds rate since the beginning of the year. Which leads us to a big reason for the market's recent rally. Flooded with "cheap" money, investors appear willing to bet on a recovery in the second half of the year - evident as they latch on to suggestion of the sort, while ignoring blatantly negative warnings. Two such examples of this were chipmakers Broadcom (BRCM) and National Semiconductor (NSM), both rallying after dismal earnings warnings Thursday. Both noted signs of stabilization and hopes for a turnaround later this year. Ailing telecom-equipment maker Lucent Technologies (LU) was an unlikely tech giant reaffirming third-quarter guidance Tuesday, while semiconductor kingpin Intel (INTC) reiterated its second-quarter guidance and predicted "?a seasonally stronger second half" on Thursday. With the market apparently ready to take on the second-quarter earnings warning season, the notion that Wall Street usually gears down for the summer months may prove untrue - analogous to how many expected the market to outperform during the winter months. Chip Stocks Expected to Take the Lead Thursday's exceptional strength among chip stocks, which powered the Philadelphia Semiconductor Index up nearly 8% to just under 700 - a key resistance level - may provide clues as to where the market goes from here. It is generally accepted that movements in the chip sector lead the broader market moves by about a month and the broader market leads the economy by about six months. While few believe that stocks are ready to return to their heights, overly cautious strategies may miss some steady gains. Next Week The economic calendar is fairly heavy, with the May retail sales figures scheduled for release Wednesday, the May Producer Price Index (PPI) Thursday and the May Consumer Price Index (CPI), capacity utilization and industrial production numbers on Friday. Several tech firms are scheduled to check in with earnings. Among them are NaviSite (NAVI), Engage (ENGA), CMGI (CMGI), Leitch Technology (LVID) and Adobe Systems (ADBE). 2. IN THE NEWS Economic calendar: http://www.123jump.com/econ_cal_live.htm Intel Update in Line With Previous Guidance The world's largest chipmaker said it expects "?revenue, gross margin percentage and expenses for the second quarter will be within the previous expectations... on April 17." http://jumpfn.123jump.com/story.htm?news_id=6330937&sid=2 Alcatel Sells DSL Modem Business French telco Alcatel announced this morning that the company will sell its consumer DSL modem business to Thomson Multimedia for $387 million. http://www.123jump.com/story.htm?story_id=11857 China's Legend Confirms Talks With AOL China's largest PC maker Legend Holdings confirmed it is in talks with AOL Time Warner's America Online unit over an "Internet related services" joint venture. http://jumpfn.123jump.com/story.htm?news_id=6329989&sid=2 Excite@Home Foregoes European Ventures Wednesday morning, broadband player Excite@Home announced that it would shut down operations in France, Germany and Spain. http://www.123jump.com/story.htm?story_id=11825 Hong Kong Firms Boost Stake in Priceline.com The troubled e-commerce outfit got a shot in the arm from Hong Kong's richest man Li Ka-Shing, who agreed to purchase about 25 million shares from Priceline founder Jay Walker, through conglomerates Cheung Kong (Holdings) and Hutchison Whampoa. http://jumpfn.123jump.com/story.htm?news_id=6315331&sid=2 UAL to Purchase MyPoints.com United NewVentures, the investment arm of United Airlines, announced Monday morning that it will acquire online marketing company MyPoints.com for $112.5 million. http://www.netstocks.com/story.htm?story_id=11764 3. INSIGHT OF THE WEEK Is Lucent on the Road to Recovery? After facing a raft of poor earnings, mounting debt and failed merger talks with Alcatel, Lucent seems finally to be on the road to recovery. http://ns.123jump.com/story.htm?story_id=11816 Intranet Solutions for All While Intranets may suit large corporations, smaller businesses have found them expensive. Planet Intra offers a solution for both the Davids and the Goliaths of the business world. http://www.netstocks.com/story.htm?story_id=11832 Is the Internet Cut Out for Movies? Online distributor of feature films CinemaNow Thursday announced that it has partnered with Hollywood.com to create a new pay-per-view movie site. http://www.netstocks.com/story.htm?story_id=11791 Dominating the e-Mail Marketing Arena Having acquired MessageMedia, its second acquisition in the e-mail marketing field this year, DoubleClick has asserted its leadership in the e-mail marketing industry. http://ns.123jump.com/story.htm?story_id=11751 4. EARNINGS NEWS Earnings calendar: http://www.123jump.com/p5t.htm Earnings Whispers: http://www.justwhispers.com/ National Semiconductor Reports Break Even Q4 Results The giant chipmaker posted a break-even bottom line, but warned of a wider-than-expected fiscal first-quarter loss. Investors, however, latched onto the company's comment that the worst bookings quarter may be behind. http://jumpfn.123jump.com/story.htm?news_id=6328097&sid=2 Broadcom Expects Shortfall in Q2 Sales The communications chipmaker scaled back its second-quarter revenue expectations, citing persistent tech-sector weakness. The networking-semiconductor maker sees Q2 sales 32% to 35% lower than in Q1. http://www.123jump.com/story.htm?story_id=11844 Hewlett-Packard Warns Of Global Slowdown The tech giant warned that the slowdown in corporate spending on technology products was spreading into Asia and Latin America, turning the company more cautious about its third-quarter sales forecast. http://jumpfn.123jump.com/story.htm?news_id=6325032&sid=2 Amazon Bullish on Outlook Online retailer Amazon reaffirmed its upbeat forecasts to turn a profit on a pro forma basis in the fourth quarter of this year and to be profitable for the full fiscal 2002. http://www.123jump.com/story.htm?story_id=11806 5. CEO TALK Avici Systems "There is no doubt in my mind that the demand for deploying IP cores continues to be very strong." Surya Panditi, CEO - Avici Systems http://www.123jump.com/story.htm?story_id=11714 SimCorp A/S "In Denmark lawmakers are extremely creative and we have been forced over time to implement different accounting schemes ... with five accounting structures in place." http://www.123jump.com/story.htm?story_id=11713 --------------------------------------------------------------- Advertise With Us: For more information about advertising in our email newsletters please visit: http://ns.123jump.com/contact.htm Helpdesk: To unsubscribe or update your settings please visit our online help desk: http://ns.123jump.com/help.htm --------------------------------------------------------------- INTERNET STOCK NEWS (ISN) ? 2001 Read our disclaimer: http://www.netstocks.com/aboutus/disclaimer.asp --- You are currently subscribed to isnweekly as: alewis@enron.com To unsubscribe send a blank email to leave-isnweekly-60870D@newsletter.netstocks.com