Friday market report
While there were strong gains early in the week, profit-taking after recent rallies and fears about upcoming earnings reports led to a fall in the major markets on Wednesday and Thursday.
The DJIA was boosted by positive manufacturing data and news about an increase in the inflation rate on Monday and Tuesday respectively, and gained 200 points from last Friday’s 9117.12, but closed on Thursday at 9179.43.
Meanwhile, the NASDAQ fell from Wednesday’s 13 month hiigh of 1677.14 to 1648.69 on Thursday.
The FTSE also responded well and broke the 4200 barrier on Wednesday, but fell back on Thursday to 4131.5 after news that retail sales had contracted in the UK.
The surge early in the week was led by news that the US Manufacturing Index had reached 26.8 - the highest level since its inception.
Furthermore, talk of a possible reduction in interest rates by 50bps to try and help re-inflate US economic growth fuelled further optimism, and during the week the dollar rose to a monthly high against the Euro, reaching $1.158.
However, Eastman Kodak’s (NYSE: EK) profit warning on Wednesday heralded a negative outlook on the markets, as the company halved its profits forecast for the second quarter, and warned that the negative trend could continue for the rest of the year.
Software manufacturer Peoplesoft (NASDAQ: PSFT) experienced gains fuelled by an increase in Oracle’s hostile takeover bid from USD5.1bn to USD6.3bn, while Oracle (NASDAQ: ORCL) fell on Thursday by 0.60% with the news that Peoplesoft plans to reject its offer on Anti-trust grounds.
Computer services group EDS (NASDAQ: EDS), who employ around 350 people in Ireland, gained nearly 4% on the back of announced restructuring plans.
In London, the UK Competition Commission announced that they were delaying their ruling on the proposed merger of Carlton (CCM.L) and Granada (GAA.L) by two months until August 26, but both companies saw solid increases during the week.
BskyB shares fell amid news that the company may lose some of its rights regarding the broadcasting of English Premiership football by the 2004/05 season due to EU pressure. After heavy falls in Cable & Wireless (CW.L) early in the week, news that Graham Wallace, the outgoing CEO, would receive a reduced severance package, helped to instil some confidence in the share price.
E-learning company Skillsoft (NASDAQ: SKIL), who merged with Irish company Smartforce earlier this year, rose 10.22% on Tuesday with the announcement that revenues for the current quarter had increased to USD43.6m from USD13.8m for the same period last year, although a net loss of USD12.6m was also reported. Skillsoft’s share price was also boosted by news that the company expects total revenues for the year ending 31 January 2004 to be close to USD190m.
