article

Stock Watch

Posted: 11/2000

Stock Watch

Stocks Hammered by High Energy Costs

The U.S. market dropped at the end of our trading session (Sept. 15),
clobbered by worries that sharply higher oil prices will eat into corporate
profits.

Europe’s weak single currency, the euro, added to concern about the future
course of earnings.

"You are going to see earnings come in a little bit softer than expected
for the multinationals," said Larry Rice, chief investment officer at
Josephthal Lyon & Ross Inc. "You are going to see the cost of energy,
labor, benefits–all that–cutting into the bottom line." Inflation data
did little to encourage investors in the face of spiking oil prices during the
trading period. And the markets rode out volatile "triple
witching"–the expiration of stock options, index options and futures that
came due.

The Dow Jones Industrial Average slid 140.00 points, or 1.27 percent, to
close at 10927.00. In contrast, the PHONE+ Stock Index jumped 383.36 points, or
9.48 percent, and closed at 4427.89. Advancing issues overtook declining issues
68 to 61.

Level 3 Communications Inc. (www. level3.com)
was our top dollar gainer after the company announced a new service offering
telephone-quality voice communication over the Internet. The service, which will
be offered in Chicago, Denver, Los Angeles and New York later this year, will
let customers place calls using their computers and Internet phones. Level 3
added 12.75 points, or 20.63 percent, to close at $74.56.

Shares of Intermedia Communications Inc. (www.intermedia.com)
bounded ahead after news that WorldCom Inc. (www.wcom.com)
will purchase Intermedia in a stock deal valued at $3 billion. WorldCom also
will assume $3 billion in debt. In the transaction, each share of Intermedia
will be traded for $39 in WorldCom stock. Intermedia gained 12.44 points, or
75.67 percent, and ended at $28.88. The company was our top percentage gainer.

ICG Communications Inc. (www. icgcomm.com)
fell following a downgrade, and dropped 3.34 points, or 46.12 percent. ICG ended
at $3.91, and was our top percentage loser.

icon.gif (618 bytes)
Chart: Service to Service


Leave a comment

Your email address will not be published. Required fields are marked *

The ID is: 68747