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This was the worst week for the market since March 2003, due to concerns that the economy may be slowing down. The Dow sank nearly 1.9 percent to 10,087.51, which is the worst percentage loss since March 31, 2003. Besides, the Nasdaq fell 38.56 points to close at 1,908.15, marking a six-month low. Meanwhile, the S&P closed at 1,142.62, after falling 19.43 points.

IBM, the world’s leading computer-services company, dropped $6.94, or 8.3 percent, to $76.70, which shows its largest plunge in three years. Besides, revenue across the services, software and hardware units did not meet the forecasted results in the final two weeks of the quarter. IBM’s quarterly earnings of 85 cents a share disappointed investors that expected a higher return.

Today’s economic reports increased investors’ concerns about the slowdown in the economy. For the first time in six months, production at U.S. factories dropped, and consumer confidence fell to the lowest since September 2003 due to rising gasoline prices. According to the Federal Reserve, industrial production rose 0.3 percent in March, while manufacturing produced fewer goods.

General Motors Corp.’s bonds fell to record levels, after the company said that it will stay within bounds of the four-year contract with United Auto Workers. The carmaker, with $297 billion in debt as of December 31, is trying to restrain health costs that have risen about 33 percent in 5 years. GM has the lowest investment-grade credit ratings from Standard & Poor’s and Moody’s Investors Service.

Among Nasdaq components that posted losses, Workstream fell 52.4 percent, after the company posted a loss $3.6 million, or 8 cents a share. Besides, Extreme Networks fell 11.2 percent, after it posted third-quarter results that fell below expectations. Extreme forecasted fouth-quarter sales of $93 million to $98 million, which is below the estimates of $106 million that analysts expected.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

Investors’ fears of an economic slowdown affected the market’s performance. The Dow fell 125.18 points to close at 10,278.75. Besides, the Nasdaq had the worst performance since October 2004. The technology index closed at 1,946.71, after falling 27.66 points. Meanwhile, the S&P fell 11.74 points to close at 1,162.05.

General Motors Corp.’s stock plumbed 12-year lows, to close at $26.66. The Securities and Exchange Commission subpoenaed relevant information and details concerning transactions with auto-parts maker Delphi, which spun off from GM in 1999. Delphi’s shares lost 16 cents, or 4.1 percent, to close at $3.75.

IBM Corp. said net income rose to $1.4 billion, or 85 cents a share, compared to $1.36 billion, a year earlier. Sales growth in IBM’s Global Services business, which contributed more than half of the firm’s revenue, was only 6 percent, while the unit’s profit fell from a year ago. After the news, IBM shares dropped more than 4 percent to $80.11 in late trading.

The May crude contract closed up 1.8 percent, or 91 cents, at $51.13 per barrel on the New York Mercantile Exchange. This increase in price was due to concerns about U.S. supplies, and investors’ expectations for potential peak in oil prices. The Amex Oil Index was lowered by 1 percent, to close at 828.89 points.

The House of Representatives passed a bill that will make it harder for consumers to clear their debts. Therefore, the bill will make filing for bankruptcy more difficult. According to lawmakers that favored the legislation, consumers will be prevented of abusing the bankruptcy laws by using them to clear debts that they can afford to pay.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

U.S. stocks fell due to a decrease in commodity prices, and a lower-than-expected gain in retail sales, which made investors believe that profit growth may slow more than forecast. The Dow fell 104.04 points to close at 10,403.93. Also, the Nasdaq closed at 1,974.37, after falling 31.03 points, while the S&P fell 13.97 points to close at 1,173.79.

Harley-Davidson shares fell $9.84 to close at $48.93, which is a 52-week low. The company posted a first-quarter profit of $227.2 million, up 11 percent from $204.6 million, a year earlier. Besides, Harley Davidson forecasted 2005 profit to grow 5% to 8%, which is down from its prior forecast of a 14% to 16% increase.

Apple Computer Inc., the maker of the Ipod, said second-quarter earnings soared as the devices increased sales and helped get new customers for Macintosh computers. The company’s net income surged to $290 million or 34 cents a share. Besides, sales rose 70 percent to $3.24 billion. According to Chief Financial Officer Oppenheimer, Apple should post a third-quarter profit of 28 cents a share on revenue of revenue of $3.25 billion.

According to the Energy Department, crude supplies rose 3.6 million barrels during the week ended April 8; meanwhile, gasoline inventories increased by 800,000 barrels. Oil and gas stocks were trading lower these days. Accordingly, the Amex Oil Index was down 1.9 percent to 832.25 points, and the Amex Natural Gas Index was down by 1.5 percent to close at 317.23 points.

Morgan Stanley said today that its top investment bankers Tarek Abdel-Meguid and Joseph Perella would leave the firm. Their resignations are the biggest blow in the battle between Phillip Purcell, the firm’s Chief Executive, and eight former Morgan Stanley’s executives that want to oust him. Michael Uva, head of European Investment Banking, and Cordell Spencer, deputy head of Worldwide Investment Banking, were named co-heads of the Investment Banking Division.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

The minutes of the March 22 Federal Reserve’s policy meeting and falling oil prices influenced the rise in U.S. stocks today. The Dow rose 59.41 points, to close at 10,507.97. Besides, both the Nasdaq and the S&P posted gains. The technology index rose 13.28 points, to close at 2,005.40; meanwhile, the S&P closed at 1,187.76, after rising 6.55 points.

According to the Reserve Open Market Committee, there are still rising, although mild concerns about inflationary pressures. This data shows that there are slim chances that the Fed will tighten aggressively and risk crushing growth. Besides, the February’s trade deficit hit a record monthly high of $61 billion, from an upwardly revised $58.5 billion in January.

The California Public Employees’ retirement System and the California State Teachers’ Retirement System, which own more than 20 million AIG shares, may sue to recover losses of about $400 million from the fall of AIG’s stock. The two pension funds lost about $1 billion from their stakes in Enron and Worldcom and are currently trying to get a compensation of about $2 billion in losses.

Shares of Elan gained 18 percent, or traded up to $4.50 after the company and partner Biogen Idec reported that there has been a reduction in disability progression, which is the rate of clinical relapse and brain lesions in patients with multiple sclerosis. Shares of Biogen Idec were up more than 1 percent, to close at $37.25.

The U.S. government charged 15 New York Stock Exchange specialists with fraud for illegal trading at the Big Board. The indicted specialists are current and former employees of LaBranche & Co., Van der Moolen NV, Bear Wagner Specialists, Goldman Sachs Group Inc.’s Speer Leeds unit and Banc of America Specialist, which are five of the NYSE’s seven specialist firms.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

Today was a mixed day for the market, and rising oil prices added to the weakness of the session. The Dow fell 12.78 points to close at 10,448.56. Besides, the Nasdaq lost more than 0.3 percent or 7.23 points to close at 1,992.12; meanwhile, the S&P closed at 1,181.21, after rising 0.01 points.

According to the Associated Press, Judge Miriam Cedarbaum rejected Martha Stewart’s request of ending her sentence early. Although Stewart claimed that her house arrest was hurting her business, Cedarbaum did not change her sentence. Shares of Martha Stewart Living Omnimedia Inc. fell 14 cents to $20.41 after trading hours.

Maurice Greenberg, former CEO of American International Group (AIG), will use his Fifth Amendment right not to answer questions from prosecutors that are investigating a four-year-old reinsurance transaction with Berkshire Hathaway Inc.’s General Re Corp. AIG said that improper accounting could be the reason for inflated net worth of as much as $1.7 billion over 14 years.

Ford Motor Co. named division chief Steve Lyons as head of North American sales and marketing in order to replace Earl Hesterberg. In the same manner, Darryl Hazel will take over Lyons’ job as Ford Motor Co. vice president and president, Ford division. Nevertheless, Hesterberg’s departure is not related to Ford’s sales decline this year.

The House of Representatives is scheduled to vote on the bill that will make it a lot harder for consumers to avoid repaying debts by filling for bankruptcy. If the House passes the legislation, President Bush has said that he would be eager to sign it. Advocates of the bill say that it will force wealthier debtors to pay back a larger share of their debts.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

U.S. stocks fell since a decrease in the price of oil dragged down energy shares of Chevron Texaco Corp., among other best performers for this year. The Dow fell 84.98 points to close at 10,461.34. Besides, both the Nasdaq and the S&P posted losses. The technology index fell 19.44 points to close at 1,999.35, while the S&P closed at 1,181.20, after falling 9.94 points.

Ford Motor Co. cut its forecast of earnings to $1.25 to $1.50 a share from a previous estimate of $1.75 to $1.95 for the year 2005. Also, it announced that it will not be able to reach a 2006 profit target of $7 billion in pretax profits due to health care cost and the increasing prices of gasoline. Therefore, S&P cut the outlook on Ford debt to “negative” from “stable”.

Comcast Corp. and Time Warner Inc. agreed to buy Adelphia Communications Corp. for about $18 billion in cash and stocks. According to the Wall Street Journal, the two biggest U.S. cable-television operators offered $12 billion in cash and about $5.6 billion in stock that would be issued in a new company created out of Time Warner’s cable unit and Adelphia Communications.

Crude for May delivery ended down 79 cents, which is 1.5 percent, to close at $53.32 a barrel. This way, crude-oil futures closed lower for a fifth consecutive session. Besides, the Amex Natural Gas Index was down 1.9 percent at 325.22.

Although the price of gas lowered, trucking stocks suffered a broad sell-off. Today, Yellow Roadway Corp. said that it was committed to its $1.47 billion acquisition of USF Corp. But, USF warned that first –quarter income would be less than analysts’ expectations. Therefore, shares of Yellow fell 7.9 percent to $54.45, and shares of USF fell 5.8 percent to $45.67.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

Today, U.S stocks rallied mainly due to a decrease in the price of oil, and a higher-than-expected return from Alcoa Inc. The Dow climbed 60.30 points to close at 10,546.32. Besides, both the Nasdaq and the S&P posted gains. The Nasdaq rose 19.65 points to close at 2,018.79, meanwhile the S&P closed at 1,191.14, after rising 7.07 points.

Among Dow components that posted gains, Alcoa Inc. rose $1.40, or about 5 percent, to close at $31.47. The company reported a net income of $260 million for the first quarter, which is down from $355 million a year earlier. Besides, revenue rose 13 percent to about $6.3 billion, from $5.7 billion last year. This shows an improvement to continued solid global demand for primary metals, and high aluminum prices.

Crude oil for May delivery plunged $1.74, or 3.1 percent, to close at $54.11 a barrel on the New York Mercantile Exchange, which is the lowest price since March 30. Also, gasoline for May delivery fell 9.12 cents to close at $1.568 a gallon in New York, which represents the lowest close since March 17. According to an economic report, U.S. gasoline production rose 424,000 barrels a day to 8.6 million barrels.

According to a report published by the Federal Reserve, the amount of consumer debt outstanding rose by $5.5 billion in February. Besides, economic data showed that there was a slowdown in job growth since February. Finally, the Labor Department reported that jobless claims dropped to 334,000.

Shares of Wall-Mart fell 60 cents to $48.90, after a report showed that the company’s first-quarter earnings would fall to 56 cents a share. Besides, March same-stores sales at Wall-Mart and other retail chains were negatively impacted by bad weather and higher gas prices. Consequently, the S&P Retail Index lost 1.79 to 426.18.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

Today, the Dow rose due to a drop in bond yields, and a decrease in the price of oil. However, shares of Dell Inc. lowered the Nasdaq. The Dow climbed 27.56 points to close at 10,486.02. Nevertheless, the Nasdaq fell 0.18 points to close at 1,999.14, while the S&P rose 2.68 points to close at 1,184.07. Crude oil for May delivery ended the day 0.3 percent lower at $55.85 a barrel in New York.

MCI Inc. finally decided to accept Verizon’s bid, after Qwest Communications International refused to raise its $8.94 billion bid. However, MCI still needs to persuade investors that Verizon is a better partner for the company. MCI said it rejected Qwest’s offer because of “negative sentiment” among its customers toward a Qwest deal.

Dell, the world’s largest computer maker, announced that it is sticking with its financial targets for the first quarter, calling for earnings of 37 cents a share, and sales of $13.4 billion. Dell said that it expects to repurchase $2 billion of its stock during a period that ends in April. Now, Dell will increase competition with Hewlett-Packard, IBM, and Sun Microsystems.

General Motors added 82 cents to close at $29.86. The company has fallen 25 percent this year, and it is one of the worst performers for the Dow. In an attempt to increase sales, showroom visitors across the U.S. will have the opportunity to win one of 58 different car models. The program will start on April 11, and will end on May 31 of this year.

Although the semiconductor sector is struggling, Merrill Lynch’s analyst Joe Osha upgraded five stocks to buy from neutral. These stocks include Altera Corp., AMI Semiconductor, ATI Technologies, Broadcom Corp., and Maxim Integrated Products. Osha expects the chip index to bounce between 380 points and 450 points for the rest of the year.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter

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It was a good day for the market due to a decrease in oil prices. U.S. light crude for May delivery fell 97 cents to settle at $56.04 a barrel on the New York Mercantile Exchange. The Dow rose 37.32 points to close at 10,458.46. Besides, both the Nasdaq and the S&P posted gains. The technology index closed at 1,999.32, after rising 8.25 points, while the S&P climbed 5.27 points to close at 1,181.39.

Among the Dow components, Pfizer Inc. performed the best by rallying 3.7 percent after announcing a cost-cutting plan aimed at saving $4 billion over the next 4 years. The pharmaceutical also reported that it saw no earnings or revenue growth on tap for 2005; however, it forecasted a double-digit earnings growth in 2006. Pfizer said that it expected 2005 sales to be even with 2004 sales of about $53 billion.

IBM Corp. said that it would begin recording stock-option compensation as part of the expenses it reports. According to IBM, the company said that it made the decision to comply with accounting standards at the Securities and Exchange Commission.

Ratings of debt from General Motors Corp. were Baa3, which is the lowest investment grade, by Moody’s Investors Service. Besides, Ford Motor Co. is being reviewed for a possible downgrade from the ratings company. Moody’s said that both companies are losing U.S. auto-market share while health-care costs are growing, pushing profits lower. Moody’s started to review GM’s ratings on middle March, after the automaker forecasted its biggest quarterly loss since 1992.

Qwest Communications International said it will extend its prior deadline until noon Wednesday to let MCI Inc. publicly respond to its latest acquisition offer. After tomorrow’s decision is made, Qwest said it will pull its bid if MCI does not respond favorably. Today, shares of MCI closed down 7 cents to $25.01. Besides, shares of Qwest fell 4 cents to $3.86. Finally, Verizon shares rose 12 cents to close at $35.77

All the best,
Manuel Jesus-Backus
The Portfolio Crafter