US HOT STOCKS: Morgan Stanley, GM, Ford Reliant Energy
By Daniel at 13 October, 2008, 10:36 am
US HOT STOCKS: Morgan Stanley, GM, Ford Reliant Energy
Last Update: 10/13/2008 10:32:49 AM
Among the companies whose shares are actively trading in Monday’s session are
Morgan Stanley (MS), General Motors Corp. (GM) and Reliant Energy Inc. (RRI).
Morgan Stanley ($13.96, $4.28, 42.67%) was able to close a $9 billion deal under
revised terms that will still give Mitsubishi UFJ Financial Group Inc. (MTU,
$7.27, $0.62, 9.32%) a 21% stake in the company, despite the investment bank’s
stock having dropped 61% from where it had closed before the deal was announced.
Morgan Stanley shares sank nearly 60% last week on concerns about whether the
deal would be completed.
General Motors ($6.04, $1.15, 23.31%) has had merger talks with both Chrysler LLC
and Ford Motor Co. (F, $2.40, $0.42, 20.60%) in recent months about a possible
merger, signaling the intense pressures mounting on the U.S. auto industry to
restructure amid a deep slump in sales. Shares of GM and Ford were pummeled last
week.
Reliant Energy (RRI, $4.82, $1.75, 57.00%) entered a definitive agreement to sell
$350 million in convertible preferred stock to First Reserve Corp. Shares of the
power producer tumbled last week amid the financial-market woes and as the
company said it might lose an advantageous credit arrangement.
U.K. banks including Royal Bank of Scotland Group PLC (RBS, $1.08, -$0.37,
-25.52%) and Lloyds TSB Group PLC (LYG, $10.38, -$2.12, -16.96%) slumped as
traders said income funds were selling positions since many of the banks won’t
issue dividends after the U.K. government recapitalizes them.
Infineon Technologies AG (IFX, $4.19, $0.53, 14.48%) rose as the pressure to find
a short-term solution for its Qimonda AG (QI, $0.97, $0.14, 16.89%) stake eased
after the memory-chip unit sold its stake in Inotera Memories Inc. (3474.TW) for
$400 million.
Apparel retailer New York & Co. (NWY, $4.60, -$2.65, -36.55%) now sees a fiscal
third-quarter loss because same-store sales have come in much lower than
expected.
Chesapeake Energy (CHK, $19.44, $2.29, 17.68%) announced plans to generate $2.5
billion to $3 billion in the fourth quarter on the sale of its 25% interest in
the Marcellus Shale in Appalachia. The company also said it will further reduce
its drilling budget by $1.5 billion in 2009 and 2010.
Principal Financial Group Inc. (PFG, $21.70, $3.51, 19.29%) projected
third-quarter operating earnings in line with analysts’ estimates as it sought to
reassure worried investors about how it is holding up amid the credit crisis.
Tesoro Co. (TSO, $9.93, $1.57, 18.58%) expects third-quarter earnings above
analysts’ expectations on improved margins and decreased energy costs. The
independent oil refiner’s shares had lost almost half their value in October.
Waste Management Inc. (WMI, $29.10, $3.34, 12.97%) pulled its $6.73 billion
takeover offer for Republic Services Inc. (RSG, $23.58, $1.08, 4.80%), citing the
financial-market woes, as it projected troubled markets, and forecast
third-quarter results above analysts’ expectations. That clears the way for
Republic’s $6.24 billion acquisition of Allied Waste Industries Inc. (AW, $9.94,
$1.40, 16.39%).
Other Stocks In Focus
AT&T Inc. (T, $23.56, $1.13, 5.04%) agreed to sell its U-verse broadband service
at Circuit City Inc. (CC, $0.43, $0.05, 13.51%) and Wal-Mart Stores Inc. (WMT,
$51.95, $1.00, 1.96%), making the company’s services available at more than 600
stores in its first push to sell the service at retail outlets.
Boston Scientific Corp. (BSX, $8.53, $1.22, 16.55%) said its co-founders were
forced to sell 31 million shares last week as part of margin calls and that more
selling could occur in the next several weeks. Boston Scientific’s shares fell
13% on Friday amid the involuntary sales.
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