Weekly Wrap

Once again I have been asked to step in for our Head Hen and cover this week's happenings in the market. We miss you Karin, and hope you're keeping those four kids of yours safe on the cobblestone streets in Germany. Go Team USA! Since I just returned from an interview for the General Hospital Fan Club Newsletter promoting the Chick book & website, I thought I would dedicate this column to all you soap watchers! There are several parallels between watching a soap and watching the market. Both can be highly addictive, but if you're a long time viewer, neither needs to be watched incessantly. Thankfully, the TV Guide offers a weekly soap synopsis of the past week's events if you happen to miss those episodes. Think of this column as your weekly TV Guide report on the market. If something major happened, we'll let ya know.no need to set your VCR!

The first bit of news was actually a surprising lack of news. After last Friday's aversion to a Writer's Guild strike, many thought that media stocks might be rewarded with a surge of some sort. As it turns out, there was little to no affect because those companies bottom-lines would not have been affected by a strike. In some cases, the strike might have been seen as a good thing, significantly lowering production costs. Hmmm, once again Main Street's affect on Wall Street fascinates me.

Lay-offs and earnings warnings continued to proliferate with reckless abandon. One such company was computer maker, Dell, announcing plans to lay off 10% of its workforce (roughly 4,000 jobs) to compensate for lowering the price of its personal computers. Fed Ex announced that it will miss their earnings estimates due to the economic climate. (What else do you do with a package that needs shipping?) 3 Com will be cutting 30% (roughly 3,000 jobs) to try to regain profitability and struggling Lucent will cut 16,000 jobs in addition to canceling product lines and shedding businesses to return to profitability. Lucent has really been having a tough time, not only are shares of the #1 US maker of phone equipment down 81%, but this week, the CFO announced her resignation after just one year.

Microsoft announced it will be releasing its new PC operating system, Windows XP, in late October, just in time for the holiday season. Bill Gates says it will be the company's most important release since Windows 95. Plan to see a lot of advertising on this one, as MSFT is spending even more money to promote it. Boeing made a highly anticipated announcement this week, revealing that they will be moving their headquarters to Chicago (despite intense lobbying from Dallas and Denver) ending an 85 year relationship with Seattle.

Finally, there were three Chick holdings making headlines this week, Cisco, General Electric and The Gap. First, Cisco reported earnings, narrowly beating Wall Street's lowered expectations. They warned that sales may continue to fall an additional 10% in the current quarter due to -- all together now -- the economic slowdown! In contrast, GE lit the market with some good news, announcing that they expect their profit for 2001 to be at the upper end of expectations.hallelujah. As for their proposed acquisition of Honeywell International, despite garnering clearance from the US, the European Commission warned that they have objections to the deal. Jeffrey Immelt (GE's new CEO) told Wall Street analysts that this came as no surprise and the deal is far from dead. European regulators have until July 12 to make a final decision. The Gap also had positive market news which sent its stock soaring 12.5%. They expect their quarterly profit to top estimates. Woo Hoo, Chick Megan is doing a jig! Their final results will be announced May 17th, but they credit television advertising for much of their increase.

Retail stocks in general, were thankful for the nice weather conditions in the country, unexpectedly leading people to buy more spring/summer apparel and outdoor gear than anticipated. Of course, some claim, this wasn't necessarily renewed consumer vigor, but merely pent-up demand due to week sales in March. Yuk, remember all that rain in March?

Well, I'm in California and the sun is shining, baby, so I'm going to head on out! Thanks for tuning in, hope you'll join us next week... same Bat time... same Bat channel!

Chick Cheryl

Closing Market Numbers