By James Langton
(July 17 – 09:30 ET) – With no major economic data out this morning traders will be looking toward tomorrow’s U.S. CPI report and Fed chair Alan Greenspan’s testimony before the Senate banking committee later in the week.
Earnings will also be in the spotlight this week with a heavy reporting schedule. In Canada the big name today is Alcan, which will be holding a 10:30 ET conference call to discuss its results. In the U.S. many banks will be reporting today, including Citigroup, Fleet Boston Financial, Northern Trust, Bank of America and Bank of New York.
In Europe this morning stocks are generally up, led by chipmakers. Tobacco stocks are sliding on the heels of Friday’s US$144 billion punitive damage award against several cigarette-makers. London’s FTSE is up 29 points to 6,504. France’s CAC 40 has gained 36 points to 6,606. Germany’s DAX is up 69 points to 7,386.
The big M&A news this moning has paper company Georgia-Pacific Group buying Fort James Corp. for US$11.3 billion in cash, stock and assumed debt. As rumoured, General Mills Inc. will buy Diageo plc’s Pillsbury unit for US$10.5 billion in stock and assumed debt. There’s also a deal in the utilities sector, with AES Corp. buying Ipalco Enterprises Inc. for US$3.04 billion in stock and assumed debt.
One rumoured deal is off. Global Crossing Ltd. was reportedly in discussions with Exodus Communications Inc. to sell its GlobalCenter Web-hosting unit for US$6.6 billion in stock.
In other news OPEC is expected to announce a 500,000 barrel per day production increase later today.
In Asia, stocks finished up after the Bank of Japan left interest rates unchanged today, bowing to political pressure. The Nikkei finished the day up 144 points to 17,286 on the news. The Hang Seng added 248 points to 17,834.
The only earnings report out today so far is Drug Royalty Corporation Inc. whose net earnings came in at 2¢ per share for the third quarter ended May 31, compared with 1¢ in the period last year.