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Contributors: Douglas McIntyre Jon C. Ogg

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Monday, August 07, 2006

Market Wrap (August 7, 2006)


DJIA 11,219.38; Down 20.97 (0.19%)
NASDAQ 2,072.50; Down 12.55 (0.60%)
S&P500 1,275.77; Down 3.59 (0.28%)
10YR-Bond 4.921%

The big story of the day was the BP plc Pipe closure out of Prudhoe Bay, which supplied 8% of US production and about 400,000 barrels per day to most of the West Coast. We were lucky that the market absorbed this as well as it did. The closure could be weeks or months, according to the company.

BP (BP) fell 2.9% to $70.41; The leveraged name that gets royalties directly from this is BP Prudhoe Bay Royalty Trust (BPT) and its shares fell over 10% to close down 12% to $76.75.

Other consolidated oil plays rose on reduced competitive pressures. ExxonMobil (XOM) rose 0.7% to $69.22, ChevronTexaco (CVX) rose 1.8% to $66.86. If you looked at the PowerShares WilderHill Clean Energy (PBW), you wouldn't even know there was an erergy issue since its shares closed down 0.4% at $17.42.

Apple (AAPL) fell 1.6% to $67.21 after Apple debuted a Mac computer that ran twice as fast. It is unclear what the street was hoping the company would unveil more products, even though today was their developers' forum.

Despite the company announcing that its partner received tentaive approval from the FDA for generic lamisil for toe fungus, Perrigo (PRGO) fell 1.3% to $15.84.

Google (GOOG) and Viacom (VIA) announced they woulkd begin beta tests for an ad system for bundling ads into videos online from MTV music video. GOOG rose 1.2% t $378.50 and VIA rose 0.2% to $34.34.

One day ahead of earnings Cisco Systems (CSCO) rose 0.6% to $17.34 on no real news.

Hansen Natural (HANS) was one of the biggest losers on the day. It had in-line EPS but soft metrics and no upside. Herb Greenberg even felt justified since it fell. HANS fell 26% to $29.80.

Marvel Entertainment (MVL) rose 6.9% to $19.36 after posting EPS at $0.19 vs $0.11e.

AES Corp (AES) rose about 10% to $20.11 after earnings.

McDermott (MDR) beat earnings and retired almost all of its debt, but no one cared. MDR fell 1.2% to $47.40.

Andrew (ANDW) rose a sharp 20% to $9.58 after its stock buyout from AD Telecommunications (ADCT) was trumped with a higher cash offer of $9.50 per share from CommScope (CTV). ADCT rose 4.8% to $12.80 and CTV fell 7% to $28.05.

Citirx Systems (CTXS) announced it would acquire privately held Orbital Data for about $50 million, and Merrill Lynch raised the stock to a Buy rating. You would have never known it since the stock 0.8% to $30.08.

Emmis Broadcasting (EMMS) fell a sharp 19% to $11.74 after the CEO dropped his bid to take the company private. It was also downgraded at Bear Stearns and at Stanford research

FileNet (FILE) rose another 1.8% to $35.27 on hopes that it may be a takeover candidate, although nothing has occurred. (KNOT) fell a sharp 5% to $17.67 ahead of this week's planned secondary offering.

Aqua America (WTR) fell over 1% to $22.97 after it filed to sell 3M shares of common stock.

LoJack (LOJN) rose over 11% to close at $19.57 after beating earnings expectations.

R.R.Donnelly (RRD) rose about 4.5% to $31.99 on a potential deal with a private equity firm.

J.Crew (JCG) came off a quiet period after the IPO where the underwriters could issue research. It was started as Buy at Citigroup, started as Neutral at Goldman Sachs, and started as Outperform at Wachovia. Its shares were also somewhat quiet, closing up 0.4% at $26.61.

Jon C. Ogg
August 7, 2006

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