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CNNfn market movers
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July 27, 1998: 2:36 p.m. ET
Wall St. calls on telecoms, but not all answers are happy ones; Net stocks slide
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NEW YORK (CNNfn) - It was mainly a tale of telecommunications companies on Wall Monday, vaulting them to the top of the list of market movers.
Cell phone maker L.M. Ericsson (ERICY) sank 6-7/16, or more than 19 percent, to 27-1/4, after reporting strong earnings growth but saying the Asian economic crisis is taking a bite out of its bottom line. The report came just days after rival Nokia (NOK.A) surged on signs it may be gobbling up market share.
GTE (GTE) was down 1-1/8 to 56-13/16 and Bell Atlantic (BEL) lost 5/16 to 44-7/8 despite reports the two phone companies are in talks to merge in a deal estimated to be worth at least $52.5 billion.
American depositary receipts of British Telecom (BTY) soared 8-1/4 to 146, while AT&T (T) was up 3/16 to 60-1/8 after the phone giants said they will form a joint venture to serve business customers worldwide.
It was mainly their rivals, namely merger partners WorldCom (WCOM) and MCI Communications (MCIC), that were moving Monday in the wake of the deals. WorldCom was down 2 to 53-7/8 while MCI was off 2-7/16 to 65-7/16.
BellSouth (BLS), one of the last Baby Bells not yet to land a major merger partner, gained 3-1/4 to 72-1/4.
And Southern New England Telecom (SNG) climbed 1-1/4 to 72-11/16 after the Connecticut-based phone company and one-time buyout target of SBC Communications (SBC) reported second-quarter earnings per share of 77 cents, in line with the First Call consensus estimate.
But communications equipment makers couldn't get much of a boost from the merger deals among some of their customers. Lucent Technologies (LU) lost 2-9/16 to 93-11/16, and Northern Telecom (NT) was down 1 to 57.
Boeing (BA) continued to get shot down, losing 1-5/16 to 39 in active trading after the giant plane maker aired disappointing earnings in its second quarter last Thursday.
Life Re (LRE) gained 2-11/16 to 91-11/16 after announcing Monday Swiss Reinsurance will buy the Stamford-based reinsurer for 95 dollars a share, or $1.8 billion dollars in cash.
Information Storage Devices (ISDI) soared 2-1/8 to 7-5/16 after the maker of voice recording chips for cell phones and answering machines said Taiwan's Winbond International has offered to buy the remaining shares that it doesn't already own for $8.25 a share.
Mylan Laboratories (MYL) slumped 9/16 to 29-15/16, but was up from an earlier low, after a report in the Wall Street Journal Monday said the federal government has widened its probe of generic-drug pricing. Mylan got a subpoena from the Federal Trade Commission last week.
But AmeriSource Health (AAS) was up 7-3/4 to 75-1/4 and Bergen Brunswig (BBC) gained 3-3/8 to 55-1/4 amid speculation that a judge may be leaning toward the approval of buyouts of each drug wholesaler.
McKesson (MCK) has plans to buy AmeriSource. Cardinal Health (CAH) has a deal to buy Bergen Brunswig.
Selloff hits 'Net-based stocks
Internet stocks took a beating Monday as the Nasdaq Composite overall began the week in a sullen mood.
America Online (AOL) was off 3-5/8 to 115-9/16. Internet service providers all were lower, but were up from early lows Monday, with Yahoo! (YHOO) off 1-3/4 to 180-3/8, Lycos (LCOS) off 2-3/4 to 64-1/2, Excite (XCIT) down 2-5/8 to 42, and Infoseek (SEEK) losing 1-3/4 to 27-1/4.
The Internet-based news service CNET (CNWK) slumped 3-3/4 to 61, and Internet search engine Inktomi (INKT) was off 1-3/4 to 55-3/4.
Broadcast.com (BCST), which distributes video and audio via the Web, was down 3-1/8 to 58-3/8, and rival RealNetworks (RNWK) was off 4-7/8 to 28-3/8.
Amazon.com (AMZN) fell 6 to 118-1/4, even though Credit Suisse First Boston started coverage of the online bookseller with a buy rating.
Mindspring Enterprises (MSPG), a high-flying Internet service provider, was off 11/16 to 48-13/16 after enacting a 3-for-1 stock split Friday.
-- by staff writer Jamey Keaten
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