Positive Confidence Report ExpectedThe four-day week will...
Positive Confidence Report Expected
The four-day week will bring a raft of economic data, including consumer confidence figures, expected Tuesday, and productivity statistics, expected Friday.
Confidence is key because two-thirds of the U.S. economy is propped up by consumer spending, and productivity is important because efficient companies can cut costs and improve earnings growth.
“Confidence numbers will be pretty good, and I don’t expect it to go down a lot,” said James Luke, director of growth equity management at BB&T; Asset Management, which oversees $10 billion. “I feel the market is poised to rally here, though I think we’ll get away from explosive moves. It’s a three-steps-forward, two-steps-back kind of market.”
Other economic reports this week:
* Tuesday, the Commerce Department will report on personal incomes in April.
The National Assn. of Realtors will report on sales of previously owned homes in April.
Friday, the Commerce Department will report on orders placed with the nation’s factories for automobiles and other goods in April.
The Labor Department will report on first-quarter productivity.
Chicago purchasing managers will issue the regional manufacturing index for May.
The University of Michigan will issue the final May reading of its index of consumer sentiment.
Reuters
Andersen Defense May Start Presenting Case
Arthur Andersen, plagued with client losses, bolting partners and the possibility of losing its accounting license in Texas, probably will begin presenting its defense in its obstruction-of-justice trial today in federal court in Houston.
Prosecutors expect to rest their case with their last witness, FBI agent Paula Schanzle. Andersen’s lead lawyer, Rusty Hardin, then expects to start presenting the defense.
David Duncan, Andersen’s former top Enron Corp. auditor, who pleaded guilty to illegally shredding documents, testified for the prosecution that he decided months later he committed a crime. He said he initially believed he hadn’t broken any laws when he ordered the destruction of “extraneous” Enron documents last autumn.
Hardin said Andersen is basically dead as a business, even if jurors acquit the firm.
Andersen has lost more than 500 publicly traded clients, or nearly a quarter of the 2,300 companies whose books it audited last year. And last week, the Texas State Board of Public Accountancy said it has recommended revoking the company’s accounting license.
So the defense will focus on showing jurors the people behind the firm, he said.
Hardin said he expected Richard Corgel, Andersen’s U.S. audit practice director in Chicago and one of 62 potential witnesses, to be the first to testify for the defense.
U.S. District Judge Melinda Harmon told jurors last week that court would be in session today despite the federal Memorial Day holiday.
Associated Press
ICN Shareholders to Select Board of Directors
Shareholders of ICN Pharmaceuticals Inc. will vote Wednesday on a slate of director candidates, and they are being encouraged to back dissident nominees.
Institutional Shareholder Services is supporting three independent candidates nominated by Franklin Mutual Advisers and Iridian Asset Management. The two investor groups together hold more than 10% of the Costa Mesa drug maker’s stock and are trying to wrest control from Chairman and Chief Executive Milan Panic, who founded the company 42 years ago.
Three other outside directors elected last year in a previous proxy battle have pledged to support the new slate on a nine-member board.
Like the dissidents of last year, the disgruntled shareholders charge that the presence of Panic at the helm has punished investors and kept well-qualified executives from working at ICN. They also charge that Panic has dragged his feet for several years in splitting the company into three independent firms to enhance shareholder value.
Times Staff and Reuters
Study to Report Success
of New Impotence Drug
A yet-to-be-approved impotence drug developed by Eli Lilly & Co. and Icos Corp. appears to be longer-lasting than Viagra, the companies said, citing a study to be released at a medical conference today.
Patients in the study reported success in achieving erections from 24 hours to as long as 36 hours after taking a 20-milligram pill of Cialis (pronounced see-ALL-iss), Lilly and Icos said.
The study did not compare Cialis’ effects directly with those of Viagra, the $1.2-billion-a-year drug for erectile dysfunction that Pfizer Inc. introduced in 1998.
Results of the peer-reviewed, final-phase study will be released today at the American Urological Assn. conference in Orlando, Fla.
The study, funded by Lilly and Icos, involved 348 men with mild to severe erectile dysfunction who were given either a placebo or Cialis over eight weeks.
About 59% of the patients reported positive effects 36 hours after taking the drug.
Dr. Gerald Brock, an associate professor of urology at the University of West Ontario, said the findings that Cialis’ effects are longer-lasting than Viagra’s are significant because many patients report that the window during which Viagra is effective hinders their sex lives.
Lilly and Icos developed Cialis in a joint venture. The companies had hoped to win marketing approval this year. But that has been delayed to next year after the Food and Drug Administration said last month that it would require additional studies.
Pfizer spokesman Geoff Cook said in March that the company expects that the emergence of competing erectile-dysfunction drugs will only boost its fortunes.
Bayer Corp. also is awaiting FDA approval for another impotence treatment, vardenafil.
Associated Press
Alabama Officials to Train Hyundai Suppliers
Economic developers from Alabama head for South Korea this week for two days of training sessions with Hyundai Motor Co. suppliers on doing business in the state.
Officials expect that 90 representatives of more than 40 potential suppliers will attend the sessions, which begin Wednesday in Seoul. Hyundai, which will build its first U.S. plant near Montgomery, will hold a similar session in Alabama in July to give U.S. auto suppliers a chance to win contracts from the plant.
Hyundai has not selected suppliers for its $1-billion Alabama plant, which in 2005 will produce the next-generation Santa Fe sport utility vehicle and the Sonata sedan. Representatives from Georgia and Mississippi have traveled to South Korea in recent weeks, hoping to steer suppliers their way.
Anita Archie, general counsel for the Alabama Development Office, said the trip is designed to give potential suppliers an overview of Alabama’s economy, taxes, incentives, work force, training and other aspects.
Hyundai has indicated that the assembly plant, expected to begin production in 2005, will require as many as 24 suppliers of major components.
That could mean as many as a dozen such suppliers will be needed in addition to U.S.-based support companies.
Associated Press
Also
* Friday is the deadline for energy firms to report to the Federal Energy Regulatory Commission on any “round-trip” trading activity they have engaged in since 2000.
