Another day of gains
Stock indices appreciated for the fourth time this week as speculation of a possible deal between Yahoo! Inc. (Nasdaq: YHOO) and Microsoft Corp. (Nasdaq: MSFT) overshadowed news of slow U.S. job growth. Among small caps, shares of EasyLink Services Corp. (Nasdaq: EASY) moved up on news of a buyout, while 21st Century Holding Company (Nasdaq: TCHC) fell sharply.
The Russell 2000 added 4.01 points, or 0.48 percent, to 832.88, less than a point below its record close on April 26. The Dow Jones Industrial Average closed in record territory for the fourth day on a row, adding 23.24 points, or 0.18 percent, to 13,264.62.
Shares of Lauderdale Lakes, Fla.-based 21st Century Holding Company were among the biggest losers today, dropping $8.94, or 45%, to close at $11.05, following news of a steep drop in quarterly profit. Net income for the period ended March 31 was $0.84 million, or $0.11 per share, compared with net income of $6 million, or $0.88 per share in the first three months of 2006, the insurance holding company said after Thursday’s close. Also, 21st Century lowered its earnings guidance for 2007 to between $2 per share and $2.50 per share, below its previous estimate of $4.50 a share. Wall Street was looking for earnings of $4.26 per share.
EasyLink Services Corp. is being acquired by Internet Commerce Corp. (Nasdaq: ICCA) for approximately $67 million, the two companies announced after Thursday’s close. Under the terms of the agreement, ICC will pay $5.80 per share in cash for all of the outstanding shares of EasyLink, subject to approval by the stockholders of both companies and U.S. regulators. The acquisition is expected to be completed in the third quarter of 2007. Piscataway, N.J.-based EasyLink and ICC help companies improve the flow and exchange of essential data. EasyLink shares added $0.36, or 7%, to $5.60.
Shares of chemicals distribution company Hawkins, Inc. (Nasdaq: HWKN) lost ground on news of a profit decline. Net income for the third quarter of fiscal 2007 was $0.3 million, or $0.03 per share, compared with net income of $1.8 million, or $0.18 per share during the same period of 2006, the Minneapolis-based company said before the opening bell. Analyst estimates were not available. Hawkins’ stock shed $0.38, or 3%, to close at $14.52.
In economic news, nonfarm payrolls increased 88,000 in April, the Labor Department said before the start of trading. That’s below economists’ expectations of 110,000 new jobs. Retailers slashed 26,000 jobs, while the construction sector lost 11,000.
The unemployment rate increased to 4.5% from 4.4%.
In business news, shares of Yahoo! Inc. shot up 18% following a report before the opening bell by the New York Post that computer giant Microsoft Corp. is looking to acquire troubled search engine, but erased part of that gain later in the afternoon when The New York Times said the companies are discussing a joint venture.
