The Trading Floor

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MARKET TALK: Ivanhoe Mines Rallying


14:20 EST Tuesday, December 05, 2006

Edited by Paul Vigna
Of DOW JONES NEWSWIRES

(call: 201-938-5172; e-mail: [e-mail])

MARKET TALK can be found using N/DJMT


2:19 (Dow Jones) Ivanhoe Mines (IVN.T) shares rising today, and a variety of reasons are being cited for the rise, including small float, target price upgrades, expectations of good outcome at meeting between Rio Tinto (RIO), Ivanhoe and the Mongolian government over the pair's Oyu Tolgoi project, and belief some big share blocks have moved in a strategic investment play. Volume now well above average daily volume. Shares up 15.42% at C$12.65. (BRT)

2:05 (Dow Jones) Dollar mostly down against rivals after gaining earlier in the session on a stronger-than-expected November non-manufacturing ISM report. The data allow the dollar to climb back up through Y115 briefly and push the euro under the $1.33 mark, but the greenback has since given back much of its gains. At 2:00 p.m. EST, the euro stood at $1.3326 from $1.3326 late Monday, while the dollar was at Y114.84 from Y115.32 late Monday, according to EBS. The euro was at Y153.05 from Y153.70 late Monday. The dollar stood at CHF1.1913 from CHF1.1943 while the U.K. pound was at $1.9738 from $1.9802 late Monday. (ILD)

1:52 (Dow Jones) M&T Bank (MTB) is well positioned, but lacks the kind of levers that would drive upside surprises, Citigroup says after meeting with management. "We continue to be impressed with the quality and shareholder focus of this management team," firm says, "and believe that this management team will be able to sustain its track record of above average EPS growth in a challenging 2007. That being said we believe most of the low hanging fruit has been picked from integrating recent acquisitions and expense initiatives, and we do not see significant upside to 2007 EPS estimates." (PJV)

1:38 (Dow Jones) Comex gold and silver close lower largely due to profit- taking, several analysts say. Catalysts include drop this morning in crude oil and the euro, even though both later recover, market watchers say. Some also point to the approaching end of the quarter and year as an influence encouraging hedge funds to book profits. After the close but ahead of settlement, Feb gold is down $2.90 to $648, and March silver is down 20.5c to $14.04. (ALS)

1:34 (Dow Jones) Stock index futures continue to post gains though contracts are largely unchanged from earlier. Dec S&P is recently up 4.40 points at 1415.10, after having set a new contract high of 1417.20. Dec DJIA set a new 1- week high of 12350, though still short of 12368, the all-time high. Dec Nasdaq recently up 4.25 points at 1807.75. (JLT)

1:26 (Dow Jones) Railpower Technologies (P.T) clambering back from the abyss after reaching a deal to terminate a contract suspended in 3Q. Settlement cuts C$21M provision for contract losses by C$18.7M in 4Q, a "significant positive impact" on balance sheet. Railpower also gets three of its Green Goat locomotives back, and plans to resell them shortly. Investors had pounded Railpower last month on fears of a liquidity crisis; fears eased somewhat now. In Toronto, P.T up 28% to 62 Canadian cents. (MAG)

1:11 (Dow Jones) Centene (CNC) shares under pressure after Goldman Sachs cuts the stock to sell from neutral. With shares up almost 100% since a 2Q earnings miss, "high valuation does not adequately reflect the risk of another earnings shortfall," firm says. "We see significant risk to the 2006-2007 outlook given the company's aggressive (medical cost ratio) projections in its Georgia start- up and its optimistic assumption that 1H2006 medical cost pressures, which were geographically diverse, are non-recurring," Goldman adds. CNC off 9.6% at $ 24.35. (JHS)

12:57 (Dow Jones) Merck (MRK) shares up about 1.4% at $45.32 ahead of a conference call tomorrow morning during which executives will provide an overview of 2007 and long-term financial guidance. Investors may be expecting an '07 EPS forecast higher than the current Street mean view of $2.56, excluding one-time items. MRK previously said it expects adjusted EPS of $2.48 to $2.52 for 2006. MRK earlier reported positive data from study of Janumet diabetes drug. (PDL)

12:44 (Dow Jones) US stocks maintain modest gains as we head into the back half of the session. November ISM services report perhaps a signal the economic sky isn't falling, and offers some degree of courage for bulls. Consumer stocks, chips and financials show respectable gains; energy's flat, industrials a bit soft. Coke, Boeing and Merck among the Dow Industrial leaders; 3M's a drag. DJIA up about 23 points; Nasdaq ahead 2; S&P 500 gains 3. (JHS)

12:35 (Dow Jones) Buckingham Research downgrades Mellon (MEL) to accumulate from strong buy and upgrades Bank of New York (BK) to accumulate from neutral in wake of merger announcement. It expects MEL's long-term growth rate to be diluted by the outsized contribution to earnings from BK and its lower growth business mix -- corporate trust and clearing businesses vs higher growth global custody and asset management. MEL is less likely to get an asset manager P/E multiple (19X 2007 EPS), and more likely to trade with its trust bank peers (17X 2007), Buckingham says. (DAM)

12:23 (Dow Jones) Canaccord Adams backs buy rating on Fuel Tech (FTEK) after visits to plants using FTEK products. Says customer using FTEK product that helps coal-fired plants run more efficiently has boosted net power availability 7%. Another customer using air pollution control products has cut nitrogen oxide emissions more than 25%. Shares up 9.2% at $25.57 after earlier reaching 52-week high at $25.95. (JMA)

12:10 (Dow Jones) Lear (LEA) down 4.2% to $29.63, erasing yesterday's 4% gain. UBS downgrades LEA to reduce from neutral, largely due to expected underperformance of its Big Three customers in 2007. LEA also said last week that its deal with Wilbur Ross for the money losing interiors division is definitive, leaving few near-term catalysts. UBS expects cash generation and improvement in 2007 results, but thinks the stock is overvalued now, given the 2007 outlook for US auto makers and Ross deal all but done. (TAK)

12:01 (Dow Jones) Yahoo's (YHOO) share gains could be "tempered" until the benefits of Panama materialize, Goldman Sachs says. "The visibility of the financial impact of Panama remains limited based on our checks with numerous advertisers," firm says. "While the new system should improve monetization and potentially increase spending at Yahoo long-term, several questions remain." One is the learning curve for advertisers, and as advertisers move along the curve will they boost spending or defect to competitors, and will advertisers with improved returns increase or just maintain spending. YHOO up 1.5% at $27.30. ( PJV)


(END) Dow Jones Newswires
12-05-06 1419ET
Copyright (c) 2006 Dow Jones & Company, Inc.