WESTON, Fla., June 7, 2004 (PRIMEZONE) -- Stocks started the day on an upnote Monday, with both the Dow and the Nasdaq gapping up at the open. Concerns over the price of crude and trouble in Iraq continued to weigh on investors, but stocks were strong out of the gate, and were holding gains in early morning dealings. The Nasdaq Composite was up 14.28 points, to 1,994.43, while the Dow Jones industrial average was higher by 73.42 points, to 10,314.87.
Crude oil futures eased back below $42 per barrel last week, after several sessions of gaining ground. The price of crude oil rose after the U.S.-appointed head of the Iraqi Governing Council, Ezzedine Salim, was killed last Monday near the U.S. headquarters in Baghdad. Also damaging investor confidence were Commerce Department figures showing the U.S. trade deficit widened by 9.1 percent to a record $46 billion, much higher than what analysts were expecting.
Stocks in the news include ImClone Systems Incorporated (Nasdaq:IMCL) and Merck (NYSE:MRK), which announced that the international, randomized Phase III clinical trial of the Companies' IMC-BEC2 cancer vaccine did not meet its primary endpoint of survival.
Genta Incorporated (Nasdaq:GNTA) which was trading lower by 12% in early dealings on over 2 million shares. The Company recently announced the termination of the Expanded Access Program (EAP) for Genasense(TM) (oblimersen sodium) Injection in combination with dacarbazine (DTIC) with Aventis (NYSE:AVE).
And Telik, Inc. (Nasdaq:TELK), which reported positive results from a Phase 2 clinical trial using the combination of TELCYTA(TM) (TLK286) and docetaxel in patients with platinum-resistant non-small cell lung cancer (NSCLC). The combination demonstrated a 27% objective response rate by RECIST with one complete response and seven partial responses.
The latest Federal Open Market Committee meeting was held on Tuesday, May 4, 2004, where the FOMC changed its tune somewhat, saying in its statement that "The Committee perceives the upside and downside risks to the attainment of sustainable growth for the next few quarters are roughly equal," the FOMC said in its statement. "Similarly, the risks to the goal of price stability have moved into balance. At this juncture, with inflation low and resource use slack, the Committee believes that policy accommodation can be removed at a pace that is likely to be measured."
In plain terms The Fed is saying that conditions have improved to the point that rates can start moving up from their current historically low levels, but will probably do so at a measured, and even pace....no 50 and 75 basis point hikes in the near future. The Fed also said it "continues to believe that an accommodative stance of monetary policy, coupled with robust underlying growth in productivity, is providing important ongoing support to economic activity." Regardless, many analysts are saying the first rate increase may come as early as June.
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