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    July 7, 2006

    Ebay drops as Citigroup cuts target share price

    Filed under: ConocoPhillips, Administaff, Newmont Mining, Marathon Oil, eBay, Altria, Reynolds American, PMC Sierra

    The New York equities markets were generally lower by midday on Friday as the Labor Department released new data showing that fewer jobs were created in the US in June than had been predicted. The Dow Jones Industrial Average was down 0.7 percent to 11,149.50, a drop of 0.1 percent on the week. The Nasdaq Composite dropped 0.4 percent to 2,146.83, a decline of 1.2 percent over the week. The S&P 500 was nearly even, having lost only 1.16 points to 1,272.92, leaving it with a gain of 0.2 percent on the week.

    The news that only 121,000 jobs had been created in the US in June was a disappointment after a gain of 200,000 had been predicted. The high expectations had been raised by Wednesday’s National Employment Report from payroll services company ADP, which said that 368,000 new jobs had been created during June. The Labor Department numbers, along with figures showing that higher than expected wage inflation during the month, made investors nervous.

    Ebay dropped 7.9 percent to $26.99, largely on a downgrade from Citigroup, which lowered its target share price on the online auctioneer by over 20 percent to $40 earlier in the week. In addition, Ebay said that it was installing new senior executives in several divisions.

    Changes in personnel also led to a decline for PMC Sierra in the semiconductors sector, as the chipmaker declined by 18.4 percent to $7.67 after it said its chief financial officer is leaving the company.

    Climbing oil prices led to advances in the oil sector. ConocoPhillips added 4.9 percent during the week to $68.74, while Marathon Oil was up 5 percent to $87.50.

    Also up on higher commodities prices was Newmont Mining, which was up 4.4 percent to $55.25.

    Tobacco companies also saw gains on the week after the Florida Supreme Court set aside a $145 billion dollar punitive damages award against the US tobacco industry. Reynolds American added 1.6 percent to $117.19, while Altria gained 5.5 percent to $77.45.





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