Business Digest

Business Digest

October 05, 2002

In the Region

Allegheny Energy shares lose $5.22 during the week

Allegheny Energy Inc.'s stock price fell nearly 10.5 percent yesterday to close at $7.88 on the New York Stock Exchange, a low the Hagerstown energy company hasn't seen in decades.

The battered stock, which started off the week at $13.10, has been falling steadily since Moody's Investors Service downgraded its debt rating Tuesday to below investment grade and placed it under review for further downgrades.

Allegheny has been struggling all year with an industry downturn, a cash crunch and now a recent lawsuit over its $490 million purchase last year of Merrill Lynch & Co. Inc.'s energy trading unit.

Novavax lotion appears to ease hot flashes

Novavax Inc.'s experimental Estrasorb lotion appeared to relieve the hot flashes of certain post-menopausal women in a clinical trial, according to results released yesterday at a scientific meeting in Chicago.

The results showed the percentage of patients achieving a clinical response - defined as seven days without hot flashes - ranged from 15 percent in the third week of treatment to 40 percent in the 12th week for those using Estrasorb. That compares with clinical responses ranging from 3 percent in the third week of treatment to 16 percent in the 12th week for women using a placebo.

The U.S. Food and Drug Administration earlier said it would not approve Estrasorb without more information. Columbia-based Novavax has since resubmitted its application for the drug's approval.

Elsewhere

J.P. Morgan Chase to lay off 4,000 of its 20,000 bankers

J.P. Morgan Chase & Co., the second-biggest U.S. bank, will fire about 4,000 of its 20,000 investment bankers this month after trading revenue plummeted and loan losses surged, people familiar with the situation said.

Chief executive William B. Harrison Jr. will cut jobs across the investment bank, including divisions handling mergers and debt underwriting, the sources.

Harrison said last month he would take steps to cut costs in a bid to stem a 55 percent drop in the bank's share price this year that has trimmed $39 billion from J.P. Morgan's market value. The bank said loan write-offs quadrupled in the third-quarter from the previous three months to $1.4 billion.

Alcoa's profit falls 43% to $193 million in 3Q

Depressed aluminum prices, idled plants and soft markets led to a 43 percent drop in Alcoa Inc.'s third-quarter profit. The results matched Wall Street expectations, but Alcoa shares fell in trading yesterday.

The world's largest aluminum company said yesterday it earned $193 million, or 23 cents a share, in the period ending Sept. 30, down from $339 million, or 39 cents a share, during the corresponding period last year.

Excluding a $23 million after-tax charge from two plant closures, profit met analysts' expectations of $216 million, or 26 cents a share. Alcoa shares lost 99 cents to close at $19.11.

Schering-Plough expects to make less in 3rd quarter

Schering-Plough Corp. cut third quarter profit estimates late Thursday, saying wholesalers were slashing orders for its top-selling allergy treatment Claritin, so they can unload supplies for generic versions.

The drug maker's shares fell for a sixth day yesterday, extending a 28 percent drop since the company lost a court bid in August to stop generic competitors for Claritin. The pill, which had sales of $3.16 billion last year, may face cheaper rivals in December.

Profit in the third quarter is expected to decline 28 cents to 29 cents a share from 41 cents in the third quarter last year, Schering-Plough said. Analysts had expected earnings of 35 cents.

This column was compiled from reports by Sun staff writers, the Associated Press, Bloomberg News and the New York Times.

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