The markets tumbled in June as the Dow Jones Industrial Average, S&P 500 and NASDAQ declined 10.2%, 8.6%, 9.1%, respectively. With rising inflation, record oil prices and a worsening credit markets, even the most optimistic Wall Street pundits dismissed any ideas about a quick recovery in the second half of the year. The high cost of oil, which ended the month at $140 a barrel, is putting a severe strain on consumers and corporations alike. On June 25, the Federal Open Market Committee announced it would hold interest rates at 2.0% despite concerns over high energy costs. Contrary to the Fed’s intentions, the US dollar traded lower, while oil continued to climb during the month. It is evident that the Fed is caught in a complicated predicament and cannot raise rates without further damaging the economy, especially in the financial sector. Year to date, the Dow, S&P 500 and NASDAQ are all trading lower, falling 14.4%, 12.8% and 13.5%, respectively.

Not surprisingly, all four of the IBO Stock Indexes traded lower in June, with the Lab Consumables/Equipment Stock Index declining the most, falling 6.6%. The Laboratory Instrumentation, Process/Metrology/Motion Instrumentation and Diversified Instrumentation Indexes slipped 3.3%, 5.8% and 3.5%, respectively.

Laboratory Instrumentation Stock Index

For the month, the Laboratory Instrumentation Index fell 3.3% to close at 600.24. Sixteen companies declined, while seven companies improved. Sequenom led the Index, soaring 108%, while Caliper Life Sciences declined 28%. For year, the Index is down 8.3%. Sequenom leads the way, up 67%, while X-Rite, despite a strong performance this month, has declined 78% and continues to weigh on the Index.

While there was little news in the way of earnings this month, several companies in the Index announced corporate initiatives to raise capital or repurchase company stock. On June 16, OI announced a repurchase of an additional 200,000 shares, expanding its previous repurchase stock program, however, shares traded lower by 3.2%. On June 17, Luminex announced a public offering of 3.5 million shares to be used for R&D, acquisitions or capital expenditures. Luminex reported on June 30 that it had raised $74.3 million in net proceeds from the offering, which included the exercise of the over-allotment option. Shares declined 10.1%. The offering price was set at $19.91 on June 25.

On June 23, Sequenom announced a similar offering of 5.5 million shares, to be used for general corporate purposes and product development, yet shares traded flat. Pricing was set at $15.50 on June 25. For Sequenom it was a roller coaster of a month, which ended on a high. Sequenom announced on June 4 that results for noninvasive screening of Down Syndrome using its technology were 100% accurate without any false positives. The news sent shares up 19.5%. However, on June 10, Sequenom reported that it had been served with a patent infringement lawsuit by Beckman Coulter and Orchid Cellmark (see IBO 6/15/08), sending shares down 6%. But the stock ended the month up more than 100%.

In other news, on June 2, Starlims announced a one-time cash dividend of $0.35 a share. However, shares traded marginally lower. On June 25, CombiMatrix announced that on June 27 it would join the Russel Microcap Index, leading shares up 4.6%. Caliper Life Sciences announced on June 30 that it would join the Russell 3000 Index. However, the stock closed down 3%. Joining the Russell 2000 Index was Sequenom, while Illumina moved from the Russell 2000 to the Russel 1000 Index.

Only one analyst’s recommendation was changed this month. On June 13, UBS downgraded shares of Applied Biosystems from “Buy” to “Neutral.” However, on June 23, Cowen& Company initiated coverage of Waters with an “Outerperform” rating, yet shares traded only 0.7% higher.

Process/Metrology/Motion Instrumentation Stock Index

In June, the Process/Metrology/Motion Instrumentation Stock Index declined 5.8% to 332.38, with seven companies trading lower and ICx Technologies gaining 9%. Nanometrics led all decliners, down 26%. Year to date, the Index has declined 16.0%, making it the worst-performing Index. All eight companies are in negative territory, led by RAE Systems, which is down 47%.

On June 10, FEI announced plans to retire a majority of its convertible debt, thereby reducing the number of shares used to calculate diluted EPS. On the same day, DA Davidson upgraded the company to “Buy” from “Neutral,” sending shares up 5.6%.

Lab Consumables/Equipment Stock Index

The Laboratory Consumables/Equipment Stock Index declined 6.6% this month to 485.72, with six companies losing ground and QIAGEN up 1%. For the year, the Lab Consumable/Equipment Index has declined 3.9%, with only Techne trading higher, gaining 17%. Kewaunee Scientific was the worst-performing company for both the month and the year so far, down 37% and 45%, respectively.

After the market close on June 9, Pall reported adjusted fiscal third-quarter EPS of $0.54, $0.04 ahead of analysts’ expectations. The company also provided full-year sales growth expectations in the mid-single digit range, leading shares up 4.8% the following day. On June 24, Kewaunee Scientific reported fiscal fourth-quarter EPS of $0.17 (see page 12), compared to $0.21 last year, sending shares down 35.3%.

On June 12, Invitrogen announced the purchase of Applied Biosystems for $38 a share (see IBO 6/15/08). As a result, Invitrogen declined 10.7%, while Applied Biosystems improved 5.3%. On the same day, Deutshe Bank downgraded Invitrogen to “Hold” and lowered its price target to $43. But, on June 24, JPMorgan upgraded Invitrogen to “Overweight” from “Neutral,” citing costs-saving opportunities following the acquisition. However, shares traded slightly lower. Also, on June 30, First Analysis Securities downgraded Millipore to “Equal-Weight” from “Overweight,”

Diversified Instrumentation Stock Index

The Diversified Instrumentation Stock Index lost 3.5% for the month, falling to 110.06. Five companies declined, while Roper Industries improved 1%. Teledyne Technologies led all decliners, dropping 12%. For the year, the Index is down 7.9% with four companies trading lower and two companies improving. Mettler-Toledo leads all decliners, having fallen 17%, while Roper is up 5%.

On June 3, Danaher increased the lower range of its forecasted adjusted second-quarter EPS by 2% to $1.04–$1.07, sending shares up 2.5%. On June 27, Janney Montgomery Scott upgraded Danaher to “Buy” from “Neutral,” leading shares up 1.1%.

International

In June, two Pacific Region companies improved, while three companies declined. Jeol was the best performing company, rising 7%, while Shimadzu fell 7%. Year to date, three companies have finished lower, while Shimadzu and Hitachi High-Technologies are trading higher, up 5% and 1%, respectively. Horiba has lost the most ground and is down 31%.

For the month, stock prices for 11 European companies declined and prices for only three companies improved. However, for the year, half the companies are still in positive territory. Millbrook Scientific Instruments led all companies for both the month and year, up 100% and 41%, respectively, while Cybio AG has lost 34% and 71% for the month and year, respectively.

On June 3, Biohit Oyj issued a profit warning for 2008, sending shares down 3.2%. The company stated that 2008 operating profits would be lower than expected as sales targets have not been met so far year. The company will undertake efforts to reduce expenses, including employee reductions starting in September. On June 10, Oxford Instruments announced preliminary adjusted EPS for fiscal 2008 ended March 31 of £0.12 ($0.23), a 21.9% increase. However, shares traded only 0.3% higher.