This month, ensuing renewed concerns over subprime mortgages and the credit crunch, the Dow suffered the second-biggest decline of the year, falling 2.8% on August 9. In the four-day trading period ending August 16, the Dow, S&P 500 and NASDAQ declined 5.6%, 6.1% and 6.2% to four-month lows of 13,846, 1,408 and 2,451, respectively. From the market highs of July the Dow, S&P 500 and NASDAQ retreated 8.2%, 9.5%, and 9.9%, respectively. On August 17, the Federal Reserve lowered the discount rate to help alleviate credit worries at troubled financial institutions. Consequently, the markets recovered some of their earlier losses, but with little conviction, until Ben Bernanke, the chairman of the Federal Reserve, announced on August 31 that the Fed would act in the best interest of the market and help prevent the credit crisis from spreading. Coupled with positive economic data and optimistic predictions for the third quarter, the markets continued to rally. The Dow, S&P 500 and NASDAQ ended the month in positive territory, improving 1.1%, 1.3% and 2.0%, respectively. Year to date, the Dow is up 7.2%, the S&P 500 has risen 3.9% and NASDAQ has gained 7.5%. Despite August’s volatility, three of the four IBO Stock Indexes closed the month in positive territory, while the Lab Consumables/Equipment Stock Index declined 1.4%. The Laboratory Instrumentation Stock Index jumped 3.3%, while the Process/Metrology/Motion Instrumentation and Diversified Instrumentation Stock Indexes improved 0.6% and 1.2%, respectively. Laboratory Instrumentation Stock Index For the month, the Laboratory Instrumentation Index climbed 3.3% to close at 604.22. Fourteen companies improved, two companies traded flat, and seven companies declined. Cepheid and Luminex led the Index, improving 27% and 19%, respectively, while CombiMatrix declined 18%. For the year, the Index has gained 12%, with Cepheid leading the way, up 120%, while Symyx Technologies leads all decliners, down 59%. On August 1, Beckman Coulter reported expected adjusted EPS of $0.75 and EPS of $3.10–$3.25, yet shares closed 0.2% lower. After market’s close on August 2, Harvard Bioscience reported adjusted EPS of $0.08 on better than expected revenue, sending shares 1.6% higher. On August 6, SEQUENOM reported a loss $0.13, $0.01 ahead of analyst expectations, and raised its 2007 revenue outlook, leading shares up 1.1% the next day. On August 7, X-Rite announced better than expected revenue and adjusted earnings of $0.16 per share (see page 12), sending shares up 8.0%. On the same day, after the market close, Cepheid reported a net loss of $0.10 per share (see page 12), in-line with analyst expectations, and raised its full-year sales forecast, while Bio-Rad announced better than expected adjusted earnings of $0.95 per share. The following day, Cepheid and Bio-Rad traded up 14.5% and 5.2%, respectively. On August 9, Caliper Life Sciences reported adjusted net loss widened to $0.05 from a gain of $0.02 a share (see page 12) due to acquisition costs. The company’s full-year revenue growth forecast of 27%–33% helped shares improve 10.0% that day. After the close, Dionex reported better than expected revenues and EPS of $0.61, however, shares traded down 5.0% the next day. On August 13, Starlims reported lower profits of $0.15 per share. Despite the company’s year-end forecast of 20%–25% revenue growth and EPS of $0.63–$0.68, shares fell 1.2%. On August 16, Cepheid signed a deal with Northrop Grumman to buy up to $200 million worth of anthrax test cartridges, sending shares up 5.6%. On August 15, CombiMatrix and Acacia Research completed the split off from Acacia Research. Every 10 shares of Acacia Research-CombiMatrix stock outstanding were redeemed for one share of common stock of CombiMatrix. On August 28, First Analysis Securities initiated coverage on Cepheid with an “Equal-Weight” rating, however, shares retreated 1.9%. On August 21, JMP Securities initiated coverage of Starlims with a “Market Outperform” rating, yet shares traded down 3.9%. Process/Metrology/Motion Instrumentation Stock Index For the month of August, the Process/Metrology/Motion Instrumentation Stock Index edged 0.6% higher to 433.69, with three companies improving and four companies declining. After several months of negative returns, RAE Systems jumped 20% to lead all companies, while Strategic Diagnostics declined 9%. Year to date, the Index is up 1.5%, led by MTS Systems, which has climbed 9.0%. On August 1, after the close, Nanometrics reported better than expected revenues and narrowed its net loss to $0.01 per share, sending shares up 3.8%. On August 6, RAE Systems reported a wider than expected loss of $0.04 a share, sending shares down 4.4%. On August 7, Brean Murray downgraded the company to “Hold” from “Buy,” yet shares improved 2.3%. After the market close on August 16, Zygo reported lower than expected revenue and EPS of $0.20 for fiscal fourth quarter, sending shares down 1.0% the following day. On August 16, Zygo announced a share repurchase program of up to $25 million, which helped shares recoup some of their losses by climbing 3.1%. On August 21, MTS Systems approved a buyback of three million shares and raised its dividend by 36% to $0.15. Lab Consumables/Equipment Stock Index The Laboratory Consumables/Equipment Stock Index declined 1.4% in August to 442.12, with half the companies gaining and the other half losing. Techne led the Index, climbing 12%, while Millipore fell 10%. For the year, the Lab Consumable/Equipment Index continues to lead all IBO Indexes, improving 15.8%, with all eight companies in positive territory, seven of which have risen in double digits. After the market close on August 1, Invitrogen announced adjusted EPS of $1.15, $0.39 ahead of analyst expectations, and a $500 million share repurchase program. Shares climbed 10.1% to a new 52-week high. On August 6, QIAGEN NV reported better than expected adjusted EPS of $0.16 and raised its full-year revenue guidance, sending shares up 2.6%. The following day, Techne reported EPS of $0.58, $0.01 ahead of analyst expectations, leading shares 5.4% higher. On August 13, New Brunswick Scientific reported EPS of $0.10, compared to $0.11 last year (see page 12). Shares remained flat, trading just below the expected acquisition price of $11.50 a share. On August 22, Kewaunee Scientific reported quarterly EPS of $0.27, an increase of $0.05 a share over last year, and 7.8% revenue growth, leading shares up 7.4%. On August 1, Millipore, the only company in the Index to report a decline in quarterly earnings (see page 12), due to restructuring and integration costs related to an acquisition, slid 5.6%. Diversified Instrumentation Stock Index The Diversified Instrumentation Stock Index grew 1.2% for the month to 109.73, with four companies gaining and three companies declining. Teledyne Technologies led the Index, improving 12% after trading lower in July, while Agilent sustained a significant decline, falling 5%. For the year, the Index is up 9.7%, with all companies in positive territory. After the close on August 14, Agilent announced adjusted quarterly EPS of $0.48, $0.01 below analyst expectations, and lowered its fiscal fourth quarter earnings estimate, sending shares down 10.8%. On August 29, Citigroup initiated coverage with a “Buy” rating, helping shares recover 2.7%, and CIBC World Markets initiated coverage of AMETEK with a “Sector Outperform” rating, sending shares 1.2% higher. In contrast, on August 13, Credit Suisse downgraded Danaher to “Neutral” from “Outperform,” citing the company’s lofty share price, leading shares down 2.0%. International In August, four of the five Pacific Region companies traded lower, with Shimadzu declining 37%, while Horiba was the only company to finish higher, up 4%. For the year, JEOL has declined 28%. This month, 11 European companies declined and one company remained flat, while three companies improved. Biohit and Oxford Instruments each fell 14%, while Millbrook Scientific jumped 11%. For the year, four European companies have positive returns and 11 firms are down.