markets-hub.com

It’s beginning to look a lot like summer at the multiplexes, as the first tent pole picture of the season, Paramount’s adaptation of the Marvel comic book “Iron Man” exploded in its debut issue, topping estimates and earning the kind of critical accolades that make it well-protected from rusting in the coming weeks.

That the $151.9 million total of the top 10 weekend films fell short of the $178.5 million posted in the equivalent week a year ago was almost inevitable. After all, last year saw the arrival of “Spider-Man 3″, which debuted with $151.1 million, still the all-time record. As was noted by Cooder, the crafty carnival worker who was out-foxed by Homer Simpson, there’s no shame in being beaten by the best.

There really is no reason to hide behind a mask this week, despite the 15% slide from last year (the total year-to-date box office is down 0.7% compared to 2007). After all, “Iron Man” forged $104.3 million in its path to get the gold. And, bucking the trend for other major releases, the film made 6.8% more on Saturday than Friday.

Deutsche Bank had been looking for a comparatively laughable $70 million to $80 million debut, a gross more appropriate for a man of steel, or aluminum foil.

Raymond James analysts speculated that the success of the film (which is already profitable when international grosses are factored in) could add 60 cents to 90 cents to Marvel Entertainment’s 2008 earnings, news that helped send the company’s stock soaring like a man in some kind of a metal suit to an all-time high in Monday trading.

The news should also bode well for other studios, as audiences are now in movie-watching mode and saw a number of high-profile coming attractions for the rest of the year. Even Burger King, which got some coveted product placement in the film, should benefit.

The success of “Iron Man” came at some cost to other films (but not at a cost to other ways audiences could’ve been entertained). The steepest declines in ticket sales from last week were “The Forbidden Kingdom”, “Harold & Kumar” and “88 Minutes”, all films geared more toward a male audience, who were also targeted in “Iron Man”. Knowing this, Sony took the normal route of counter-programming by releasing the romantic comedy “Made of Honor,” which took the silver medal with $15.5 million. While not a horrible debut, the film will probably soon be obscured by bigger films and their bigger ad campaigns, disappearing quickly. Yet another reason why it’s safer, from a box office point of view, to be made out of iron instead of honor.

Next weekend sees the release of “Speed Racer”, which will take away much of the audience for “Iron Man”.

In the ever-changing and fast-paced world of personal computers and information technology, there’s a new rookie on the scene.

The ultra low-cost PC (ULC-PC) is fixing to make quite the splash - a big splash, actually, when you consider its smaller monitor, Linux-based operating system and downsized storage space. The ULC-PC is a prime sign that consumers with strapped budgets are willing to forfeit the bells and whistles of some of the more expensive models for a less-expensive, yet practical, computer.

“While average selling prices on ULC-PCs may ultimately be less than half the market average for notebooks, our analysis of their base operating models suggests that they can be profitable,” Bernstein Research senior analyst Toni Sacconaghi said in a note to clients. Sacconaghi estimates that we could potentially see a 3% boost to annual PC market unit growth over the next five years, but only about a 0.5% boost per year to PC revenue growth rates.

Bernstein Research’s forecast also calls for 5.5 million ULC-PCs in 2008, rising to 14 million in 2012, amounting to a compound annual growth rate of 26%. The firm said its forecast implies that ULC-PCs will account for 5% of total notebook shipments in 2012 and 11% of consumer notebook shipments.

The current poster child for the ULC-PCs is Asus’s $300 Eee PC, which shipped 700,000 units in the first quarter of 2008, a 2% market share of all notebooks (in only Asus’s second quarter of existence). What does this new trend mean for the big boys of the computer world?

“We believe that higher-end ULC-PCs (such as Hewlett-Packard’s fully configured 2133 mini-note) run a risk (of) negatively cannibalizing more expensive notebooks,” Sacconaghi said. “Positioning is critical (the ULC-PC needs to have definitive performance trade-offs versus more traditional offerings).”

With that said, Bernstein Research still believes that ULC-PCs should, overall, benefit branded-PC vendors, given their dominance in notebooks, versus whitebox vendors, and accelerate the migration away from desktops. The firm also said increased units should be positive for Intel, particularly if it can sustain a competitive lead with its tiny processor, Atom. On the flip side, Sacconaghi believes the new ULC-PC craze could raise awareness and acceptability of Linux in the client space in developed markets, which would incrementally impact Microsoft.

Stocks in the U.S. look to open lower Monday after Microsoft Corp. over the weekend withdrew its offer to acquire Internet company Yahoo Inc.

Futures on the Dow Jones industrial average were down 54 points to 13,006, while S&P 500 futures fell 7.60 to 1408.20, and Nasdaq futures fell 11.25 to 1979.00.

On Friday, Wall Street turned in a mixed performance as investors set aside some initial enthusiasm over a stronger-than-expected jobs report to lock in some of their recent gains.

The Dow Jones industrial average climbed 48.20, or 0.37%, to close at 13,058.20, the Nasdaq slipped 3.72, or 0.15%, to 2,476.99, and the Standard & Poor’s 500 index rose 4.56, or 0.32%, to 1,413.90. The yield on the benchmark 10-year Treasury note rose to 3.86% from 3.77%, and light, sweet crude climbed $3.80 to settle at $116.32 per barrel on the New York Mercantile Exchange.

ECONOMIC DATA:

• Institute for Supply Management non-manufacturing index for April, 10 a.m. ET, 49.3 estimate

EARNINGS HIGHLIGHTS:

Company                 Symbol    Period     Estimate 

Alpharma Inc.            ALO        1Q       $  (.15)
Anadarko Petroleum       APC        1Q          1.22
CMS Energy               CMS        1Q           .47
Forest Oil               FST        1Q           .89
Great Atlantic & Pacific GAP        4Q          (.65)
Marvel Entertainment     MVL        1Q           .43
Pilgrim's Pride          PPC        2Q          (.81)
Principal Financial      PFG        1Q           .98
Scotts Miracle-Gro       SMG        2Q          1.17
Figures in parentheses denote losses.

AFTER-HOURS ACTION:

After Friday’s close of trading, Berkshire Hathaway Inc. said its first-quarter profit fell 64% on an unrealized $1.6 billion loss on its derivative contracts. Bristol-Myers Squibb Co. said it plans to sell its wound therapy and surgical care unit for $4.1 billion to two private equity firms.