S&P 500 1,180.08 +.74%
Dow 10,491.12 +.61%
NASDAQ 2,060.40 +1.21%
Russell 2000 620.29 +1.19%
DJ Wilshire 5000 11,608.07 +.78%
S&P Barra Growth 567.23 +.61%
S&P Barra Value 608.67 +.89%
Morgan Stanley Consumer 583.08 +.10%
Morgan Stanley Cyclical 753.53 +1.07%
Morgan Stanley Technology 473.84 +1.46%
Transports 3,592.38 +1.31%
Utilities 342.30 +.81%
Put/Call .68 -11.69%
NYSE Arms .87 -32.56%
Volatility(VIX) 12.97 -2.11%
ISE Sentiment 185.00 +3.35%
US Dollar 83.49 +.01%
CRB 283.16 -.36%
Futures Spot Prices
Crude Oil 46.65 -.81%
Unleaded Gasoline 128.40 -1.85%
Natural Gas 6.19 -1.10%
Heating Oil 130.20 -2.69%
Gold 423.10 -1.17%
Base Metals 122.86 +.26%
Copper 143.30 -.38%
10-year US Treasury Yield 4.14% +.14%
Leading Sectors
Airlines +2.74%
Iron/Steel +2.66%
I-Banks +1.86%
Lagging Sectors
Telecom -.11%
Drugs -.67%
Boxmakers -.84%
Market Movers
WYE -7.3% after missing 4Q estimates, lowering 05 guidance and Prudential downgrade to Neutral.
AAPL +4.2% after unveiling faster, more affordable PowerBooks.
CREO +13.65% after Eastman Kodak(EK) agreed to buy it for $980 million in cash.
AVL +19.87% after saying GE gave it exclusive rights to distribute certain parts for GE’s CF6-50 and CF6-80A aircraft engines.
NOVN +17.21% after the FDA denied pending citizen petitions intended to prevent or delay the approval of certain generic versions of Johnson & Johnson’s Duragesic product and RBC upgrade to Outperform.
SEE +9.63% after substantially beating 4Q estimates and raising 05 guidance.
RYAAY +9.05% after raising 3Q estimates and 4Q outlook.
GRMN +7.53% after saying the original equipment parts and accessories provider for Chrysler, Dodge and Jeep will begin offering a new Garmin-built GPS automotive navigation system as a dealer-installed option.
MSTR +3.9% on Maxim upgrade to Buy.
NVEC +11.56% after confirming that Magnetoresistive Random Access Memory alpha samples recently announced by Cypress Semiconductor are covered by NVE’s technology agreement.
RSTG -13.68% on profit-taking.
SIR -33.88% after lowering 4Q estimates and saying it may restate results after an internal review found accounting errors.
HSP -7.4% after lowering 05 outlook.
Market Internals
NYSE Unusual Volume
NASDAQ Unusual Volume
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Hot Spots
Option Dragon
Economic Data
-Personal Income for December rose 3.7% versus estimates of a 3.4% increase and a .4% gain in November.
-Personal Spending for December rose .8% versus estimates of a .8% increase and a .4% rise in November.
-PCE Deflator(YoY) for December rose 2.4% versus estimates of a 2.4% increase and a 2.7% increase in November.
-PCE Core(YoY) for December rose 1.5% versus estimates of a 1.5% gain and a 1.6% rise in November.
-New Home Sales for December were 1098K versus estimates of 1200K and 1097K in November.
-Chicago Purchasing Manager for January rose to 62.4 versus estimates of 59.0 and a reading of 61.9 in December.
Recommendations
-Goldman Sachs: Reiterated Outperform on SBC, BBY and TSMC. Reiterated Underperform on T and MMC. Reiterated Underweight rating on Newspaper stocks.
-Citi SmithBarney: Upgraded CEG to Buy, target $55. Downgraded EOP to Sell, target $26. Reiterated Buy on NE, target $65. Upgraded SII to Buy, target $73. Reiterated Buy on HAL, target $50. Reiterated Sell on MYG, target $11. Reiterated Buy on WMT, target $65. Reiterated Buy on DNA, target $87.50. Reiterated Sell on NYB, target $17. Reiterated Sell on MU, target $11.50. Reiterated Sell on SIVB, target $34. Reiterated Buy on STZ, target $53.
-UBS: Raised MATR to Buy, target $55.
-Banc of America: Rated ISTA Buy, target $13.
-Morgan Stanley: Cut HAL and BJS to Underweight.
-CSFB: Raised JBL to Outperform, target $28.
-CIBC: Raised RTEC to Sector Outperform, target $20.
-Legg Mason: Raised CCE to Buy, target $26. Raised COTT to Buy, target $30. Raised PBG to Buy, target $32.
-Prudential: Cut NUE to Underweight, target $43. Cut FISV to Underweight, target $35. Cut T to Underweight, target $16.
-Merrill Lynch: Raised AWA to Buy, target $7. Raised CAL to Buy, target $14.
-Bear Stearns: Rated NCTY Outperform, target $32.
-Raymond James: Raised RSAS to Strong Buy, target $22. Cut SBC to Underperform. Raised VRSN to Buy, target $35.
Mid-day News
US stocks are higher mid-day on optimism over the outcome of the Iraqi elections, merger activity and lower energy prices. Yahoo! plans to increase its financial data offerings online, a move that would allow the company to add to its popular finance site and become a data provider for other sites, the Wall Street Journal reported. MetLife is close to buying Citigroup’s Travelers Life & Annuity unit for about $12 billion, the Wall Street Journal reported. The SEC is considering rules that would give investors a better idea of how much their mutual funds spend to buy and sell securities, the Wall Street Journal reported. Time Warner’s cable unit plans to provide America Online accounts to high-speed Internet customers at no extra cost, the Wall Street Journal reported. Vivendi Universal SA has filed suit against EchoStar Communications to force the No. 2 US satellite-television service to carry a new 24-hour music channel, the NY Post reported. Coach Inc. plans to add 100 new stores over the next four to five years, bringing the company’s total outlets to almost 300, the NY Daily News reported. International home-video sales are the fastest-growing part of the film industry, although the Motion Picture Association of America and most studios won’t give specific figures, the NY Times reported. An internal UN investigation and a US Justice Department probe over corruption in the UN/Iraq Oil-for-food Program have clashed over access to documents and witnesses, the NY Times reported. American Indian tribes in Southern California are trying to transform their desert casinos into resorts to compete with Las Vegas, the LA Times reported. SBC Communications agreed to buy AT&T for about $16 billion in stock and cash, marking the end of the 130-year-old company that brought phones into American homes, Bloomberg reported. Lee Enterprises, which operates 44 daily newspapers in 19 states, agreed to buy Pulitzer, owner of 14 daily newspapers, for about $1.41 billion in cash, Bloomberg said. US personal spending accelerated in December and incomes jumped the most on record as Microsoft made a one-time $32.6 billion dividend payout, Bloomberg reported. French President Chirac offered US President Bush help with the training of the Iraqi police force following yesterday’s election, Bloomberg said. Crude oil fell to its lowest in almost three weeks after Iraq’s election yesterday passed without attacks against pipelines and OPEC agreed to leave production quotas unchanged, Bloomberg reported. Marsh & McLennan agreed to pay $850 million to settle NY Attorney General Spitzer’s accusations that it rigged bids and took kickbacks from insurers, Bloomberg said. US sales of new homes rose .1% last month to 1.098 million houses at an annual rate, capping the fourth consecutive all-time record year, Bloomberg reported. US fourth-quarter GDP figures were likely adversely affected as much as .5 percentage points by an error in Canada’s trade report for November, a Commerce Department official said. United Airlines pilots voted to ratify a new contract that will cut pilot pay be 12% and help save the company $180 million annually as part of the airline’s plan to stem losses and exit bankruptcy, Bloomberg said. Iraqi interim Prime Minister Allawi said today the country’s new national assembly should work with Sunni Arabs to create a government and constitution, Bloomberg reported.
BOTTOM LINE: The Portfolio is substantially higher mid-day on gains in my retail, internet, networking and computer longs. I added a few new longs this morning, thus bringing the Portfolio to 125% net long. One of my new longs is AUO and I am using a $14.50 stop-loss on this position. The tone of the market is pretty good today as most sectors are higher and the advance/decline line is very good. Small-caps and technology shares are outperforming. On the negative side, volume is lighter than I would like to see on a rally and oil isn’t declining as much as I anticipated. As well, measures of investor anxiety are falling. I expect US stocks to rise modestly into the close on more optimism, short-covering and bargain-hunting.
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