Wednesday, March 23, 2005

Wednesday Close

S&P 500 1,172.53 +.07%
DJIA 10,456.02 -.14%
NASDAQ 1,990.22 +.04%
Russell 2000 612.06 -1.05%
DJ Wilshire 5000 11,557.77 -.11%
S&P Barra Growth 566.66 +.18%
S&P Barra Value 601.49 -.04%
Morgan Stanley Consumer 574.86 +.74%
Morgan Stanley Cyclical 750.67 -1.07%
Morgan Stanley Technology 452.44 +.39%
Transports 3,732.28 -.58%
Utilities 348.70 -.91%
Put/Call .83 -15.31%
NYSE Arms .54 -48.29%
Volatility(VIX) 14.06 -1.47%
ISE Sentiment 119.00 -28.31%
US Dollar 83.95 +.01%
CRB 306.51 -2.08%

Futures Spot Prices
Crude Oil 54.04 +.43%
Unleaded Gasoline 159.25 +1.12%
Natural Gas 7.15 +.24%
Heating Oil 154.25 +.58%
Gold 425.40 unch.
Base Metals 128.81 -1.19%
Copper 144.25 -.14%
10-year US Treasury Yield 4.59% -1.05%

Leading Sectors
Airlines +2.03%
Drugs +1.27%
Semis +1.16%

Lagging Sectors
Iron/Steel -1.89%
Energy -1.90%
Oil Service -3.16%

After-hours Movers
DITC +4.70% after announcing it will replace DuPont Photomask(DPMI) in the S&P SmallCap 600.
DRI +4.86% after beating 3Q estimates and raising 05 guidance.
OATS +10.03% after Burkle’s Yucaipa announced it held a 9.2% stake.
XRTX +10.7% after beating 1Q estimates and boosting 2Q guidance substantially.
LEXR +36.23% after a jury said Toshiba Corp. and a unit must pay $381.4 million to it in a case over flash memory technology.

Evening Review
Detailed Market Summary
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
Futures Recap
S&P 500 Gallery View
Timely Economic Charts
PM Market Call
Real-time/After-hours Stock Quote
In Play

Afternoon Recommendations
Goldman Sachs:
- Reiterated Outperform on WAG, SLB, CL, HEP and RCL.

Merrill Lynch:
- Named GIS to Focus 1 stock list.

Afternoon/Evening Headlines
- Applied Materials will start paying dividends and boosted its stock buyback program to $4 billion to return cash to shareholders.
- Delta Air Lines must further reduce costs and generate additional cash to counter the rising price of fuel.
- Crude oil rose from its daily lows and gasoline futures surged to a record after an explosion at BP Plc’s Texas City crude-oil refinery, the third-largest in the US, raised supply concerns before the peak summer driving season.
- The US dollar traded near a 5-week high against the euro in Asia on forecasts durable goods orders probably rose in February, signaling consumer spending may prompt the Fed to speed up rate increases.
- Tiffany & Co. is revamping its strategy in Japan, adding more expensive items and refurbishing stores, to try to reverses three consecutive years of sales declines in the country.
- MCI Inc. said it will keep discussing an $8.45 billion takeover bid from Qwest Communications Intl.

Wall Street Journal:
- Texas Pacific Group, General Atlantic Partners LLC and Newbridge Capital Inc. may buy shares of Lenovo Group Ltd. for $350 million.

London-based Times:
- GlaxoSmithKline Plc will produce data which will show its Seretide asthma drug is more effective than its biggest competitor.

Real Estate Alert:
- Bids for New York’s MetLife Building came in at about $1.7 billion, short of the expected $2 billion, as a rise in long-term interest rates drove down offers.

BOTTOM LINE: US stocks finished mostly lower today as fears over slowing global economic growth more than offset falling commodity prices. The Portfolio finished slightly lower as losses in my Gaming longs more than offset gains in my Homebuilding shorts. I did not trade in the afternoon, thus leaving the Portfolio market neutral. The tone of the market deteriorated into the close as the advance/decline line dropped to its daily lows, most sectors declined and volume increased. Tech and defensive Consumer-oriented sectors outperformed throughout the day while Small-caps, Cyclicals and Commodity-related stocks underperformed. Most measures of investor anxiety were lower, which is also a negative. Overall, today’s market action was negative, considering recent losses, stabilizing interest rates, a firming US dollar and declining energy prices. While an oversold rally could occur at any time, I continue to expect measures of investor anxiety to rise further before a more durable bottom is in place.

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