Earnings Announcements
Company/Estimate
BEAS/.09
CHTR/-.46
CIEN/-.08
HPQ/.35
KVHI/-.10
NXTL/.40
PNRA/.34
JWN/.66
NANO/-.15
TGT/.87
WMT/.63
Splits
SNDK 2-for-1
Economic Data
Initial Jobless claims estimated at 355K vs. 363K last week.
Continuing claims estimated at 3105K vs. 3083K last week.
Leading Indicators estimated at .5% vs. .2% last month.
Philadelphia Fed. estimated at 35.0 vs. 38.8 last month.
Late-night News
North Korea is willing to discuss its highly enriched uranium program with the U.S. during six-nation talks to be held in Beijing next week. Guidelines for fining passengers who carry prohibited items on airplanes have been released by the Transportation Security Admin. Howard Dean dropped out of the presidential race. The U.S. will work with the Afghan government to try to meet the deadline of June this year for holding presidential and parliamentary elections. Iran shut the offices of 2 newspapers that published a letter by lawmakers criticizing Iran's supreme leader for allowing unfair elections to be held.
Late-Night Trading
Asian markets are mixed, ranging from +.5% to -.5%.
S&P 500 indicated +.24%.
NASDAQ indicated +.36%.
BOTTOM LINE: The major U.S. indices should rally tomorrow given the positive news in the tech sector after the close. A weak rally or sell-off on this news would most likely mean a continuation of the current consolidation. A strong rally tomorrow should eventually lead to a move through recent highs. The Portfolio is 100% net long, thus I will closely monitor the open tomorrow for any signs of weakness and cut market exposure accordingly.
Thursday, February 19, 2004
Wednesday, February 18, 2004
Wednesday Close
S&P 500 1,151.82-.45%
NASDAQ 2,076.47-.19%
Leading Sectors
Fashion+1.0%
Semis+.67%
Software+.51%
Lagging Sectors
Telecom-1.68%
Airlines-1.69%
Oil Service-1.78%
Other
Crude Oil 35.45 unch.
Natural Gas 5.36+.17%
Base Metals 112.58+.13%
U.S. Dollar Index 85.83-.13%
10-Yr. Long-Bond Yield 4.04% unch.
After-hours Movers
AMAT+5.4% on better-than-expected 1Q and raised 2Q expectations.
OVTI+18.6% after significantly beating 3Q estimates and raising 4Q guidance.
BRCM+3.3% on conf. call saying its sales for 1Q will be $565M, higher than the $528M forecast.
INTU-5.0% after exceeding 2Q estimates, but lowering 3Q guidance.
ECLG-8.4% after beating 4Q estimates, but lowering 1Q guidance.
After-hours News
Yahoo drops Google and says it will use it's own search software. A Houston grand jury issued a sealed indictment against former Enron CEO Jeff Skilling today, the Houston Chronicle said. Earnings growth for the S&P 500 has only been this high 4 other times in the last 130 years. Market breadth is continuing to expand at a healthy pace, with over 85% of stocks still above their 200-day moving averages, the strongest pace in the past 12 years.
BOTTOM LINE: I took some profits in a few of my basic material stocks and added a couple of tech stocks near the close. The portfolio was down today and is still 100% net long. Semi and Semi equipment stocks should lead the way tomorrow. OVTI, BRCM and AMAT all had very positive things to say on their calls after the close.
NASDAQ 2,076.47-.19%
Leading Sectors
Fashion+1.0%
Semis+.67%
Software+.51%
Lagging Sectors
Telecom-1.68%
Airlines-1.69%
Oil Service-1.78%
Other
Crude Oil 35.45 unch.
Natural Gas 5.36+.17%
Base Metals 112.58+.13%
U.S. Dollar Index 85.83-.13%
10-Yr. Long-Bond Yield 4.04% unch.
After-hours Movers
AMAT+5.4% on better-than-expected 1Q and raised 2Q expectations.
OVTI+18.6% after significantly beating 3Q estimates and raising 4Q guidance.
BRCM+3.3% on conf. call saying its sales for 1Q will be $565M, higher than the $528M forecast.
INTU-5.0% after exceeding 2Q estimates, but lowering 3Q guidance.
ECLG-8.4% after beating 4Q estimates, but lowering 1Q guidance.
After-hours News
Yahoo drops Google and says it will use it's own search software. A Houston grand jury issued a sealed indictment against former Enron CEO Jeff Skilling today, the Houston Chronicle said. Earnings growth for the S&P 500 has only been this high 4 other times in the last 130 years. Market breadth is continuing to expand at a healthy pace, with over 85% of stocks still above their 200-day moving averages, the strongest pace in the past 12 years.
BOTTOM LINE: I took some profits in a few of my basic material stocks and added a couple of tech stocks near the close. The portfolio was down today and is still 100% net long. Semi and Semi equipment stocks should lead the way tomorrow. OVTI, BRCM and AMAT all had very positive things to say on their calls after the close.
Mid-day Update
S&P 500 1,155.06-.16%
NASDAQ 2,080.29 unch.
Leading Sectors
Fashion+1.0%
Semis+.9%
Biotech+.82%
Lagging Sectors
Oil Service-.82%
Airlines-.92%
Telecom-1.78%
Other
Crude Oil 35.60+1.17%
Natural Gas 5.39+1.24%
Gold 413.80-.62%
Base Metals 115.72+2.93%
U.S. Dollar 85.23+.31%
10-Yr. Long-Bond Yield 4.01%-2.9%
Market Movers
ELN+30.0% on accelerated schedule for new ms drug.
RMBS+30.0% on dismissal of patent-fraud case, resulting in as much as $3B in royalties.
CMX+4.6% on winning contract from FEP covering 3.9M workers.
MHS-10.7% on losing contract to CMX.
NTES+21.0% on strong earnings report, strength of on-line gaming was big surprise.
BRCM+8.8% on expectations of positive conf. call after close.
NTAP+7.7% on strong 3rd Q and raised 4th Q guidance.
Recommendations
Goldman says Manufacturing sector capex for tech should increase 16% this year, dramatically improving in recent weeks. Goldman raising price forecasts for base metals across the board, favorites are AL, N and AA. Goldman raises rating on PCS to "Outperform" and NXTL raised to "In-Line." Citigroup's favorite semis are CY, FCS, INTC, MU and NSM. Also, Citi says BRCM may acquire PXLW, TRID or GNSS to bolster digital TV offerings. Leerlink raising target on CMX to $45 on massive contract win from Federal Employees Health Benefit Plan. JP Morgan raises VIP to "Overweight" and lowers MBT to "Neutral."
Mid-day News
U.S. stocks are down modestly at mid-day on weaker housing numbers. U.S. housing starts came in at 1903K, below the 1910K estimate. Building permits were 1899K, also failing to meet estimates of 1910K. The shortfall was blamed on cold weather and storms in some parts of the country. Cablevision(CVC) says capital costs low and margins high for VOIP, already seeing 40% direct margins. Copper prices hit an 8-yr. high as basic materials continue their strong advance.
BOTTOM LINE: The stair-step pattern continues as the markets rest after yesterdays strong advance. This is very healthy. I wouldn't be surprised to see a rally later in the day. A lot of stocks are moving up significantly on good news. Breadth is pretty good. My indicators are still on short-term sell in tech, so I will postpone my buying in this area for now. I haven't made any changes today, the Portfolio is currently down for the day and is 100% net long. I don't think the housing numbers are a big deal and I expect the market to resume its upward move shortly.
NASDAQ 2,080.29 unch.
Leading Sectors
Fashion+1.0%
Semis+.9%
Biotech+.82%
Lagging Sectors
Oil Service-.82%
Airlines-.92%
Telecom-1.78%
Other
Crude Oil 35.60+1.17%
Natural Gas 5.39+1.24%
Gold 413.80-.62%
Base Metals 115.72+2.93%
U.S. Dollar 85.23+.31%
10-Yr. Long-Bond Yield 4.01%-2.9%
Market Movers
ELN+30.0% on accelerated schedule for new ms drug.
RMBS+30.0% on dismissal of patent-fraud case, resulting in as much as $3B in royalties.
CMX+4.6% on winning contract from FEP covering 3.9M workers.
MHS-10.7% on losing contract to CMX.
NTES+21.0% on strong earnings report, strength of on-line gaming was big surprise.
BRCM+8.8% on expectations of positive conf. call after close.
NTAP+7.7% on strong 3rd Q and raised 4th Q guidance.
Recommendations
Goldman says Manufacturing sector capex for tech should increase 16% this year, dramatically improving in recent weeks. Goldman raising price forecasts for base metals across the board, favorites are AL, N and AA. Goldman raises rating on PCS to "Outperform" and NXTL raised to "In-Line." Citigroup's favorite semis are CY, FCS, INTC, MU and NSM. Also, Citi says BRCM may acquire PXLW, TRID or GNSS to bolster digital TV offerings. Leerlink raising target on CMX to $45 on massive contract win from Federal Employees Health Benefit Plan. JP Morgan raises VIP to "Overweight" and lowers MBT to "Neutral."
Mid-day News
U.S. stocks are down modestly at mid-day on weaker housing numbers. U.S. housing starts came in at 1903K, below the 1910K estimate. Building permits were 1899K, also failing to meet estimates of 1910K. The shortfall was blamed on cold weather and storms in some parts of the country. Cablevision(CVC) says capital costs low and margins high for VOIP, already seeing 40% direct margins. Copper prices hit an 8-yr. high as basic materials continue their strong advance.
BOTTOM LINE: The stair-step pattern continues as the markets rest after yesterdays strong advance. This is very healthy. I wouldn't be surprised to see a rally later in the day. A lot of stocks are moving up significantly on good news. Breadth is pretty good. My indicators are still on short-term sell in tech, so I will postpone my buying in this area for now. I haven't made any changes today, the Portfolio is currently down for the day and is 100% net long. I don't think the housing numbers are a big deal and I expect the market to resume its upward move shortly.
Wednesday Watch
Earngings Announcements
Company/Estimate
AMT/-.16
ADCT/.00
AMAT/.08
ECLG/.03
INTU/.70
OVTI/.42
Splits
OVTI 2-for-1
Economic Data
Housing starts estimated at 2000K vs. 2088K last month.
Building Permits estimated at 1910K vs. 1924K last month.
Late-night News
Senator Kerry edged out Senator Edwards in Wisconsin's primary. Thailand reports 7th human death from bird flu. Scott Moritz of TheStreet.com says Cingular/AT&T Wireless deal could be huge opportunity for OPWV. Jury finds against Tyson Foods in Cattle price-fixing, Tyson plans appeal.
Late-Night Trading
Asian markets are mostly higher, ranging from +.5% to +1.0%.
S&P 500 indicated +.02%.
NASDAQ indicated +.07%.
BOTTOM LINE: Very little late-night news of any importance. I still expect a pretty good day for the longs tomorrow, led by tech.
Company/Estimate
AMT/-.16
ADCT/.00
AMAT/.08
ECLG/.03
INTU/.70
OVTI/.42
Splits
OVTI 2-for-1
Economic Data
Housing starts estimated at 2000K vs. 2088K last month.
Building Permits estimated at 1910K vs. 1924K last month.
Late-night News
Senator Kerry edged out Senator Edwards in Wisconsin's primary. Thailand reports 7th human death from bird flu. Scott Moritz of TheStreet.com says Cingular/AT&T Wireless deal could be huge opportunity for OPWV. Jury finds against Tyson Foods in Cattle price-fixing, Tyson plans appeal.
Late-Night Trading
Asian markets are mostly higher, ranging from +.5% to +1.0%.
S&P 500 indicated +.02%.
NASDAQ indicated +.07%.
BOTTOM LINE: Very little late-night news of any importance. I still expect a pretty good day for the longs tomorrow, led by tech.
Tuesday, February 17, 2004
Tuesday Close
S&P 500 1,156.99+.98%
NASDAQ 2,080.35+1.30%
Leading Sectors
Wireless+3.98%
Airlines+3.26%
Iron/Steel+3.18%
Lagging Sectors
Broadcasting+.34%
Fashion+.07%
Transports-.25%
Other
Crude Oil 35.14-.14%
Natural Gas 5.31-.17%
Base Metals 112.43+2.63%
U.S. Dollar Index 84.87-.11%
10-Yr. Long-Bond Yield 4.04%-.05%
After-hours Movers
NTAP+9.5% on exceeding 3Q earnings/sales and raised 4Q guidance.
BRCM+7.1% after setting conference call tomorrow to discuss "stronger business outlook."
EP-11.1% after slashing its assessment of natural gas and oil reserves by 41%.
ANF+5.1% after meeting 4Q earnings/missing sales targets and reaffirming 1Q guidance on price increases for their clothes, baffling analysts.
BRKT+19.4% after significantly beating 4Q earnings estimates and raising 1Q guidance.
DITC+14.7% after beating 3Q estimates and raising 4Q guidance.
NTES+7.7% on excellent 4Q earnings above estimates.
PLAB+7.1% after significantly beating 1Q earnings estimates.
TXCC+5.6% on announcement that Samsung selected it as preferred VLSI component supplier for W-CDMA wireless platforms.
After-hours News
U.S. stocks advanced today on optimism an increase in merger activity is a sign that shares are cheap. Exceedingly strong corporate profits and low interest rates also helped. A U.S. appeals court rejected the challenge to the "Do not call" list. Rambus(RMBS) won a ruling from a U.S. FTC judge that may help it reap as much as $3B/year from semi makers. Japan's economy grew at a 7% annual pace last quarter, the fastest in 13 years. NYSE specialists settled with SEC for $240M.
BOTTOM LINE: Asian indices are indicated higher as prospects for the first synchronized global recovery in decades are brightening. The Portfolio had a very good day, notwithstanding its conservative position at the start of the day. It is now 100% net long. I added long positions in the basic material, overseas telecom and energy-related sectors. I expect more follow-through tomorrow, with tech leading the way after a multitude of good earnings reports after-hours. I may rotate into some tech if my short-term indicators give buy signals on the open.
NASDAQ 2,080.35+1.30%
Leading Sectors
Wireless+3.98%
Airlines+3.26%
Iron/Steel+3.18%
Lagging Sectors
Broadcasting+.34%
Fashion+.07%
Transports-.25%
Other
Crude Oil 35.14-.14%
Natural Gas 5.31-.17%
Base Metals 112.43+2.63%
U.S. Dollar Index 84.87-.11%
10-Yr. Long-Bond Yield 4.04%-.05%
After-hours Movers
NTAP+9.5% on exceeding 3Q earnings/sales and raised 4Q guidance.
BRCM+7.1% after setting conference call tomorrow to discuss "stronger business outlook."
EP-11.1% after slashing its assessment of natural gas and oil reserves by 41%.
ANF+5.1% after meeting 4Q earnings/missing sales targets and reaffirming 1Q guidance on price increases for their clothes, baffling analysts.
BRKT+19.4% after significantly beating 4Q earnings estimates and raising 1Q guidance.
DITC+14.7% after beating 3Q estimates and raising 4Q guidance.
NTES+7.7% on excellent 4Q earnings above estimates.
PLAB+7.1% after significantly beating 1Q earnings estimates.
TXCC+5.6% on announcement that Samsung selected it as preferred VLSI component supplier for W-CDMA wireless platforms.
After-hours News
U.S. stocks advanced today on optimism an increase in merger activity is a sign that shares are cheap. Exceedingly strong corporate profits and low interest rates also helped. A U.S. appeals court rejected the challenge to the "Do not call" list. Rambus(RMBS) won a ruling from a U.S. FTC judge that may help it reap as much as $3B/year from semi makers. Japan's economy grew at a 7% annual pace last quarter, the fastest in 13 years. NYSE specialists settled with SEC for $240M.
BOTTOM LINE: Asian indices are indicated higher as prospects for the first synchronized global recovery in decades are brightening. The Portfolio had a very good day, notwithstanding its conservative position at the start of the day. It is now 100% net long. I added long positions in the basic material, overseas telecom and energy-related sectors. I expect more follow-through tomorrow, with tech leading the way after a multitude of good earnings reports after-hours. I may rotate into some tech if my short-term indicators give buy signals on the open.
Mid-day Update
S&P 500 1,156.86+.96%
NASDAQ 2,079.13+1.25%
Leading Sectors
Wireless+3.72%
Iron/Steel+3.08%
Homebuilders+2.55%
Lagging Sectors
Fashion+.07%
Drugs+.44%
Transports-.26%
Other
Crude Oil 34.62+.17%
Natural Gas 5.31-3.81%
Gold 416.70+1.44%
Copper 129.9+4.46%
Market Movers
AWE+15.7% on Cingular's $41B takeover bid.
NXTL+6.2% on AWE news and anticipation of strong earnings report.
RTRSY+20.2% on strong earnings and raised guidance.
IDXC+9.2% on Suntrust and Maxim upgrades to "Strong Buy".
SLAB-5.6% on Morgan Stanley downgrade to "Equal-weight".
OMC-2.2% on earnings report that disappointed some.
DE+4.7% on significantly better-than-expected 1st Q earnings and raised guidance.
Recommendations
Morgan Stanley positive on large-cap integrated oil-service companies. INTC developer forum Feb.17-19 is being watched closely. Goldman Sachs has positive comments on AZO. Goldman also saying Oil/E&P shares can rally to peak valuations, up 30% from current levels, and AMAT quarterly report should be VERY strong. Finally, Goldman likes cell-tower stocks as consolidation news is now out. Citigroup raised estimates for Samsung. Also said prices for power amps and linear IC's have risen 80% and 60%, respectively at TXN and NSM. NSM says 6-inch fabs running at full capacity and TXN has extended lead-times to 12-16 weeks from 6-8 weeks. Citigroup says SEBL favorite play on applications recovery. OSI raised to "Buy" at BB&T Capital. CIEN raised to "Buy" at W.R. Hambrecht. UNA raised to "Buy" at Robert Baird.
Mid-day News
U.S. stocks advanced on optimism an increase in mergers is a sign that shares are cheap even after an 11-month rally and corporate profits will keep rising. The Empire Manufacturing reading came in at 42.05, higher than the 37.0 estimates. Industrial Production met expectations, rising .8%. Capacity Utilization rose to 76.2%, modestly below expectations of 76.4%. Foreigners purchases of U.S. debt, corporate bonds and stocks rose by a net $75B in Dec., dispelling the notion that the falling U.S. dollar and larger budget/trade deficits are hurting demand for U.S. assets. Moreover, the report showed foreigners added 23% to their net holdings of U.S. securities for all of 2003. National City agreed to buy Provident Financial for $2.1B.
BOTTOM LINE: A very good day. Only one sector I follow is down today. However, my short-term indicators are still giving sell signals on the NASDAQ and the technology sector, but buys in many other sectors and the broad market. Thus, I have taken my market exposure back to 100%, adding new positions in a variety of sectors, excluding technology.
NASDAQ 2,079.13+1.25%
Leading Sectors
Wireless+3.72%
Iron/Steel+3.08%
Homebuilders+2.55%
Lagging Sectors
Fashion+.07%
Drugs+.44%
Transports-.26%
Other
Crude Oil 34.62+.17%
Natural Gas 5.31-3.81%
Gold 416.70+1.44%
Copper 129.9+4.46%
Market Movers
AWE+15.7% on Cingular's $41B takeover bid.
NXTL+6.2% on AWE news and anticipation of strong earnings report.
RTRSY+20.2% on strong earnings and raised guidance.
IDXC+9.2% on Suntrust and Maxim upgrades to "Strong Buy".
SLAB-5.6% on Morgan Stanley downgrade to "Equal-weight".
OMC-2.2% on earnings report that disappointed some.
DE+4.7% on significantly better-than-expected 1st Q earnings and raised guidance.
Recommendations
Morgan Stanley positive on large-cap integrated oil-service companies. INTC developer forum Feb.17-19 is being watched closely. Goldman Sachs has positive comments on AZO. Goldman also saying Oil/E&P shares can rally to peak valuations, up 30% from current levels, and AMAT quarterly report should be VERY strong. Finally, Goldman likes cell-tower stocks as consolidation news is now out. Citigroup raised estimates for Samsung. Also said prices for power amps and linear IC's have risen 80% and 60%, respectively at TXN and NSM. NSM says 6-inch fabs running at full capacity and TXN has extended lead-times to 12-16 weeks from 6-8 weeks. Citigroup says SEBL favorite play on applications recovery. OSI raised to "Buy" at BB&T Capital. CIEN raised to "Buy" at W.R. Hambrecht. UNA raised to "Buy" at Robert Baird.
Mid-day News
U.S. stocks advanced on optimism an increase in mergers is a sign that shares are cheap even after an 11-month rally and corporate profits will keep rising. The Empire Manufacturing reading came in at 42.05, higher than the 37.0 estimates. Industrial Production met expectations, rising .8%. Capacity Utilization rose to 76.2%, modestly below expectations of 76.4%. Foreigners purchases of U.S. debt, corporate bonds and stocks rose by a net $75B in Dec., dispelling the notion that the falling U.S. dollar and larger budget/trade deficits are hurting demand for U.S. assets. Moreover, the report showed foreigners added 23% to their net holdings of U.S. securities for all of 2003. National City agreed to buy Provident Financial for $2.1B.
BOTTOM LINE: A very good day. Only one sector I follow is down today. However, my short-term indicators are still giving sell signals on the NASDAQ and the technology sector, but buys in many other sectors and the broad market. Thus, I have taken my market exposure back to 100%, adding new positions in a variety of sectors, excluding technology.
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