S&P 500 1,106.44 +1.37%
NASDAQ 1,955.34 +2.40%
Leading Sectors
Airlines +4.89%
Networking +3.75%
Software +3.65%
Lagging Sectors
Drugs +.48%
Tobacco +.24%
Energy -.17%
Other
Crude Oil 35.90 -3.0%%
Natural Gas 5.34 -1.64%
Gold 417.20 -.07%
Base Metals 110.43 -1.23%
U.S. Dollar 88.75 -.17%
10-Yr. Long-Bond Yield 3.73% +.66%
VIX 18.13 -8.48%
Put/Call .62 -30.34%
NYSE Arms .42 -66.13%
Market Movers
NANX +19.7% after announcing that it received a $10M investment from Germany's Altana AG to develop paints, plastics and coatings.
GETI +18.6% after selling its phone-gear business for $291M to ADC Telecom.
KVHI +13.9% after Raymond James upgrade to Strong Buy.
VIP +8.0% on strong 4Q earnings report.
AVP +6.7% after raising 1Q guidance substantially.
INFY +4.6% after positive comments from Citi Smith Barney.
ASCA +9.9% after boosting 1Q guidance substantially.
MERX -11.9% after meeting 3Q estimates and lowering 4Q guidance.
IBC -11.6% after lowering 3Q guidance substantially.
Economic Data
Final 4Q GDP was +4.1% vs. expectations of 4.1%.
Initial Jobless Claims last week were 339K vs. expectations of 340K.
Continuing Claims were 3004K vs. 3050K prior.
Existing Home Sales for February were 6.12M vs. expectations of 6.12M.
Help Wanted Index for February was 40 vs. expectations of 39.
Recommendations
Jim Cramer of TheStreet.com is positive on cable stocks, favorites are CMCSA, TWX and CHTR. CTXS raised to Outperform at CSFB. CTB raised to Buy at Deutshe Bank. CTAS raised to Overweight at Morgan Stanley. CIBC positive on AUDC, saying it will likely exceed estimates on strong voice-over-internet-protocol sales. MKC raised to Buy at Merrill. KVHI raised to Strong Buy at Raymond James. Goldman Sachs reiterated Underperform on LSI. Goldman says tone at Society of Toxicology conference in Baltimore was markedly positive for CRO companies. GS reiterated Outperform on AVP, AG and BBY. Citi Smith Barney positive on commodity chemical companies, favorites are EMN, NCX and MCH. Citi would Buy MU on weakness.
Mid-day News
U.S. stocks are rising sharply mid-day, led by airlines and technology shares. A drop in energy prices, strong earnings reports and more positive economic data are the catalysts for the rise. Lucent(LU) will repair and upgrade Iraq's telecom networks under a two-year contract valued at $75M from the U.S. Dept. of Defense, the Star-Ledger reported. Texas oil refineries are possible targets for terrorists, the FBI said today, Reuters reported. Al Jazeera aired a tape of al-Qaeda's Zawahiri calling on Pakistanis to overthrow the government, CNN reported. The number of Americans filing initial claims for jobless benefits remained near a 3-year low, a government report showed. Eli Lilly, maker of the world's top-selling schizophrenia medicine, Zyprexa, said its marketing and promotional practices are being investigated by the U.S. Attorney in Pennsylvania. Oil fell after members of OPEC said the group should postpone production cuts. The U.S. economy expanded at a 4.1% annual rate in the final 3 months of 2003 after a rise of 8.2% in the 3rd quarter, resulting in the fastest six-month economic growth in almost 20 years. The National Association of Manufacturing says 55% of companies surveyed expect to increase hiring in the near future, the most positive results they have seen in a very long time, reported CNBC.
BOTTOM LINE: The Portfolio is having a good day today as I added technology and airline longs on the gap up open in the Morgan Stanley High-tech Index and the gap down in crude oil. The Portfolio is 100% net long. This countertrend rally should have legs into next week on quarter-end positioning. Hedge funds will take profits in their shorts and Mutual funds will use cash to attempt to boost shares at quarter-end. Tech stocks positive reaction to Micron's relatively weak quarter, the fall in crude oil prices and the broad market's strength in the face of another al-Qaeda video tape threat also leads me to believe that this countertrend rally will continue for a few days.
Thursday, March 25, 2004
Thursday Watch
Earnings Announcements
Company/Estimate
CKEC/-.15
CAG/.38
SHRP/1.40
SRR/.23
Splits
AMSG 3-for-2
RJF 3-for-2
Economic Data
Final 4Q GDP estimated at 4.1%.
Initial Jobless Claims last week estimated at 340K vs. 336K prior week.
Existing Home Sales for Feb. estimated at 6.12M vs. 6.04M in Jan.
Help Wanted Index estimated at 39 in Feb. vs. 38 in Jan.
Recommendations
Goldman Sachs reiterated Underperform on RNWK and THC. GS reiterated Outperform on KMI, TYC and KMR. JP Morgan cut its estimate for the euro against the U.S. dollar after it reduced its estimate for economic growth in the European Union. JP Morgan said the yen may rally 12% to 95 per dollar by year-end, boosting its forecast from 99, as economic growth in Japan attracts foreign investment.
Late-Night News
Asian stocks are mostly lower with Japan's Nikkei being the lone stand-out on the upside. Japanese stocks rose after a government report showed a widening trade surplus, adding to optimism that the pace of economic growth can be sustained, reported Bloomberg. The European Union may log all airline passengers arriving from the U.S. to allow it to collect similar data to the U.S.' monitoring of travelers from European destinations, the Financial Times reported. Nokia's sales from it Indian operations rose 97% to more than $1.21B in 03, making the country its fastest growing market after the United Arab Emirates, the Business Standard reported. Human Genome Sciences'(HGSI) Chairman and CEO will leave the company later this year once a successor is found, the NY Times reported. Nokia(NOK) executives bought shares worth millions of euros in the past year, the Helsingin Sanomat reported.
Late-Night Trading
Asian Indices -1.25% to +.25%. Japan's Nikkei +1.46%.
S&P 500 indicated +.12%.
NASDAQ indicated +.25%.
BOTTOM LINE: The Nikkei will break a double top on a close above 11,577. The world's 3rd largest economy is finally improving after years of dragging down world economic growth. This is a very positive development and I would not underestimate its consequences. The Semiconductor Index is still hovering right near its 200-day moving average. If the SOX can hold its recent lows, after Micron's relatively disappointing report, or rise tomorrow I would expect the entire tech sector to benefit. This should then lead to broad-market countertrend rally. The Portfolio is 25% net long.
Company/Estimate
CKEC/-.15
CAG/.38
SHRP/1.40
SRR/.23
Splits
AMSG 3-for-2
RJF 3-for-2
Economic Data
Final 4Q GDP estimated at 4.1%.
Initial Jobless Claims last week estimated at 340K vs. 336K prior week.
Existing Home Sales for Feb. estimated at 6.12M vs. 6.04M in Jan.
Help Wanted Index estimated at 39 in Feb. vs. 38 in Jan.
Recommendations
Goldman Sachs reiterated Underperform on RNWK and THC. GS reiterated Outperform on KMI, TYC and KMR. JP Morgan cut its estimate for the euro against the U.S. dollar after it reduced its estimate for economic growth in the European Union. JP Morgan said the yen may rally 12% to 95 per dollar by year-end, boosting its forecast from 99, as economic growth in Japan attracts foreign investment.
Late-Night News
Asian stocks are mostly lower with Japan's Nikkei being the lone stand-out on the upside. Japanese stocks rose after a government report showed a widening trade surplus, adding to optimism that the pace of economic growth can be sustained, reported Bloomberg. The European Union may log all airline passengers arriving from the U.S. to allow it to collect similar data to the U.S.' monitoring of travelers from European destinations, the Financial Times reported. Nokia's sales from it Indian operations rose 97% to more than $1.21B in 03, making the country its fastest growing market after the United Arab Emirates, the Business Standard reported. Human Genome Sciences'(HGSI) Chairman and CEO will leave the company later this year once a successor is found, the NY Times reported. Nokia(NOK) executives bought shares worth millions of euros in the past year, the Helsingin Sanomat reported.
Late-Night Trading
Asian Indices -1.25% to +.25%. Japan's Nikkei +1.46%.
S&P 500 indicated +.12%.
NASDAQ indicated +.25%.
BOTTOM LINE: The Nikkei will break a double top on a close above 11,577. The world's 3rd largest economy is finally improving after years of dragging down world economic growth. This is a very positive development and I would not underestimate its consequences. The Semiconductor Index is still hovering right near its 200-day moving average. If the SOX can hold its recent lows, after Micron's relatively disappointing report, or rise tomorrow I would expect the entire tech sector to benefit. This should then lead to broad-market countertrend rally. The Portfolio is 25% net long.
Wednesday, March 24, 2004
Wednesday Close
S&P 500 1,091.33 -.24%
NASDAQ 1,909.48 +.40%
Leading Sectors
Gaming +3.28%
Semis +2.33%
Software +.53%
Lagging Sectors
Energy -2.11%
Iron/Steel -2.46%
Oil Service -3.05%
Other
Crude Oil 36.82 .51%
Natural Gas 5.42 -.22%
Gold 415.50 -.46%
Base Metals 111.80 +.84%
U.S. Dollar 88.97 +.04%
10-Yr. Long-Bond Yield 3.71% +.50%
VIX 19.81 -4.16%
Put/Call .89 +32.84%
NYSE Arms 1.24 +1.64%
After-hours Movers
THC +5.54% after it said it agreed to pay the government $30.75M to settle 2 investigations into its billing practices.
LSCC +3.33 after better-than-expected 4Q and restating previous 3 quarters downward.
MERX -8.34% after beating 3Q estimates and lowering 4Q guidance.
MU -4.55% after missing sales estimates for 2Q.
Recommendations
Goldman Sachs reiterates Outperform on MDT, PFE, TRW and MSFT.
After-hours News
U.S. stocks finished mixed on Wednesday as strength in gaming and semiconductors was offset by weakness in commodity-related sectors. Continued fears of terrorism hurt economically sensitive groups after French officials discovered a bomb underneath the tracks of a train headed from Paris to Basel. Investors fear that already weak European economies could weaken further, damaging the U.S. economy. After the close, the Financial Times said Microsoft faces further suits over Windows XP. Bush administration officials said they are working to get Saudi Arabia to disrupt funding for terror groups and they are cooperating much more than a year ago. Israeli forces stopped a 14-year old Palestinian boy that was paid $22 to carry an 18 pound bomb and detonate it at a roadblock. The boy said he was tempted by the promise of his dispatchers that he would meet 70 virgins once he entered heaven and that he wanted to be a hero, reported Ha'aretz.
BOTTOM LINE: The Portfolio ended down slightly on the day as the market deteriorated substantially in the afternoon. I sold a few of my commodity-related longs, bringing market exposure for the Portfolio back down to 25%. I will closely monitor the tech sector's reaction to a relatively disappointing quarter from Micron. A break below 456 on the Morgan Stanley High-tech index will lead me to exit some of my longs and a break above 467 will lead me to increase my exposure in tech. Semis led the market correction and it is good to see them stabilizing and showing outperformance. However, tomorrow will be the real test. I am expecting a significant countertrend rally to begin early next week, but it could begin at any time due to the oversold short-term position of the major U.S. indices.
NASDAQ 1,909.48 +.40%
Leading Sectors
Gaming +3.28%
Semis +2.33%
Software +.53%
Lagging Sectors
Energy -2.11%
Iron/Steel -2.46%
Oil Service -3.05%
Other
Crude Oil 36.82 .51%
Natural Gas 5.42 -.22%
Gold 415.50 -.46%
Base Metals 111.80 +.84%
U.S. Dollar 88.97 +.04%
10-Yr. Long-Bond Yield 3.71% +.50%
VIX 19.81 -4.16%
Put/Call .89 +32.84%
NYSE Arms 1.24 +1.64%
After-hours Movers
THC +5.54% after it said it agreed to pay the government $30.75M to settle 2 investigations into its billing practices.
LSCC +3.33 after better-than-expected 4Q and restating previous 3 quarters downward.
MERX -8.34% after beating 3Q estimates and lowering 4Q guidance.
MU -4.55% after missing sales estimates for 2Q.
Recommendations
Goldman Sachs reiterates Outperform on MDT, PFE, TRW and MSFT.
After-hours News
U.S. stocks finished mixed on Wednesday as strength in gaming and semiconductors was offset by weakness in commodity-related sectors. Continued fears of terrorism hurt economically sensitive groups after French officials discovered a bomb underneath the tracks of a train headed from Paris to Basel. Investors fear that already weak European economies could weaken further, damaging the U.S. economy. After the close, the Financial Times said Microsoft faces further suits over Windows XP. Bush administration officials said they are working to get Saudi Arabia to disrupt funding for terror groups and they are cooperating much more than a year ago. Israeli forces stopped a 14-year old Palestinian boy that was paid $22 to carry an 18 pound bomb and detonate it at a roadblock. The boy said he was tempted by the promise of his dispatchers that he would meet 70 virgins once he entered heaven and that he wanted to be a hero, reported Ha'aretz.
BOTTOM LINE: The Portfolio ended down slightly on the day as the market deteriorated substantially in the afternoon. I sold a few of my commodity-related longs, bringing market exposure for the Portfolio back down to 25%. I will closely monitor the tech sector's reaction to a relatively disappointing quarter from Micron. A break below 456 on the Morgan Stanley High-tech index will lead me to exit some of my longs and a break above 467 will lead me to increase my exposure in tech. Semis led the market correction and it is good to see them stabilizing and showing outperformance. However, tomorrow will be the real test. I am expecting a significant countertrend rally to begin early next week, but it could begin at any time due to the oversold short-term position of the major U.S. indices.
Mid-day Update
S&P 500 1,094.33 +.02%
NASDAQ 1,916.79 +.78%
Leading Sectors
Gaming +2.94%
Semis +2.86%
Software +.97%
Lagging Sectors
I-Banks -1.03%
Oil Service -1.58%
Iron/Steel -2.08%
Other
Crude Oil 37.15 -.80%
Natural Gas 5.44 -1.63%
Gold 417.40 -.62%
Base Metals 111.80 +.84%
U.S. Dollar 88.78 +1.14%
10-Yr. Long-Bond Yield 3.71% +.56%
VIX 19.84 -4.21%
Put/Call .85 +26.87%
NYSE Arms 1.01 -17.21%
Market Movers
NOVL +13.1% after announcing joint agreement with HPQ and multiple upgrades.
SNTO +17.6% after announcing that C. Lloyd Mahaffey joined board.
ENDP +13.6% after the drug-maker won U.S. approval for a generic version of the OxyContin painkiller.
CTB +7.8% after saying it may sell its auto-parts unit to focus on expanding its main business in emerging markets such as China.
PCSA -13.3% after announcing resignation of CFO.
GS -2.18% after negative Heard on the Street column in Wall Street Journal.
Gaming stocks up across the board on positive comments from Deutsche Bank.
Economic Data
Durable Goods Orders for February +2.5% vs. expectations of +1.5%.
Durable Goods Less Transportation for February -.3% vs. expectations of +1.0%.
New Home Sales for February 1163K vs. expectations of 1100K.
Recommendations
TheStreet.com says companies are using coal bed methane to boost natural gas production. Companies that are focusing on this method are APC, BR, DVN, ECA, EVG, KWK and MHR. Cramer of TheStreet.com is saying that the high Put/Call ratio, Investors Intelligence drop in bulls, the oversold oscillator reading and low valuations in many stocks should provide the catalyst for at least a short-term bottom. TMB, TSU, EAGL and HOT raised to Overweight at JP Morgan. BBBY and BBY raised to Outperform at CSFB. TWX raised to Sector Outperform by CIBC. SLB, BNI and NSC raised to Overweight at Morgan Stanley. CSX and UNP cut to Underweight at Morgan Stanley. SPLS raised to Overweight at Prudential. RSAS rated Buy at Citi Smith Barney. NRP raised to Buy at Citi. Citi says to use recent weakness in MAR, HLT and FHR to Buy. Citi says to Buy MSFT, target $34. Citi reiterates 1M on GTK. Citi reiterates 1H on GS, raised target to $127. Goldman Sachs says recreational boat season stronger than expected, reiterates Outperform on BC. GS reiterating Outperform on MSFT.
Mid-day News
U.S. stocks are mostly higher in the afternoon as strength in gaming and semiconductor companies more than offset terrorism fears in Europe. Many U.S. companies and politicians are criticized for exporting jobs outside the U.S., while the fact that foreign companies are creating jobs here almost goes unnoticed, the Wall Street Journal reported. France's embassy in Djibouti said today it received a letter from an Islamic extremist threatening French interests due to its ban on religious clothing in public schools, Agence France-Presse reported. An unexploded bomb with several detonators was found today in France on the rail line linking Paris and the Swiss city of Basel, AFP reported. The U.S. economy is strengthening as business investment picks up and that will force the Fed to raise rates at some point, said Fed Bank of Atlanta President Jack Guynn. U.S. durable goods orders rose a larger-than-expected 2.5% in February on strength in computers, vehicles and aircraft. New Home Sales were the third-fastest on record, reported Bloomberg. Crude oil fell after an Energy Dept. report showed inventories rose to their highest level in 4 months.
BOTTOM LINE: The Portfolio is up today as one of my longs is up substantially and my shorts are unchanged. I added a few beaten up tech long positions this morning, raising market exposure to 50% net long. It is too early to tell if the countertrend rally has begun, but outperformance by semis is a positive development. A move up through 467 on the Morgan Stanley High-tech Index will likely lead me to add another 25% long exposure.
NASDAQ 1,916.79 +.78%
Leading Sectors
Gaming +2.94%
Semis +2.86%
Software +.97%
Lagging Sectors
I-Banks -1.03%
Oil Service -1.58%
Iron/Steel -2.08%
Other
Crude Oil 37.15 -.80%
Natural Gas 5.44 -1.63%
Gold 417.40 -.62%
Base Metals 111.80 +.84%
U.S. Dollar 88.78 +1.14%
10-Yr. Long-Bond Yield 3.71% +.56%
VIX 19.84 -4.21%
Put/Call .85 +26.87%
NYSE Arms 1.01 -17.21%
Market Movers
NOVL +13.1% after announcing joint agreement with HPQ and multiple upgrades.
SNTO +17.6% after announcing that C. Lloyd Mahaffey joined board.
ENDP +13.6% after the drug-maker won U.S. approval for a generic version of the OxyContin painkiller.
CTB +7.8% after saying it may sell its auto-parts unit to focus on expanding its main business in emerging markets such as China.
PCSA -13.3% after announcing resignation of CFO.
GS -2.18% after negative Heard on the Street column in Wall Street Journal.
Gaming stocks up across the board on positive comments from Deutsche Bank.
Economic Data
Durable Goods Orders for February +2.5% vs. expectations of +1.5%.
Durable Goods Less Transportation for February -.3% vs. expectations of +1.0%.
New Home Sales for February 1163K vs. expectations of 1100K.
Recommendations
TheStreet.com says companies are using coal bed methane to boost natural gas production. Companies that are focusing on this method are APC, BR, DVN, ECA, EVG, KWK and MHR. Cramer of TheStreet.com is saying that the high Put/Call ratio, Investors Intelligence drop in bulls, the oversold oscillator reading and low valuations in many stocks should provide the catalyst for at least a short-term bottom. TMB, TSU, EAGL and HOT raised to Overweight at JP Morgan. BBBY and BBY raised to Outperform at CSFB. TWX raised to Sector Outperform by CIBC. SLB, BNI and NSC raised to Overweight at Morgan Stanley. CSX and UNP cut to Underweight at Morgan Stanley. SPLS raised to Overweight at Prudential. RSAS rated Buy at Citi Smith Barney. NRP raised to Buy at Citi. Citi says to use recent weakness in MAR, HLT and FHR to Buy. Citi says to Buy MSFT, target $34. Citi reiterates 1M on GTK. Citi reiterates 1H on GS, raised target to $127. Goldman Sachs says recreational boat season stronger than expected, reiterates Outperform on BC. GS reiterating Outperform on MSFT.
Mid-day News
U.S. stocks are mostly higher in the afternoon as strength in gaming and semiconductor companies more than offset terrorism fears in Europe. Many U.S. companies and politicians are criticized for exporting jobs outside the U.S., while the fact that foreign companies are creating jobs here almost goes unnoticed, the Wall Street Journal reported. France's embassy in Djibouti said today it received a letter from an Islamic extremist threatening French interests due to its ban on religious clothing in public schools, Agence France-Presse reported. An unexploded bomb with several detonators was found today in France on the rail line linking Paris and the Swiss city of Basel, AFP reported. The U.S. economy is strengthening as business investment picks up and that will force the Fed to raise rates at some point, said Fed Bank of Atlanta President Jack Guynn. U.S. durable goods orders rose a larger-than-expected 2.5% in February on strength in computers, vehicles and aircraft. New Home Sales were the third-fastest on record, reported Bloomberg. Crude oil fell after an Energy Dept. report showed inventories rose to their highest level in 4 months.
BOTTOM LINE: The Portfolio is up today as one of my longs is up substantially and my shorts are unchanged. I added a few beaten up tech long positions this morning, raising market exposure to 50% net long. It is too early to tell if the countertrend rally has begun, but outperformance by semis is a positive development. A move up through 467 on the Morgan Stanley High-tech Index will likely lead me to add another 25% long exposure.
Wednesday Watch
Earnings Announcements
Company/Estimate
LSCC/-.01
MERX/.09
MU/-.07
PERY/1.11
Splits
ASFI 2-for-1
COCO 2-for-1
Economic Data
Durable Goods Orders for February estimated up 1.5% vs. -2.3% prior month.
Durable Goods Less Transportation for February estimated up 1.0% vs. 1.2% prior month.
New Home Sales estimated at 1100K for February vs. 1106K prior month.
Recommendations
Goldman Sachs reiterated Underperform on RKY. TheStreet.com is saying OVTI is about to have a lot of large competition. TSC also says that this still looks a pullback in a primary uptrend.
Late-Night News
Asian stocks are mostly higher on an upgrade of Japan's debt rating and several major stock buyback announcements by leading Taiwanese companies. Richard Branson's Virgin USA low-cost carrier plans to purchase as many as 55 planes and may partner with US Airways as it seeks to take advantage of demand for low cost flights in the U.S. OPEC will discuss a proposal to delay production cuts at a meeting next week, OPEC news agency said. Taiwan Semi announced a 300 million share buyback on its 13% decline since the disputed election. Nokia(NOK) may tell shareholders at an annual general meeting Thursday that demand for handsets is rising, leading to better-than-expected 1Q earnings. Japan's debt outlook was raised by S&P, the first of the rating companies to become more optimistic after 3 years of downgrades.
Late-Night Trading
Asian Indices -.25% to +.75%.
S&P 500 indicated -.05%.
NASDAQ indicated +.11%.
BOTTOM LINE: I expect the U.S. markets to remain weak to flat tomorrow on continuing worries over geopolitical matters, technical deterioration and high commodity prices. The Portfolio is 25% net long and I will look to add market exposure on any signs of a significant countertrend rally.
Company/Estimate
LSCC/-.01
MERX/.09
MU/-.07
PERY/1.11
Splits
ASFI 2-for-1
COCO 2-for-1
Economic Data
Durable Goods Orders for February estimated up 1.5% vs. -2.3% prior month.
Durable Goods Less Transportation for February estimated up 1.0% vs. 1.2% prior month.
New Home Sales estimated at 1100K for February vs. 1106K prior month.
Recommendations
Goldman Sachs reiterated Underperform on RKY. TheStreet.com is saying OVTI is about to have a lot of large competition. TSC also says that this still looks a pullback in a primary uptrend.
Late-Night News
Asian stocks are mostly higher on an upgrade of Japan's debt rating and several major stock buyback announcements by leading Taiwanese companies. Richard Branson's Virgin USA low-cost carrier plans to purchase as many as 55 planes and may partner with US Airways as it seeks to take advantage of demand for low cost flights in the U.S. OPEC will discuss a proposal to delay production cuts at a meeting next week, OPEC news agency said. Taiwan Semi announced a 300 million share buyback on its 13% decline since the disputed election. Nokia(NOK) may tell shareholders at an annual general meeting Thursday that demand for handsets is rising, leading to better-than-expected 1Q earnings. Japan's debt outlook was raised by S&P, the first of the rating companies to become more optimistic after 3 years of downgrades.
Late-Night Trading
Asian Indices -.25% to +.75%.
S&P 500 indicated -.05%.
NASDAQ indicated +.11%.
BOTTOM LINE: I expect the U.S. markets to remain weak to flat tomorrow on continuing worries over geopolitical matters, technical deterioration and high commodity prices. The Portfolio is 25% net long and I will look to add market exposure on any signs of a significant countertrend rally.
Tuesday, March 23, 2004
Tuesday Close
S&P 500 1,093.95 -.13%
NASDAQ 1,901.80 -.42%
Leading Sectors
Iron/Steel +.80%
HMO's +.78%
Airlines +.72%
Lagging Sectors
Telecom -1.02%
Disk Drives -1.03%
Oil Service -1.40%
Other
Crude Oil 37.51 +.16%
Natural Gas 5.53 unch.
Gold 419.90 -.02%
Base Metals 110.87 -1.28%
U.S. Dollar 87.85 +.07%
10-Yr. Long-Bond Yield 3.69% -.61%
VIX 20.67 -4.22%
Put/Call .67 -30.21%
NYSE Arms 1.22 -63.58%
After-hours Movers
RHAT +9.12% after largest developer of Linux software met 4Q estimates and raised 1Q guidance.
NOVL +5.71% as number 2 developer of Linux software benefited from strong RHAT report.
Recommendations
Goldman Sachs reiterated Outperform on AMGN. GS reiterates its view that steel stocks will continue to see earnings driven outperformance. TheStreet.com has a negative column on AWE, saying it is losing subscribers. TheStreet.com has a positive column on gaming stocks, saying estimates are rising as the stocks correct.
After-hours News
U.S. stocks ended slightly lower Tuesday on another disappointing session for the bulls. Equities were higher until the final 30 minutes, dropping on reports that Israeli gunboats opened fired off the shoreline of Gaza City. After the close, Tyson Foods said it won't have to pay $1.28B in damages to thousands of ranchers, according to a ruling by a U.S. judge. Morgan Stanley led companies that sold $7.5B of new notes and bonds today, more than double the daily average this year, as frequent borrowers such as finance companies took advantage of low borrowing costs. Israeli planes hit a squad preparing to fire rockets from Lebanon into Israel, military officials reported.
BOTTOM LINE: The Portfolio was up slightly on the day, as I took profits in a few winning longs and added a new overbought short, bringing market exposure back down to 25% net long. I shorted ANF in the afternoon and will use a tight stop-loss of $33 as the market is very oversold short-term. The action in the final 30 minutes was disheartening for the bulls, as the days gains completely evaporated on some inconsequential news items. I expect a bit more weakness before a real countertrend rally begins on quarter-end mark-ups. Furthermore, I expect weakness to resurface in early April. However, the beginning of earnings season later in the month should provide the catalyst for a resumption of the bull market that began last year.
NASDAQ 1,901.80 -.42%
Leading Sectors
Iron/Steel +.80%
HMO's +.78%
Airlines +.72%
Lagging Sectors
Telecom -1.02%
Disk Drives -1.03%
Oil Service -1.40%
Other
Crude Oil 37.51 +.16%
Natural Gas 5.53 unch.
Gold 419.90 -.02%
Base Metals 110.87 -1.28%
U.S. Dollar 87.85 +.07%
10-Yr. Long-Bond Yield 3.69% -.61%
VIX 20.67 -4.22%
Put/Call .67 -30.21%
NYSE Arms 1.22 -63.58%
After-hours Movers
RHAT +9.12% after largest developer of Linux software met 4Q estimates and raised 1Q guidance.
NOVL +5.71% as number 2 developer of Linux software benefited from strong RHAT report.
Recommendations
Goldman Sachs reiterated Outperform on AMGN. GS reiterates its view that steel stocks will continue to see earnings driven outperformance. TheStreet.com has a negative column on AWE, saying it is losing subscribers. TheStreet.com has a positive column on gaming stocks, saying estimates are rising as the stocks correct.
After-hours News
U.S. stocks ended slightly lower Tuesday on another disappointing session for the bulls. Equities were higher until the final 30 minutes, dropping on reports that Israeli gunboats opened fired off the shoreline of Gaza City. After the close, Tyson Foods said it won't have to pay $1.28B in damages to thousands of ranchers, according to a ruling by a U.S. judge. Morgan Stanley led companies that sold $7.5B of new notes and bonds today, more than double the daily average this year, as frequent borrowers such as finance companies took advantage of low borrowing costs. Israeli planes hit a squad preparing to fire rockets from Lebanon into Israel, military officials reported.
BOTTOM LINE: The Portfolio was up slightly on the day, as I took profits in a few winning longs and added a new overbought short, bringing market exposure back down to 25% net long. I shorted ANF in the afternoon and will use a tight stop-loss of $33 as the market is very oversold short-term. The action in the final 30 minutes was disheartening for the bulls, as the days gains completely evaporated on some inconsequential news items. I expect a bit more weakness before a real countertrend rally begins on quarter-end mark-ups. Furthermore, I expect weakness to resurface in early April. However, the beginning of earnings season later in the month should provide the catalyst for a resumption of the bull market that began last year.
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