Indices
S&P 500 1,134.61 -.41%
Dow 10,451.97 +.09%
NASDAQ 1,995.74 -.32%
Russell 2000 583.37 -2.43%
Wilshire 5000 11,078.10 -.79%
Volatility(VIX) 14.94 -8.12%
AAII Bullish % 63.75 +8.46%
US Dollar 89.94 +1.14%
CRB 277.52 -2.31%
Futures Spot Prices
Gold 401.60 -4.52%
Crude Oil 37.74 +1.64%
Natural Gas 5.61 -5.32%
Base Metals 112.93 +1.26%
10-year US Treasury Yield 4.34% +3.58%
Average 30-year Mortgage Rate 5.89% +1.73%
Leading Sectors
Drugs +4.42%
Oil Service +3.86%
Energy +3.15%
Lagging Sectors
Semis -6.18%
Broadband -6.57%
Disk Drives -6.82%
*% Gain or loss for the week
Saturday, April 17, 2004
Friday, April 16, 2004
Friday Close
S&P 500 1,134.61 +.51%
NASDAQ 1,995.74 -.32%
Leading Sectors
Gaming +2.49%
Papers +1.92%
I-Banks +1.81%
Lagging Sectors
Semis -1.76%
Broadband -2.50%
Disk Drives -2.88%
Other
Crude Oil 37.74 +.45%
Natural Gas 5.61 -2.16%
Gold 401.60 +.83%
Base Metals 112.93 +1.45%
U.S. Dollar 89.94 -.13%
10-Yr. Long-Bond Yield 4.34% -1.27%
VIX 14.94 -5.08%
Put/Call .77 -8.33%
NYSE Arms 1.44 +51.58%
After-hours Movers
DNA +7.31% after announcing an increase in its authorized shares of common stock from 1.2B to 3B shares and declaring a 2-for-1 stock split.
Recommendations
MOLXA raised to Buy at Citi Smith Barney. Goldman Sachs reiterated Outperform on ROH, DOW, PKG, MCK, CAH and CLS.
After-hours News
U.S. stocks finished mixed as declining rates boosted shares of consumer cyclicals and financials while technology stocks continued their recent underperformance. After the close, Bloomberg reported that Japanese bonds fell for a fifth week, their longest slide in more than two years, on prospects that an export-led economic recovery will be sustained after reports signaled growth will accelerate in the U.S. Ernst & Young will be barred from accepting new public company audit clients for six months because of independence violations, a U.S. SEC judge ruled.
BOTTOM LINE: The Portfolio finished down on the day. I rotated out of some losing tech positions and into a few consumer cyclical and energy-related stocks, leaving the portfolio with market neutral exposure. The technology sector appears to have further downside in the near-term, while many other sectors seem to be stabilizing.
NASDAQ 1,995.74 -.32%
Leading Sectors
Gaming +2.49%
Papers +1.92%
I-Banks +1.81%
Lagging Sectors
Semis -1.76%
Broadband -2.50%
Disk Drives -2.88%
Other
Crude Oil 37.74 +.45%
Natural Gas 5.61 -2.16%
Gold 401.60 +.83%
Base Metals 112.93 +1.45%
U.S. Dollar 89.94 -.13%
10-Yr. Long-Bond Yield 4.34% -1.27%
VIX 14.94 -5.08%
Put/Call .77 -8.33%
NYSE Arms 1.44 +51.58%
After-hours Movers
DNA +7.31% after announcing an increase in its authorized shares of common stock from 1.2B to 3B shares and declaring a 2-for-1 stock split.
Recommendations
MOLXA raised to Buy at Citi Smith Barney. Goldman Sachs reiterated Outperform on ROH, DOW, PKG, MCK, CAH and CLS.
After-hours News
U.S. stocks finished mixed as declining rates boosted shares of consumer cyclicals and financials while technology stocks continued their recent underperformance. After the close, Bloomberg reported that Japanese bonds fell for a fifth week, their longest slide in more than two years, on prospects that an export-led economic recovery will be sustained after reports signaled growth will accelerate in the U.S. Ernst & Young will be barred from accepting new public company audit clients for six months because of independence violations, a U.S. SEC judge ruled.
BOTTOM LINE: The Portfolio finished down on the day. I rotated out of some losing tech positions and into a few consumer cyclical and energy-related stocks, leaving the portfolio with market neutral exposure. The technology sector appears to have further downside in the near-term, while many other sectors seem to be stabilizing.
Mid-day Update
S&P 500 1,135.13 +.56%
NASDAQ 2,003.02 +.04%
Leading Sectors
Gaming +1.93%
Restaurants +1.85%
I-Banks +1.85%
Lagging Sectors
Semis -1.46%
Broadband -1.87%
Disk Drives -2.49%
Other
Crude Oil 37.36 -.56%
Natural Gas 5.65 -1.38%
Gold 400.50 +.55%
Base Metals 112.93 +1.45%
U.S. Dollar 89.88 -.21%
10-Yr. Long-Bond Yield 4.36% -.91%
VIX 14.85 -5.72%
Put/Call .78 -7.14%
NYSE Arms 1.59 +67.37%
Market Movers
NOK -8.35% after lowering 2Q estimates and multiple downgrades.
DCLK -25.6% after missing 1Q sales estimates, lowering 2Q forecast and multiple downgrades.
LEXR -30.5% after missing 1Q estimate, lowering 2Q forecast and multiple downgrades.
AVID +10.78% after beating 1Q estimates.
GWW +6.97% after beating 1Q estimates and raising 04 forecast.
TASR +9.4% on further short-squeeze and anticipation of quarterly report next week.
NFLX -16.66% after saying it expects more customers to cancel subscriptions this quarter after raising fees.
Economic Data
Housing Starts for March 2007K vs. 1900K estimate.
Building Permits for March 1946K vs. 1910 estimate.
Industrial Production for March -.2% vs. +.3% estimate.
Capacity Utilization for March 76.5% vs. 76.8% estimate.
U. of Mich. Consumer Confidence preliminary April 93.2 vs. 97.0 estimate.
Recommendations
GTK raised to Buy at Merrill, target $68. CPB rated Sell and Bank of America. MOGN raised to Buy at Bank of America, target $74. Citi Smith Barney recommending Sell Brazilian debt. Citi says MOT will meet or exceed estimates. Citi lowered rating on DCLK to Sell. Citi reiterated Buy on UNH, target $74. Citi reiterated Buy on SEBL, $19 target. Citi reiterated Buy on CCI, target $18. Goldman Sachs reiterating Outperform on JCI, UNH, IBM, TRB and FD. TheStreet.com has a positive column on MRCY.
Mid-day News
U.S. stocks are rising mid-day as commodity and consumer cyclicals rise on a fall in interest rates. Xerox plans to detail in a report "major progress" toward fabricating electronics from low-cost, flexible plastic, the NY Times reported. Shiite cleric al-Sadr said a compromise with the coalition in Iraq "will not work", Agence France-Presse reported. Copper futures in NY had their biggest gain in two months after a government report showed a surge in U.S. housing starts last month, reviving expectations for increased metal demand, Bloomberg reported. The U.S. economy is showing signs of accelerating without significant risks of inflation, as consumer spending strengthens and companies invest in more workers and equipment, said Alfred Broaddus, president of the Federal Reserve Bank of Richmond.
BOTTOM LINE: The Portfolio is down today as one of my longs is falling significantly and shorts are unchanged. I have not traded as of yet, thus the Portfolio is still market neutral. The broad market is looking much better, with the exception of tech. Tech looks like it is heading lower in the short-run, while the rest of the market will likely remain neutral to slightly higher. I will look to add market exposure in gaming and cyclicals on any weakness from tech selling.
NASDAQ 2,003.02 +.04%
Leading Sectors
Gaming +1.93%
Restaurants +1.85%
I-Banks +1.85%
Lagging Sectors
Semis -1.46%
Broadband -1.87%
Disk Drives -2.49%
Other
Crude Oil 37.36 -.56%
Natural Gas 5.65 -1.38%
Gold 400.50 +.55%
Base Metals 112.93 +1.45%
U.S. Dollar 89.88 -.21%
10-Yr. Long-Bond Yield 4.36% -.91%
VIX 14.85 -5.72%
Put/Call .78 -7.14%
NYSE Arms 1.59 +67.37%
Market Movers
NOK -8.35% after lowering 2Q estimates and multiple downgrades.
DCLK -25.6% after missing 1Q sales estimates, lowering 2Q forecast and multiple downgrades.
LEXR -30.5% after missing 1Q estimate, lowering 2Q forecast and multiple downgrades.
AVID +10.78% after beating 1Q estimates.
GWW +6.97% after beating 1Q estimates and raising 04 forecast.
TASR +9.4% on further short-squeeze and anticipation of quarterly report next week.
NFLX -16.66% after saying it expects more customers to cancel subscriptions this quarter after raising fees.
Economic Data
Housing Starts for March 2007K vs. 1900K estimate.
Building Permits for March 1946K vs. 1910 estimate.
Industrial Production for March -.2% vs. +.3% estimate.
Capacity Utilization for March 76.5% vs. 76.8% estimate.
U. of Mich. Consumer Confidence preliminary April 93.2 vs. 97.0 estimate.
Recommendations
GTK raised to Buy at Merrill, target $68. CPB rated Sell and Bank of America. MOGN raised to Buy at Bank of America, target $74. Citi Smith Barney recommending Sell Brazilian debt. Citi says MOT will meet or exceed estimates. Citi lowered rating on DCLK to Sell. Citi reiterated Buy on UNH, target $74. Citi reiterated Buy on SEBL, $19 target. Citi reiterated Buy on CCI, target $18. Goldman Sachs reiterating Outperform on JCI, UNH, IBM, TRB and FD. TheStreet.com has a positive column on MRCY.
Mid-day News
U.S. stocks are rising mid-day as commodity and consumer cyclicals rise on a fall in interest rates. Xerox plans to detail in a report "major progress" toward fabricating electronics from low-cost, flexible plastic, the NY Times reported. Shiite cleric al-Sadr said a compromise with the coalition in Iraq "will not work", Agence France-Presse reported. Copper futures in NY had their biggest gain in two months after a government report showed a surge in U.S. housing starts last month, reviving expectations for increased metal demand, Bloomberg reported. The U.S. economy is showing signs of accelerating without significant risks of inflation, as consumer spending strengthens and companies invest in more workers and equipment, said Alfred Broaddus, president of the Federal Reserve Bank of Richmond.
BOTTOM LINE: The Portfolio is down today as one of my longs is falling significantly and shorts are unchanged. I have not traded as of yet, thus the Portfolio is still market neutral. The broad market is looking much better, with the exception of tech. Tech looks like it is heading lower in the short-run, while the rest of the market will likely remain neutral to slightly higher. I will look to add market exposure in gaming and cyclicals on any weakness from tech selling.
Friday Watch
Earnings Announcements
Company/Estimate
CVTX/-1.25
DPH/.20
ET/.20
BONZ/.04
NVR/11.36
SUP/.50
TARO/.53
VMSI/.06
Splits
None of note.
Economic Data
Housing Starts for March estimated at 1900K vs. 1855K prior month.
Building Permits for March estimated at 1910K vs. 1903K prior month.
Industrial Production for March estimated +.3% vs. +.7% prior month.
Capacity Utilization for March estimated at 76.8% vs. 76.6% prior month.
U. of Mich. Consumer Confidence preliminary April estimated at 97.0 vs. 95.8 prior month.
Recommendations
None of note.
Late-Night News
Asian stocks are mixed as strength in Taiwan is being offset by weakness in Korea. In another sign that companies have finally begun to boost their technology spending, worldwide PC shipments rose 16.5% in the in the first quarter versus expectations of 13.5% growth, according to researcher IDC. The genetically-modified food debate will begin to intensify in the EU as the 15-nation block prepares to end its six-year ban on new bio-engineered crops, the Wall Street Journal reported. Echo Bay Mines is under investigation for allegedly paying terrorist groups in exchange for protection of its mines, ABC News said. China and the U.S. are close to reaching a bilateral air services agreement, the South China Morning Post reported.
Late-Night Trading
Asian Indices -1.75% to +1.25%.
S&P 500 indicated unch.
NASDAQ indicated -.14%.
BOTTOM LINE: The NASDAQ 100 Globex futures are rallying late-night after declining 9 points earlier in the evening. The Portfolio is market neutral heading into trading tomorrow. U.S. stocks may bounce tomorrow if the NASDAQ 2000 level holds early on. A convincing break through 2000 would lead to further selling in the broad market. I would like to see stocks with great earnings reports rewarded and interest rates stabilizing before I get more aggressive on the long-side.
Company/Estimate
CVTX/-1.25
DPH/.20
ET/.20
BONZ/.04
NVR/11.36
SUP/.50
TARO/.53
VMSI/.06
Splits
None of note.
Economic Data
Housing Starts for March estimated at 1900K vs. 1855K prior month.
Building Permits for March estimated at 1910K vs. 1903K prior month.
Industrial Production for March estimated +.3% vs. +.7% prior month.
Capacity Utilization for March estimated at 76.8% vs. 76.6% prior month.
U. of Mich. Consumer Confidence preliminary April estimated at 97.0 vs. 95.8 prior month.
Recommendations
None of note.
Late-Night News
Asian stocks are mixed as strength in Taiwan is being offset by weakness in Korea. In another sign that companies have finally begun to boost their technology spending, worldwide PC shipments rose 16.5% in the in the first quarter versus expectations of 13.5% growth, according to researcher IDC. The genetically-modified food debate will begin to intensify in the EU as the 15-nation block prepares to end its six-year ban on new bio-engineered crops, the Wall Street Journal reported. Echo Bay Mines is under investigation for allegedly paying terrorist groups in exchange for protection of its mines, ABC News said. China and the U.S. are close to reaching a bilateral air services agreement, the South China Morning Post reported.
Late-Night Trading
Asian Indices -1.75% to +1.25%.
S&P 500 indicated unch.
NASDAQ indicated -.14%.
BOTTOM LINE: The NASDAQ 100 Globex futures are rallying late-night after declining 9 points earlier in the evening. The Portfolio is market neutral heading into trading tomorrow. U.S. stocks may bounce tomorrow if the NASDAQ 2000 level holds early on. A convincing break through 2000 would lead to further selling in the broad market. I would like to see stocks with great earnings reports rewarded and interest rates stabilizing before I get more aggressive on the long-side.
Thursday, April 15, 2004
Thursday Close
S&P 500 1,128.84 +.06%
NASDAQ 2,002.17 -1.12%
Leading Sectors
Drugs +3.57%
Oil Service +2.28%
Energy +1.27%
Lagging Sectors
Semis -2.85%
Disk Drives -3.33%
HMO's -3.55%
Other
Crude Oil 37.85 +.75%
Natural Gas 5.73 unch.
Gold 400.30 +.50%
Base Metals 111.32 -.28%
U.S. Dollar 90.04 -.03%
10-Yr. Long-Bond Yield 4.39% +.78%
VIX 15.74 +.77%
Put/Call .84 +5.00%
NYSE Arms .95 +53.23%
After-hours Movers
LEXR -21.04% after missing 1Q estimates and lowering 04 forecast.
DCLK -16.25% after missing 1Q estimates and lowering 2Q guidance.
NFLX -10.99% on profit-taking after meeting 1Q estimates and raising 2Q and 04 guidance.
CREE +4.44% after beating 3Q estimates and raising 4Q guidance.
PMCS -8.06% on profit-taking after beating 1Q estimates and raising 2Q guidance.
IPIX -20.25% after reporting disappointing 1Q results.
Recommendations
Goldman Sachs reiterated Outperform on CEN, PEP, KMT and CAL. GS reiterated Underperform on UIS. Greg Manning Auctions(GMAI), the seller of collectible stamps and coins that has seen its stock price increase more than 700% since June, is still undervalued, Business Week reported.
After-hours News
U.S. stocks finished mixed on strength in drug and energy shares and weakness in tech stocks. After the close, Japan said it would relax the requirement of having all cattle it purchases from the U.S. tested for mad cow, the Nihon Keizai reported. New York Senator Hillary Clinton said she wouldn't consider being Democratic presidential candidate John Kerry's running mate, NBC news reported. One month of inflation data may not be conclusive enough to change the Fed's long-term forecast on prices, Federal Reserve Governor Ben Bernanke said. IBM said first-quarter net income rose 16% and sales rose 11%. IBM's CFO John Joyce said that "Customer's existing infrastructure is the oldest it's been in nearly 20 years. There's a need for customers to update."
BOTTOM LINE: The Portfolio fell slightly today and I took profits in a few winning tech longs in the afternoon, bringing the Portfolio's market exposure to market neutral(longs-shorts=0). My short-term trading indicators turned negative today and the fact that many companies reporting very good earnings still fell does not bode well for the short-term direction of the market, thus my conservative postioning.
NASDAQ 2,002.17 -1.12%
Leading Sectors
Drugs +3.57%
Oil Service +2.28%
Energy +1.27%
Lagging Sectors
Semis -2.85%
Disk Drives -3.33%
HMO's -3.55%
Other
Crude Oil 37.85 +.75%
Natural Gas 5.73 unch.
Gold 400.30 +.50%
Base Metals 111.32 -.28%
U.S. Dollar 90.04 -.03%
10-Yr. Long-Bond Yield 4.39% +.78%
VIX 15.74 +.77%
Put/Call .84 +5.00%
NYSE Arms .95 +53.23%
After-hours Movers
LEXR -21.04% after missing 1Q estimates and lowering 04 forecast.
DCLK -16.25% after missing 1Q estimates and lowering 2Q guidance.
NFLX -10.99% on profit-taking after meeting 1Q estimates and raising 2Q and 04 guidance.
CREE +4.44% after beating 3Q estimates and raising 4Q guidance.
PMCS -8.06% on profit-taking after beating 1Q estimates and raising 2Q guidance.
IPIX -20.25% after reporting disappointing 1Q results.
Recommendations
Goldman Sachs reiterated Outperform on CEN, PEP, KMT and CAL. GS reiterated Underperform on UIS. Greg Manning Auctions(GMAI), the seller of collectible stamps and coins that has seen its stock price increase more than 700% since June, is still undervalued, Business Week reported.
After-hours News
U.S. stocks finished mixed on strength in drug and energy shares and weakness in tech stocks. After the close, Japan said it would relax the requirement of having all cattle it purchases from the U.S. tested for mad cow, the Nihon Keizai reported. New York Senator Hillary Clinton said she wouldn't consider being Democratic presidential candidate John Kerry's running mate, NBC news reported. One month of inflation data may not be conclusive enough to change the Fed's long-term forecast on prices, Federal Reserve Governor Ben Bernanke said. IBM said first-quarter net income rose 16% and sales rose 11%. IBM's CFO John Joyce said that "Customer's existing infrastructure is the oldest it's been in nearly 20 years. There's a need for customers to update."
BOTTOM LINE: The Portfolio fell slightly today and I took profits in a few winning tech longs in the afternoon, bringing the Portfolio's market exposure to market neutral(longs-shorts=0). My short-term trading indicators turned negative today and the fact that many companies reporting very good earnings still fell does not bode well for the short-term direction of the market, thus my conservative postioning.
Mid-day Update
S&P 500 1,127.60 -.05%
NASDAQ 2,003.66 -1.05%
Leading Sectors
Drugs +3.23%
Oil Service +2.09%
Energy +1.04%
Lagging Sectors
Disk Drives -3.14%
Semis -3.24%
HMO's -4.06%
Other
Crude Oil 37.00 +.76%
Natural Gas 5.65 -1.55%
Gold 399.20 -.30%
Base Metals 111.32 -.28%
U.S. Dollar 90.37 +.14%
10-Yr. Long-Bond Yield 4.36% -.04%
VIX 15.81 +1.22%
Put/Call .76 -5.00%
NYSE Arms 1.05 +69.35%
Market Movers
AAPL +7.9% after substantially beating 2Q estimates and raising 3Q guidance.
AMD -6.6% after substantially beating 1Q estimates and saying 2Q margins could be lower.
TBI +23.01% on $2.7B acquisition by ECA.
NAP +19.78% after substantially beating 1Q forecast and raising 04 guidance.
SNDK -11.9% after substantially beating 1Q estimates, CEO said he cut prices 20% as pre-emptive move because cards aren't selling fast enough.
CCBL -19.01% after announcing purchase of Lantern Communications, saying it will meet 3Q estimates, but miss 4Q.
CNET -17.18% after beating 1Q estimates, but weaker-than-expected guidance.
Economic Data
Empire Manufacturing for April 36.05 vs. 28.25 estimate.
Initial Jobless Claims last week 360K vs. 335K estimate.
Continuing Claims 2980K vs. 3000K estimate.
Philadelphia Fed. for April 69 vs. 65 estimate.
Recommendations
Deutsche Bank rated GTK BUY, target $72. PCG raised to BUY at Bank of America, target $33. FCN cut to UNDERPERFORM at CSFB. ATK raised to BUY at Bank of America, target $64. DAL cut to UNDERWEIGHT at Prudential. GE rated OVERWEIGHT at Morgan Stanley, $38 target. JBHT rated OUTPERFORM at Raymond James, target $36. TXN rated OUTPERFORM at Raymond James, target $35. Goldman Sachs says Gold is a BUY right here with 22% upside potential, favorite stocks are NEM and PDG. GS reiterated OUTPERFORM on SNDK, EQT and UNH. Citi Smith Barney upgraded MTG to BUY. Citi says VZ is favorite telecom service stock going into second quarter. Citi reiterates 1S on CNET, would buy on weakness. Citi reiterated BUY on EXTR, $11 target. Citi raised KMP to BUY.
Mid-day News
U.S. stocks are falling mid-day as strength in pharmaceuticals and energy stocks is not offsetting weakness in technology and hmo shares. RealNetworks CEO Glaser proposed creating a musical alliance with Apple, the NY Times reported. Google plans to announce today that it will offer businesses the Internet equivalent of local advertising, the NY Times reported. PacifiCare Health and Humana are among managed-care companies that could see a significant reduction in payments amid a debate about trimming Medicare spending, the NY Times reported. Equipment used in nuclear-related projects, some of it contaminated by radiation, and a small number of missile engines were smuggled out of Iraq to scrap yards in Europe, the Washington Post reported, citing the head of the UN's nuclear watchdog group. Iraqis growing middle class is spending more on their homes, benefiting furniture and electronics retailers, lighting companies, building companies and plant stores. Many Iraqis first purchase a TV and satellite dish, which were outlawed under Saddam Hussein's regime, the LA Times reported. A company in Sausalito, California, is offering to clone people's cats for $50,000, the San Francisco Chronicle reported. The number of Americans filing initial claims for jobless benefits rose to 360,000 last week, a 30,000 increase that was the biggest in more than a year. International investors increased their holdings of U.S. government debt, corporate bonds and stocks by a net $83.4B in February.
BOTTOM LINE: The Portfolio is down slightly today as my declining shorts are not offsetting losses in my tech longs. I added a few new shorts in the biotechnology sector this morning, lowering the Portfolio's market exposure to 25% net long. My short-term indicators have now turned negative. The action in technology shares is not good for the bulls. Quarterly reports that should be viewed positively are not, thus leading me to believe that there is more downside in this sector. However, 2000 on the NASDAQ may provide some support in the short-term. U.S. stocks will likely remain weaker to neutral until the first rate hike as investors are very worried the Fed is falling behind the curve on inflation. I do not believe that this fear is valid at this time, however I am not going to fight the perceptions of the market.
NASDAQ 2,003.66 -1.05%
Leading Sectors
Drugs +3.23%
Oil Service +2.09%
Energy +1.04%
Lagging Sectors
Disk Drives -3.14%
Semis -3.24%
HMO's -4.06%
Other
Crude Oil 37.00 +.76%
Natural Gas 5.65 -1.55%
Gold 399.20 -.30%
Base Metals 111.32 -.28%
U.S. Dollar 90.37 +.14%
10-Yr. Long-Bond Yield 4.36% -.04%
VIX 15.81 +1.22%
Put/Call .76 -5.00%
NYSE Arms 1.05 +69.35%
Market Movers
AAPL +7.9% after substantially beating 2Q estimates and raising 3Q guidance.
AMD -6.6% after substantially beating 1Q estimates and saying 2Q margins could be lower.
TBI +23.01% on $2.7B acquisition by ECA.
NAP +19.78% after substantially beating 1Q forecast and raising 04 guidance.
SNDK -11.9% after substantially beating 1Q estimates, CEO said he cut prices 20% as pre-emptive move because cards aren't selling fast enough.
CCBL -19.01% after announcing purchase of Lantern Communications, saying it will meet 3Q estimates, but miss 4Q.
CNET -17.18% after beating 1Q estimates, but weaker-than-expected guidance.
Economic Data
Empire Manufacturing for April 36.05 vs. 28.25 estimate.
Initial Jobless Claims last week 360K vs. 335K estimate.
Continuing Claims 2980K vs. 3000K estimate.
Philadelphia Fed. for April 69 vs. 65 estimate.
Recommendations
Deutsche Bank rated GTK BUY, target $72. PCG raised to BUY at Bank of America, target $33. FCN cut to UNDERPERFORM at CSFB. ATK raised to BUY at Bank of America, target $64. DAL cut to UNDERWEIGHT at Prudential. GE rated OVERWEIGHT at Morgan Stanley, $38 target. JBHT rated OUTPERFORM at Raymond James, target $36. TXN rated OUTPERFORM at Raymond James, target $35. Goldman Sachs says Gold is a BUY right here with 22% upside potential, favorite stocks are NEM and PDG. GS reiterated OUTPERFORM on SNDK, EQT and UNH. Citi Smith Barney upgraded MTG to BUY. Citi says VZ is favorite telecom service stock going into second quarter. Citi reiterates 1S on CNET, would buy on weakness. Citi reiterated BUY on EXTR, $11 target. Citi raised KMP to BUY.
Mid-day News
U.S. stocks are falling mid-day as strength in pharmaceuticals and energy stocks is not offsetting weakness in technology and hmo shares. RealNetworks CEO Glaser proposed creating a musical alliance with Apple, the NY Times reported. Google plans to announce today that it will offer businesses the Internet equivalent of local advertising, the NY Times reported. PacifiCare Health and Humana are among managed-care companies that could see a significant reduction in payments amid a debate about trimming Medicare spending, the NY Times reported. Equipment used in nuclear-related projects, some of it contaminated by radiation, and a small number of missile engines were smuggled out of Iraq to scrap yards in Europe, the Washington Post reported, citing the head of the UN's nuclear watchdog group. Iraqis growing middle class is spending more on their homes, benefiting furniture and electronics retailers, lighting companies, building companies and plant stores. Many Iraqis first purchase a TV and satellite dish, which were outlawed under Saddam Hussein's regime, the LA Times reported. A company in Sausalito, California, is offering to clone people's cats for $50,000, the San Francisco Chronicle reported. The number of Americans filing initial claims for jobless benefits rose to 360,000 last week, a 30,000 increase that was the biggest in more than a year. International investors increased their holdings of U.S. government debt, corporate bonds and stocks by a net $83.4B in February.
BOTTOM LINE: The Portfolio is down slightly today as my declining shorts are not offsetting losses in my tech longs. I added a few new shorts in the biotechnology sector this morning, lowering the Portfolio's market exposure to 25% net long. My short-term indicators have now turned negative. The action in technology shares is not good for the bulls. Quarterly reports that should be viewed positively are not, thus leading me to believe that there is more downside in this sector. However, 2000 on the NASDAQ may provide some support in the short-term. U.S. stocks will likely remain weaker to neutral until the first rate hike as investors are very worried the Fed is falling behind the curve on inflation. I do not believe that this fear is valid at this time, however I am not going to fight the perceptions of the market.
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