Earnings of Note
Company/Estimate
ATN/.42
BUD/.83
APPB/.33
ASKJ/.22
AVP/.46
BIIB/.32
BA/.47
CAH/.93
CMCSA/.09
EDS/-.03
ESRX/.94
HLT/.18
INSP/.14
JDSU/.00
NXTP/.05
SOHU/.24
SBL/.09
TWX/.15
ZBRA/.59
ZMH/.55
Splits
None of note.
Economic Data
Durable Goods Orders for June estimated +1.5% versus -1.8% in May.
Durable Goods Orders Less Transportation for June estimated +1.1% versus -1.4% in May.
Fed's Beige Book
Recommendations
Goldman Sachs reiterated Attractive view of non-life insurance industry, favorites are AIG, ALL, ENH, RE and STA. Goldman reiterated Outperform on AUO, DD, NFX and BC. Goldman reiterated Underperform on EDS and FSS.
Late-Night News
Asian indices are mostly higher, led by Japan, on optimism over exports after a report showed U.S. consumer confidence hit a 2-year high. Members of the al-Qaeda terrorist network are traveling through Europe on illegally obtained South African passports, the AP reported. Exxon Mobil is considering selling it 19% stake in China Petroleum & Chemical, raising about $1.2 billion, almost double what it paid four years ago, the Financial Times reported. Afghanistan will have 23 candidates for its presidential election in October, including the incumbent President Hamid Karzai, Agence France-Presse reported. A blood test may help prevent premature births by detecting infections in amniotic fluids, according to a study in the Journal of the AMA. The dollar traded near its highest in about six weeks against the euro and the yen in Asia after the strong U.S. consumer confidence report, Bloomberg reported. Charter Communications, the U.S. cable-tv operator controlled by billionaire Paul Allen, settled a SEC investigation into how it counted subscribers, Bloomberg said.
Late-Night Trading
Asian Indices are unch. to +1.0% on average.
S&P 500 indicated +.06%.
NASDAQ 100 indicated +.11%
BOTTOM LINE: I expect U.S. stocks to open modestly higher in the morning on stronger earnings reports, falling energy prices and stabilizing interest rates. The Portfolio is 100% net long heading into tomorrow.
Wednesday, July 28, 2004
Tuesday, July 27, 2004
Tuesday Close
S&P 500 1,094.83 +.99%
NASDAQ 1,869.10 +1.64%
Leading Sectors
Retail +2.91%
Biotech +2.64%
Telecom +2.41%
Lagging Sectors
Hospitals -.51%
Airlines -.78%
HMO's -4.2%
Other
Crude Oil 41.82 -.05%
Natural Gas 5.98 -.10%
Gold 388.00 +.26%
Base Metals 108.33 -.74%
U.S. Dollar 89.73 +.79%
10-Yr. T-note Yield 4.60% +2.68%
VIX 16.55 -4.34%
Put/Call .72 -12.2%
NYSE Arms .78 -32.76%
After-hours Movers
CREE +6.76% after beating 4Q estimates and raising 1Q guidance.
VRTS +4.10% after beating 2Q estimates and raising 3Q forecast.
ZRAN +10.04% after beating 2Q estimates and raising 3Q/04 outlook.
MFE +7.84% after beating 2Q estimates and raising 3Q guidance.
UTSI -13.4% after missing 2Q forecast and lowering 3Q/04 outlook.
MNST +6.1% after beating 2Q estimates and lowering 3Q outlook.
Recommendations
Goldman Sachs reiterated Attractive view of Paper sector, favorite is IP. Goldman reiterated Outperform on AMGN, ADP, MSFT and GDT.
After-hours News
U.S. stocks finished higher today on better-than-expected economic reports and strong telecom earnings. After the close, Electronic Data Systems, the world's second-biggest computer-services provider, reduced its quarterly dividend to 5 cents a share, Bloomberg reported. Chubb, the second-biggest liability insurer for U.S. corporate boards, said second-quarter profit climbed 41% as premiums and investment income rose, Bloomberg said. New Jersey faces higher borrowing costs after S&P and Fitch cut credit ratings on more than $18 billion in debt, Bloomberg said.
BOTTOM LINE: The Portfolio finished slightly higher today as strength in my biotech, security and technology longs offset my rising retail shorts. I added a few more longs in the afternoon, bringing the Portfolio's market exposure to 100% net long. One of my new longs is ERES and I am using a $22.00 stop-loss on this position. The strength of today's rally was impressive given the extent to which rates rose and oil climbed. The advance/decline line and volume were much improved today as well. Finally, the CRB Index continued its recent slide, breaking down through its 200-day moving-average today, which bodes well for future inflation readings. While the major U.S. averages should continue to rally for awhile longer, recent lows will likely be tested in the coming weeks as investor complacency is still too high for a meaningful bottom.
NASDAQ 1,869.10 +1.64%
Leading Sectors
Retail +2.91%
Biotech +2.64%
Telecom +2.41%
Lagging Sectors
Hospitals -.51%
Airlines -.78%
HMO's -4.2%
Other
Crude Oil 41.82 -.05%
Natural Gas 5.98 -.10%
Gold 388.00 +.26%
Base Metals 108.33 -.74%
U.S. Dollar 89.73 +.79%
10-Yr. T-note Yield 4.60% +2.68%
VIX 16.55 -4.34%
Put/Call .72 -12.2%
NYSE Arms .78 -32.76%
After-hours Movers
CREE +6.76% after beating 4Q estimates and raising 1Q guidance.
VRTS +4.10% after beating 2Q estimates and raising 3Q forecast.
ZRAN +10.04% after beating 2Q estimates and raising 3Q/04 outlook.
MFE +7.84% after beating 2Q estimates and raising 3Q guidance.
UTSI -13.4% after missing 2Q forecast and lowering 3Q/04 outlook.
MNST +6.1% after beating 2Q estimates and lowering 3Q outlook.
Recommendations
Goldman Sachs reiterated Attractive view of Paper sector, favorite is IP. Goldman reiterated Outperform on AMGN, ADP, MSFT and GDT.
After-hours News
U.S. stocks finished higher today on better-than-expected economic reports and strong telecom earnings. After the close, Electronic Data Systems, the world's second-biggest computer-services provider, reduced its quarterly dividend to 5 cents a share, Bloomberg reported. Chubb, the second-biggest liability insurer for U.S. corporate boards, said second-quarter profit climbed 41% as premiums and investment income rose, Bloomberg said. New Jersey faces higher borrowing costs after S&P and Fitch cut credit ratings on more than $18 billion in debt, Bloomberg said.
BOTTOM LINE: The Portfolio finished slightly higher today as strength in my biotech, security and technology longs offset my rising retail shorts. I added a few more longs in the afternoon, bringing the Portfolio's market exposure to 100% net long. One of my new longs is ERES and I am using a $22.00 stop-loss on this position. The strength of today's rally was impressive given the extent to which rates rose and oil climbed. The advance/decline line and volume were much improved today as well. Finally, the CRB Index continued its recent slide, breaking down through its 200-day moving-average today, which bodes well for future inflation readings. While the major U.S. averages should continue to rally for awhile longer, recent lows will likely be tested in the coming weeks as investor complacency is still too high for a meaningful bottom.
Mid-day Update
S&P 500 1,089.19 +.47%
NASDAQ 1,853.49 +.75%
Leading Sectors
Telecom +2.60%
Retail +2.15%
I-Banks +1.8%
Lagging Sectors
Hospitals -1.33%
Airlines -1.67%
HMO's -5.37%
Other
Crude Oil 41.95 +1.23%
Natural Gas 5.98 +.39%
Gold 387.50 -.72%
Base Metals 108.33 -.74%
U.S. Dollar 89.68 +.73%
10-Yr. T-note Yield 4.57% +1.93%
VIX 16.85 -2.60%
Put/Call .69 -15.58%
NYSE Arms 1.23 +6.03%
Market Movers
NT -15.5% after saying it won't meet its gross margin target because of higher-than-expected operating costs.
VZ +3.9% after beating 2Q estimates and boosting 2H outlook.
CAH -13.7% after the company said yesterday that it CFO resigned amid U.S. accounting investigations.
ATH -8.4% after lowering 04 forecast.
SLAB -17.7% after beating 2Q estimates and lowering 3Q guidance.
TRMB +18.6% after beating 2Q estimates and raising 3Q/04 outlook.
IFLO +20.5% after beating 2Q revenue forecast and announcing 1M share buy-back.
GNSS +14.6% after beating 1Q estimates.
ATRS +13.2% after beating 2Q estimates.
RTEC +14.3% after beating 2Q estimates and raising 3Q outlook.
HYDL +9.6% after strong 2Q results and CSFB upgrade to Neutral.
ICLR -19.1% after beating 4Q estimates and lowering 05 outlook.
LNCR -7.6% after the NY Times reported that it may be hurt by a proposed 89% drop in the price paid by the U.S. government for two lung treatments.
SWK -5.2% after missing 2Q estimates and lowering outlook.
Economic Data
Consumer Confidence for July rose to 106.1 versus estimates of 102.0 and an upwardly revised 102.8 in June.
New Home Sales for June were 1326K versus estimates of 1272K and a downwardly revised 1337K in May.
Recommendations
Kellogg raised to Buy at Deutsche Bank, target $46. AXP raised to Buy at Deutsche Bank, target $57. CMCSA raised to Overweight at Prudential, target $39. Goldman Sachs reiterated Outperform on ATYT, ADP, CMX, PFE, BHI, SSL and CTSH. Goldman reiterated Underperform on ASH and TGS. Citi SmithBarney said to Sell DAL, target $1. Citi said to Buy AAI, target $18. Citi reiterated Sell on COP, target $65. Citi reiterated Sell on XOM, target $40.50. Citi reiterated Buy on CHE, target $64. Citi reiterated Buy on KIND, target $35. Citi reiterated Buy on WLP, target $150. Citi reiterated Buy on ATH, target $131. Citi reiterated Buy on BLS, target $32. Citi reiterated Buy on HCA, target $48. Citi reiterated Buy on CVH, target $65.
Mid-day News
U.S. stocks are rising mid-day on stronger-than-expected economic reports. Saks Fifth Avenue may close an undisclosed number of stores and remodel its flagship in Manhattan as part of an overhaul, the NY Times reported. Advertising dollars spent on Internet sites and other online media are expected to equal spending on magazines by 2007, and overtake more traditional areas in 2008, the Wall Street Journal reported. Starwood Hotels plans to build two of its W designer hotels in China, the Wall Street Journal reported. More than 35 bloggers received media credentials to cover the Democratic Convention, giving the Internet postings a new place in the press, the Wall Street Journal reported. The U.S. State Dept. wants to increase the pace of its rebuilding effort in Iraq, hoping to provide more jobs and show off the results of projects more quickly to Iraqis, the NY Times reported. Closely held Flight Options is expected to off business customers the opportunity to rent time on aircraft instead of forcing them to buy a share in the plane, the Wall Street Journal reported. Iran has resumed building and installing equipment that could be used to make nuclear weapons, the AP reported. U.S. new home sales fell less than forecast to a 1.326 million annual rate in June, the second-fastest on record, evidence more jobs and higher incomes are keeping homes affordable as interest rates rise, Bloomberg reported. Consumer confidence in the U.S. economy rose this month to a two-year high as expectations for the job market improved, Bloomberg said. Crude oil and interest rates are rising on strong U.S. economic reports, Bloomberg reported. California Republican Governor Schwarzenegger and legislative leaders reached agreement on a $103 billion spending plan that has no tax increases and relies on $7 billion in bonds, loans and spending cuts to cover a $14 billion projected deficit, Bloomberg reported. The Democratic Party is giving filmmaker Michael Moore what he called "red carpet treatment" at the party convention, including a box inside the FleetCenter and credentials to mingle with the delegates and press, Bloomberg reported. The Holy Land Foundation for Relief and Development, the largest Muslim charity in the U.S., was indicted on charges it provided financial support to the Islamist terror group Hamas, Bloomberg said.
BOTTOM LINE: The Portfolio is slightly lower today as my retail and technology shorts are rising more than my longs. I took profits in a number of shorts this morning and added a few longs, bringing the Portfolio's market exposure to 25% net long. One of my new longs is CCMP and I am using a $31.25 stop-loss on the position. I expect U.S. stocks to rise modestly into the close, notwithstanding rising interest rates and oil prices. This appears to be the beginning stages of a tradable rally, however I do not believe we have seen the lows as of yet. Weakness will likely resurface in the next couple of weeks.
NASDAQ 1,853.49 +.75%
Leading Sectors
Telecom +2.60%
Retail +2.15%
I-Banks +1.8%
Lagging Sectors
Hospitals -1.33%
Airlines -1.67%
HMO's -5.37%
Other
Crude Oil 41.95 +1.23%
Natural Gas 5.98 +.39%
Gold 387.50 -.72%
Base Metals 108.33 -.74%
U.S. Dollar 89.68 +.73%
10-Yr. T-note Yield 4.57% +1.93%
VIX 16.85 -2.60%
Put/Call .69 -15.58%
NYSE Arms 1.23 +6.03%
Market Movers
NT -15.5% after saying it won't meet its gross margin target because of higher-than-expected operating costs.
VZ +3.9% after beating 2Q estimates and boosting 2H outlook.
CAH -13.7% after the company said yesterday that it CFO resigned amid U.S. accounting investigations.
ATH -8.4% after lowering 04 forecast.
SLAB -17.7% after beating 2Q estimates and lowering 3Q guidance.
TRMB +18.6% after beating 2Q estimates and raising 3Q/04 outlook.
IFLO +20.5% after beating 2Q revenue forecast and announcing 1M share buy-back.
GNSS +14.6% after beating 1Q estimates.
ATRS +13.2% after beating 2Q estimates.
RTEC +14.3% after beating 2Q estimates and raising 3Q outlook.
HYDL +9.6% after strong 2Q results and CSFB upgrade to Neutral.
ICLR -19.1% after beating 4Q estimates and lowering 05 outlook.
LNCR -7.6% after the NY Times reported that it may be hurt by a proposed 89% drop in the price paid by the U.S. government for two lung treatments.
SWK -5.2% after missing 2Q estimates and lowering outlook.
Economic Data
Consumer Confidence for July rose to 106.1 versus estimates of 102.0 and an upwardly revised 102.8 in June.
New Home Sales for June were 1326K versus estimates of 1272K and a downwardly revised 1337K in May.
Recommendations
Kellogg raised to Buy at Deutsche Bank, target $46. AXP raised to Buy at Deutsche Bank, target $57. CMCSA raised to Overweight at Prudential, target $39. Goldman Sachs reiterated Outperform on ATYT, ADP, CMX, PFE, BHI, SSL and CTSH. Goldman reiterated Underperform on ASH and TGS. Citi SmithBarney said to Sell DAL, target $1. Citi said to Buy AAI, target $18. Citi reiterated Sell on COP, target $65. Citi reiterated Sell on XOM, target $40.50. Citi reiterated Buy on CHE, target $64. Citi reiterated Buy on KIND, target $35. Citi reiterated Buy on WLP, target $150. Citi reiterated Buy on ATH, target $131. Citi reiterated Buy on BLS, target $32. Citi reiterated Buy on HCA, target $48. Citi reiterated Buy on CVH, target $65.
Mid-day News
U.S. stocks are rising mid-day on stronger-than-expected economic reports. Saks Fifth Avenue may close an undisclosed number of stores and remodel its flagship in Manhattan as part of an overhaul, the NY Times reported. Advertising dollars spent on Internet sites and other online media are expected to equal spending on magazines by 2007, and overtake more traditional areas in 2008, the Wall Street Journal reported. Starwood Hotels plans to build two of its W designer hotels in China, the Wall Street Journal reported. More than 35 bloggers received media credentials to cover the Democratic Convention, giving the Internet postings a new place in the press, the Wall Street Journal reported. The U.S. State Dept. wants to increase the pace of its rebuilding effort in Iraq, hoping to provide more jobs and show off the results of projects more quickly to Iraqis, the NY Times reported. Closely held Flight Options is expected to off business customers the opportunity to rent time on aircraft instead of forcing them to buy a share in the plane, the Wall Street Journal reported. Iran has resumed building and installing equipment that could be used to make nuclear weapons, the AP reported. U.S. new home sales fell less than forecast to a 1.326 million annual rate in June, the second-fastest on record, evidence more jobs and higher incomes are keeping homes affordable as interest rates rise, Bloomberg reported. Consumer confidence in the U.S. economy rose this month to a two-year high as expectations for the job market improved, Bloomberg said. Crude oil and interest rates are rising on strong U.S. economic reports, Bloomberg reported. California Republican Governor Schwarzenegger and legislative leaders reached agreement on a $103 billion spending plan that has no tax increases and relies on $7 billion in bonds, loans and spending cuts to cover a $14 billion projected deficit, Bloomberg reported. The Democratic Party is giving filmmaker Michael Moore what he called "red carpet treatment" at the party convention, including a box inside the FleetCenter and credentials to mingle with the delegates and press, Bloomberg reported. The Holy Land Foundation for Relief and Development, the largest Muslim charity in the U.S., was indicted on charges it provided financial support to the Islamist terror group Hamas, Bloomberg said.
BOTTOM LINE: The Portfolio is slightly lower today as my retail and technology shorts are rising more than my longs. I took profits in a number of shorts this morning and added a few longs, bringing the Portfolio's market exposure to 25% net long. One of my new longs is CCMP and I am using a $31.25 stop-loss on the position. I expect U.S. stocks to rise modestly into the close, notwithstanding rising interest rates and oil prices. This appears to be the beginning stages of a tradable rally, however I do not believe we have seen the lows as of yet. Weakness will likely resurface in the next couple of weeks.
Tuesday Watch
Earnings of Note
Company/Estimate
ADP/.35
ATH/1.64
AV/.11
ABX/.06
BMCS/.13
CELL/.21
CB/1.58
DD/.81
JNY/.59
LLL/.79
LMT/.61
MFE/.06
MNST/.13
PSFT/.14
PD/2.48
SFA/.35
SINA/.31
TROW/.62
RIG/.10
UTSI/.33
VRTS/.19
VZ/.60
Splits
None of note.
Economic Data
Consumer Confidence for July estimated at 102.0 versus 101.9 in June.
New Home Sales for June estimated at 1272K versus 1369K in May.
Recommendations
Goldman Sachs reiterated Underperform on EK, SMP and VRTX. Goldman reiterated Outperform on AXP, BSX, IP, SLB, SII, BHI, EPD, ENH, AMGN, IDPH, DNA, GILD, AMLN, TRMS and BIIB.
Late-Night News
Asian indices are mixed as strength in Taiwan is being offset by weakness in Japan. Intel will cut prices of its processors used in desktop computers by as much as 35% next month to help reduce inventory and stimulate demand, the Commercial Times reported. China's first-half vehicle exports increased 84% to $290 million, the China news agency said. Cardinal Health said Richard Miller resigned as CFO after U.S. regulators stepped up a probe of the company's accounting, Bloomberg reported. Sleep Apnea, a breathing disorder that interrupts air flow during slumber, raises the risk of dying from a stroke, the European Respiratory Journal said. Almost 80% of Afghanistan's estimated 10 million eligible voters have registered to take part in presidential elections in October and a parliamentary poll next April, the UN said. Comcast will announce tomorrow that it is buying back more than $500 million of its own stock, the Wall Street Journal Reported.
Late-Night Trading
Asian Indices are -.50% to +.50% on average.
S&P 500 indicated +.09%.
NASDAQ 100 indicated +.29%
BOTTOM LINE: I expect U.S. stocks to open mixed in the morning on better economic reports, continuing earnings worries and negative political rhetoric. The CRB Index is trading very close to its 200-day moving-average and I expect it to break this level in the near future. This continues to be an unreported positive development as inflation worries stem mainly from the rise in commodities' prices. The Portfolio is 50% net short heading into tomorrow.
Company/Estimate
ADP/.35
ATH/1.64
AV/.11
ABX/.06
BMCS/.13
CELL/.21
CB/1.58
DD/.81
JNY/.59
LLL/.79
LMT/.61
MFE/.06
MNST/.13
PSFT/.14
PD/2.48
SFA/.35
SINA/.31
TROW/.62
RIG/.10
UTSI/.33
VRTS/.19
VZ/.60
Splits
None of note.
Economic Data
Consumer Confidence for July estimated at 102.0 versus 101.9 in June.
New Home Sales for June estimated at 1272K versus 1369K in May.
Recommendations
Goldman Sachs reiterated Underperform on EK, SMP and VRTX. Goldman reiterated Outperform on AXP, BSX, IP, SLB, SII, BHI, EPD, ENH, AMGN, IDPH, DNA, GILD, AMLN, TRMS and BIIB.
Late-Night News
Asian indices are mixed as strength in Taiwan is being offset by weakness in Japan. Intel will cut prices of its processors used in desktop computers by as much as 35% next month to help reduce inventory and stimulate demand, the Commercial Times reported. China's first-half vehicle exports increased 84% to $290 million, the China news agency said. Cardinal Health said Richard Miller resigned as CFO after U.S. regulators stepped up a probe of the company's accounting, Bloomberg reported. Sleep Apnea, a breathing disorder that interrupts air flow during slumber, raises the risk of dying from a stroke, the European Respiratory Journal said. Almost 80% of Afghanistan's estimated 10 million eligible voters have registered to take part in presidential elections in October and a parliamentary poll next April, the UN said. Comcast will announce tomorrow that it is buying back more than $500 million of its own stock, the Wall Street Journal Reported.
Late-Night Trading
Asian Indices are -.50% to +.50% on average.
S&P 500 indicated +.09%.
NASDAQ 100 indicated +.29%
BOTTOM LINE: I expect U.S. stocks to open mixed in the morning on better economic reports, continuing earnings worries and negative political rhetoric. The CRB Index is trading very close to its 200-day moving-average and I expect it to break this level in the near future. This continues to be an unreported positive development as inflation worries stem mainly from the rise in commodities' prices. The Portfolio is 50% net short heading into tomorrow.
Monday, July 26, 2004
Monday Close
S&P 500 1,084.07 -.20%
NASDAQ 1,839.02 -.54%
Leading Sectors
Telecom +1.94%
Insurance +.83%
HMO's +.44%
Lagging Sectors
Networking -1.79%
Biotechnology -1.92%
Hospitals -2.69%
Other
Crude Oil 41.39 -.12%
Natural Gas 5.95 -.12%
Gold 390.70 +.10%
Base Metals 109.14 +.89%
U.S. Dollar 89.01 -.28%
10-Yr. T-note Yield 4.48% +1.19%
VIX 17.30 +4.85%
Put/Call .82 +5.13%
NYSE Arms 1.16 -33.33%
After-hours Movers
SLAB -4.58% after beating 2Q estimates, but lowering 3Q forecast.
NVTL -7.5% after beating 2Q estimates and raising 3Q guidance.
IPIX +15.6% after announcing it has received an order for the purchase of $3 million of it ComandView video surveillance cameras from its UK distributor.
RTEC +6.7% after beating 2Q estimates and raising 3Q forecast.
Recommendations
TLAB raised to Buy at Merrill Lynch, target $10.60. Goldman Sachs reiterated Outperform on AXP, MET and Underperform on CVH.
After-hours News
U.S. stocks finished modestly lower today, led by healthcare-related companies, ahead of negative political rhetoric, earnings worries and rising interest rates. After the close, stem cells injected into the human brain may help people recover from strokes and regain their ability to speak and move normally, according to a study of rats in the Proceedings of the National Academies of Science, Bloomberg reported. Google's search engine malfunctioned after it was infected by the Mydoom virus that also struck corporate and personal computers, Bloomberg reported. Stanley Works, the biggest U.S. maker of hand tools, said second-quarter profit surged as sales rose 22%, Bloomberg said. Former President Clinton's address before the Democratic Convention will be watched by almost half the registered voters in the country, Bloomberg reported. Kellogg and General Mills are among food manufacturers that may be stuck with too many products aimed at dieters as the number of U.S. consumers on low-carb diets probably has peaked, Bloomberg said. American Express said second-quarter profit rose 15% as an expanding economy prompted more travel than any time sine the terrorist attacks of Sept. 2001, Bloomberg reported. The Fed's benchmark interest rate is still "highly accommodative" and far below a neutral rate, said Thomas Hoenig, president of the Federal Reserve Bank of Kansas City.
BOTTOM LINE: The Portfolio finished unchanged today as my falling technology longs offset my declining retail shorts. I did not trade today and the Portfolio is still 50% net short. I continue to expect the major U.S. indices will make a short-term bottom later this week. Beaten-up tech shares will likely lead for a brief period. My short-term trading indicators are still giving sell signals.
NASDAQ 1,839.02 -.54%
Leading Sectors
Telecom +1.94%
Insurance +.83%
HMO's +.44%
Lagging Sectors
Networking -1.79%
Biotechnology -1.92%
Hospitals -2.69%
Other
Crude Oil 41.39 -.12%
Natural Gas 5.95 -.12%
Gold 390.70 +.10%
Base Metals 109.14 +.89%
U.S. Dollar 89.01 -.28%
10-Yr. T-note Yield 4.48% +1.19%
VIX 17.30 +4.85%
Put/Call .82 +5.13%
NYSE Arms 1.16 -33.33%
After-hours Movers
SLAB -4.58% after beating 2Q estimates, but lowering 3Q forecast.
NVTL -7.5% after beating 2Q estimates and raising 3Q guidance.
IPIX +15.6% after announcing it has received an order for the purchase of $3 million of it ComandView video surveillance cameras from its UK distributor.
RTEC +6.7% after beating 2Q estimates and raising 3Q forecast.
Recommendations
TLAB raised to Buy at Merrill Lynch, target $10.60. Goldman Sachs reiterated Outperform on AXP, MET and Underperform on CVH.
After-hours News
U.S. stocks finished modestly lower today, led by healthcare-related companies, ahead of negative political rhetoric, earnings worries and rising interest rates. After the close, stem cells injected into the human brain may help people recover from strokes and regain their ability to speak and move normally, according to a study of rats in the Proceedings of the National Academies of Science, Bloomberg reported. Google's search engine malfunctioned after it was infected by the Mydoom virus that also struck corporate and personal computers, Bloomberg reported. Stanley Works, the biggest U.S. maker of hand tools, said second-quarter profit surged as sales rose 22%, Bloomberg said. Former President Clinton's address before the Democratic Convention will be watched by almost half the registered voters in the country, Bloomberg reported. Kellogg and General Mills are among food manufacturers that may be stuck with too many products aimed at dieters as the number of U.S. consumers on low-carb diets probably has peaked, Bloomberg said. American Express said second-quarter profit rose 15% as an expanding economy prompted more travel than any time sine the terrorist attacks of Sept. 2001, Bloomberg reported. The Fed's benchmark interest rate is still "highly accommodative" and far below a neutral rate, said Thomas Hoenig, president of the Federal Reserve Bank of Kansas City.
BOTTOM LINE: The Portfolio finished unchanged today as my falling technology longs offset my declining retail shorts. I did not trade today and the Portfolio is still 50% net short. I continue to expect the major U.S. indices will make a short-term bottom later this week. Beaten-up tech shares will likely lead for a brief period. My short-term trading indicators are still giving sell signals.
Mid-day Update
S&P 500 1,080.04 -.57%
NASDAQ 1,831.54 -.93%
Leading Sectors
Telecom +1.31%
Insurance +.46%
Computer Services -.12%
Lagging Sectors
Internet -1.99%
Biotech -2.68%
Hospitals -3.20%
Other
Crude Oil 41.40 -.74%
Natural Gas 5.97 -2.59%
Gold 389.80 -.18%
Base Metals 109.14 +.89%
U.S. Dollar 89.02 -.27%
10-Yr. T-note Yield 4.47% +1.01%
VIX 17.63 +6.85%
Put/Call .73 -6.41%
NYSE Arms 1.36 -21.84%
Market Movers
ANDW -26.2% after beating 2Q estimates and lowering 3Q/4Q guidance.
CHKP -13.65% after slightly missing 2Q estimates and lowering 3Q forecast.
MYL -15.5% after agreeing to buy KG for $4 billion in stock to expand into heart treatments and add sales force to call on cardiologists. KG +25.2%.
IMCL -15.0% after Citi downgrade to Neutral, price target cut to $72.
OCR -31.0% after missing 2Q estimates and lowering 04 guidance.
BSX +4.88% after 2Q estimates mostly met expectations after stent recall.
AGYS +18.88% after beating 1Q estimates and raising 05 forecast.
MANT +11.1% after saying it received a four-year contract to provide the federal government with security clearance background investigations.
CTSH +11.8% after beating 2Q estimates and raising 3Q and 04 forecast.
CRS +7.2% after JP Morgan upgrade to Overweight.
BEC -8.4% after missing 2Q estimates and lowering 3Q forecast.
TASR -9.9% on news that CBS News will run a negative story on the company.
Economic Data
Existing Home Sales for June were 6.95M versus estimates of 6.65M and 6.81M in May.
Recommendations
CRS raised to Overweight at JP Morgan. IGT raised to Sector Outperform at CIBC, target $38. HCR raised to Buy at Legg Mason, target $38. UHS raised to Buy at Oppenheimer, target $52. NTLI raised to Overweight at JP Morgan. Goldman Sachs reiterated Outperform on AMT, VZ, XRX, SRE, NEM, PDG, ENH, BSX, AMLN, FS, IGT, GCI, HOT, PG, SLB and ITT. Goldman reiterated Underperform on CYT, SGP, PGL, CR and DJ. Citi SmithBarney reiterated Buy on HAL, target $37. Citi reiterated Sell on MYG, target $15. Citi reiterated Buy on WY, target $72. Citi reiterated Buy on ITT, target $92. Citi reiterated Buy on SSCC, target $23. Citi reiterated Buy on UTX, target $109. Citi thinks banks will outperform in second half, favorite is BAC. Citi said with semi-equipment shipment delays finally beginning, the final phase of the correction in those stocks has begun, Buy on weakness, favorite is LRCX. Citi reiterated Buy on ATH, target $90. Citi reiterated Buy on WLP, target $111.70.
Mid-day News
U.S. stocks are falling mid-day, led lower by healthcare-related companies, on concerns over negative political rhetoric, earnings shortfalls and rising interest rates. Iraqi Defense minister Hazima al-Shalan said Iran has sent spies into Iraq, infiltrated the country's new government and taken positions along Iraq's border, the Washington Post reported. Sun Micro plans to debut two computer system lines with microprocessors from Advanced Micro, the Wall Street Journal reported. Sprint will likely announce today it is offering local telephone service to business customers in 35 markets, the Wall Street Journal said. Shares of AO Yukos Oil, Russia's largest oil exporter, fell after Interfax reported a major shareholder was placed on a wanted list by a Moscow court on murder-related charges. An Alzheimer's drug called donepezil might slow the onset of the disease in high-risk patients by six months, the LA Times reported. Roche Holding and Chiron are competing for the lead in the market for tests that can screen donated blood for the West Nile virus, the LA Times reported. Career Education, which is being probed by the U.S. SEC, is also being investigated by federal law-enforcement officials, the Financial Times reported. Nokia may have its credit rating reduced by S&P on concern the company will continue to lose market share to competitors, Bloomberg reported. HCA, the biggest U.S. hospital chain, said second-quarter profit rose 47% as lower malpractice expenses compensated for an increase in unpaid bills, Bloomberg reported. Google plans to sell 24.6 million shares in its IPO for between $108-$135/share and the symbol will be GOOG, Bloomberg said. U.S. sales of previously owned houses rose more than expected in June to a record annual pace of 6.95 million, the National Assoc. of Realtors said. U.S. Treasuries fell in New York after home sales unexpectedly rose and speculation increased that other economic reports this week will add to evidence growth is accelerating, Bloomberg reported. Medicare proposed rules for its 2006 program to help the elderly pay for prescription drugs, including how the agency will work with pharmacy-benefit managers such as Express Scripts to get discounts on drugs, Bloomberg reported.
BOTTOM LINE: The Portfolio is unchanged today as my longs are falling more than my shorts. I have not traded today and the Portfolio is still 50% net short. It is good to see the VIX continue higher, however the Put/Call and Arms readings are falling. My short-term trading indicators are still giving sell signals. I expect U.S. stocks to fall modestly into the close.
NASDAQ 1,831.54 -.93%
Leading Sectors
Telecom +1.31%
Insurance +.46%
Computer Services -.12%
Lagging Sectors
Internet -1.99%
Biotech -2.68%
Hospitals -3.20%
Other
Crude Oil 41.40 -.74%
Natural Gas 5.97 -2.59%
Gold 389.80 -.18%
Base Metals 109.14 +.89%
U.S. Dollar 89.02 -.27%
10-Yr. T-note Yield 4.47% +1.01%
VIX 17.63 +6.85%
Put/Call .73 -6.41%
NYSE Arms 1.36 -21.84%
Market Movers
ANDW -26.2% after beating 2Q estimates and lowering 3Q/4Q guidance.
CHKP -13.65% after slightly missing 2Q estimates and lowering 3Q forecast.
MYL -15.5% after agreeing to buy KG for $4 billion in stock to expand into heart treatments and add sales force to call on cardiologists. KG +25.2%.
IMCL -15.0% after Citi downgrade to Neutral, price target cut to $72.
OCR -31.0% after missing 2Q estimates and lowering 04 guidance.
BSX +4.88% after 2Q estimates mostly met expectations after stent recall.
AGYS +18.88% after beating 1Q estimates and raising 05 forecast.
MANT +11.1% after saying it received a four-year contract to provide the federal government with security clearance background investigations.
CTSH +11.8% after beating 2Q estimates and raising 3Q and 04 forecast.
CRS +7.2% after JP Morgan upgrade to Overweight.
BEC -8.4% after missing 2Q estimates and lowering 3Q forecast.
TASR -9.9% on news that CBS News will run a negative story on the company.
Economic Data
Existing Home Sales for June were 6.95M versus estimates of 6.65M and 6.81M in May.
Recommendations
CRS raised to Overweight at JP Morgan. IGT raised to Sector Outperform at CIBC, target $38. HCR raised to Buy at Legg Mason, target $38. UHS raised to Buy at Oppenheimer, target $52. NTLI raised to Overweight at JP Morgan. Goldman Sachs reiterated Outperform on AMT, VZ, XRX, SRE, NEM, PDG, ENH, BSX, AMLN, FS, IGT, GCI, HOT, PG, SLB and ITT. Goldman reiterated Underperform on CYT, SGP, PGL, CR and DJ. Citi SmithBarney reiterated Buy on HAL, target $37. Citi reiterated Sell on MYG, target $15. Citi reiterated Buy on WY, target $72. Citi reiterated Buy on ITT, target $92. Citi reiterated Buy on SSCC, target $23. Citi reiterated Buy on UTX, target $109. Citi thinks banks will outperform in second half, favorite is BAC. Citi said with semi-equipment shipment delays finally beginning, the final phase of the correction in those stocks has begun, Buy on weakness, favorite is LRCX. Citi reiterated Buy on ATH, target $90. Citi reiterated Buy on WLP, target $111.70.
Mid-day News
U.S. stocks are falling mid-day, led lower by healthcare-related companies, on concerns over negative political rhetoric, earnings shortfalls and rising interest rates. Iraqi Defense minister Hazima al-Shalan said Iran has sent spies into Iraq, infiltrated the country's new government and taken positions along Iraq's border, the Washington Post reported. Sun Micro plans to debut two computer system lines with microprocessors from Advanced Micro, the Wall Street Journal reported. Sprint will likely announce today it is offering local telephone service to business customers in 35 markets, the Wall Street Journal said. Shares of AO Yukos Oil, Russia's largest oil exporter, fell after Interfax reported a major shareholder was placed on a wanted list by a Moscow court on murder-related charges. An Alzheimer's drug called donepezil might slow the onset of the disease in high-risk patients by six months, the LA Times reported. Roche Holding and Chiron are competing for the lead in the market for tests that can screen donated blood for the West Nile virus, the LA Times reported. Career Education, which is being probed by the U.S. SEC, is also being investigated by federal law-enforcement officials, the Financial Times reported. Nokia may have its credit rating reduced by S&P on concern the company will continue to lose market share to competitors, Bloomberg reported. HCA, the biggest U.S. hospital chain, said second-quarter profit rose 47% as lower malpractice expenses compensated for an increase in unpaid bills, Bloomberg reported. Google plans to sell 24.6 million shares in its IPO for between $108-$135/share and the symbol will be GOOG, Bloomberg said. U.S. sales of previously owned houses rose more than expected in June to a record annual pace of 6.95 million, the National Assoc. of Realtors said. U.S. Treasuries fell in New York after home sales unexpectedly rose and speculation increased that other economic reports this week will add to evidence growth is accelerating, Bloomberg reported. Medicare proposed rules for its 2006 program to help the elderly pay for prescription drugs, including how the agency will work with pharmacy-benefit managers such as Express Scripts to get discounts on drugs, Bloomberg reported.
BOTTOM LINE: The Portfolio is unchanged today as my longs are falling more than my shorts. I have not traded today and the Portfolio is still 50% net short. It is good to see the VIX continue higher, however the Put/Call and Arms readings are falling. My short-term trading indicators are still giving sell signals. I expect U.S. stocks to fall modestly into the close.
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