S&P 500 1,122.30 +1.01%
NASDAQ 1,964.08 +1.82%
Leading Sectors
Airlines +4.14%
Semis +2.95%
I-Banks +2.83%
Lagging Sectors
Commodity -1.40%
Energy -2.09%
Oil Service -3.14%
Other
Crude Oil 53.75 -2.66%
Natural Gas 8.12 -3.36%
Gold 425.60 -.44%
Base Metals 112.86 +1.50%
U.S. Dollar 85.33 +.14%
10-Yr. T-note Yield 4.05% +1.30%
VIX 16.02 -2.26%
Put/Call .71 -4.05
NYSE Arms .92 +64.29%
Market Movers
SINA +26.1% after beating 3Q estimates, raising 4Q guidance and multiple upgrades.
CAH +23.1% on better-than-expected 4Q earnings.
AAPL +4.1% on continued optimism over new iPod Photo.
QCOM +4.0% on optimism over upcoming earnings release.
MSTR +29.1% after substantially beating 3Q estimates, raising 4Q/05 outlooks.
LSCP +28.4% after beating 3Q estimates and raising 04/05 outlooks.
SYNT +22.2% after beating 3Q estimates substantially and raising 04 guidance.
FFIV +19.3% after beating 4Q estimates and raising 1Q guidance.
SHOP +14.9% on continuing strong demand for IPO.
TRMB +10.9% after beating 3Q estimates, lowering 4Q outlook and raising 04 guidance.
ISRG +17.2% on strong 3Q report.
ZMH +5.0% after beating 3Q estimates, raising 4Q guidance and reiterating 05 outlook.
CECO +14.5% after beating 3Q estimates and raising 4Q guidance.
AVID +7.6% on strong 3Q report.
LPNT +10.5% on strong 3Q report.
NLS -15.9% after meeting 3Q estimates and lowering 4Q guidance.
SKX -15.0% after beating 3Q estimates and lowering 4Q outlook.
NILE -17.1% after beating 3Q estimates and widening 4Q outlook.
ZBRA -9.1% after beating 3Q estimates and widening 4Q outlook.
FLS -11.9% after delaying its third-quarter results and downgrade to Sell by Hibernia Southcoast.
AFL -5.9% after meeting 3Q estimates and lowering 4Q outlook.
Economic Data
Durable Goods Orders rose .2% in September versus estimates of a .5% rise and a .3% decline in August.
Durable Goods Less Transportation rose 1.7% versus estimates of a .3% increase and a 2.8% gain in August.
New Home Sales for September were 1206K versus estimates of 1150K and 1165K in August.
Recommendations
-Goldman Sachs reiterated Outperform on AMGN, MDT, ATYT, COH, PG, NEM, AHC and GE. Goldman reiterated Underperform on FSS and AG. Goldman upgraded TMK to Outperform.
-Citi SmithBarney initiated FST with a Buy, target $38. Citi reiterated Buy on AAPL, target $60. Citi reiterated Buy on FFIV, target $45. Citi reiterated Buy on AV, target $20. Citi reiterated Buy on UTSI, target $26. Citi reiterated Buy on EOG, target $78. Citi reiterated Buyon BWA, target $50. Citi reiterated Buy on TLAB, target $11. Citi reiterated Buy on WFR, target $13. Citi reiterated Buy on FD, target $58. Citi reiterated Sell on AFL, target $40. Citi reiterated Buy on BNI, target $44.50. Citi reiterated Buy on GE, target $38. Citi reiterated Buy on PNR, target $43. Citi reiterated Buy on MRO, target $45. Citi reiterated Buy on MSTR, target $64. Citi reiterated Buy on VRTS, target $26. Citi reiterated Buy on TGT, target $50. Citi reiterated Buy on CHE, target $72. Citi reiterated Buy on AAI, target $13.
-Legg Mason raised CBMD to Buy, target $35.
-Bank of America raised GLW to Buy, target $15. Bank of America raised ZMH to Buy, target $84.
-Bear Stearns raised PHRM to Outperform.
Mid-day News
U.S. stocks are sharply higher mid-day on optimism over falling oil prices, better economic reports, stronger earnings reports, short-covering, diminishing terrorism fears and bargain-hunting. The U.S. craze for low-carb foods seems to be fading, the Wall Street Journal reported. Some Iraqi insurgents say recent anti-U.S. violence has been aimed at helping Senator Kerry defeat President Bush, in the belief that the U.S. will then lose its will to fight, the Washington Times reported. Pathmark, which operates supermarkets in New York, New Jersey and Pennsylvania, has begun talking with financial firms and competitors about a possible sale, the Deal.com reported. Rain in California has rotted some of the state's tomato crop, worsening a nationwide shortage brought about by hurricanes in Florida and a pest outbreak in Mexico, the AP reported. Red Herring magazine plans to publish twice-monthly issues in November and introduce a weekly edition by January, the San Francisco Chronicle reported. A group led by JP Morgan Chase agreed to buy U.K. drugmaker Warner Chilcott Plc for $3 billion, outbidding two other private equity firms, Bloomberg reported. Comcast reported a third-quarter profit as it added a record 549,000 high-speed Internet access customers, Bloomberg reported. U.S. orders for durable goods rose in September for the third time in four months, driven by demand for military equipment and computers, Bloomberg reported. U.S. new home sales unexpectedly rose in September to the third highest total on record, bolstered by lower mortgage rates and suggesting housing is helping spurt the economy, Bloomberg said. Crude oil futures are falling after an Energy Dept. report showed that U.S. stockpiles rose more than expected, Bloomberg reported.
Bottom Line: The Portfolio is substantially higher mid-day, at its highs for the year, on strength in my wireless, internet and Chinese ADR longs. I have not traded today and the Portfolio is still 100% net long. I do believe the strong rally I forecasted for the fourth quarter has begun and that the lows for the year are in place. Technology is outperforming again today and should continue to strengthen into year-end. Many of these stocks are trading at very depressed levels after substantial declines in the 3rd quarter. Year-end budget flushes, capital equipment tax incentives, better-than-expected holiday sales and strengthening demand in China should also boost tech shares. Barring another significant decline in oil prices tomorrow, I expect U.S. stocks to trade mixed this afternoon and through tomorrow as apprehension increases ahead of the election. Another move higher will likely commence on Friday, spurred by a good GDP report and short-covering.
Wednesday, October 27, 2004
Wednesday Watch
Earnings of Note
Company/Estimate
BUD/.85
ASKJ/.25
ATH/1.65
BIIB/.35
BDK/1.32
BA/.40
CMCSA/.11
JDSU/.00
NEM/.25
NOC/.77
PG/.72
SIRI/-.12
THQI/-.20
ZBRA/.42
Splits
None of note.
Economic Data
Durable Goods Orders for September are estimated to have risen .5% versus a .3% fall in August.
Durable Goods Less Transportation are estimated to have risen .3% versus a 2.3% gain in August.
New Home Sales for September are estimated at 1150K versus 1184K in August.
Fed's Beige Book
Recommendations
Goldman Sachs reiterated Outperform on MUR, UDR, MET, LIZ, LMT, MERQ, BSX, RIG, DD, AMR and Underperform on QGENF, CNH, UAL, BA, MMC, TLAB.
Late-Night News
Asian indices are mostly higher on optimism over recent earnings reports in the region. Prime Minister Koizumi said Japan's troops won't leave Iraq, and the government will do all it can to secure the release of a Japanese man shown in a video being held by an armed group in the Middle Eastern country, state-run NHK tv reported. AU Optronics will use its new sixth-generation plant to produce 17-inch flat panel displays used in computer monitors, to cope with competition from South Korean makers, the Commercial Times reported. Delta Air Lines may file for bankruptcy court protection tomorrow if the company cannot agree on concessions with its pilot union, the Wall Street Journal reported. Robert Mondavi has attracted interest from at least 10 potential bidders, the Wall Street Journal reported. Nokia Oyj regained lost mobile-phone market share in the third quarter from the previous three months after the company cut prices and introduced cheaper models, Bloomberg said. GE will buy Australian Financial Investments Group for about $300 million to boost its share of that nation's mortgage market, Bloomberg reported. High-speed rail service between Tokyo and earthquake-hit Niigata prefecture was suspended after a magnitude 5.7 temblor struck the region, East Japan Railway said. OPEC President Yusgiantoro said the producer group has asked the U.S. to release oil from its strategic reserves to help lower oil prices, Bloomberg reported.
Late-Night Trading
Asian Indices are unch. to +.50% on average.
S&P 500 indicated -.19%.
NASDAQ 100 indicated -.07%
BOTTOM LINE: I expect U.S. equities to open mixed in the morning and head modestly higher later in the day, led by technology shares, on short-covering, diminishing domestic terrorism fears, bargain-hunting and better earnings reports. The Portfolio is 100% net long heading into tomorrow.
Company/Estimate
BUD/.85
ASKJ/.25
ATH/1.65
BIIB/.35
BDK/1.32
BA/.40
CMCSA/.11
JDSU/.00
NEM/.25
NOC/.77
PG/.72
SIRI/-.12
THQI/-.20
ZBRA/.42
Splits
None of note.
Economic Data
Durable Goods Orders for September are estimated to have risen .5% versus a .3% fall in August.
Durable Goods Less Transportation are estimated to have risen .3% versus a 2.3% gain in August.
New Home Sales for September are estimated at 1150K versus 1184K in August.
Fed's Beige Book
Recommendations
Goldman Sachs reiterated Outperform on MUR, UDR, MET, LIZ, LMT, MERQ, BSX, RIG, DD, AMR and Underperform on QGENF, CNH, UAL, BA, MMC, TLAB.
Late-Night News
Asian indices are mostly higher on optimism over recent earnings reports in the region. Prime Minister Koizumi said Japan's troops won't leave Iraq, and the government will do all it can to secure the release of a Japanese man shown in a video being held by an armed group in the Middle Eastern country, state-run NHK tv reported. AU Optronics will use its new sixth-generation plant to produce 17-inch flat panel displays used in computer monitors, to cope with competition from South Korean makers, the Commercial Times reported. Delta Air Lines may file for bankruptcy court protection tomorrow if the company cannot agree on concessions with its pilot union, the Wall Street Journal reported. Robert Mondavi has attracted interest from at least 10 potential bidders, the Wall Street Journal reported. Nokia Oyj regained lost mobile-phone market share in the third quarter from the previous three months after the company cut prices and introduced cheaper models, Bloomberg said. GE will buy Australian Financial Investments Group for about $300 million to boost its share of that nation's mortgage market, Bloomberg reported. High-speed rail service between Tokyo and earthquake-hit Niigata prefecture was suspended after a magnitude 5.7 temblor struck the region, East Japan Railway said. OPEC President Yusgiantoro said the producer group has asked the U.S. to release oil from its strategic reserves to help lower oil prices, Bloomberg reported.
Late-Night Trading
Asian Indices are unch. to +.50% on average.
S&P 500 indicated -.19%.
NASDAQ 100 indicated -.07%
BOTTOM LINE: I expect U.S. equities to open mixed in the morning and head modestly higher later in the day, led by technology shares, on short-covering, diminishing domestic terrorism fears, bargain-hunting and better earnings reports. The Portfolio is 100% net long heading into tomorrow.
Tuesday, October 26, 2004
***Alert***
There will not be a Tuesday Close due to a scheduling conflict. The Wednesday Watch will be posted at its regular time. Sorry for the inconvenience.
Mid-day Update
S&P 500 1,106.80 +1.09%
NASDAQ 1,921.38 +.38%
Leading Sectors
HMOs +4.4%
Insurance +4.25%
Airlines +3.60%
Lagging Sectors
Hospitals -.25%
Broadcasting -.32%
Disk Drives -.67%
Other
Crude Oil 54.55 +.02%
Natural Gas 8.16 +3.49%
Gold 426.40 -.81%
Base Metals 111.19 +.15%
U.S. Dollar 85.29 +.38%
10-Yr. T-note Yield 3.98% +.34%
VIX 16.07 -3.08%
Put/Call .73 unch.
NYSE Arms .61 -47.41%
Market Movers
DAL +27.2% after saying American Express agreed to provide as much as $600 million in financing, including $500 million to prepay for the airline's frequent-flier points.
FLEX -9.3% after missing 2Q estimates, lowering 3Q/4Q guidance and multiple downgrades.
QCOM -5.3% on Morgan Stanley downgrade to Underweight.
NVDA +12.7% after boosting 3Q sales estimate.
LCAV +15.0% after beating 3Q estimates substantially and raising 04/05 guidance.
HZO +16.2% after beating 4Q estimates substantially and reiterating 05 outlook.
SHOP +57.9% on strong demand for IPO.
COH +5.7% after beating 1Q estimates and raising 2Q/05 outlooks.
SEPR +5.7% after beating 3Q estimates.
EXBD +6.3% after beating 3Q estimates and raising 4Q/04 outlooks.
OMC +7.4% after beating 3Q estimates.
SLAB -18.6% after meeting 3Q estimates, lowering 4Q guidance substantially and multiple downgrades.
WIRE -18.6% on disappointing 3Q report.
TRMB -7.9% after beating 3Q estimates and lowering 4Q/04 outlooks.
TWP -8.1% after missing 3Q estimates and reiterating 04 outlook.
APOL -4.2% on Piper Jaffray downgrade to Market Perform.
OVNT -7.5% after missing 3Q estimates and lowering 4Q guidance.
DVA -8.4% after receiving a subpoena from U.S. prosecutors in NY for documents relating to their operations.
ATRS -7.3% after missing 3Q estimates, raising 4Q outlook and Jefferies downgrade to Hold.
AH -5.1% after announcing that it had priced at par its previously announced offering of $300 million in aggregate principal amount of 2.0% senior subordinated convertible notes.
CNCT -7.5% after beating 3Q estimates and lowering 4Q outlook.
*Insurance and HMO stocks up across the board on news that Spitzer would not pursue criminal charges against MMC.
Economic Data
Consumer Confidence for October fell to 92.8 versus estimates of 94.0 and a reading of 96.7 in September.
Recommendations
-Goldman Sachs reiterated Outperform on ENH, RIG, KO, IP, RE and AIG. Goldman reiterated Underperform on NFS, LVLT, AKS, RAI and MMC.
-Citi SmithBarney says to Buy IMCL for a trade into earnings on Thur., target $66. Citi also said to Buy HAIN on any weakness related to 1Q earnings, target $21. Citi reiterated Buy on KMB, target $72. Citi reiterated Buy on FLEX, target $17. Citi reiterated Buy on WLP, target $142. Citi reiterated Buy on DIS, target $30. Citi reiterated Buy on BWA, target $50. Citi reiterated Buy on VECO, target $26. Citi reiterated Buy on BJ, target $30. AMAT reiterated Buy on AMAT, target $22. Citi reiterated Buy on CMCSK, target $34. Citi reiterated Buy on SMTC, target $24. Citi reiterated Buy on INTX, target $18. Citi reiterated Buy on PHM, target $83.
-JP Morgan rated BBBY Overweight.
-Morgan Stanley downgraded QCOM to Underweight.
-Bank of America raised TRW to Buy, target $21. Bank of America downgraded SUP to Sell, target $18.
Mid-day News
U.S. stocks are higher mid-day, led by HMO and Insurance shares, after Democratic Attorney General Spitzer said he would not pursue criminal charges against Marsh & McLennan. Political action committees supporting Senator Kerry and his bid for the White House are outspending backers of President Bush by more than 4 to 1, the AP reported. U.S. retailers, preparing for the holiday sales season, are waiting longer than usual for merchandise shipped from Asia due to a backload of cargo ships, railroads and truck lines, the NY Times reported. An NBC News crew, embedded with the U.S. Army during the liberation of Iraq last year, reported that the 380 tons of explosives that were recently reported missing were already gone when troops arrived, CNN reported. Iraqi Prime Minister Allawi said today he has asked the United Nations to send troops to help guard the country's January elections from terrorist attack, Agence France-Presse reported. Afghanistan's interim President Hamid Karzai has won a majority of 55.4% of the votes in the final count of the country's first presidential election, the Afghan Election Web site said. Senator Kerry grants special access to top Democratic California fundraisers, letting them listen in on conference calls and visit his family on retreats, the LA Times reported. The fundraisers, often well-connected or celebrities, have helped bring in more than $102 million from Californians for Kerry and Democratic causes, a record for contributions from a single state, the newspaper said. Hewlett-Packard is testing ways of using wireless tracking technology, known as radio frequency identification or RFID, that's aimed at replacing bar codes, the San Jose Mercury News reported. Comcast may report a fifth consecutive quarterly profit after expanding its video-on-demand service in an effort to keep subscribers from leaving for satellite-TV, Bloomberg reported. Mittal's $4.5 billion acquisition of Intl. Steel Group may prompt a spree of deals as the steel industry consolidates to cut costs, Bloomberg said. Monsanto won European Union approval for one of its gene-modified corn varieties to be used in food as the EU seeks to expand the biotech market after a six-year moratorium and ease a transatlantic trade dispute, Bloomberg reported. A U.S appeals court lifted a ban on sales of rebuilt toner cartridges that compete with products made by Lexmark Intl., Bloomberg said. U.S. consumer confidence fell more-than-expected in October as both political parties engage in historically negative rhetoric, Bloomberg said. A divided U.S. SEC ordered hedge fund managers to register with the agency, subjecting the private investment partnerships to SEC oversight for the first time, Bloomberg reported.
Bottom Line: The Portfolio is higher mid-day on strength in my internet, Russian telecom ADR and wireless longs. I have not traded today and the Portfolio is still 100% net long. The tone of the market is better today, however the advance/decline line is near even, technology stocks are underperforming and measures of investor anxiety are mostly lower. I expect U.S. stocks to trade mixed into the afternoon as political worries and domestic terrorism fears offset stabilizing energy prices and optimism over the MMC news.
NASDAQ 1,921.38 +.38%
Leading Sectors
HMOs +4.4%
Insurance +4.25%
Airlines +3.60%
Lagging Sectors
Hospitals -.25%
Broadcasting -.32%
Disk Drives -.67%
Other
Crude Oil 54.55 +.02%
Natural Gas 8.16 +3.49%
Gold 426.40 -.81%
Base Metals 111.19 +.15%
U.S. Dollar 85.29 +.38%
10-Yr. T-note Yield 3.98% +.34%
VIX 16.07 -3.08%
Put/Call .73 unch.
NYSE Arms .61 -47.41%
Market Movers
DAL +27.2% after saying American Express agreed to provide as much as $600 million in financing, including $500 million to prepay for the airline's frequent-flier points.
FLEX -9.3% after missing 2Q estimates, lowering 3Q/4Q guidance and multiple downgrades.
QCOM -5.3% on Morgan Stanley downgrade to Underweight.
NVDA +12.7% after boosting 3Q sales estimate.
LCAV +15.0% after beating 3Q estimates substantially and raising 04/05 guidance.
HZO +16.2% after beating 4Q estimates substantially and reiterating 05 outlook.
SHOP +57.9% on strong demand for IPO.
COH +5.7% after beating 1Q estimates and raising 2Q/05 outlooks.
SEPR +5.7% after beating 3Q estimates.
EXBD +6.3% after beating 3Q estimates and raising 4Q/04 outlooks.
OMC +7.4% after beating 3Q estimates.
SLAB -18.6% after meeting 3Q estimates, lowering 4Q guidance substantially and multiple downgrades.
WIRE -18.6% on disappointing 3Q report.
TRMB -7.9% after beating 3Q estimates and lowering 4Q/04 outlooks.
TWP -8.1% after missing 3Q estimates and reiterating 04 outlook.
APOL -4.2% on Piper Jaffray downgrade to Market Perform.
OVNT -7.5% after missing 3Q estimates and lowering 4Q guidance.
DVA -8.4% after receiving a subpoena from U.S. prosecutors in NY for documents relating to their operations.
ATRS -7.3% after missing 3Q estimates, raising 4Q outlook and Jefferies downgrade to Hold.
AH -5.1% after announcing that it had priced at par its previously announced offering of $300 million in aggregate principal amount of 2.0% senior subordinated convertible notes.
CNCT -7.5% after beating 3Q estimates and lowering 4Q outlook.
*Insurance and HMO stocks up across the board on news that Spitzer would not pursue criminal charges against MMC.
Economic Data
Consumer Confidence for October fell to 92.8 versus estimates of 94.0 and a reading of 96.7 in September.
Recommendations
-Goldman Sachs reiterated Outperform on ENH, RIG, KO, IP, RE and AIG. Goldman reiterated Underperform on NFS, LVLT, AKS, RAI and MMC.
-Citi SmithBarney says to Buy IMCL for a trade into earnings on Thur., target $66. Citi also said to Buy HAIN on any weakness related to 1Q earnings, target $21. Citi reiterated Buy on KMB, target $72. Citi reiterated Buy on FLEX, target $17. Citi reiterated Buy on WLP, target $142. Citi reiterated Buy on DIS, target $30. Citi reiterated Buy on BWA, target $50. Citi reiterated Buy on VECO, target $26. Citi reiterated Buy on BJ, target $30. AMAT reiterated Buy on AMAT, target $22. Citi reiterated Buy on CMCSK, target $34. Citi reiterated Buy on SMTC, target $24. Citi reiterated Buy on INTX, target $18. Citi reiterated Buy on PHM, target $83.
-JP Morgan rated BBBY Overweight.
-Morgan Stanley downgraded QCOM to Underweight.
-Bank of America raised TRW to Buy, target $21. Bank of America downgraded SUP to Sell, target $18.
Mid-day News
U.S. stocks are higher mid-day, led by HMO and Insurance shares, after Democratic Attorney General Spitzer said he would not pursue criminal charges against Marsh & McLennan. Political action committees supporting Senator Kerry and his bid for the White House are outspending backers of President Bush by more than 4 to 1, the AP reported. U.S. retailers, preparing for the holiday sales season, are waiting longer than usual for merchandise shipped from Asia due to a backload of cargo ships, railroads and truck lines, the NY Times reported. An NBC News crew, embedded with the U.S. Army during the liberation of Iraq last year, reported that the 380 tons of explosives that were recently reported missing were already gone when troops arrived, CNN reported. Iraqi Prime Minister Allawi said today he has asked the United Nations to send troops to help guard the country's January elections from terrorist attack, Agence France-Presse reported. Afghanistan's interim President Hamid Karzai has won a majority of 55.4% of the votes in the final count of the country's first presidential election, the Afghan Election Web site said. Senator Kerry grants special access to top Democratic California fundraisers, letting them listen in on conference calls and visit his family on retreats, the LA Times reported. The fundraisers, often well-connected or celebrities, have helped bring in more than $102 million from Californians for Kerry and Democratic causes, a record for contributions from a single state, the newspaper said. Hewlett-Packard is testing ways of using wireless tracking technology, known as radio frequency identification or RFID, that's aimed at replacing bar codes, the San Jose Mercury News reported. Comcast may report a fifth consecutive quarterly profit after expanding its video-on-demand service in an effort to keep subscribers from leaving for satellite-TV, Bloomberg reported. Mittal's $4.5 billion acquisition of Intl. Steel Group may prompt a spree of deals as the steel industry consolidates to cut costs, Bloomberg said. Monsanto won European Union approval for one of its gene-modified corn varieties to be used in food as the EU seeks to expand the biotech market after a six-year moratorium and ease a transatlantic trade dispute, Bloomberg reported. A U.S appeals court lifted a ban on sales of rebuilt toner cartridges that compete with products made by Lexmark Intl., Bloomberg said. U.S. consumer confidence fell more-than-expected in October as both political parties engage in historically negative rhetoric, Bloomberg said. A divided U.S. SEC ordered hedge fund managers to register with the agency, subjecting the private investment partnerships to SEC oversight for the first time, Bloomberg reported.
Bottom Line: The Portfolio is higher mid-day on strength in my internet, Russian telecom ADR and wireless longs. I have not traded today and the Portfolio is still 100% net long. The tone of the market is better today, however the advance/decline line is near even, technology stocks are underperforming and measures of investor anxiety are mostly lower. I expect U.S. stocks to trade mixed into the afternoon as political worries and domestic terrorism fears offset stabilizing energy prices and optimism over the MMC news.
Tuesday Watch
Earnings of Note
Company/Estimate
AKS/.54
ATVI/.09
AV/.18
AVID/.52
ABX/.04
NILE/.07
CTX/1.59
CECO/.28
CME/1.67
CTSH/.18
FFIV/.21
HAL/.36
LLL/.88
LMT/.65
MSTR/.51
RFMD/-.02
SINA/.28
TROW/.63
RIG/.05
VRTS/.21
WMS/.10
Splits
None of note.
Economic Data
Consumer Confidence for October estimated at 94.0 versus 96.8 in September.
Recommendations
Goldman Sachs reiterated Outperform on CIT, SII, ADP, AMT, VLTR and Underperform on VRTX.
Late-Night News
Asian indices are mixed as strength in Australia is being offset by weakness in Taiwan and China. Oracle's $7.7 billion takeover bid for Peoplesoft may today receive approval from the European Union's antitrust regulator, removing the last remaining regulatory obstacle, the Financial Times said. SLM Corp., the student-loan company known as Sallie Mae, is being investigated by the state of California for non-federally backed loans to students to for-profit career training schools, the Financial Times reported. News Corp. shareholders approved Rupert Murdoch's plan to move his media company to the U.S. from Australia, making it easier to raise money for expansion and allowing the stock to be added to the benchmark S&P 500 Index, Bloomberg reported.
Late-Night Trading
Asian Indices are -1.25% to +.50% on average.
S&P 500 indicated +.16%.
NASDAQ 100 indicated +.21%
BOTTOM LINE: I expect U.S. equities to open modestly lower in the morning on a weaker consumer confidence report. As I have said many times before, the constant barrage of negativity from the media and politicians is having an affect on consumer psychology. However, confidence should head higher in the intermediate-term as the election ends, domestic terrorism fears diminish and hiring improves. Stocks should attempt to rally later in the day on better earnings reports, declining energy prices, short-covering and bargain-hunting.
Company/Estimate
AKS/.54
ATVI/.09
AV/.18
AVID/.52
ABX/.04
NILE/.07
CTX/1.59
CECO/.28
CME/1.67
CTSH/.18
FFIV/.21
HAL/.36
LLL/.88
LMT/.65
MSTR/.51
RFMD/-.02
SINA/.28
TROW/.63
RIG/.05
VRTS/.21
WMS/.10
Splits
None of note.
Economic Data
Consumer Confidence for October estimated at 94.0 versus 96.8 in September.
Recommendations
Goldman Sachs reiterated Outperform on CIT, SII, ADP, AMT, VLTR and Underperform on VRTX.
Late-Night News
Asian indices are mixed as strength in Australia is being offset by weakness in Taiwan and China. Oracle's $7.7 billion takeover bid for Peoplesoft may today receive approval from the European Union's antitrust regulator, removing the last remaining regulatory obstacle, the Financial Times said. SLM Corp., the student-loan company known as Sallie Mae, is being investigated by the state of California for non-federally backed loans to students to for-profit career training schools, the Financial Times reported. News Corp. shareholders approved Rupert Murdoch's plan to move his media company to the U.S. from Australia, making it easier to raise money for expansion and allowing the stock to be added to the benchmark S&P 500 Index, Bloomberg reported.
Late-Night Trading
Asian Indices are -1.25% to +.50% on average.
S&P 500 indicated +.16%.
NASDAQ 100 indicated +.21%
BOTTOM LINE: I expect U.S. equities to open modestly lower in the morning on a weaker consumer confidence report. As I have said many times before, the constant barrage of negativity from the media and politicians is having an affect on consumer psychology. However, confidence should head higher in the intermediate-term as the election ends, domestic terrorism fears diminish and hiring improves. Stocks should attempt to rally later in the day on better earnings reports, declining energy prices, short-covering and bargain-hunting.
Monday, October 25, 2004
Monday Close
S&P 500 1,094.80 -.09%
NASDAQ 1,914.04 -.06%
Leading Sectors
Airlines +4.22%
Homebuilders +3.88%
Steel +3.61%
Lagging Sectors
HMOs -.64%
Restaurants -.80%
Biotech -1.27%
Other
Crude Oil 54.35 -1.49%
Natural Gas 7.92 -2.28%
Gold 430.10 +1.06%
Base Metals 111.02 -1.63%
U.S. Dollar 84.97 -1.05%
10-Yr. T-note Yield 3.97% -.10%
VIX 16.58 +8.51%
Put/Call .73 -1.35%
NYSE Arms 1.16 -8.66%
After-hours Movers
PHRM +5.3% after beating 3Q estimates and raising 04 outlook.
NVDA +11.7% after boosting 3Q sales estimate.
MMC +9.4% after CEO Greenberg resigned, 11 days after Spitzer probe was announced.
DAL +6.4% after saying American Express agreed to provide as much as $600 million in financing, including $500 million to prepay for the airline's frequent-flier points.
SLAB -20.7% after meeting 3Q estimates and lowering 4Q guidance substantially.
FLEX -7.5% after missing 2Q estimates and lowering 3Q/4Q guidance.
ATRS -7.1% after missing 3Q estimates and raising 4Q outlook.
Recommendations
Goldman Sachs reiterated Outperform on KO, BC and BSX. Goldman reiterated Underperform on ASH.
After-hours News
U.S. stocks finished slightly lower today as continuing worries over high energy prices, politics and terrorism offset a strong housing report. After the close, Time Warner and Comcast will be allowed to bid together for assets of Adelphia Communications, the Wall Street Journal reported. Japan will take action to prevent a rapid appreciation of the yen as the U.S. dollar declines, Reuters reported. Pitney Bowes, the word's largest maker of postal meters and mailing equipment, said third-quarter profit rose 15% on lower costs and higher sales of software and services, Bloomberg said. American Express said quarterly profit climbed 14% to a record as customers spent more on travel and carried larger loan balances, Bloomberg reported. Boston's wins over St. Louis in the first two games of the World Series, televised by Fox, drew the highest tv ratings for the start of the World Series since 1996, Bloomberg said. Electronic Data Systems said it delayed the release of third-quarter earnings while it reviews the value of a contract with the U.S. Navy, Bloomberg said. Toyota Motor's U.S. auto-loan unit said it will restate financial results for the past three years, raising profit and revenue because some fees paid to dealers were accounted for incorrectly, Bloomberg said.
BOTTOM LINE: The Portfolio had its best day of the year today on substantial strength in my internet, security and steel longs. I did not trade in the afternoon, thus leaving the Portfolio's market exposure at 100% net long. Notwithstanding the small losses in the major indices, most stocks were higher on the day. The VIX is moving up ahead of the election which is also a positive. Any sell-off related to weaker-than-expected economic reports over the next few days should be bought as the U.S. economy is poised to accelerate on the conclusion of the election without terrorism.
NASDAQ 1,914.04 -.06%
Leading Sectors
Airlines +4.22%
Homebuilders +3.88%
Steel +3.61%
Lagging Sectors
HMOs -.64%
Restaurants -.80%
Biotech -1.27%
Other
Crude Oil 54.35 -1.49%
Natural Gas 7.92 -2.28%
Gold 430.10 +1.06%
Base Metals 111.02 -1.63%
U.S. Dollar 84.97 -1.05%
10-Yr. T-note Yield 3.97% -.10%
VIX 16.58 +8.51%
Put/Call .73 -1.35%
NYSE Arms 1.16 -8.66%
After-hours Movers
PHRM +5.3% after beating 3Q estimates and raising 04 outlook.
NVDA +11.7% after boosting 3Q sales estimate.
MMC +9.4% after CEO Greenberg resigned, 11 days after Spitzer probe was announced.
DAL +6.4% after saying American Express agreed to provide as much as $600 million in financing, including $500 million to prepay for the airline's frequent-flier points.
SLAB -20.7% after meeting 3Q estimates and lowering 4Q guidance substantially.
FLEX -7.5% after missing 2Q estimates and lowering 3Q/4Q guidance.
ATRS -7.1% after missing 3Q estimates and raising 4Q outlook.
Recommendations
Goldman Sachs reiterated Outperform on KO, BC and BSX. Goldman reiterated Underperform on ASH.
After-hours News
U.S. stocks finished slightly lower today as continuing worries over high energy prices, politics and terrorism offset a strong housing report. After the close, Time Warner and Comcast will be allowed to bid together for assets of Adelphia Communications, the Wall Street Journal reported. Japan will take action to prevent a rapid appreciation of the yen as the U.S. dollar declines, Reuters reported. Pitney Bowes, the word's largest maker of postal meters and mailing equipment, said third-quarter profit rose 15% on lower costs and higher sales of software and services, Bloomberg said. American Express said quarterly profit climbed 14% to a record as customers spent more on travel and carried larger loan balances, Bloomberg reported. Boston's wins over St. Louis in the first two games of the World Series, televised by Fox, drew the highest tv ratings for the start of the World Series since 1996, Bloomberg said. Electronic Data Systems said it delayed the release of third-quarter earnings while it reviews the value of a contract with the U.S. Navy, Bloomberg said. Toyota Motor's U.S. auto-loan unit said it will restate financial results for the past three years, raising profit and revenue because some fees paid to dealers were accounted for incorrectly, Bloomberg said.
BOTTOM LINE: The Portfolio had its best day of the year today on substantial strength in my internet, security and steel longs. I did not trade in the afternoon, thus leaving the Portfolio's market exposure at 100% net long. Notwithstanding the small losses in the major indices, most stocks were higher on the day. The VIX is moving up ahead of the election which is also a positive. Any sell-off related to weaker-than-expected economic reports over the next few days should be bought as the U.S. economy is poised to accelerate on the conclusion of the election without terrorism.
Subscribe to:
Posts (Atom)