Two Strong Performers Lead The Rise
The markets are on the rise for the first time
this week as semiconductor maker Analog Devices
(
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quarterly profits rose. This triggered gains in computer-related shares such as
Intel
(
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(
$SOX.X |
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shares may benefit from a revival in corporate profit growth as companies
upgrade or modernize equipment.
Benchmark indexes erased early losses triggered
by concern that companies such as Siebel Systems
(
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Group
(
IPG |
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The Standard & Poor’s 500 Index
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$SPX.X |
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ET. Computer-related shares
contributed more than a third of the gain. The Dow Jones Industrial Average
(
$INDU |
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Index
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$COMPQ |
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Earnings for S&P 500 companies are expected to rise 16.5% this quarter,
according to a survey of analysts by Thomson First Call. That’s up from 7.3% in
the third quarter and 1.4% in the second quarter.
Strong Sectors: semi, biotech, oil service, natural gas, retail,
storage/disk drive, network, wireless, telecom and banking.
Weak Sectors: Chemical, HMO and Airline/
The Philadelphia Semiconductor Index
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$SOX.X |
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is approaching the Oct/Nov highs. Initial resistance at the 330 level, the 78.6%
retracement (drawn from the Aug. high to the Oct. low on the daily chart). This
will be followed by the 338, which is the 84.1% zone. To the downside, look
for initial support at 321 followed by a subsequent floor at 316.
Some of the
SOX components contributing to today’s move include: Altera
(
ALTR |
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Novellus
(
NVLS |
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(
KLAC |
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PowerRating), Applied Materials
(
AMAT |
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PowerRating), Linear Technology
(
LLTC |
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PowerRating), Applied Micro Devices
(
AMD |
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PowerRating), Maxim Integrated Products
(
MXIM |
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PowerRating), National Semi
Conductor
(
NSM |
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(
XLNX |
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PowerRating).
Varian Semiconductor
(
VSEA |
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above the neck-line of 27.50. VSEA has a
TradingMarkets.com RS3 rating of 84 and an up trending
ADX of 32.
Caterpillar
(
CAT |
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is rallying to a two-month high with rising volume. The 50%
retracement line is the resistance level for CAT. CAT has an up trending
ADX of 32.
Merrill Lynch
(
MER |
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a 2-month high with increasing volume. The Broker Dealers Index
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$XBD.X |
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is one of the strongest performing sectors on the day.
Covance
(
CVD |
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PowerRating) is breaking out to a new
52-week high with increasing volume. CVD has a
TradingMarkets.com RS3 rating of 83.
Three stocks rose for every two that fell on the
New York Stock Exchange and the Nasdaq Stock Market. Some 627 million shares
traded on the Big Board, down 3.8% from a week ago.
Nasdaq Market Breadth
Adv: 1956 UpVol: 6523708
Dec: 1039 DnVol: 1227060
Net: +917 Net: +5296648
NYSE Market Breadth
Adv: 2026 UpVol: 53583940
Dec: 1120 DnVol: 23620433
Net: +906 Net: +29963507