This News Might Help The Biotechs
The
markets moved south today, obviously not impressed with Intel beating
its quarterly earnings by two cents. The selling was broad based, as price
action opened slightly higher, then moved sharply lower where it consolidated
for the rest of the session. The bellwether semiconductors and broker/dealers
were some of the hardest hit, providing an overall bearish indication. The major
indexes remain range bound, with earnings coming out after the close from
Yahoo!
(
YHOO |
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PowerRating), and
Apple
(
AAPL |
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PowerRating).
Genetech
(
DNA |
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PowerRating)
chimed in with earnings after the bell, meeting expectations, and reporting
strong sales. The stock is up over 3% in after hours.
Dow Jones Industrial Average
(
$INDU.X |
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PowerRating) closed -1.35% at 8,723.18. The S&P 500
(
$SPX.X |
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PowerRating)
closed -1.44% at 918.22. The Nasdaq
(
$COMPQ |
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PowerRating) closed -1.51% at
1,438.79.
The biggest gainers on the day
were oil service
(
$OSX.X |
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Chart |
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PowerRating), +3.06%, natural gas
(
$XNG.X |
Quote |
Chart |
News |
PowerRating), +2.29%, and gold and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating),
+0.25%.
The biggest laggards on the day
were semiconductors
(
$SOX.X |
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Chart |
News |
PowerRating), -3.50%, which closed right on
its 50-day moving average, broker/dealers
(
$XBD.X |
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Chart |
News |
PowerRating), -2.22%
networking
(
$NWX.X |
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Chart |
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PowerRating), -2.18%.
In economic news, business
inventories for November came in at 0.2% vs. an expected 0.1%, core PPI
was down 0.3% vs. an expected 0.1%, and PPI was unchanged vs.
expectations of a 0.3% reading. And the beige book gave anecdotal
evidence that holiday shopping was disappointing, new employment was flat, and
there was little in the way of capital spending improvement. Â
The Ten Year Note
(
TYH3 |
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PowerRating) was +035 at 113 105.
The U.S. Dollar
(
DXH3 |
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News |
PowerRating) was +0.16 at 101.69.
Volume was average,
with the NYSE coming in at 1,339,711,000 and the Nasdaq at 1,693,090,000.
Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 1.55, and down
volume over up volume by a 2.81 ratio. Nasdaq declining issues over advancing
issues came in at 1.43, and down volume beat up volume by a 2.79 ratio.
The
VIX was +1.31 at 27.86. The
TRIN was +0.99 at 1.71.
Leading the Dow lower were:
Alcoa
(
AA |
Quote |
Chart |
News |
PowerRating) -4.14% at 22.20, SBC Communications
(
SBC |
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Chart |
News |
PowerRating), -3.61% at 28.54, DuPont
(
DD |
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Chart |
News |
PowerRating), -3.40% at 42.50, Walt
Disney
(
DIS |
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Chart |
News |
PowerRating), -2.59% at 17.99, Intel Corp.
(
INTC |
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Chart |
News |
PowerRating), -2.47% at
17.35, and Johnson & Johnson
(
JNJ |
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Chart |
News |
PowerRating), -2.41% at 55.00.
Stocks in the news:
Chip king Intel Corp.
(
INTC |
Quote |
Chart |
News |
PowerRating),
-2.47% at 17.35, failed to lift the market despite beating its fourth-quarter
earnings expectations by $0.02 with profits of $0.16 per share.
Chip equipment stocks opened
the day under water after Intel announced it plans to cut back on spending. Down
in the pre-market are Applied Materials
(
AMAT |
Quote |
Chart |
News |
PowerRating), -5.79% at 14.47,
KLA-Tencor
(
KLAC |
Quote |
Chart |
News |
PowerRating), -3.02% at 38.45, and Novellus
(
NVLS |
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Chart |
News |
PowerRating),
-2.09% at 32.75.
Also in the semiconductor
sector, Linear Tech
(
LLTC |
Quote |
Chart |
News |
PowerRating), -4.51% at 29.43, beat its second-quarter
earnings expectations by $0.01 with profits of $0.18 per share.
In the biotech sector,
Biosite Inc.
(
BSTE |
Quote |
Chart |
News |
PowerRating), +4.51% at 39.35, had its fourth-quarter and 2003
earnings estimates raised by Bank of America. The firm now sees fourth-quarter
earnings at $0.34 vs. previous guidance of $0.31. Also in the sector,
Transkaryotic
(
TKTX |
Quote |
Chart |
News |
PowerRating), -25.65% at 6.49, sold off after the Food and Drug
Administration said the company has not been able to prove its drug will help
Fabry disease.
Chemical company and Dow
component DuPont
(
DD |
Quote |
Chart |
News |
PowerRating), -3.40% at 42.50, lowered its fourth-quarter
earnings guidance to $0.31-0.33 per share vs. a consensus of $0.33.
Money center bank Bank of
America
(
BAC |
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Chart |
News |
PowerRating), -1.42% at 71.45, beat its fourth-quarter earnings
expectations by $0.03 with profits of $1.69 per share.
Regional Bank Fifth Third Bancorp
(
FITB |
Quote |
Chart |
News |
PowerRating),
-3.86% at 59.42, announced a rise in profits for the fourth-quarter, though sold
off as investors remain concerned over an investigation into a charge taken in
the third-quarter.
Financial services company Fannie Mae
(
FNM |
Quote |
Chart |
News |
PowerRating),
-1.29% at 69.14, beat its fourth-quarter earnings expectations by $0.02 with
profits of $1.66 per share.
Investment services company Goldman Sachs
(
GS |
Quote |
Chart |
News |
PowerRating),
-1.59% at 73.51, announced it has made a $1.3 billion investment into Japanese
bank Sumitomo Mitsui Financial Group.
In the airline sector, Continental Airlines
(
CAL |
Quote |
Chart |
News |
PowerRating),
+2.24% at 9.10, rallied after reporting smaller than expected losses for its
fourth-quarter.
Business services company Automatic Data Processing
(
ADP |
Quote |
Chart |
News |
PowerRating), -8.02% at 36.31, met its second-quarter earnings expectations, though
guided lower for fiscal 2003.
danielb@tradingmarkets.com