Why We May See Buying This Afternoon

March 31, 2003
Daniel Beighley

The
major indexes are in negative territory midday with light volume
indicating a lack of trading interest for this final day of the first quarter.
After gapping lower, price action hits intraday low after the Chicago PMI number
slightly disappointed.Â The Dow is being weighed down by bad news out of Altria
as it struggles with ongoing legal problems. Representing the day’s weakness are
the market-leading semiconductors and broker/dealers. Meanwhile, war news
dominates headlines as coalition forces engage Iraqi troops 50 miles outside of
Baghdad. This being the last day of the month, buyers often step up for a little
“window dressing,” where fund managers buy some of the better-performing stocks
so they can show their clients they were a part of the portfolio.

In economic news, Chicago PMI came in at
48.4 vs. expectations of 50.8.

The 10-year U.S. Note
is +240 at 115 030.

The dollar is -0.90 at
99.45.

Gold is +4.80 at 336.30.

Crude OilÂ +0.47 at
30.63.

Volume is at 610,206,000
on the NYSE, and at 784,144,000 on the Nasdaq.

Market breadth is negative,
with NYSE advancing issues over declining issues by a ratio of 1.81, and down
volume over up volume by a 4.04 ratio. Nasdaq declining issues over advancing
issues are at 1.96, and down volume is over up volume by a 2.50 ratio.

Weakest in the Dow are:

Stocks in the news:

Tobacco company Altria Group
(
MO |
Quote |
Chart |
News |
PowerRating), -9.31% at 29.14, was smacked down after it was reported that its Philip
Morris USA division could not produce $12 billion for a bond to appeal a legalÂ
case in Illinois. The stock is a member of TM’s Implosion List.

Software company Checkpoint
Software
(
CHKP |
Quote |
Chart |
News |
PowerRating), -2.90% at 14.41, has had its first-quarter estimates
cut by CSFB who claims the company’s competitive edge has deteriorated in the
past six months.

Natural gas utilities company
El Paso
(
EP |
Quote |
Chart |
News |
PowerRating), +3.90% at 6.13, posted a big loss for the fourth-quarter
as it missed its consensus expectations by $0.84.

Food processing company
Kellogg
(
K |
Quote |
Chart |
News |
PowerRating), +2.01% at 30.46, has been upgraded by Bear Stearns to
“outperform” from “peer perform”.

Money center bank Wachovia
(
WB |
Quote |
Chart |
News |
PowerRating), -0.55% at 34.34, has upped its first-quarter earnings guidance to
$0.76-0.78 vs. a consensus of $0.72.

Retailer Abercrombie and
Fitch
(
ANF |
Quote |
Chart |
News |
PowerRating), +3.58% at 30.07, was given a positive mention in Barron’s
over the weekend which claimed the company could go higher due to sales and
valuation.

Media giant America Online
(
AOL |
Quote |
Chart |
News |
PowerRating), -3.08% at 11.00, is being reported to be under investigation by the
SEC over whether or not the company misstated $400 million in advertising
revenue.

Entertainment company Walt
Disney
(
DIS |
Quote |
Chart |
News |
PowerRating), -3.96% at 16.99 has had its estimates for the full years
2003 and 2004 cut by Goldman Sachs. The firm is now looking for 2003 earnings
per share to be $0.59 vs. previous expectations of $0.64.

Oil service company Halliburton
(
HAL |
Quote |
Chart |
News |
PowerRating), -1.54% at 21.11, has lost a bid for a $600 million contract to help
rebuild Iraq.

Auto maker Ford Motor
(
F |
Quote |
Chart |
News |
PowerRating),
+1.48% at 7.52, received negative comments in Barron’s over the weekend which
claimed the company could lose its debt rating if efforts to revitalize its
business fail.

Software company Cognizant
Tech
(
CTSH |
Quote |
Chart |
News |
PowerRating), +0.49% at 67.18 has had coverage initiated on it by Morgan
Stanley at “underweight”.

danielb@tradingmarkets.com

Why We May See Buying This Afternoon

BUY THE FEAR, SELL THE GREED

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