A Good Sign In Front Of A Big Report

The
markets were mostly down on another round of selling pressure
, though
a late session rally lifted the Naz into a just barely positive close. The Dow
and S&P 500 dropped below their two week trading ranges for new three-month
lows. The Nasdaq also hit a new three-month low, with the bellwether
Semiconductor Index remaining within a five-session range. Tomorrow we’ll get a
fresh batch of employment data, an event many traders think twice about stepping
in front of, though today’s afternoon rally was a sign of confidence as it’s
often the smart money that finishes the day.

The
Dow Jones Industrial Average

(
$INDU.X |
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closed 
-0.69%
at 7929.30. The S&P 500
(
$SPX.X |
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closed

-0.64%

at 838.16. The Nasdaq
(
$COMPQ |
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closed
+0.01%
at 1,301.73.

Topping the gainers list were Internet
(
$GIN.X |
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, +2.19%, airlines
(
$XAL.X |
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, +2.12%, telecoms
(
$IXTC.X |
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, +2.06%, and transportation
(
$TRAN.X |
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, +1.79%.

Leading to the downside were insurance
(
$IUX.X |
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, -3.60%, healthcare providers
(
$RXH.X |
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, -1.78%,
oil
(
$OIX |
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, -1.62%, and broker/dealers
(
$XBD.X |
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, -1.42%.

In economic news was
disappointing today as initial jobless claims came in at 391K vs.
expectations of 380K, and productivity preliminary number came in at
-0.2% at 0.7%.

The Ten Year Note
(
TYH3 |
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was +135 at 114 110.

The U.S. Dollar
(
DXH3 |
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PowerRating)
was -0.21 at 99.69.

Volume was below
average
, with the NYSE coming in at 1,369,407,000

and the Nasdaq at 1,220,000,000.

Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 1.76, and down
volume over up volume by a 2.55 ratio. Nasdaq declining issues over advancing
issues came in at 1.45, and down volume beat up volume by a 1.04 ratio.

The
VIX
was +1.68 at 38.52. The TRIN
was -0.13 at 1.44
.

Leading the Dow down were:

AT&T Corp.
(
T |
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PowerRating)
, -2.94% at 17.82, JP Morgan
(
JPM |
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, -2.74% at 22.31, McDonalds
(
MCD |
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, -2.70% at 13.68, American
Express
(
AXP |
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PowerRating)
, -2.56% at 33.76, Eastman Kodak
(
EK |
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, -2.27%
at 30.55, and Alcoa
(
AA |
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, -1.91% at 19.46.

Stocks in the news:

Trucking companies Roadway
(
ROAD |
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, +3.61% at 35.50, and Yellow
(
YELL |
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, +3.61% at 24.35, rallied on the heels of a five-year agreement
reached with the Teamsters and other unions. 

Software giant Microsoft
(
MSFT |
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PowerRating)
, +0.97% at 47.42, announced that
it has reached an agreement with Nvidia over a price dispute relating to the
Xbox.

Media company Martha Stewart Living Omnimedia
(
MSO |
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PowerRating)
, -2.19% at
8.90, was under pressure after federal prosecutors said they might have enough
evidence to build a criminal case against the CEO, Martha Stewart.

Telecom gear maker Ericsson
(
ERICY |
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,
+7.58% at 7.23, announced an new CEO in what hopes to be a new start for the
struggling company.

Retail stocks turned in same store sales today,
with Gap
(
GPS |
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, +3.67% at 15.53, easily toping analysts predictions
with a 16% increase from a year ago, Wal-Mart
(
WMT |
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, +0.10% at 46.79,
posted a 2.3% rise from a year ago, and Kohl’s
(
KSS |
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, +2.20% at
52.89, reported a 5.5% boost.

Fuel cell stocks are fired up ahead of President
Bush’s 1:40 pm ET speech on energy independence, with Ballard Power
(
BLDP |
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PowerRating)
, +6.18% at 10.48, and Plug Power
(
PLUG |
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, +8.95% at 5.23.

Oil company ConocoPhillips
(
COP |
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PowerRating)
,
-1.13% at 48.85, has been upgraded by JP Morgan to “overweight” from
“neutral”.

Electric utilities company TXU Corp.
(
TXU |
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PowerRating)
, -7.46% at 16.70, has been downgraded by Morgan Stanley to
“equal-weight” from “overweight”.

Communications services company j2 Global
(
JCOM |
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PowerRating)
, +1.63% at 21.80, has beat its fourth-quarter earnings expectations
by $0.03 with profits of $0.38 per share.

Online travel company Expedia
(
EXPE |
Quote |
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News |
PowerRating)
, +7.29% at 63.36, has beat its fourth-quarter earnings expectations
by $0.07 with profits of $0.48 per share. The company has also raised its
guidance for the year.

Testing equipment maker Agilent
(
A |
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PowerRating)
, -24.87% at 12.26, has said it will likely take a first-quarter loss for
twice as much as initially anticipated, as customers are buying less.

Beverage giant PepsiCo’s
(
PEP |
Quote |
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News |
PowerRating)
, -2.09% at 40.22, posted profits inline with expectations at $0.50 per
share

Retailer Michaels Stores
(
MIK |
Quote |
Chart |
News |
PowerRating)
, -21.55% at 25.76, has warned that it expects to earn less for the
full year due to unusually cold weather. The company now estimates earnings per
share to come in between $2.05-$2.10 vs. previous expectations of $2.11.

Insurance company Allstate
(
ALL |
Quote |
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PowerRating)
, -6.89% at 32.05, has beat its fourth-quarter earnings estimates by
$0.12 with profits of $0.89 per share.

Also in the insurance sector, Unumprovident
(
UNM |
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Chart |
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PowerRating)
, -15.14% at 14.45, has been downgraded by CSFB to
“underperform” from “neutral”.

Biotechnology company Cephalon
(
CEPH |
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PowerRating)
, +4.82% at 50.43, has been upgraded by JP Morgan to
“overweight” from “neutral”.

Healthcare facilities company Coventry
Health Care

(
CVH |
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Chart |
News |
PowerRating)
, +0.31% at 25.47, has been upgraded by Salomon Smith
Barney to “outperform” from “in-line”.

From TM’s Implosion List,
insurer American International Group
(
AIG |
Quote |
Chart |
News |
PowerRating)
, -5.15% at 48.20.

danielb@tradingmarkets.com