A Positive Sign For Tomorrow

May 9, 2002
Daniel Beighley

The
markets cooled their engines today as the major indexes gave back
some of yesterday’s gains. Gold and silver, Japan, healthcare, and forest and
paper products made up the gainers list, with biotechnology, software,
networking, and airline stocks posting the worst losses. The last half hour of
trading was marked by an influx of volume to the downside on the Dow and S&P
500.

Teetering
on a key support level, the Retail Index
(
$RLX.X |
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PowerRating), down 1.34%,
digested several earnings announcements. Though the sector closed down, it held
above its support level which is a positive sign going forward. The index is
currently caught between its 50-day and 200-day moving averages.

U.S.
Treasury Bonds were up 13 at 101 ’17.

The
markets sold off briefly mid-day after an announcement from the Federal Reserve
that said anthrax spores were found in 20 pieces of mail targeted at its
members, including Alan Greenspan.

In
economic news, the Labor Department reported that initial jobless claims
fell 11,000 to 411,000, for a larger decrease than expected.

Market
breadth was negative, with NYSE declining issues over advancing issues by a
ratio of 1.86, and down volume over up volume by a 2.71 ratio. Nasdaq declining
issues over advancing issues came in at 1.95, and down volume beat up volume by
a 5.31 ratio. The VIX
was up 0.76 at 24.05. The TRIN
was up 1.08 at 1.46.

Below
average volume on the NYSE and average volume on the Nasdaq moved the Dow to
test and close above its 20-day MA,Â as the S&P 500 turned down from its
20-day MA, and the Nasdaq made an inside day, still below its 20-day MA. The
Semiconductor Index
(
SOX.X |
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PowerRating), down 3.57%, made an inside day. The
Broker/Dealer Index
(
$XBD.X |
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PowerRating), down 1.19%, retreated from its 20-day
MA.

Broadcasting and cable TV company Adelphia
Communications (ADLAE),
up 1.86%, announced it is selling less than half of its subscriber base to pay
down debt. The company also warned it could default on some credit agreements.

The country’s largest movie theatre
company, Regal Entertainment Group
(
RGC |
Quote |
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PowerRating), up 14.47% at 21.75, had its
first day of trading today.

Computer hardware company Sun
Microsystems (SUNW),
down 3.19% at 6.67, gave the Nasdaq a spark as it was upgraded by Morgan Stanley
to “equal-weight” from “underweight.”

Energy trader Dynegy (DYN),
down 0.89% at 11.05, may have its credit rating cut by Standard and Poor’s as
the U.S. Securities and Exchange Commission is seeking a formal investigation
into the company’s natural gas transactions.

Discount retailer Wal-Mart (WMT),
down 2.48% at 54.99, said that same-store sales rose 3.3% in April vs.
expectations of a 3.9% rise.

Drug maker NaPro BioTherapeutics
(NPRO),
up 44.52% at 7.93, released in a statement with Abbott Laboratories (ABT)
that it has obtained U.S. approval to market an anticancer product.

Motion picture company Pixar
Animation Studios (PIXR),
up 2.90% at 42.19, reported first-quarter earnings of 30 cents a share vs. the
23 cents expected by analysts. The company has also raised its 2002 outlook.Â

Brokerage Goldman Sachs (GS),
down 1.08% at 78.64, and Franklin Resources (BEN)
are close to winning a $4 billion account with the California Public Employees
Retirement System.

Personal computer maker Hewlett-Packard
(
HPQ |
Quote |
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PowerRating), up 0.05% at 20.01, was upgraded by JP Morgan to “buy” from
“market perform.”

A Positive Sign For Tomorrow

BUY THE FEAR, SELL THE GREED

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