A Textbook Rally…What’s Next?

April 30, 2002
Daniel Beighley

The indexes pushed higher in
early trading and held ground throughout most of the day before selling off some
into the close. Biotechnology, Internet, software, and forest and paper were the
big gainers of the day, with gold and silver taking the heaviest losses. Also
down were airline, oil service, Japan, and retail stocks as they made slight
losses on the day.

Today’s rally was foreseen by Kevin
Haggerty, who also caught a buy pattern in the Biotech HOLDR
(
BBH |
Quote |
Chart |
News |
PowerRating).
Kevin also sees a case for the markets returning to the September lows.

U.S. Treasury Bonds were
up 11 at 102’10.

In economic news, April consumer confidence came in
at 108.8, just below last month’s reading of 110.7. This was slightly better
than expected.

Market breadth was
positive, with NYSE advancing issues over declining issues by a ratio of 2.35,
and up–volume
over down–volume
by a 3.17 ratio. Nasdaq advancing issues over declining issues came in at 1.71,
and up–volume
beat down–volume
by a 3.13 ratio. The
VIX
was down 2.33 at 23.78. The TRIN
was down 1.78 at 0.74.

Above-average volume
moved the Dow above its 200-day MA, as the S&P 500 formed a bullish
engulfing pattern on the daily chart, and the Nasdaq bounced off its 61.8%
retracement from its September low to January high. The Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating),
up 1.75%, tested its 200-day MA, though closed for the fourth day in a row below
this mark. The Broker/Dealer Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating), up 1.48%, closed
higher than the two previous sessions.

Chip maker
Micron Technology (MU),
down 10.39% at 23.70, will no longer be in talks to acquire Hynix
Semiconductor after Hynix’s board of directors rejected being sold for $3
billion.

Personal and household product maker Proctor
& Gamble (PG),
up 0.28% at 90.26, reported that profits rose 16%
for the quarter
on strong sales from hair-care products.

Drug maker Eli Lily (LLY)
has reduced its 2002 profit outlook and now expects to earn between $2.60 and
$2.65 a share vs. previous estimates of $2.68 a share.

Partners, ICOS Corp. (ICOS),
down 33.94% at 25.67, and Eli Lily (LLY),
down 3.29% at 66.05,
have received approval from the Food and Drug Administration for its
anti-impotence drug Cialis.

Communications services company Qwest
Communications (Q),
up 1.41% at 5.03, announced that it lost 42 cents a share for the first
quarter, compared
to a loss of 3 cents a year ago.

Communications services company WorldCom Inc
(WCOM),
up 5.53% at 2.48,
said that its chief executive officer Bernard Ebbers has resigned and will be
replace by Vice Chairman John Sidgmore.

Energy trading firm Dynegy
(
DYN |
Quote |
Chart |
News |
PowerRating), up
29.96% at 18.00, rose after posting earnings in line with expectations and
receiving $900 million worth of revolving credit.

Software giant Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating), up
0.03% at 52.26, was reported by the Financial Times to be preparing to
bid for Denmark’s Navision, a business services company.

Aerospace and defense company Northrop Grumman
(
NOC |
Quote |
Chart |
News |
PowerRating), up 4.02% at 120.66, said that it was awarded a $2.9 billion contract
with the U.S. Navy.

A Textbook Rally…What’s Next?

BUY THE FEAR, SELL THE GREED

Quick Links

Company Info

Contact

Company Resources