How Strong Is The Bull?

November 7, 2002
Daniel Beighley

The
markets gapped lower off the open, and headed south for nearly the
entire session. There was little, news-wise, to inspire the selling, though it
was orderly and on lighter volume. Derrik
Hobbs has cited a potential reversal zone for the indexes here — how steep
and severe a pullback might be will help give us an indication of how strong the
bull really is.

In economic news, the initial
jobless claims came in at 390,000 vs. an expected 400,000. The productivity
preliminary was at 4.0% vs. an expected 4.2%. Wholesale inventories
were at 0.5% vs. an expected 0.2%. And consumer credit was at 10.0
billion vs. an expected 6.0 billion.

The 10-year US Note
was +300 at 114 250.

The dollar was -0.65 at
105.13.

Volume was average, at
1,403,434,000 on the NYSE, and
1,742,340,000 on
the Nasdaq.

Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 1.88, and down
volume over up volume by a 4.30 ratio. Nasdaq declining issues over advancing
issues came in at 2.02, and down volume beat up volume by a 5.17 ratio.

The
VIX
was +0.80 at 35.28. The TRIN
was +1.58 at 2.28.

The Dow’s biggest decliner was JP
Morgan
(
JPM |
Quote |
Chart |
News |
PowerRating), -6.61% at 20.60, as it sold off after a rumor that the
investment bank was facing possible losses in its derivatives department. The
company denied the rumor.

Stocks in
the news:

Advertising company TMP
Worldwide
(
TMPW |
Quote |
Chart |
News |
PowerRating), -20.67% at 12.51, issued a profit warning for the
fourth quarter. The owner of Monster.com also said the global slowdown in
employment will cut into profits.

Computerized casino gaming
product maker International Gaming Tech
(
IGT |
Quote |
Chart |
News |
PowerRating), +1.19% at 76.28, beat
its fourth-quarter earnings expectations by $0.03 with profits of $0.95 per
share.

Air carrier Jetblue
(
JBLU |
Quote |
Chart |
News |
PowerRating),
-9.06% at 37.10, missed its third-quarter earnings expectations by $0.01 with
profits of $0.27 per share.

Insurance company MetLife
(
MET |
Quote |
Chart |
News |
PowerRating), +0.11% at 26.66, was upgraded by Merrill Lynch to “buy”
from “neutral” after better-than-expected third-quarter results form
the company.

From the
Retail Sector:

Costco
(
COST |
Quote |
Chart |
News |
PowerRating),
-4.86% at 32.07, reduced its earnings forecast to between $0.30 and $0.32 a
share from previous estimates up to $0.33 a share.Â

Sears Roebuck
(
S |
Quote |
Chart |
News |
PowerRating),
-6.76% at 25.78, announced that October same-store sales fell 10%, which was
slightly worse than the company had forecasted. The company also said its
November sales will also be down.

Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating),
-0.62% at 25.78, announced that October same store sales were up 3.7%, which was
in line with forecasts, though down from a year ago.

Nordstrom
(
JWN |
Quote |
Chart |
News |
PowerRating),
+2.72% at 21.88, said that their October same-store sales were up 9.6%, which
was ahead of the 1.3% expected by Firs Call.

Federated Department Stores
(
FD |
Quote |
Chart |
News |
PowerRating), +2.89% at 31.25, recorded a 0.3% gain for October same-store sales,
which was slightly better than expected.

How Strong Is The Bull?

BUY THE FEAR, SELL THE GREED

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