Is This A Barrier For The Bulls?

Stocks
ended the day lower,
as buyers failed to extend their two-day spree.
With volume coming in exceptionally light, price action ground lower for most of
the session, with a decent rally in the last hour. News wise there was little to
go on, though it is believed by many that looming conflict with Iraq remains a
barrier for new money coming into the market. Tomorrow we’ll get a new read on
key economic numbers including PPI and the Phily Fed.

The Dow Jones Industrial
Average

(
$INDU.X |
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closed -0.50% at 8,000.60. The S&P 500
(
$SPX.X |
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closed -0.70% at 845.13. The Nasdaq
(
$COMPQ |
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closed -0.90% at
1,334.32.

In the green today were gold
and silver

(
$XAU.X |
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, +1.56%, healthcare providers
(
$RXH.X |
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, +0.86%, and
REIT’s
(
DJR.X |
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, +0.60%.

Leading to the downside were
airlines

(
$XAL.X |
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, -2.92%, networking
(
$NWX.X |
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, -2.33%,
computer hardware
(
$HWI.X |
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, -1.87%, and telecom
(
IXTC.X |
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,
-1.72%.

In economic news, housing
starts came in at 1.850M vs. expectations of 1.765M, and building permits came
in at 1.781M vs. expectations of 1.800M.

The Ten Year Note
(
TYH3 |
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was +160 at 115 125.

The U.S. Dollar
(
DXH3 |
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was -0.52 at 100.18.

Volume was well below
average
, with the NYSE coming in at 1,058,600,000

and the Nasdaq at 1,179,398,000.

Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 1.61, and down
volume over up volume by a 2.27 ratio. Nasdaq declining issues over advancing
issues came in at 1.65, and down volume beat up volume by a 2.25 ratio.

The

VIX
was -0.34 at 35.22. The

TRIN
was +0.97 at 1.40.

Biggest Dow losers were:

Hewlett Packard
(
HPQ |
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PowerRating)
, -3.41% at 17.81, SBC
Communications

(
SBC |
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PowerRating)
, -2.78% at 23.03, Walt Disney
(
DIS |
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,
-2.60% at 16.85, Du Pont
(
DD |
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, -2.08% at 37.11, Alcoa
(
AA |
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,
-2.00% at 20.53, and International Paper
(
IP |
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, -11.92% at 35.17.

Stocks in the news:

Consumer and business product maker Kimberly-Clark
(
KMB |
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,
+0.84% at 45.40, announced that it has increased its quarterly dividend by 13%
to $0.34 per share.

Heavy-duty equipment makers Caterpillar
(
CAT |
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,
+3.14% at 45.95, and Ingersoll Rand
(
IR |
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, +0.38% at 38.65, have been
upgraded by UBS Warburg to “buy” from “neutral.” 

Regional bank MBNA America
(
KRB |
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PowerRating)
, -12.12% at
14.50, had its estimates cut by Goldman Sachs for 2003 and 2004.

Forestry and wood product maker
Weyerhaeuser
(
WY |
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PowerRating)
, -0.23% at 50.57,
was upgraded by Goldman Sachs to “outperform” from “in-line.”

Security systems company
Invision
(
INVN |
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News |
PowerRating)
, -10.12% 50.53, was downgraded by SG Cowen to “underperform”
from “outperform.”

Morgan Stanley has upgraded the semiconductor group to
“attractive” from “in-line”, and has upgraded individually Intel
(
INTC |
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PowerRating)
,
+0.53% at 16.80, Texas Instruments
(
TXN |
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, +1.04% at 16.41, and
Xilinx
(
XLNX |
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, +0.04% at 22.10, to “overweight” from
“equal-weight.” 

Also in the chip sector, Micron Technology
(
MU |
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PowerRating)
,
+3.76% at 7.44, announced it will cut 10% of its workforce.

Healthcare facilities company LifePoint Hospitals
(
LPNT |
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PowerRating)
,
+8.67% at 21.79, beat its fourth-quarter earnings expectations by $0.08 with
profits of $0.45 per share.

Financial company Prudential
(
PRU |
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PowerRating)
, -1.97% at
30.31, guided lower for 2003 due to the combining of its retail brokerage with
Wachovia
(
WB |
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PowerRating)
, -1.09% at 35.26.

Retailer Abercrombie and Fitch
(
ANF |
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, +6.29% at
29.57, beat its fourth-quarter earnings estimates by $0.03 with profits of $0.93
per share. The stock is a member of TM’s Momentum List.

Electric utilities company DTE Energy
(
DTE |
Quote |
Chart |
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PowerRating)
,
+0.91% at 42.11, was upgraded by UBS Warburg to “buy” from “neutral.”

Computer services company
Overture Systems
(
OVER |
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Chart |
News |
PowerRating)
, -20.71% at 18.07, had its estimates
cut by Salomon Smith Barney due to its current bid for Alta Vista.

danielb@tradingmarkets.com