Keep An Eye On These Divergences

September 19, 2003
Vincent Mao

Stocks are
lower this midday. The major indices are
staging a small pullback on this quadruple-witching Friday. After brief early
session gains, stocks turned lower but are off session lows. After rising for
the last five out of six weeks, both the Dow and S&P are running into
resistance. In addition, there is negative divergence on their weekly charts. No
economic releases today. Hurricane Isabel slammed into the East Coast yesterday,
leaving 14 people dead and 4.5 million homes and businesses without power. The
Hurricane’s damage is estimated to be near $1 billion or just a quarter of
previous estimates. Both airline
(
$XAL.X |
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PowerRating) and insurance
(
$IUX.X |
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PowerRating)
issues are down nearly 1%.

No economic
reports today.

The 10-year U.S. Note
is +035 at 112 150.

The dollar is -0.99 at
95.32.

Gold is +5.90 at 383.10.

Crude Oil -0.35 at
26.82.

Volume is 711,000,000 on
the NYSE, and 1,004,000,000 on the Nasdaq.

Market breadth is mixed,
with NYSE advancing issues over declining issues by1.14, and down over up volume
by 1.21; Nasdaq advancing issues over declining issues at 1.07, and down volume
over up volume at 1.18.

Top Dow stocks are:

Stocks in the news:

Logistics services provider
Expeditors
(
EXPD |
Quote |
Chart |
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PowerRating) is lower by more than 10% after the company warned
that its third-quarter results will be short of expectations. Due to lower
margins and reduced tonnage from Asia, the company now sees third-quarter
results between 28 to 30 cents a share vs. current consensus estimates of 33
cents a share.

Internet marketing services
provider Findwhat.com [FWHT|FWHT|] is trading lower by more than 23%
after the company announced that it is renegotiating the terms of its recent
acquisition, Espotting Media. Findwhat has retracted its previous statements
regarding Espotting’s historical and projected performance. However, the company
did reaffirm its third-quarter and full-year targets of 11 cents a share and 48
cents a share, respectively.

Nike
(
NKE |
Quote |
Chart |
News |
PowerRating) is higher
by 7.5% after reporting its first-quarter results. Yesterday, the athletic
footwear and apparel maker reported earnings of 98 cents a share compared to a
loss of 18 cents a share in the year-ago quarter. Revenues came in at a record
$3 billion.

Software maker Red Hat
(
RHAT |
Quote |
Chart |
News |
PowerRating)
is higher by more than 15% after the company posted a second-quarter profit
compared to year-ago loss. The leading distributor of the Linux operating system
earned 2 cents a share compared to a loss of a penny a share during the year-ago
quarter. Analysts were expecting a penny a share. Revenues jumped 36% to $28.8
million.

If you have any comments or questions, please
feel free to email me.

Vincent Mao

vincentm@tradingmarkets.com

Keep An Eye On These Divergences

BUY THE FEAR, SELL THE GREED

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