Market Ponders: Will Greenspan Cut?
Stocks kicked
off the fourth quarter with a low-volume decline, failing to carry
over Friday’s rally. The major indexes cruised south right off the opening bell,
then attempted to break into positive territory by 1:50 ET, falling short,
retreating, then putting in another rally into the close.
The Dow Industrials closed down 11.49
at 8836.07. The S&P 500 closed down 2.79 at 1038.15. The Nasdaq Composite
closed down 20.88 at 1477.92. NYSE advancing issues numbered at 1,297 and
declining issues at 1,856. Total NYSE volume was light at 1,220,894,590. Of
technical interest was the TRIN peaking at 1.94. The VIX backed off 0.41 today
closing at 34.78
Critical on the news front this week
is Tuesday’s FOMC meeting. It is widely believed that Greenspan and crew will cut interest rates again. Friday unemployment numbers will be released with an anticipated
rate of 5%. Combine this with a potential military strike in Afghanistan and it
it could provide for a very volatile week.
The National Association of Purchasing
Management’s manufacturing index narrowed 0.9 from August to a reading of 47.0
for September. Any level above 42.7 suggests expansion for most economists.
The Philadelphia Semiconductor Index
dropped 3.01% today, representing the worst of sector performances.
Alliance Semiconductor
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fell today after announcing it would cut 10% of its workforce, slash salaries
from 5% to 15%, and cease operations for three weeks during the holiday period.
The stock closed down 0.18 at 7.
Advanced Micro Devices
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down 0.22 at 7.93 and Intel
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Lynch analyst Joseph Osha made negative comments over the semiconductor industry
with lowered fourth quarter estimates.
Energy stocks also experienced losses
when Lehman Brothers said it expects oil to trade between $20 and $25 a barrel
in the upcoming months. BP Amoco (BP) fell 2.02 to 47.15, Exxon
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0.31 to 39.09, and Royal Dutch
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Citigroup
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41.75 on an upgrade from Credit Suisse First Boston to “strong buy”
from “buy.”
Motorola
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as the company is in talks with Siemans AG over a potential joint venture for
their wireless business.
The AMEX Airline Index advanced 0.92
to 68.63 up 1.35%.
The S&P Health Care Index advanced
11.52 to 818.50 up 1.42%.
The S&P Transport Index declined
16.93 to 556.04 down 2.95%.