Not Since Last Summer…

March 7, 2002
Daniel Beighley

Price
action was weak today as the three major averages shifted down off
the bell, never managing to gain a bullish foothold. Retail, energy, and health
care stocks held the top spots on the gainers list, with gold and silver,
Internet, and biotechnology leading the negative column.

The mood was cautious today in
anticipation of after-the-bell updates from Intel
(
INTC |
Quote |
Chart |
News |
PowerRating), down 0.06%, and
Sun Microsystems
(
SUNW |
Quote |
Chart |
News |
PowerRating), down 2.10%. For the economy, Greenspan’s
testimony was the focus of analysts, as it widely interpreted that the Fed
Chief is upbeat as he stated "an economic expansion is already well under
way."

The Labor Department reported
that business productivity rose 5.2% in the fourth quarter, easily
beating expectations of 4.5%. Weekly jobless claims fell 5,000 to
376,000, in line with expectations. Tomorrow’s employment report will tell
whether or not the economy was able to add jobs in February.

Market breadth was neutral,
with NYSE advancing issues over declining issues by a ratio of 1.02, and down
volume over up volume by a 1.17 ratio. Nasdaq advancing issues over declining
issues came in at 1.13, and up volume beat down volume by a 1.05 ratio. The
VIX
was down 0.15 to 21.88. The TRIN
was up 0.58 to 1.19.

Slightly above-average volume
had the Dow hit a high not made since last July, the S&P 500 make its second
close in a row above its 200-day MA, and the Nasdaq move well above its 50 and
200-day MA, though close below these marks. The Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating),
up 0.50%, also hit new highs not made since last summer, though closed at the
bottom of its range. The Broker/Dealer Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating), down 0.24%,
made a new 2-month high, though also closed at the bottom of its range.

Biotech drug maker Sepracor (SEPR),
down 58.54% to 19.60, fell after it was announced that the U.S.
Food and Drug Administration will not approve its allergy drug Soltara.

Elsewhere in the biotech world,
Celgene
(
CELG |
Quote |
Chart |
News |
PowerRating), down 16.73% to 23.12, said that its application for
the drug Thalomid will be delayed with the U.S. Food and Drug Administration due
to a required, additional clinical trial.

Chip stock National
Semiconductor
(
NSM |
Quote |
Chart |
News |
PowerRating), up 4.46% at 33.02, beat earnings estimates when it
announced it had lost 23 cents a share compared to the 27 cents expected.

Aviation and aerospace giant Boeing
(
BA |
Quote |
Chart |
News |
PowerRating), down 3.05% to 48.34, sold
off on the news that rival company Airbus had won a South African Airways
purchase of 41 aircraft worth about $3.5 billion.

Discount retailer Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating), up 1.43% to 61.77, rose on news
that same-store sales rose 10.3% for the year.

Auto maker General Motors
(
GM |
Quote |
Chart |
News |
PowerRating), up 2.50% to 61.42, was upgraded by
Merrill Lynch to Buy from Neutral with the expectations that the company will
produce solid earnings growth.

Online broker E -Trade Group
(
ET |
Quote |
Chart |
News |
PowerRating), up 0.31% to 9.63, was upgraded
by JP Morgan to Buy from Long-term Buy based on valuation and a better business
environment.

Computer hardware maker Hewlett Packard (HWP), down
0.55% to 20.07, now
has the approval of the U.S. Federal Trade Commission for its
proposed acquisition of Compaq Computer (CPQ),
up 1.55% to 11.15 . The shareholder votes of Hewlett Packard remain the only
hurdle for the deal to go through.

Not Since Last Summer…

BUY THE FEAR, SELL THE GREED

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