Semi-Bounce
Semiconductors paced a Nasdaq rally of 3.3% Monday, as traders positioned
themselves for what could be a final decision by the Supreme Court regarding the
Presidential election. Broker/dealers and banks joined tech stocks to the
upside, and that helped the S&P 500 post a 0.8% gain. The Dow stayed
relatively flat, gaining just 0.1%.
Volume levels were solid despite a general reluctance to take major positions
until the election mess is settled. Nasdaq volume was a healthy 2.37 billion
shares while NYSE volume totaled 1.20 billion shares.
While technology stocks looked good Monday, many analysts continue to look
toward other sectors and styles for potential leadership.
“The past few months have been the worst-performing months for growth
investing in a decade. As expected, low-risk stocks with high dividends, low
betas, and high value have had their best performance in years. We expect value
investing to lead in 2001,” said Paul Rabbitt, President, Rabbitt
Analytics.com.
“Why do we believe this? The growth/value investing cycle usually lasts
three to five years. Growth has led for seven years to an extreme that resulted in the
Internet stock mania. Now the pendulum has reversed and is swing the other
way.”
According to preliminary numbers, the Nasdaq rose 97.14 to 3014.57, the Dow
added 12.52 to 10,725.43, and the S&P 500 gained 10.46 to 1380.33.
Top sectors were semiconductors
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up 5.0%, and broker/dealers
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Weakest sectors were gold and silver
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down 2.4%, and retailers
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Tech leapers included StorageNetworks
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Broadcom
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A rally in the big-cap techs actually helped the Dow, as Intel
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jumped 10% and Microsoft
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Morgan
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Dow losers were Coca-Cola
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and Wal-Mart
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Looking ahead, the week is fairly light in terms of economic news, but
traders will be keeping an eye on the Producer Price Index on Thursday. Analysts expect a 0.2% increase.