Signs Of Follow Through?

Positive
earnings from Dow stocks
helped drive the index to just shy of its
50-day moving average, while the S&P 500 and Nasdaq managed to close above
their 50-day averages. The bulls took charge for the fourth session in a row, as
the major indexes posted another round of impressive gains. Price action was
choppy, though trended higher throughout the day. Volume was well above average,
giving indication of the follow-through Tim
Truebenbach
has been looking for from last Thursday’s potential bottom.

The
Dow Jones Industrial Average

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$INDU.X |
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closed 
+4.80%
at 8255.68. The S&P 500
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$SPX.X |
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closed
+4.73%
at 881.21. The Nasdaq
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closed
+5.07%
at
1,282.44.

The biggest advances were made
in airlines
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$XAL |
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, +12.16%, semiconductors
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$SOX |
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,
+9.44%, networking
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$GIP |
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, +8.34%, insurance
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$IUX |
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,
+7.88%, and banks
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$BKX |
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, +7.54%.

The only losing sectors were gold
and silver

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$XAU |
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, -2.73%, and utilities
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, -0.74%. 

In economic news, business
inventories
fell 0.1% vs. expectations of an increase of 0.2%.

The 10-year U.S. Note
was -1 165 at 113 095.

The dollar was +0.62 at
108.12.

Volume was above average, at
1,821,716,000 on
the NYSE, and 1,946,856,000

on the Nasdaq.

Market breadth was positive,
with NYSE advancing issues over declining issues by a ratio of 2.90, and up
volume over down volume by a 7.01 ratio. Nasdaq advancing issues over declining
issues came in at 3.01, and up volume beat down volume by a 9.72 ratio.

The
VIX
was -2.87 at 39.74. The TRIN
was -0.38 at 0.41
.

The Dow was helped higher by the following earnings
releases:

Financial giant Citigroup
(
C |
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, +12.63% at 34.14, was the biggest Dow gainer as it beat its third quarter
earnings estimates by $0.01 with profits of $0.74 per share.

Auto maker General Motors
(
GM |
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, +10.34% at 36.70, beat its third-quarter earnings estimates with
profits of $2.20 per share vs. the Multex consensus of $0.99.

Pharmaceutical company
Johnson & Johnson

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, +2.99% at 59.56, beat its third-quarter
earnings estimates by $0.01 with profits of $0.60 per share.

Stocks in the news:

Airline Delta Airlines
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DAL |
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,
+21.20% at 9.09, announced a much lower-than-expected loss for the
third-quarter, which was much smaller than a year ago. Also from the sector, Continental
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, +6.07% at 5.24, and AMR Corp.
(
AMR |
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, +19.78% at 4.48.

In the pharmaceutical business,
Forest Labs

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FRX |
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, +3.80% at 97.06, beat its quarter
estimates by $0.03, and feels comfortable earrings will be 50% for the year.

Money center bank Bank of
America

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BAC |
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, +7.02% at 39.74, beat its third-quarter earnings by $0.04
with profits of $1.45 per share. Also, Bank One
(
ONE |
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, +7.02% at
39.74, posted third-quarter profits inline with estimates, and Wells Fargo
(
WFC |
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, +5.39% at 49.78, reported third-quarter earnings in line with
estimates.

Tobacco company Philip
Morris

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MO |
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, +4.51% at 40.02, been upgraded by Goldman Sachs to
“recommended list” from “market outperform.”

Home mortgage company Fannie
Mae

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FNM |
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, +6.76% at 70.98, beat Wall Street third-quarter estimates,
and said 2002 growth will be above long term trends.

Broker Charles Schwab
(
SCH |
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,
+10.37% at 9.79, reported profits inline with estimates as it increased the
number of new accounts by 3 percent.

Computer hardware maker International
Business Machines

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IBM |
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, +7.97% at 68.48, received positive comments
form SoundView Technology, who thinks the company will beat expectations as its
business sees stabilization in the Asia/Pacific region.

Software giant Microsoft
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, +6.08% at 52.29, was by Goldman Sachs “to meet or slightly
exceed” earnings and revenue estimates due to strong fiscal first-quarter
results.

From TM’s Momentum List, audio
and video equipment maker Imation
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IMN |
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was +6.22% at 36.67 .