Taking Everything Into Account
Like a witch hunt in old Salem, investors
turned their attention from trading to hunting trying to find the next Enron.
Many traders bailed out of the markets today as many sell triggers were hit
along the way. According to investor sentiment, Williams [WMB|WMB],
Cendant
(
CD |
Quote |
Chart |
News |
PowerRating) and Tyco International
(
TYC |
Quote |
Chart |
News |
PowerRating) are the new
Witches of Wall Street.
Investors are worried that these companies may
have questionable accounting practices, which was one of the problems
contributing to Enron’s fall. Tyco plunged $8.49 to $33.51 after it disclosed
that it paid a total of $20 million to one of its outside directors and a
charity that this individual controls in exchange for his help arranging the $10
billion purchase last year of commercial lender CIT Group. Williams lost $5.36,
or 24%, to $18.78, its biggest one-day percentage decline in at least 20 years.
The energy trader and natural gas pipeline company is delaying fourth quarter
results to review up to $2.15 billion in debt and costs from the
telecommunications business it spun off in April of 2001. Cendant, which is the
franchiser of Days Inn hotels and owner of Avis rental car, fell as much as 17%
after analysts at Credit Suisse First Boston and Lehman Brothers divulged to
their clients that the Wall Street Journal may be preparing an article
critical of Cendant’s accounting.
Broader market future indexes took the heat
today, breaking through key support levels. The March S&P 500
(
SPH2 |
Quote |
Chart |
News |
PowerRating)
fell through all key support levels to end at 1100.50, down 35.00. There is some
support here, and the first test facing the S&Ps tomorrow is to get back up
above the 38.2% retracement level (1118.35). The March Dow futures
(
DJH2 |
Quote |
Chart |
News |
PowerRating)
fell hard as well, down 264.00 to close at 9603. The next support level is at
9535. The March Nasdaq 100 futures
(
NDH2 |
Quote |
Chart |
News |
PowerRating) were able to stay above
their second support pivot (1528.83), closing at 1530.00, down 42.50.
It was a barnyard bonanza for cattle today. April
live cattle
(
LCJ2 |
Quote |
Chart |
News |
PowerRating) rallied with strong volume to break above its
70.7% retracement line and close at 75.70, up .75. March feeder cattle
(
FCH2 |
Quote |
Chart |
News |
PowerRating)
rose .13 to 83.825.
March lumber
(
LBH2 |
Quote |
Chart |
News |
PowerRating) is giving back
most of its robust gains from the last couple of trading sessions. Today lumber
fell below its 50% retracement line to close the gap it created last week. March
lumber ended lower by 3.900 to 280.00.
March corn futures
(
CH2 |
Quote |
Chart |
News |
PowerRating) ended lower
at the Chicago Board of Trade on Tuesday. For the second session in a row, corn
has dropped mostly due to a lack of any kind of positive news. Corn fell 1.25 to
close at 206.25