The Path Of Least Resistance
The
indexes posted slight gains today, as price action moved higher in
early action, dropped to the day’s lows by Noon ET, then drifted higher again
into the close. Downgrades and improper accounting rumors took their toll on
individual stocks, though the path of least resistance for the overall market
was once again to the upside. Volume was above average in a holiday week that
typically sees less than average traffic.
Dow Jones Industrial Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed +0.50% at 8,849.40. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
closed +0.25% at 932.89. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed +0.90% at
1,481.96.
The biggest gainers were
Internet
(
$INX.X |
Quote |
Chart |
News |
PowerRating), +7.07%, networking
(
$NWX.X |
Quote |
Chart |
News |
PowerRating), +5.63%,
semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), , and airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating),
+2.49%.
The day’s big losers were
healthcare
(
$HMO.X |
Quote |
Chart |
News |
PowerRating), -8.04%, gold and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating),
-1.46%, and insurance
(
$IUX.X |
Quote |
Chart |
News |
PowerRating), -1.05%.
In economic news, existing
home sales came in at 5.77 million vs. an expected 5.35 million.
The 10-year U.S. Note
was unchanged at 112 210.
The Dollar was +0.41 at
106.69.
Volume was above average at
1,523,236,000 on the NYSE, and
1,940,657,000 on
the Nasdaq.
Market breadth was positive,
with NYSE advancing issues over declining issues by a ratio of 1.35, and up
volume over down volume by a 1.51 ratio. Nasdaq advancing issues over declining
issues came in at 1.54, and up volume beat down volume by a 3.31 ratio.
The
VIX was +0.22 at 26.95. The
TRIN was -0.25 at 0.89.
Leading the Dow were:
SBC Communications
(
SBC |
Quote |
Chart |
News |
PowerRating),
+3.08% at 28.40, General Motors
(
GM |
Quote |
Chart |
News |
PowerRating) +2.98% at 38.70, Merck
Co.
(
MRK |
Quote |
Chart |
News |
PowerRating), +2.16% at 60.31, Allied Capital
(
ALD |
Quote |
Chart |
News |
PowerRating), +2.10% at
21.86, International Business Machines
(
IBM |
Quote |
Chart |
News |
PowerRating), +2.09% at 86.20, and
Intel Corporation
(
INTC |
Quote |
Chart |
News |
PowerRating), +2.09% at 20.47.
Stocks in the news:
Managed care companies were
under pressure today after SG Cowen downgraded the sector to “market perform”
from “strong buy.” From the sector, WellPoint Health
(
WLP |
Quote |
Chart |
News |
PowerRating), -10.39%
at 62.49, Aetna
(
AET |
Quote |
Chart |
News |
PowerRating), -10.93% at 35.75, Health Net
(
HNT |
Quote |
Chart |
News |
PowerRating),
-7.49% at 24.33, UnitedHealth Group
(
UNH |
Quote |
Chart |
News |
PowerRating), -9.65% at 76.45,
Human
(
HUM |
Quote |
Chart |
News |
PowerRating), -8.01% at 9.87, and Cigna
(
CI |
Quote |
Chart |
News |
PowerRating), -2.79% at 40.39.
Conglomerate Cendant
(
CD |
Quote |
Chart |
News |
PowerRating),
-3.46% at 12.26, fell after the New York Times reported that securities
regulators are investigating the company’s dealings with Homestore.com
(
HOMS |
Quote |
Chart |
News |
PowerRating), -8.78% at 1.35. Cendant said that there was no investigation.
Discount retailer Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating), +0.11% at 53.82, said that they expect total sales for stores open at
least one year to come in at the low end of growth rate targets.
Autos geared up today as
Deutsche Bank said now is the time to buy shares because they may rally on
stronger-than-expected volume. General Motors
(
GM |
Quote |
Chart |
News |
PowerRating), +2.98% at 38.70,
and Ford Motor
(
F |
Quote |
Chart |
News |
PowerRating), +6.56% at at 10.88.
Software maker Computer
Associates
(
CA |
Quote |
Chart |
News |
PowerRating), +1.07% at 14.98, was reported by the Wall Street
Journal to have engaged in improper accounting tactics, though company
denied the story.
Internet infrastructure giant
Cisco Systems
(
CSCO |
Quote |
Chart |
News |
PowerRating), unchanged at 14.89, was downgraded by UBS
Warburg to “hold” from “buy” based on valuation.
Drug maker Forest Labs
(
FRX |
Quote |
Chart |
News |
PowerRating),
+3.37% at 108.20, had its estimates raised by Morgan Stanley with a new price
target of $124 vs. previous estimates of $117.
Deutsche Bank has taken a shot
at the following with downgrades to “hold” from “buy”: Lehman Brothers
(
LEH |
Quote |
Chart |
News |
PowerRating),
-1.68% at 61.20, Â First Health
(
FHCC |
Quote |
Chart |
News |
PowerRating), -7.09% at 21.33, CIT Group
(
CIT |
Quote |
Chart |
News |
PowerRating), -1.03% at 21.00.
Communications services company
UTStarcom
(
UTSI |
Quote |
Chart |
News |
PowerRating), -6.87% at 19.10, has been downgraded by UBS Warburg
to “sell” from “buy.”
From TM’s Implosion List:
healthcare companies UnitedHealth
(
UNH |
Quote |
Chart |
News |
PowerRating), -9.65% at 76.45,
WellPoint
(
WLP |
Quote |
Chart |
News |
PowerRating), -10.39% at 62.49, Anthem
(
ATH |
Quote |
Chart |
News |
PowerRating), -7.52% at
54.97, Triad Hospitals
(
TRI |
Quote |
Chart |
News |
PowerRating), -5.14% at 28.74, and medical equipment
and supplies company Patterson Dental Company
(
PDCO |
Quote |
Chart |
News |
PowerRating), -5.40% at
39.70.
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