The Stand-Out Candidate
The major indexes wavered in
tight ranges throughout the day, with the Dow and Nasdaq posting slight gains,
and the S&P 500 taking a slight loss. Healthcare topped the gainers list,
with oil service, transportation, and telecoms also putting on a good show.
Biotechnology and broker/dealers weighed the negative column down with the
heaviest losses.
Closing at the top of its
range, the Retail Index
(
$RLX.X |
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PowerRating), up 0.10%, stands out as a
candidate for potential follow through in tomorrow’s session. Among the gainers
closing with consolidations at the top of their ranges were Tiffany and Co.
(
TIF |
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PowerRating), up 8.65% at 39.55, Autozone
(
AZO |
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PowerRating), up 3.78% at 78.75, Bed
Bath and Beyond
(
BBBY |
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PowerRating), up 2.15% at 36.93, and Best Buy
(
BBY |
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PowerRating), up 1.72%.
The
Dow Jones Industrial Average
(
$INDU |
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PowerRating) closed up 0.04% at 10035.06 The
S&P 500
(
$SPX |
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PowerRating) closed down 0.15% at 1091.48. The Nasdaq
(
$COMPQ |
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PowerRating) closed up 0.02% at
1713.71.
U.S. Treasury Bonds were
up 2 at 101’26.
Today’s action was highlighted
by announcement that the Securities and Exchange Commission is set to launch a
major probe into "analysts with conflicts of interest." At this time
there are no companies being singled out. Among the most active in that sector
were Lehman Brothers
(
LEH |
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PowerRating), down 3.72% at 57.91, Morgan Stanley
(
MWD |
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PowerRating), down 5.60% at 48.13, and Goldman Sachs
(
GS |
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PowerRating), down 2.86% at
77.21.
In economic news, the employment
cost index came in at 0.8% for the first quarter vs. the 1% expected. Initial
jobless claims came in at 421,000, coming in short of analysts’ expectations
of 430,000. Finally, the help wanted index came in at 46 reading, also
short of expectations with economists looking for a number of 53.
Market breadth was mixed, with
NYSE advancing issues over declining issues by a ratio of 1.07, and down–volume
over up–volume
by a 1.14 ratio. Nasdaq declining issues over advancing issues came in at 1.07,
and up–volume
beat down–volume
by a 1.48 ratio. The
VIX
was up 0.29 at 22.97. The TRIN
was down 0.13 at 1.22.
Heavy volume saw the Dow test
its 200-day MA, the S&P 500 move closer to its 1080 support zone, and the
Nasdaq break below a triple bottom on its daily chart. The Semiconductor
Index
(
$SOX.X |
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PowerRating), up 0.80% at 538.61, moved briefly above its 200-day
MA, though closed for the second day in a row below this mark.
Top
advancing sectors of the day were the Morgan
Stanley Healthcare Index
(
$HMO.X |
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PowerRating),
up 2.45% at
97.09,
and the Oil Service Sector
Index
(
$OSX.X |
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PowerRating), up 2.85% at 106.78.
Losing sectors of the day were the Biotechnology Index
(
$BTK.X |
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PowerRating),
down 3.19% at 440.09, and the Broker/Dealer Index
(
$XBD.X |
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PowerRating), down
2.32%, which made its second consecutive close below its 200-day MA.
Media giant
AOL Time Warner (AOL),
up 0.98% at 19.49, posted first quarter
profits of 18 cents per share, excluding certain items. The company was expected
to earn 14 cents a share.
Software company Network Associates (NET),
down 20.46% at 18.89, has withdrawn its offer to acquire Internet security
software firm McAfee.com (MCAF),
down 24.64% at 13.97, and also said it may have to restate its financial results
for 1999 and 2000.
Conglomerate Tyco International Ltd. (TYC),
down 19.88% at 20.75, canceled its plans to turn the company into four smaller
companies, and said it had $3.3 billion in costs. The company will also
eliminate 7,100 jobs.
Drug maker Pfizer
(
PFE |
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PowerRating), up 2.95% at 37.57, was upgraded by
DeutscheBank on the belief that the company’s drug Lipitor will benefit from the
delayed certification by the Federal Drug Administration of its competitor
Crestor, made by AstraZeneca
(
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PowerRating), which was down 3.98% at 48.40.
Communications services company WorldCom (WCOM),
up 2.01% at 3.55, reported earnings of 9 cents a share vs. the 13 cents expected
by analysts.
Energy trader Dynegy Inc. (DYN),
down 29.63% at 19.21, said that it is the focus of
an informal inquiry by the U.S. Securities and Exchange Commission over a
natural gas
supply contract.
Software company Cadence Design Systems (CDN),
up 1.89% at 21.47, announced that it will acquire Simplex Solutions (SPLX),
up 41.38% at 17.39, in a $300 million stock deal.
Also in the Internet security business, Symantec
Corp. (SYMC),
up 3.69% at 35.93, reported better-than-expected fourth quarter
profits as it pulled in record revenue from strong sales to corporations and
consumers for its antivirus software.
From TM’s proprietary Momentum
List, healthcare facilities company Triad Hospitals
(
TRI |
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PowerRating) gained
3.18%, and auto retailer Autozone
(
AZO |
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PowerRating) rose 3.78%.
From TM’s proprietary Implosion
List, brokerage Merrill Lynch
(
MER |
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PowerRating) was down 4.81%.