The Standout Gainers
The major averages traded in
narrow ranges for the day, as the Dow and S&P 500 closed with slight gains,
and the Nasdaq closed with a slight loss. Healthcare along with gold and silver were
the standout gainers, with telecom, semiconductors, utilities and networking
weighing down the negative column. With all three major indexes clinging to
their 50-day moving averages, traders will welcome any separation.
The
Dow Jones Industrial Average
(
$INDU |
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PowerRating) closed down 0.50% at 10257.11.
The S&P 500
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$SPX |
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(
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Action was relatively quiet
this options expiration Friday, with Microsoft’s reversal from pre-market losses
giving a boost to upside action. Earnings season continues next week, with key
announcements for Amazon.com
(
AMZN |
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PowerRating) Tuesday, America Online
(
AOL |
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(
PSFT |
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PowerRating) on Thursday. Economic
releases coming up will be for consumer confidence on Tuesday, new
home sales Wednesday, existing home sales Thursday, and GDP
Friday.Â
Market breadth was mixed, with
NYSE advancing issues over declining issues by a ratio of 1.26, and up–volume
over down–volume
by a 1.08 ratio. Nasdaq declining issues over advancing issues came in at 1.10,
and down–volume
beat up–volume
by a 1.05 ratio. The
VIX
was down 1.24 at 20.00. The TRIN
was down 0.09 at 1.16.
Below-average volume on the day
closed the Dow, the S&P 500, and the Nasdaq just below their 50-day MAs. The
Semiconductor Index
(
$SOX.X |
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50-day MA. The Broker/Dealer Index
(
$XBD.X |
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its 50-day MA.
Winning
sectors of the day were the Morgan Stanley Healthcare Index
(
$HMO.X |
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PowerRating),
up 2.86% at 585.71,
and the Disk Drive Index
(
$DDX.X |
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PowerRating), up 2.63% at 105.73.
Losing
sectors of the day were the North American Telecoms Index
(
$SOX.X |
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PowerRating),
down 2.83% at 580.35, and the Networking Index
(
$NWX.X |
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PowerRating), down
1.75% at 228.92.
Software giant Microsoft Corp (MSFT),
up 1.47% at 57.20, failed to meet earrings forecasts for the quarter ending
March 31 and has reduced its expectations for this quarter and 2003. Despite
this, Merrill Lynch upgraded the stock to “buy” from “neutral,”
giving the stock a boost in pre-market trading.
Office supplies company International Paper
(
IP |
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PowerRating), up
2.03% at 42.17, beat its earnings expectations by taking in 12 cents a share
compared to the 8 cents anticipated by analysts.
Online auctioneer eBay Inc. (EBAY),
up 2.54% at 54.39, said its first quarter
earnings were 17 cents per share compared to earnings of 8 cents a year
ago. Analysts were looking for 16 cents a share, though the company said its
revenue from advertising has dropped 32%,
and it has
not raised its 2002 earnings guidance.
Computer hardware maker Compaq Computer (CPQ),
up 2.86% at 11.13, reported earnings of 4 cents a share, excluding acquisition–related
expenses. The company was expected to earn 1 cent a share.
Also in the computer hardware sector,
Sun Microsystems (SUNW),
up 7.39% at 9.15, said sales for the quarter ending March 31 came in at $3.11
billion, compared to expectations of $3.2 billion.
Restaurant company Cheesecake Factory (CAKE),
down 1.10% at 40.15, announced first quarter earnings of 21 cents a share
compared to the 20 cents it was expected to earn.Â
Communications equipment maker Scientific
Atlanta (SFA),
up 5.82% at 23.44, said that it has earned 28 cents a share for the quarter
ending March 31.
The
company was expected to earn 26 cents a share.
Communications services company BellSouth Corp
(
BLS |
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at 31.37, announced that first quarter profits rose 30%, largely due to sales of
investments, and reduced their 2002 outlook citing weak U.S. and Latin American
markets. This is the second time this year the company has reduced its earnings
outlook.
Computer hardware maker Gateway
(
GTW |
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PowerRating), up 7.25% at 6.65, met its
earnings expectations for the first quarter, though beat its revenue forecasts.
The company has not raised its revenue guidance for the second quarter.
Chip maker Xilinx
(
XLNX |
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PowerRating), down 2.95% at 41.67, beat its earnings
expectations as Morgan Stanley raised the company’s 2003 and 2004 earnings
estimates.
Aerospace and defense company Boeing
(
BA |
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PowerRating), down 2.17% at 42.75, was
awarded a multi-billion dollar contract with South Korea to deliver fighter
jets.
Entertainment giant Disney
(
DIS |
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PowerRating), up 2.25% at 24.95, was upgraded
by Goldman Sachs to “trading buy” from “market performer”
and by CIBC World Markets to “buy” from “hold.”     Â