This Action Is A Good Sign
The
major indexes ended the day slightly positive after better-than-expected
economic news helped attract buyers. Rallying late in the session occurred at
the same time it was reported US stealth bombers were leaving their home base.
It was a good sign earlier in the week when a negative consumer confidence
report was shaken off, and today’s action shows the markets are willing to rally
into the weekend amidst geopolitical tension. The pressing issue for the market
remains Iraq, and how a potential war may play out.
The
Dow Jones Industrial Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed +0.07%
at 7,891.01. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed
+0.46%
at 841.15. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed +1.02%
at 1,337.54.
Biggest winners were semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), +2.77%, gold and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating), +2.43%, Internet
(
$GIN.X |
Quote |
Chart |
News |
PowerRating), +2.38%, and networking
(
$NWX.X |
Quote |
Chart |
News |
PowerRating), +1.96%.
Biggest losers were insurance
(
$IUX.X |
Quote |
Chart |
News |
PowerRating), -0.67%, forest and paper
(
$FPP.X |
Quote |
Chart |
News |
PowerRating), -0.51%, and utilitiesÂ
(
$UTIL.X |
Quote |
Chart |
News |
PowerRating), -0.17%.
In economic news, the GDP
preliminary number came in at 1.4% vs. a consensus of 1.0%, the chain
deflator was at 1.6% vs. expectations of 1.8%, Michigan Sentiment
came in at 79.9 vs. expectations of 79.2, and the Chicago PMI was at 54.9
vs. expectations of 52.5.
The Ten Year Note
(
TYH3 |
Quote |
Chart |
News |
PowerRating) was +130 at 116 230.
The US dollar
(
DXH3 |
Quote |
Chart |
News |
PowerRating) was -0.06 at 99.81.
Volume was below
average, with the NYSE coming in at 1,292,760,000
and the Nasdaq at 1,329,366,000.
Market breadth was positive,
with NYSE advancing issues over declining issues by a ratio of 1.48, and up
volume over down volume by a 1.70 ratio. Nasdaq advancing issues over declining
issues came in at 1.04, and up volume beat down volume by a 3.02 ratio.
The
VIX
was -1.03 at 34.15. The TRIN
was +0.09 at 0.87.
Biggest Dow gainers were:
Walt Disney
(
DIS |
Quote |
Chart |
News |
PowerRating), +3.39 at 17.06, Intel
Corp.
(
INTC |
Quote |
Chart |
News |
PowerRating), +3.35% at 17.26, McDonalds
(
MCD |
Quote |
Chart |
News |
PowerRating), +2.71% at
13.61, Hewlett Packard
(
HPQ |
Quote |
Chart |
News |
PowerRating), +1.99% at 15.85, American Express
(
AMX |
Quote |
Chart |
News |
PowerRating), +1.51% at 33.58, and Home Depot
(
HD |
Quote |
Chart |
News |
PowerRating), +1.47% at
23.45.Â
Stocks in the news:
Software giant Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating), +0.50% at 23.70, said that it is considering buying video game
company Sega, which is in the process of merging with pinball-machine maker
Sammy. Also in the business, Electronic Arts
(
ERTS |
Quote |
Chart |
News |
PowerRating), +0.07% at
52.85, is making a bid for Sega.
Oil stocks were well bid as
OPEC announced that increasing oil output cannot suppress the increase in oil
prices. From the sector, Exxon Mobile
(
XOM |
Quote |
Chart |
News |
PowerRating), +0.11% at 34.02, Chevron
Texaco CVX|CVX], +0.06% at 64.20, and Royal Dutch Petroleum
(
RD |
Quote |
Chart |
News |
PowerRating),
+2.05% at 39.67.
Restaurant company Darden Restaurants
(
DRI |
Quote |
Chart |
News |
PowerRating), -0.22% at 17.81, received an upgrade from JP Morgan who believes the
company will have a strong first half of the year. Also in the sector, YUM
Brands
(
YUM |
Quote |
Chart |
News |
PowerRating), +1.31% at 23.81, reaffirmed its guidance for the
fourth-quarter.
Electric utilities company American
Electric Power
(
AEP |
Quote |
Chart |
News |
PowerRating), +3.96% at 21.78, announced a plan to issue 50
million shares in an effort to better its financial situation. The company also
lowered its earnings guidance to reflect the move.
Clothing retailer The Gap
(
GPS |
Quote |
Chart |
News |
PowerRating),
-12.01% at 13.04, reported earnings of $0.27 per share vs. its loss of $0.04 per
share a year ago, though was downgraded by Bank of America to
“neutral” from “buy.”
Goldman Sachs has cut its full year 2003
estimates on U.S. drug wholesalers as it reduces earnings growth forecasts on
the sector to 15% from 20%. Companies with reduced estimates are Cardinal
Health
(
CAH |
Quote |
Chart |
News |
PowerRating), -1.56% at 57.29, Amerisourcebergen
(
ABC |
Quote |
Chart |
News |
PowerRating),
-0.63% at 55.00, and McKesson Corp.
(
MCK |
Quote |
Chart |
News |
PowerRating), -2.45% at 26.64.
Home builders were the subject of negative
comments in a Wall Street Journal article which claimed the sector
may suffer if yesterday’s Commerce Department report is an indication of
weakness to come. Companies mentioned were Centex Corp.
(
CTX |
Quote |
Chart |
News |
PowerRating), -0.50%
at 55.28, DR Horton Inc.
(
DHI |
Quote |
Chart |
News |
PowerRating), -1.02% at 18.31, KB Home
(
KBH |
Quote |
Chart |
News |
PowerRating), -0.95% at 46.90, Lennar Corp.
(
LEN |
Quote |
Chart |
News |
PowerRating), -0.16% at 53.99, Pulte
Home
(
PHM |
Quote |
Chart |
News |
PowerRating), -0.56% at 50.83, and Toll Brothers
(
TOL |
Quote |
Chart |
News |
PowerRating), -0.51%
at 19.37.
Chip giant Intel Corp.
(
INTC |
Quote |
Chart |
News |
PowerRating),
+3.35% at 17.26, had its first-quarter estimates raised by Dan Niles at Lehman
Brothers due to strength in foreign sales. Niles believes the company will also
raise its estimates. Intel also announced that it has made a campaign with Marriott
(
MAR |
Quote |
Chart |
News |
PowerRating), +1.75% at 30.22, to promote high speed wireless technology.Â
Software company Take-Two Interactive
(
TTWO |
Quote |
Chart |
News |
PowerRating), +2.00% at 20.91, was upgraded to RBC Capital’s top pick with a
price target of $38.
Retailer Sears
(
S |
Quote |
Chart |
News |
PowerRating), +2.73% at
21.78, had its credit rating cut by S&P to BBB+ from A-.
danielb@tradingmarkets.com