Watch For This Level On The Dow
Stocks
are sharply lower this midday. The major indices are starting the
week off on a negative note. A mega merger between Biogen
(
BGEN |
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PowerRating) and IDEC
Pharmaceuticals
(
IDPH |
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PowerRating) failed to prop up the market. Meanwhile warnings
from Tenet Healthcare
(
THC |
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PowerRating) and Rohm & Haas are weighing on the indices. The
major indices are near the lows of the day and every sector is in the red. The
Dow
(
$INDU |
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PowerRating) has pulled back to support at its 20-day moving average while
both the S&P
(
$SPX.X |
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PowerRating) and Nasdaq
(
$COMPQ |
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PowerRating) are already below it.
Next possible support for the Dow is the all important psychological level at
9,000. Tomorrow marks the start of the two-day FOMC meeting. A 0.25 cut is
expected.Â
The Dow Jones Industrial
Average
(
$INDU.X |
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Chart |
News |
PowerRating) is -1.51% at 9,061.25Â The S&P 500
(
$SPX.X |
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PowerRating)
is -1.53% at 980.45. The Nasdaq
(
$COMPQ |
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PowerRating) is -2.17% at 1608.93.
The day’s leading sectors are
none.
Weak today are Health
Providers
(
$RXH.X |
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News |
PowerRating), -4.02%, Biotechs
(
$BTK.X |
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News |
PowerRating), -3.89%,
Networking
(
$NWX.X |
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Chart |
News |
PowerRating), -3.75%, Computer Hardware
(
$HWI.X |
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News |
PowerRating),
-3.08%, and Airlines
(
$XAL.X |
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Chart |
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PowerRating), -3.03%.
No economic news for today. Â
The 10-year U.S. Note
is +125 at 118 180.
The dollar is -0.11 at
94.34.
Gold is -4.40 at 352.30.
Crude Oil -0.33 at
29.15.
Volume is at 702,000,000
on the NYSE, and at 1,108,000,000 on the Nasdaq.
Market breadth is negative,
with NYSE declining issues over advancing issues by a ratio of 3.28, and downÂ
olume over up volume by a 8.33 ratio. Nasdaq declining issues over advancing
issues at 3.14, and down volume over up volume is at a 4.58 ratio.
Top Dow stocks are:
Altria Group
(
MO |
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Chart |
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PowerRating), +2.58% at
44.12, McDonalds
(
MCD |
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Chart |
News |
PowerRating), +0.86% at 22.22, Coca-Cola
(
KO |
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Chart |
News |
PowerRating),
+0.30% at 46.61.Â
Stocks in the news:
Advanced Fibre
Communications
(
AFCI |
Quote |
Chart |
News |
PowerRating) is higher by 4% after Lehman Brothers upgraded
the stock from “equal weight” to “over weight”. Lehman based the upgrade on
attractive valuations and believes that the company could benefit from increased
spending by regional Bell operating companies. Lehman also raises its target
price from $15 to $20. Â
Cray
(
CRAY |
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Chart |
News |
PowerRating) is
higher by 2.5% on very heavy volume. The supercomputer maker was the subject of
a positive Barron’s article. The article suggested that company could receive
significant contracts from government agencies due to its supercomputers that
can solve complex problems in weeks to months instead of years.Â
IGEN International
(
IGEN |
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Chart |
News |
PowerRating)
is higher by 1.80 after the company announced that it had received a $23 million
contract from the Department of Defense. IGEN would provide its Origen
technology to the DOD for detection of biological agents in the environment.Â
American Capital Strategies
(
ACAS |
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News |
PowerRating) is lower by 7.4% on very heavy volume after a negative Barron’s
article. The article raised concerns over the company’s deteriorating loan
portfolio. Â
Avery Dennison
(
AVY |
Quote |
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News |
PowerRating)
is lower by 5.6% on heavy volume after the company lowered second quarter
guidance. Due to slow sales, the adhesive and office supply maker, now expects
earnings between 68 to 72 cents a share. Previously the company was looking from
77 to 82 cents a share. Â
Biogen
(
BGEN |
Quote |
Chart |
News |
PowerRating) is
off 3.7% on heavy volume reversing its earlier gains. The company agreed to be
acquired by Idec Pharmaceuticals in a $6.6 billion stock deal. Separately Biogen
warned that second quarter results would come in between 32 to 38 cents a share
compared to analyst estimates of 42 cents a share. Â
Tenet Healthcare
(
THC |
Quote |
Chart |
News |
PowerRating)
is off 22% on very heavy volume reversing its earlier gains. The company warned
that second quarter and full year estimates would be below estimates due to
lower payments from insurers and higher medical costs. Second quarter estimates
for the company were at 34 cents a share, but Tenet said that for the past two
months of the quarter was only 2 cents a share.Â