What The Bulls Wanted To See

The markets are slightly higher
mid-day on the heels of better than expected economic numbers. Price action
opened flat, pushed higher in reaction to the numbers, then sold off sharply to
where it now consolidates. Select aerospace and defense stocks are under
pressure in reaction to the space shuttle tragedy over the weekend.

The Dow Jones Industrial
Average

(
$INDU.X |
Quote |
Chart |
News |
PowerRating)
is +0.81% at 8,118.80. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
is +0.52% at 860.16. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating)
is +0.48%
at 1,327.30.

Leading today’s action are
forest and paper

(
$FPP.X |
Quote |
Chart |
News |
PowerRating)
, +1.48%, oil service
(
$OSX.X |
Quote |
Chart |
News |
PowerRating)
, +1.40%, and utilities
(
$UTY.X |
Quote |
Chart |
News |
PowerRating)
,
+1.28%.

The biggest laggards on the
session are healthcare
(
$HMO.X |
Quote |
Chart |
News |
PowerRating)
, -2.87%, airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating)
, -2.06%, and healthcare providers
(
$RXH.X |
Quote |
Chart |
News |
PowerRating)
, -1.66%.

In economic news, construction spending
was up 1.2% vs. expectations of 0.5%. and the ISM Index came in at 53.9
vs. expectations of  54.00.

The 10-year U.S. Note
is -095 at 113 270.

The Dollar is -0.01 at
100.13.

Gold is +3.10 at 371.40
at 368.30.

Crude Oil – 0.46 at
33.05.

Volume is at 582,073,000
on the NYSE, and at 684,255,000 on the Nasdaq.

Market breadth is mostly
positive
, with NYSE advancing issues over declining issues by a ratio of
1.19, and up volume over down volume by a 1.25 ratio. Nasdaq declining issues
over advancing issues are at 1.13, and down volume over up volume is at a 1.44
ratio.

Biggest Dow gainers are:

Eastman Kodak
(
EK |
Quote |
Chart |
News |
PowerRating)
, +4.55% at 31.68, SBC
Communications

(
SBC |
Quote |
Chart |
News |
PowerRating)
, +3.76% at 25.36, United Technologies
(
UTX |
Quote |
Chart |
News |
PowerRating)
, +2.99% at 65.48, Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating)
, +2.38% at 48.58.
Home Depot

(
HD |
Quote |
Chart |
News |
PowerRating)
, +1.77% at 21.27, and Du Pont
(
DD |
Quote |
Chart |
News |
PowerRating)
, +1.32% at
38.37.

Stocks In The News:

Aerospace and defense companies Alliant Tech
(
ATK |
Quote |
Chart |
News |
PowerRating)
, -9.77% at 49.05, Boeing
(
BA |
Quote |
Chart |
News |
PowerRating)
, -1.17% at 31.22, and
Lockheed Martin

(
LMT |
Quote |
Chart |
News |
PowerRating)
, -2.12% at 49.97, are all under selling pressure
in the aftermath of the space shuttle tragedy, as they are all suppliers to
NASA.

Retailer JC Penny
(
JCP |
Quote |
Chart |
News |
PowerRating)
, +0.41% at
19.47, announced that it expects sales for its stores open at least a year to be
flat for February, vs. 13% growth for the month a year ago.

Toy maker Mattel
(
MAT |
Quote |
Chart |
News |
PowerRating)
, +4.30% at
20.86, has beat its fourth-quarter earnings expectations by $0.03 with profits
of $0.42 0 per share.

Electric utilities company Entergy
(
ETR |
Quote |
Chart |
News |
PowerRating)
, +2.36% at 45.50, has been upgraded by UBS Warburg to “buy” from
“neutral.” 

Savings bank Greenpoint Financial
(
GPT |
Quote |
Chart |
News |
PowerRating)
, +1.79% at 43.88, has been upgraded by UBS Warburg to “buy” from
“neutral.”

Also in the retail sector, Abercrombie and
Fitch

(
ANF |
Quote |
Chart |
News |
PowerRating)
, +2.84% at 28.63, has been upgraded by Merrill Lynch to
“buy” from “neutral.”

Healthcare facilities company
Accredo Health

(
ACDO |
Quote |
Chart |
News |
PowerRating)
, -22.69% at 29.00, sold off after lowering its
2003 revenue guidance to $1.40-1.45 from previous guidance of $1.45-1.50.

Communications equipment maker
LM Ericsson Telephone
(
ERICY |
Quote |
Chart |
News |
PowerRating)
, -8.27% at 7.46, is down after
releasing disappointing earnings and guiding lower for 2003.

Drug maker Eli Lilly
(
LLY |
Quote |
Chart |
News |
PowerRating)
, +2.88% at 61.98, has been upgraded by Prudential to “buy” from
“hold.”

Photo giant and Dow component
Eastman Kodak
(
EK |
Quote |
Chart |
News |
PowerRating)
, +4.55% at 31.68, was given a favorable mention in
Barron’s from Legg Mason Value Trust’s Bill Miller.

danielb@tradingmarkets.com