What The DNA After-Hours Sell Off Could Mean For Biotechs
The
major averages ended the day in negative territory after going
positive in early action while Iraqi citizens and coalition forces symbolically
toppled a statue of Saddam Hussein. Price action trended down for most of the
session in concurrence with Monday’s reversal day signal. Volume was on the
light side, giving the move less conviction. Now that the conflict in Iraq has
subsided, traders will focus on the upcoming parade of earnings announcements.
This earnings season will be a real test for the markets as the past three years
have produced a series of disappointments.
In after hours trading biotech
firm Genentech
(
DNA |
Quote |
Chart |
News |
PowerRating) beat its first-quarter earnings expectations by
$0.07, though is down in after hours. It’s usually a bad sign when a company
beats expectations and sells off.
The Dow Jones Industrial
Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed -1.21% at 8,197.94. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
closed -1.40% at 865.99. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed -1.89% at
1,356.74.
Biggest gainers were gold
and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating), +3.06%, oil service
(
$OSX.X |
Quote |
Chart |
News |
PowerRating),
+0.60%, and REITs
(
DJR.X |
Quote |
Chart |
News |
PowerRating), +0.20%.
Biggest losers were Internet
(
$ECM.X |
Quote |
Chart |
News |
PowerRating), -3.24%, biotechnology
(
$BTK.X |
Quote |
Chart |
News |
PowerRating), -2.56%,
computer hardware
(
$HWI.X |
Quote |
Chart |
News |
PowerRating), -2.10%, and chemicals
(
$CEX.X |
Quote |
Chart |
News |
PowerRating),
-2.03%.
There were no economic releases
for the day.
The Ten Year Note was
+095 at 114 175.
The US dollar was -0.37
at 100.53.
Volume was average,
with the NYSE coming in at 1,261,180,000 and the Nasdaq at 1,295,023,000.
Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 1.23, and down
volume over up volume by a 2.63 ratio. Nasdaq declining issues over advancing
issues came in at 1.38, and down volume beat up volume by a 5.98 ratio.
The
VIX was +1.32 at 30.91. The
TRIN was +0.69 at 2.14.
Biggest Dow losers were:
Microsoft Corp.
(
MSFT |
Quote |
Chart |
News |
PowerRating), -3.94% at 24.57,
AT&T Corp.
(
T |
Quote |
Chart |
News |
PowerRating), -2.91% at 14.67, General Electric
(
GE |
Quote |
Chart |
News |
PowerRating), -2.70%
at 27.30, Home Depot
(
HD |
Quote |
Chart |
News |
PowerRating), -2.57% at 25.75, Hewlett Packard
(
HPQ |
Quote |
Chart |
News |
PowerRating),
-2.47% at 15.36, and Intel Corp.
(
INTC |
Quote |
Chart |
News |
PowerRating), -2.45% at 16.68.
Stocks in the news:
Tool maker Stanley Works
(
SWK |
Quote |
Chart |
News |
PowerRating), -11.63% at 21.12, fell after reducing its first-quarter earnings due
to lower sales and higher production costs.
Chip maker Motorola
(
MOT |
Quote |
Chart |
News |
PowerRating),
-4.44% at 7.95, was downgraded by Needham & Co. to “hold” from “buy”.
Maker of ATM’s and retail systems NCR
(
NCR |
Quote |
Chart |
News |
PowerRating),
+11.05% at 20.40, said that it expected to post first-quarter earnings ahead of
expectations with a loss of $0.30 vs. previous estimates of $0.48 per share.
Drug maker Abbott Labs
(
ABT |
Quote |
Chart |
News |
PowerRating),
+0.70% at 40.21, met its first-quarter earnings expectations of $0.51 per share,
though profits were down 6.2% from a year ago.
Car maker Daimler Chrysler
(
DCX |
Quote |
Chart |
News |
PowerRating), +1.08% at 32.74, announced that its 2003 earnings targets have become
“much more difficult”, though will try to bring costs down more in an effort to
meet targets.
Business services company
D&B Corp.
(
DNB |
Quote |
Chart |
News |
PowerRating), -12.27% at 34.75, lowered its first-quarter revenue
targets to $315 million vs. the previous estimate of $330.9 million.
Printing and publishing company
Knight-Ridder
(
KRI |
Quote |
Chart |
News |
PowerRating), -2.56% at 58.81, announced that they expect to see
first-quarter earnings come in just above $0.60 vs. a consensus of $0.67.
Textile company Lear Corp.
(
LEA |
Quote |
Chart |
News |
PowerRating), -0.38% at 38.49, was upgraded by JP Morgan to “overweight” from
“neutral”.
Personal services company
SABRE Holdings
(
TSG |
Quote |
Chart |
News |
PowerRating), +6.03% at 17.03, guided lower for the
first-quarter and expects to earn $0.36 vs. a consensus of $0.40.
Online bookseller Amazon.com
(
AMZN |
Quote |
Chart |
News |
PowerRating), -5.50% at 25.06, had coverage initiated on it by JP Morgan at
“underweight”.
Online auctioneer eBay
(
EBAY |
Quote |
Chart |
News |
PowerRating),
-2.59% at 86.96, had coverage initiated on it by JP Morgan at “overweight”.
Beverage giant Pepsi
Bottling
(
PEP |
Quote |
Chart |
News |
PowerRating), +0.40% at 39.39, was upgraded by Goldman Sachs to
“outperform” from “in-line”.
Bank of America was active with
drug wholesalers as it initiated “buy” ratings on Amerisourcebergen
(
ABC |
Quote |
Chart |
News |
PowerRating),
-2.86% at 51.17, Cardinal Health
(
CAH |
Quote |
Chart |
News |
PowerRating), -2.76% at 56.55, and
McKessen
(
MCK |
Quote |
Chart |
News |
PowerRating), -1.94% at 24.17. The firm has also downgraded Accredo
Health
(
ACDO |
Quote |
Chart |
News |
PowerRating), -5.87% at 13.45, and PSS World Medical
(
PSSI |
Quote |
Chart |
News |
PowerRating),
+0.16% at 6.14, to “neutral”, and Owens and Minor
(
OMI |
Quote |
Chart |
News |
PowerRating), -1.97% at
16.85, and Priority Healthcare
(
PHCC |
Quote |
Chart |
News |
PowerRating), -2.00% at 23.89, to “sell”.
Media company Fox
Entertainment
(
FOX |
Quote |
Chart |
News |
PowerRating), -2.15% at 27.25, had its estimates raised by
Goldman Sachs based on the belief that it will announce better-than-expected
third-quarter results.