What’s Leading The Upside Action

  • August 29, 2002
  • Paul Letourneau

After
lower opens, the major indices reversed course, and rallied to
intraday highs by mid-day, with the Dow and S&P slightly negative, and the
Nasdaq slightly positive. Technology is leading the action, as the major indexes
attempt to regain their 50-day moving averages.

The biggest advances are in:
Internet, networking, biotechnology, and gold and silver.

Leading the losers are: oil
service, transportation, and energy.

In economic news, the
preliminary GDP came in at an expected 1.1%, and initial jobless claims
clocked in at 403,000 vs. an expected 385,000.

The Dow Jones Industrial
Average
(
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(
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is up 0.58% at 923.27. The Nasdaq
(
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PowerRating) is up 2.15% at 1342.68.

U.S. Treasury Bonds were
are up ’22 at 110 ’18.

Volume is on the light side
at  670,652,830
on the NYSE, and 732,769,692 on the Nasdaq.

Market breadth is positive,
with NYSE advancing issues over declining issues by a ratio of 1.16, and up
volume is over down volume by a 1.28 ratio. Nasdaq advancing issues are over
declining issues came by1.52, and up volume is beating down volume by a 5.13
ratio.

Internet portal Yahoo!
(
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PowerRating),
up 13.02 at 10.33, was upgraded by Merrill Lynch to “neutral” from “sell” based
on valuation.

UBS hit the semis with four
downgrades primarily due to valuation. Downgraded were:  Novelus (NVLS),
up 2.19% at 24.71, Logic Vision (LGVN),
down 5.40% at 2.45, Lam Research (LRCX),
up 2.18% at 12.18, and Newport Corp. (NEWP),
down 1.66% at 16.52.

Conglomerate General Electric
(
GE |
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PowerRating), down 2.84% at
30.41, had its 2003 earnings estimates reduced by Lehman Brothers, who said the
company’s pension fund could have a negative impact, though the fundamentals are
still intact.

Goldman Sachs put in another
round of downgrades on the airline industry, due to perceived weakness in the
near future. Among stocks downgraded were: Delta Airlines (DAL),
up 3.38% at 18.31, Continental Airlines (CAL),
up 0.58% at 10.31, United Airlines (UAL),
down 5.48% at 3.10, American Airlines (AMR),
up 4.90% at 10.48, and Southwest Airlines (LUV),
up 2.64% at 14.72.

Also in the chip sector, Micron Technology
(
MU |
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PowerRating),
down 3.53 at 17.20, had its estimates reduced by Morgan Stanley who claims back
to school buying has been weak.

Restaurant company Panera
Bread (PNRA),
up 5.82% at 29.05, has been upgraded by Raymond James to “strong buy” from
“outperform” based on valuation.

Doughnut retailer Krispy
Kreme (KKD),
down 0.60% at 36.14, beat its second-quarter earnings expectations by a penny
with earnings of 15 cents a share.

Specialty retailer Michaels
Stores (MIK),
up 10.44 at 43.90, beat its second-quarter earnings expectations by 12 cents
with profits of 30 cents per share. The company has also increased its outlook.

Healthcare facilities company
Advanced PCS (ADVP),
up 2.83% at 19.23, has been upgraded by First Albany to “buy” to “neutral” based
on the belief that management will now fully cooperate with an ongoing
investigation and provide greater disclosure.