Why Housing Boost May Pull Market Higher
Despite better-than-expected data from the real estate market, the
major stock indexes are under water at the day’s mid-point.
New home sales came in
better than expected with 1,017,000 new sales vs. an expected 975,000. Also,
existing home sales came in better than expected with 5.33 million new sales
vs. an expected 5.30 million.
The Dow Jones Industrial
Average
(
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PowerRating) is down 0.91% at 8791.41. The S&P 500
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is down 0.55% at 935.66 at. The Nasdaq
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1372.19.
U.S. Treasury Bonds were
are up ’06 at 110 ’04.
Volume is on the light side
at 488,514,000 on the NYSE, and 753,410,000 on the Nasdaq.
Market breadth is mixed,
with NYSE advancing issues over declining issues by 1.03, and down volume over
up volume by a 1.20 ratio. Nasdaq declining issues are over advancing issues by
a 1.09 ratio, and down volume is over up volume by a 1.81 ratio.
Candy maker Hershey
(
HSY |
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being reported by USA Today as being bid for by European company Nestle
for $82 a share.
Construction services company Ryland Homes
(
RYL |
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PowerRating),
up 1.51% at 44.75, got a boost from better than expected data from the housing
sector.Â
Pharmaceutical company IDEC Pharmaceuticals
(
IDPH |
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PowerRating),
down 4.04% at 41.52, is under pressure from a negative Wall Street Journal
article on generic drugs, cautious comments from Wachovia, and a rumor that
the company might reduce its outlook on its drug Zevalin.
Also down in the pharmaceutical business, Biogen
(
BGEN |
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, Amgen
(
AMGN |
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PowerRating), down 2.00% at 46.32, and Johnson and Johnson
(
JNJ |
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PowerRating), down 0.54% at 54.62.
Biotechnology company Alkermes
(
ALKS |
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7.44% at 9.32, announced that it will lay off 23% of its workforce due to a
delay of its drug Risperdal Consta.
Healthcare facilities company
 Accredo Health (ACDO),
down 3.83% at 50.92, has beat its fourth-quarter earnings by 3 cents with
profits of 32 cents per share.
Defense contractor TRW Inc.
(TRW),
up 1.59% at 56.57, has won a contract worth $4.5 billion dollars to build
weather satellites for the U.S. Government.
The restaurant sector is experiencing weakness as earnings
momentum shows signs of slowing. From the sector, Cheesecake Factory
(
CAKE |
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PowerRating),
down 6.34% at 29.09, Panera Bread
(
PNRA |
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P.F. Chang’s Bistro
(
PFCB |
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PowerRating), down 3.14% at 30.83.
The Hotel industry was also slapped by a negative Wall
Street Journal article which claimed the industry may not recover until
2004. Among stocks affected by the news are: Marriot International
(
MAR |
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down 0.52% at 33.99, Hilton Hotels
(
HLT |
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Starwood Hotels & Restaurants
(
HOT |
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PowerRating), down 2.07% at 27.37.
Shipping company UPS (UPS),
down 1.42% at 64.36, Morgan Stanley downgrades to “equal-weight/in-line” from
“overweight/in-line”.
Communications equipment maker Ciena Corp. (CIEN),
up 6.00% at 4.41, was upgraded by SoundView Technology to “outperform” from
“neutral”.
Insurance company Fidelity National (FNF),
down 0.38% at 30.80, was downgraded by U.S. Bancorp to “outperform” from “strong
buy”.
Railroad company Burlington Northern (BNI),
down 0.44% at 29.00, was downgraded by Morgan Stanley to “underweight/in-line”
from “equal-weight/inline”.
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