Why Treasuries Are Rising

US Treasuries rose, sending
the two-year note yield to a two-week low, on speculation the Federal Reserve
will lower interest rates as soon as next week to bolster the economy. The FOMC
meeting is next Tuesday. The Dec. 10-year note
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and the
Dec. 30 year bond

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are both trading higher today.

At just past the midpoint of trading on the
first day of trading this week, the markets have returned to positive territory after
opening positive and then retreating to the negative zone.

The S&P 500 Index
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has
support at the 900 level. Overhead resistance is at 910.

The Nasdaq Composite
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has
overhead resistance at 1340 with support at 1330.

Some of the strongest sectors on the day are: The

Amex Pharmaceutical Index

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(led out of the gate by Merck
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,
Schering Plough

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and King Pharmaceuticals
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);
Semiconductors
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; Networking; Wireless;
Telecom
; Utility; Computer-hardware; Banking
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;
and Oil Service
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.

Sectors that are experiencing weakness
are:
Healthcare,
Chemical, Defense, Consumer, Disk Drive,
Homebuilding
, Prescription Bene Mgt, Internet security,
Gaming
, Retail, Biotech
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.

Varian Medical Systems
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is
rallying up to hit a 52-week high with increasing volume. Varian has a

TradingMarkets.com RS3 rating of 82
.

Imation
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is breaking out to
hit a 52-week high with increasing volume. IMN has a
TradingMarkets.com RS3 rating 96
and an up trending

ADX
of 37.

Covance
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is hitting a 52-week
high with increasing volume. CVD has a
TradingMarkets.com
RS3 rating 91
.

Performance Food Group Co.
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is
hitting a 90-day high with increasing volume.

Nasdaq Market Breadth

Adv: 1692 UpVol: 5526399

Dec: 1401 DnVol: 3965766

Net: +291 Net: +1560633

NYSE Market Breadth

Adv: 1744 UpVol: 55604356

Dec: 1416 DnVol: 30830940

Net: +328 Net: +24773416