Will This Bellwether Take Us Higher?

January 21, 2003
Daniel Beighley

The markets are mixed at
mid-day, as positive earnings reports from Dow stocks 3M Co., Johnson & Johnson
and Citibank have failed to attract buyers. This has been the theme of earnings
season so far, which has set a negative tone going forward. All three major
averages remain below their 50-day moving averages. Bellwether semis are
attempting to lead us higher, as volume on the session has been light so far.

In economic news, housing
starts came in at 1.835 million vs. expectations of 1.680 million.
Building permits were at 1.880 million vs. expectations of 1.710. million.Â

The 10-year U.S. Note
is +060 at 113 315.

The Dollar is -0.47 at
100.47.

Gold is +0.50 at 356.30.

Crude Oil is -0.33 at
33.58.

Volume is at 641,899,000
on the NYSE and at 729,344,000 on the Nasdaq.

Market breadth is mostly
negative, with NYSE declining issues over advancing issues by a ratio of
1.91, and down volume over up volume by a 3.15 ratio. Nasdaq advancing issues
over declining issues came are at 1.60, and down volume is over up volume by a
1.43 ratio.

Leading the Dow down are:

Stocks in the news:

Regional bank BB&T Corp.
(
BBT |
Quote |
Chart |
News |
PowerRating), -5.81% at
35.20, announced that it will acquire First Virginia Banks for $3.38 billion in
stock.

Automaker Ford
(
F |
Quote |
Chart |
News |
PowerRating), -0.39% at 10.12, sold off
despite reporting fourth-quarter earnings above expectations.

Chinese online media company Sohu.com
(
SOHU |
Quote |
Chart |
News |
PowerRating),
+14.45% at 9.98, rallied after reporting earnings in line with expectations.

Computer hardware maker Dell Computer
(
DELL |
Quote |
Chart |
News |
PowerRating), +0.19% at 24.87, has been downgraded by UBS Warburg to “neutral”
from “buy”.

Motorcycle maker Harley Davidson
(
HDI |
Quote |
Chart |
News |
PowerRating), -9.70: at 42.53, beat its fourth-quarter earnings expectations by
$0.03 with profits of $0.49 per share.

Discount broker Charles Schwab
(
SCH |
Quote |
Chart |
News |
PowerRating), -8.43% at 10.75, missed its fourth-quarter earnings by $0.01 with
profits of $0.07 per share.

From the Dow 30 Index:

Conglomerate 3M Co.
(
MMM |
Quote |
Chart |
News |
PowerRating),
+0.33% at 126.74, beat its quarterly earnings expectations by $0.01 and raised
its first-quarter guidance.

Automaker General Motors
(
GM |
Quote |
Chart |
News |
PowerRating),
+0.52% at 40.209, was upgraded by UBS Warburg to “buy” from “neutral”.

Drug maker Johnson & Johnson
(
JNJ |
Quote |
Chart |
News |
PowerRating), -0.26% at 54.65, beat its fourth-quarter earnings by $0.01 with
profits of $0.48.

Money center bank Citibank
(
C |
Quote |
Chart |
News |
PowerRating),
-1.33% at 36.31, beat its fourth-quarter earnings by $0.01 with profits of $0.47
per share.

danielb@tradingmarkets.com

Will This Bellwether Take Us Higher?

BUY THE FEAR, SELL THE GREED

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