Giving The Benefit Of The Doubt
Markets opened mixed Monday ahead of
the FOMC meeting scheduled tomorrow. Expectations are for the Fed to lower
interest rates by 25 basis points and to continue their aggressive pace of
easing.
Traders should also be cognizant on
what the Fed’s counterpart overseas, the European Central Bank (ECB), will be
doing in their meeting on August 30. Even though worsening economic
conditions earlier this year failed to spark the ECB to cut rates other than the
single 25-basis-point cut,
speculation is that the ECB will cut rates by another 25 basis points.
With the ECB so tight with cutting
rates, why do traders speculate that there will be a rate cut? Primarily because
of the most recent inflation reports along with other economic numbers that
point to the ECB being accommodating. Either way, the markets are giving
them the benefit of the doubt.
Breadth thus far for the session is
negative, with NYSE Advancers lagging Decliners 1385 to 1628.
The broader markets are mixed, with the Nasdaq Composite
down .66 at 1866.35, the Dow Jones Industrials are up 39.51 at 10280.29, and the S&P 500
Index is trading at 1165.90, gaining 3.93.
Stocks moving higher in the session
are Krispy Kreme Donuts
(
KKD |
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Chart |
News |
PowerRating), up 2.27 at 32.99.
Toy store Toys R Us
(
TOY |
Quote |
Chart |
News |
PowerRating) is
moving higher 1.51 after reporting Q2 numbers in line with analysts’ expectations.
The company reported a Q2 loss of 15 cents a share. However, the CEO said the
company is “well positioned” to return to profitability by Q4 and will
benefit from improvements made through the remodeling of its stores.
RF Micro Devices
(
RFMD |
Quote |
Chart |
News |
PowerRating) is
trading at 24.60, higher by 1.59, after the company said it is shipping power
amplifiers to Ericsson
(
ERICY |
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News |
PowerRating).
Up 1.69 is United Natural Foods
(
UNFI |
Quote |
Chart |
News |
PowerRating)
on an upgrade by Tucker Anthony from Buy to Strong Buy.
NETIQ
(
NTIQ |
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Chart |
News |
PowerRating) is gaining 1.31 at
35.60.
As is Qualcomm
(
QCOM |
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News |
PowerRating), with its
shares increasing by 1.74.
Moving lower thus far in the session
is Lear Corp
(
LEA |
Quote |
Chart |
News |
PowerRating), which is down 3.20.
Forest Laboratories
(
FRX |
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Chart |
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PowerRating) is lower
3.09.
Enterasys Networks
(
ETS |
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Chart |
News |
PowerRating) shares
slipped 3.58 after being downgraded by Morgan Stanley.
Green Mountain Coffee
(
GMCR |
Quote |
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News |
PowerRating)
shares are getting hammered, down 5.94, after the company said that
it has revised its fiscal 2002 financial outlook lower.
Extreme Networks
(
EXTR |
Quote |
Chart |
News |
PowerRating) is losing
ground after being downgraded by Morgan Stanley from Outperform to Neutral. EXTR
is at 17.19 down 5.28.
Biotechnology firm Protein Design Labs
(
PDLI |
Quote |
Chart |
News |
PowerRating) is lower by 3.41.
After moving higher last week, shares
of Advance
PCS
(
ADVP |
Quote |
Chart |
News |
PowerRating) are off 3.51 on the company’s announcement that it will
be filing a shelf registration for a 5.1 million share offering of Class A
common stock.
Microsemi
(
MSCC |
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Chart |
News |
PowerRating) continues its
slide down, losing 2.38.
Moving higher at midday in the sector
watch are the Semiconductor Index
(
$SOX.X |
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PowerRating), the Retail Index
(
$RLX.X |
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PowerRating)
and the Pharmaceutical Index
(
$DRG.X |
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PowerRating).
The Gold and Silver Index
(
$XAU.X |
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Chart |
News |
PowerRating),
the Biotechnology Index
(
$BTK.X |
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PowerRating) and the Chemical Index
(
$CEX.X |
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PowerRating)
are lagging.