Katrina Downgraded, Stocks Shake Off Early Weakness

Stocks are recovering from early weakness Monday
morning as Hurricane Katrina is downgraded to a Category 3 storm,
down from a category 5 just yesterday. Winds are reported at 140 MPH. Crude oil
climbed above $70/barrel after offshore platforms were evacuated. Katrina could
be the most expensive storm in history, costing insurers an estimated $25
billion. Last year, insurers paid a record $22.9 billion on 4 hurricanes.

Among the insurers, Allstate
(
ALL |
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PowerRating) is 1.00 lower, Hartford
(
HIG |
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(
RNR |
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Re
(
RE |
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(
AIG |
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PowerRating) is up 0.24.

In other hurricane-related issues, Home Depot
(
HD |
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PowerRating) is up 0.75 and
Lowe’s
(
LOW |
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S&P 500 changes to note: Coventry Health
(
CVH |
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PowerRating) will replace May
(
MAY |
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PowerRating).

Strong Sectors are:   Gold 

(
XAU |
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PowerRating)
+0.95%    Semis

(
SOX |
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PowerRating)
+0.84%    Oil Services 

(
OSX |
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PowerRating)
+0.69%

Weak sectors
are:   Airlines

(
XAL |
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PowerRating)
-1.56%     Insurance

(
IUX |
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PowerRating)
-0.22%   

Apple Computer
(
AAPL |
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PowerRating) will purchase chips from Freescale
(
FSL |
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PowerRating)

A decision on Barr Labs‘
(
BRL |
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PowerRating) controversial contraceptive drug
drug Plan B has been delayed by the FDA. Prudential cut estimates.

Wachovia
(
WB |
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PowerRating) was upgraded to buy at Bank of America.       

Brice Wightman