Michael Dell Unloads Stock — Should You?
Stocks
were sharply higher Tuesday. Â After some brief early morning
weakness brought on by weakness in the dollar, stocks staged a strong turnaround
after some favorable economic reports. Consumer confidence rose to a five-month
high and thanks to record low interest rates, the housing sector is still red
hot. Biotechs, Internets, and Semiconductors led the way. After a
three-week run, bonds fell slightly. The dollar is weaker, trading at 1.1926 against the euro.
The Dow Jones Industrial
Average
(
$INDU.X |
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(
$SPX.X |
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rallied 18.27 at 951.49. The Nasdaq
(
$COMPQ |
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PowerRating) rose 46.60 at
1556.69.
The day’s leading sectors were
Biotechs
(
$BTK.X |
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(
$MOX.X |
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+5.24%, Semiconductors
(
$SOX.X |
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PowerRating), +6.09%, Disk Drives
(
$DDX.X |
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+5.43%, and Networking
(
$NWX.X |
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PowerRating), +4.48%.
In economic news, Consumer
Confidence for May, jumped to a six-month high of 83.8 from
April’s 81.0. However, this was below estimates of 84.0. New home sales in
April increased by 1.7% to an annual rate of 1028K. This bested estimates of
985K. Existing home sales in April jumped 5.6% to an annual rate of 5.84
million, topping estimates of 5.70M.
The 10-year U.S. Note
was -85 at 118 175.
The dollar was -0.32 at
92.81.
Gold was -1.40 at 367.40
Crude Oil was -0.12 at
29.23.
Volume was at
1,529,455,000
on the NYSE, and at 1,905,372,000 on the Nasdaq.
Market breadth was very
positive, with NYSE advancing issues over declining issues by a ratio of
2.40, and up volume over down volume by a 5.4 ratio. Nasdaq advancing issues
over declining issues at 2.38, and up volume over down volume is at a 9.03
ratio.
Top Dow stocks were:
Eastman Kodak
(
EK |
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PowerRating), +1.48 at
31.76, Intel
(
INTC |
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PowerRating) +0.98 at 19.79, General Motors
(
GM |
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PowerRating)
+1.64 at 34.90, J.P. Morgan
(
JPM |
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PowerRating) +1.15 at 32.05, and IBM
(
IBM |
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PowerRating)
+2.43 at 87.69.
Stocks in the news:
After the close, it was reported that
Dell Computer
(
DELL |
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PowerRating) CEO Michael Dell sold 10 million shares of
stock earlier in last week. DELL closed at 29.99, up 0.49.
AOL Time Warner
(
AOL |
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PowerRating)
traded to a new three-month high after The New York Times reported that
Stephen Case wants to spin off the Internet unit from the media giant. However a
spokesperson for AOL denied such plans. AOL closed at 14.98, up 0.27.
Dow component Boeing
(
BA |
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PowerRating)
is fractionally lower. The aerospace and defense giant reached a $16 deal with
the Pentagon for the use of one hundred 767 planes. BA closed at 29.90, down
.09.
MGM Mirage
(
MGG |
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PowerRating) was
higher on heavy volume. The resort and casino operator agreed to pay $5
million to the Nevada Gaming Control Board for failing to file a a proper
paperwork for cash transactions. MGG closed at 27.48, up 0.72.
Altria Group
(
MO |
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PowerRating) was
down on heavy volume. UBS Warburg downgraded the stock to “neutral”
from “buy” after its recent 20+% rally. Tobacco shares had been strong recently
after a Florida judge threw out a $145 billion suit against the companies. MO
closed down 0.22 at 42.09.
Honeywell
(
HON |
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PowerRating) was
higher after Morgan Stanley reiterated their “overweight” rating on the
company. Morgan based its view on Honeywell’s attractive valuation. HON closed
up 1.03 at 25.50.