Monday’s Stock Watch
The broader
markets made
further gains today as the S&P 500 put in another accumulation day. Volume came in above average across the indexes, as broker/dealer,
transportation, and Internet stocks led the way. New 52-week highs capped off
the week with impressive numbers, with the Nasdaq and the NYSE chalking up 90 total. Stocks on our watch lists had a mixed day, with key accumulation and
distribution days made.
Market breadth was positive, with
NYSE advancing issues over declining issues by a ratio of 1.71, and down volume
over up volume by a 2.08 ratio. Nasdaq advancing issues over declining
issues came in at 1.47, and up volume beat down volume by a 2.14 ratio.
The Dow Jones Industrial Average
(
$INDU |
Quote |
Chart |
News |
PowerRating) closed up
0.86% to
10,259.74. The S&P 500
(
$SPX |
Quote |
Chart |
News |
PowerRating)
closed up
0.54% to
1,171.51.
The Nasdaq [$COMPQ |$COMPQ] closed up
0.74% to
2,059.39.
| NYSE | NASDAQ | |
| Advancing Issues | 1,993 |
2,175 |
| Declining Issues | 1,163 |
1,475 |
| Advancing Volume |
1,009,051,000 |
1,466,055,000 |
| Declining Volume |
483,306,000 |
684,100,000 |
| Total Volume | 1,497,523,000 |
2,188,183,000 |
| New 52-week Highs | 52 | 38 |
| New 52-week Lows | 1 | 2 |
| New 52-week Highs for Week |
109 | 97 |
| New 52-week Lows for Week |
9 | 4 |
Weekly Perspective:
The markets kicked off the new year
with gains, as technology established itself as a clear leader. The Dow finished
the week up 122.75 for a 1.2% gain, the S&P 500 finished up 11.40 for a .09% gain, and the Nasdaq finished up 72.12
for a 3.6% gain.
Though volume at the beginning of
this shortened week was light, the last two days of trading were marked by an
accumulation day each for the S&P 500 and Nasdaq. The Dow and the S&P 500 are
now trading above their 200-day MAs, and the Nasdaq traded into levels not seen since August.
Strength in Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating)
was evident as it broke out of a four-month base and saw its components
make eight new 52-week highs. The Securities Broker/Dealer Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating)
also put in a good
performance, with a breakout into levels not seen since May of last year. These
two sectors should be watched as indications of strength, and we would like to
see them lead the rest of the market. We will take the market day by day,
and watch for further signs of strength with high quality stocks setting up in
bases, and reaching new highs. Watch Mark Boucher’s
Top
Relative Strength/New Highs list for levels of 100 or more to endorse this.
The bearish argument for this market
comes from fears that an economic recovery will not happen in the first half of
the year. The indexes drifted down during “warnings” season, and will soon
be tested under the gun of actual warnings in a couple of weeks.
Top sectors with new highs for the
week included drugs, Internet, and medical stocks.
Top sectors:
Securities Broker/Dealer Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating) up 5.11% at 553.67
Dow Jones Internet Commerce Index
(
$ECMX |
Quote |
Chart |
News |
PowerRating) up
3.80% at 58.95.
Losing sectors:
Dow Jones
Utility Average
(
$UTIL.X |
Quote |
Chart |
News |
PowerRating) down 3.58% at 580.71.
Nasdaq Telecommunications Index
(
$IXTC.X |
Quote |
Chart |
News |
PowerRating) down
0.49% to 245.50.
Sectors With New Highs:
Business – 7
Drugs – 3
Internet – 5
Medical – 3
REITs – 6
Computers – 3
Electronics – 3
Semiconductors – 8
Watch List Action
Krispy Kreme
(
KKD |
Quote |
Chart |
News |
PowerRating), fell another 2.72% on above average-volume for a
distribution day. The stock is currently parked at the halfway mark of its
breakout bar, threatening to move lower and trigger stop losses. Adhering to the
7% loss rule, disciplined IT traders can do nothing but wait and watch. So far
this stock has performed poorly against the overall market trend since its
breakout.
Our old friend PEC Solutions
(
PECS |
Quote |
Chart |
News |
PowerRating) was in action today, rising
12.43% on over twice-average volume for an accumulation day. The stock has
broken out of a four- week base, and is a member of the strong Internet sector. A
story in Business Week cited the company as having good exposure to the armed
forces demand for increased Internet services and security.
Recent Breakouts
We monitor the action of Recent Breakouts as an indicator
of the market health for IT traders. When breakouts are acting well, this is a
good sign for the likelihood of further sustainable breakouts. When breakouts
are failing, IT traders should be even more cautious.
American Healthways Inc
(
AMHC |
Quote |
Chart |
News |
PowerRating), down 1.33% on above-average volume.
Copart Inc.
(
CPRT |
Quote |
Chart |
News |
PowerRating), down 5.35% on very
high volume for a distribution day.
Ebay
(
EBAY |
Quote |
Chart |
News |
PowerRating), up 0.73% on below-average
volume.
Genesis Microchip
(
GNSS |
Quote |
Chart |
News |
PowerRating), down 0.15% on
below-average volume.
MTR Gaming Group
(
MNTG |
Quote |
Chart |
News |
PowerRating), up 4.75% on
average volume for an accumulation day.
Nvidia Corp.
(
NVDA |
Quote |
Chart |
News |
PowerRating), down 2.91% on below-average volume.
Panera Bread Co.
(
PNRA |
Quote |
Chart |
News |
PowerRating), up 1.84% on
below-average volume for an accumulation day.
THQ Inc.
(
THQI |
Quote |
Chart |
News |
PowerRating), up 4.35% on above-average volume
for an accumulation day.
Company Name |
Symbol |
12 Month RS |
Price |
Price Change |
Average Volume |
| American Healthways Inc. | ( AMHC | Quote | Chart | News | PowerRating) |
96 | 29.47 | – 0.40 | 324,400 |
| Copart Inc. | ( CPRT | Quote | Chart | News | PowerRating) |
87 | 34.66 | – 1.96 | 666,700 |
| Ebay | ( EBAY | Quote | Chart | News | PowerRating) |
89 | 68.50 | + 0.50 | 7,238,200 |
| Genesis Microchip | ( GNSS | Quote | Chart | News | PowerRating) |
99 | 68.75 | – 0.11 | 2,597,800 |
| Krispy Kreme Doughnuts | ( KKD | Quote | Chart | News | PowerRating) |
91 | 41.65 | – 1.17 | 887,900 |
| MTR Gaming Group | ( MNTG | Quote | Chart | News | PowerRating) |
96 | 15.86 | + 0.68 | 487,300 |
| Nvidia Corp. | ( NVDA | Quote | Chart | News | PowerRating) |
98 | 69.62 | – 2.09 | 9,494,700 |
| Panera Bread Co. | ( PNRA | Quote | Chart | News | PowerRating) |
93 | 52.45 | + 0.95 | 284,700 |
| PEC Solutions | ( PECS | Quote | Chart | News | PowerRating) |
98 | 42.52 | + 4.70 | 600,700 |
| THQ Inc. | ( THQI | Quote | Chart | News | PowerRating) |
80 | 51.75 | + 2.16 | 1,593,500 |
Stocks Forming a Handle
Career Education Corp.
(
CECO |
Quote |
Chart |
News |
PowerRating), up 1.04% on low volume.
Direct Focus Inc.
(
DFXI |
Quote |
Chart |
News |
PowerRating), up 1.03% on
average volume for an accumulation day.
Integra Lifesciences
(
IART |
Quote |
Chart |
News |
PowerRating) up 1.12% on
average
volume.
Company Name |
Symbol |
12 Month RS |
Price |
Price Change |
Average Volume |
| Career Education Corp. | ( CECO | Quote | Chart | News | PowerRating) |
78 | 34.81 | + 0.31 | 596,100 |
| Direct Focus Inc. | ( DFXI | Quote | Chart | News | PowerRating) |
89 | 30.31 | + 0.31 | 689,900 |
| Integra Lifesciences | ( IART | Quote | Chart | News | PowerRating) |
86 | 26.90 | + 0.30 | 297,700 |
Stocks Building A Base
Company Name |
Symbol |
12 Month RS |
Price |
Price Change |
Average Volume |
| None |