No Matter Who Wins The Election Tuesday, Here Is The Clear Winner

Stocks were higher Monday, the
day before Election Day.
Mid-morning,
weakness in heating oil and the energy markets sent stocks higher. Crude oil
made a 4-week low.

Personal income for September rose +0.2%; personal spending rose 0.6%, in-line
with estimates. The ISM manufacturing index fell to 56.8 in October from 58.5 in
September. A figure over 50 indicates expansion.

The Dow transports are at a 5-year high; the
utility Index is at a 3-year high; the Smallcap Index is 1.4% from a historic
high and the S&P Midcap Index is near historic highs.

No matter who wins the election tomorrow, there
is a clear winner: radio and TV. More than $600 million in ads have been spent
in Election 2004–more than triple that of 2000.

Q3 earnings for the S&P 500 rose 15.9%–record
highs for S&P–but high P/Es have been preventing a larger advance, observers
say.

Merck
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fell by 9% after a Wall
Street Journal article said the company may have downplayed the risks of Vioxx.
At these levels , the dividend yield on MRK is 5.3%.

Oracle
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raised its offer for Peoplesoft
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by
$3 to $24, calling it the “best and final” offer.

Wal-Mart’s
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October sales rose
2.8%.

Lockheed Martin
(
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will take a $110
million charge in Q4.

Dow +27.66 10055.20
S&P 500 +0.30 1130.50
Nasdaq +4.74 1979.63

Strong sectors were: Airlines
(
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+1.29%, Internet
(
GIN.X |
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+1.53%, Retail
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RLX.X |
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+0.66%.

Weak sectors were: Gold
(
XAU.X |
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-1.42%, Oil Services
(
OSX.X |
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-1.35%, Healthcare
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-1.03%.

The dollar was +0.30 at
85.21

Gold was -2.30 at 426.90

Crude Oil was -1.58 at 50.18

ce=”Arial” size=”2″ face=”Arial”>Volume was 1.39 billion on the NYSE and
1.51 billion on the Nasdaq.

Market breadth was positive.

NYSE Issues
Advancing 1865 Up Vol 642
Declining 1431 Down Vol 644
Ratio 1.30 1.00
Nasdaq
Advancing 1588 Up Vol 908
Declining 1543 Down Vol 513
Ratio 1.03 1.76

Stocks in the News

Tyco
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beat by 0.02 but guided lower for Q1.

Infineon
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was downgraded at Goldman, to in-line from outperform.

Humana
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beat by 0.08 and guided higher.

Northup Grumman
(
NOC |
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received two Navy contracts, worth $492 million and
$112 million.

Coach
(
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was the subject of a positive article in Barron’s.

Progressive Corp.
(
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was the cover story in Barron’s and the
subject of a positive article.

Brice Wightman