There Is Hope Still
Stocks opened
slightly higher Tuesday ahead of the FOMC meeting this afternoon.
The Federal Reserve cut interest rates
by 25 basis points saying, “Household demand has been sustained, but
business profits and capital spending continue to weaken and growth abroad is
slowing, weighing on the U.S. economy.” The Fed has left the door
open for an additional rate cut at the October meeting.
In addition, the dollar continued to
weaken against the euro and the yen. It should be noted that the euro could run
into some profit-taking and should negative news on the state of the European
economy be released or some good economic news be announced for the U.S., it
could cause the Euro to weaken. So continue to monitor the ECB’s meeting, which
is scheduled for August 30. Speculation is that the ECB will cut rates by
25 basis points and perhaps help boost the global economy.
The breadth for the day was negative.
NYSE advancers lagging decliners 1345 to 1763. Nasdaq advancers fell behind decliners
1094 to 2071.
The CBOE Volatility Index
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closed higher 3.3%, and the Nasdaq 100 Volatility Index
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1.3%.
The broader markets closed lower, with
the Nasdaq Composite losing 2.6% and the Dow Jones Industrial closing lower 1.4%
and looking poised to test its support level of 10150. Volume was light for the
day.
The S&P 500 Index breached and
closed below its support level of 1160, closing off 1.2%
On the sector front the, indexes
moving higher were the Mexico Index
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The Oil Services Index
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moved up 1.0%.
The Chemical Index
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closed up 0.7%, but bumped into overhead resistance of its 200-day moving
average.
And the Gold and Silver Index
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0.7%, closing above its pivot point of a W-shaped pattern and in the top of its
trading range.
Losing ground was the Retail Index
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which slid 2.5% as the index broke support at its 200-day moving
average.
The Semiconductor Index
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4.2%, and the GSTI Internet Index
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closed lower 4.0%.
Guidant
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GDT |
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the company said it has agreed to collaborate with Cook Inc. to bring to market
a new stent. The collaboration will allow GDT to cut its schedule on bringing the drug
coated stent to market by six months.
Calpine
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CPN |
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after yesterday’s announcement by the company saying that it was moving forward
with its expansion efforts.
Also gaining was Shaw Group
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SGR |
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which tacked on 3.3%.
Spectra Physics
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SPLI |
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higher 52.3% on news that Thermo Electron
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TMO |
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subsidiary, private for $20.00 a share in cash.
Losing ground in the session
were C&D Technologies
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CHP |
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flat earnings for Q2.
Factset Research Systems
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FDS |
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closed lower 16.9%.
Also losing ground was Americredit
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ACF |
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which was off by 14.1%.
Tektronics
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TEK |
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after Goldman Sachs cut its earnings for FY 2002 from 85 cents to 55 cents.
American Eagle Outfitters
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reported Q2 numbers after the bell yesterday and warned in its conference call that Q3
numbers would increase
only between 10% to 15%. Analysts polled estimated the company to have earnings
increase 19.5% for the quarter. The stocks lost 28.0%.
Telecom stock Metro One
Telecommunications
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