We Get Confirmation

Stocks opened
lower Friday
as earnings warnings and the further weakening of the U.S. dollar weighed heavily on
the markets.

The markets felt the continued weight
on its shoulders, as the economic slowdown the U.S. economy is experiencing is
further confirmed with the strengthening of the yen and euro. Investors are
concerned that the weakness will make recovery overseas tougher, which would be
detrimental to the U.S. economy in the longer-term picture.

Something positive did come out of the
trading day though, volume was light as it shows institutions were not
overselling the markets.

Breadth for the day was negative. NYSE
advancers lagged decliners 1139 to 1929, as for the Nasdaq, decliners led the
advancers by a ratio of 20 to 10.

The broader market indexes closed
lower for the week. The Nasdaq Composite closed down 3.2%, while the Dow Jones
Industrials lost 1.4% and looks poised to testing its support level of 10,200.

The CBOE Volatility Index
(
$VIX.X |
Quote |
Chart |
News |
PowerRating)

closed higher 12.2%, indicating fear on behalf of the markets. The Nasdaq 100
Volatility Index
(
$QQV.X |
Quote |
Chart |
News |
PowerRating)
moved higher 7.0%. We got some conflicting bias
signals which is understandable, so trade cautiously on Monday.

There was only one sector in the
green, which was the Gold and Silver Index
(
$XAU.X |
Quote |
Chart |
News |
PowerRating)
which moved higher
0.9% as the index cleared its pivot point of a W-shaped bottom handily.

The Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating)

slid further away from its 50-day moving average, closing down 4.7%.

Also shedding ground was the
Interactive Week Internet Index
(
$IIX.X |
Quote |
Chart |
News |
PowerRating)
which fell 4.4%.

The Mexico Index
(
$MXY.X |
Quote |
Chart |
News |
PowerRating)
broke
support at the 200-day moving average. The index closed off 2.5%.

Looking at individual stocks leading
on a percentage basis, ACLN Limited
(
ASW |
Quote |
Chart |
News |
PowerRating)
scooted higher 16.8%.

Precious metal mining company Freeport
McMoran Copper and Gold
(
FCX |
Quote |
Chart |
News |
PowerRating)
moved up 4.5%
as
gold futures soared to a 12 week high.

Community Health Systems
(
CYH |
Quote |
Chart |
News |
PowerRating)

gained 3.5%.

Leeds Federal Bankshares
(
LFED |
Quote |
Chart |
News |
PowerRating)

shot higher 96.2% on news that Northwest Bancorp
(
NWSB |
Quote |
Chart |
News |
PowerRating)
has agreed to
acquire the company for approximately $44 million.

Webmethods
(
WEBM |
Quote |
Chart |
News |
PowerRating)
moved up 12.2%
after Goldman Sachs initiated coverage on the company with a rating of Market
Outperformer and set a price target of $18.

Stocks losing ground were Scientific
Atlanta
(
SFA |
Quote |
Chart |
News |
PowerRating)
as it slid 15.0% after the company announced it could no
longer forecast expectations accurately. SFA was also downgraded by Banc of
America Securities from Strong Buy to Market Perform.

Lear Corp
(
LEA |
Quote |
Chart |
News |
PowerRating)
shares fell 12.0%
after being downgraded by Credit Suisse First Boston.

Retailer Gap
(
GPS |
Quote |
Chart |
News |
PowerRating)
got hammered as
investors sold the stock after the company was downgraded by Credit Suisse First
Boston to Hold from Buy after the company posted lower Q2 profits and warned
that Q3 earnings could come in below analysts’ expectations. Gap lost 8.0%.

Jabil Circuit
(
JBL |
Quote |
Chart |
News |
PowerRating)
closed lower
12.2% on the downgrade by Deutsche Banc Alex Brown from Buy to Market Perform.

Microtune
(
TUNE |
Quote |
Chart |
News |
PowerRating)
shares slipped
17.1%.

Fleming
(
FLM |
Quote |
Chart |
News |
PowerRating)
lost 12.0% after the
company said it reached an agreement to acquire 5 Smith’s Food and Drug stores.

Greg