Portfolio up 0.66%, Dow down 0.53%, Nasdaq up 0.25%, S&P500 down 0.31%, Gilder up 1.1%, Meisler up 0.1%, J-Blimps down 1.0%, Fuel cells/Alt energy up 0.1%
NYSE Volume: 931 mln...Adv: 1594...Dec: 1243
Nasdaq Volume: 1.39 bln...Adv: 2031...Dec: 1904
Put/call ratio is 0.55 (range 0.45-0.61)
Sector Watch
NYSE Comp. ($NYA) 666.25 -1.76 -0.26% Still above the 666 level which was the previous peak. Hate that number.
Nasdaq has eight green days to two red one and only up about 320 points. This is one weak rally.
Cyclicals (XLY) 25.79 -0.52 -1.98% HD dropped 4.7%. Despite the positive media hype this sector is now below the 200/50 day EMA bearish stack.
Gold ($XAU) 54.47 +1.45 +2.73%. PDG led it up with 7% gain on no news. December gold rose 30 cents to close at $277.60 an ounce. Very close to breaking the 50 day EMA of 55. Resistance level of 60 will be stiff. Might try a gold stock if sector can break this 60 level. AU ABX AEM MDG FCX HM PD NEM PDG make up this sector. phlx.com
Oil Services ($OSX) 133.24 +4.25 +3.29%. Busted through two year high of 131 today. Very bullish chart. SLB led sector with a 5% move. Every one of the stocks in the index was green. BHI CAM FLC GLBL GLM HAL NBR NE RDC RIG SII SLB TDW VRC WFT comprise this sector. Frost securities downgraded SLB and BHI today too. But this news came out also.
"Merrill Lynch raised its third and fourth quarter forecasts for WTI prices per barrel to $29 and $25. Previously, they were $26 and $23, respectively. The revision is based on tighter-than-expected global oil balances as reflected by a "significantly smaller-than-expected" rebuilding of petroleum reserves. Merrill's 2001 and 2002 price forecasts remain at $23 per barrel. "On a very near-term basis, we do believe that Saudi Arabia is uncomfortable with prices above $30, as are the G7 nations, raising the prospect of a supply response on-or-ahead of the September 10th OPEC conference," the research note said.
Retailers ($RLX) 817.63 -24.10 -2.86%. News on earnings is got everyone on edge. Below bearish 200/50 stack and gettting worse. Avoid this sector.
Broker Dealers ($XBD) 600.92 -13.81 -2.25%. DLJ and GS lost 4% today to drag index down. Dipped below 10 day EMA – a first since June. Still well above 50/200 stack. No news really other than SCH announcing pre-market trading on-line. AGE SCH DLJ EGRP GS LM MER MWD PWJ RJF are in the sector.
Portfolio Watch
CNC down 2.52%. 500K buy at the ask in the afternoon. Interesting.
MTSN up 4.57%. Outperforming the SOX both in advancing days and declining days. Busted out of the negative channel that formed since late June.
KEM up 6.54%. KEMET Corporation Announces Common Stock Repurchase Program was the headline, following VSH’s lead a few days ago. Good move by company.
Other stocks on the move
CPST up 8.0% on no news. Been moving sideways. Revenues are uneven and every quarter is a loss. Cash burn must be high. Moving sideways since IPO. High risk/low reward.
GLW announces a 3/1 split and goes up 5%. Really moving sideways since June runup. I expect a downturn since volume is weaker. Only a blowout by CIEN can make this higher.
HWP posted blowout earnings, but 2Q revs were down sequentially. Excluding equity gains, the company posted earnings of 97 cents a share for the current quarter. Analysts surveyed by First Call/Thomson Financial were expecting earnings of 85 cents a share. Revenue rose to $11.82 billion from $10.32 billion a year earlier. Home-PC revenue grew 62%. In notebooks, which grew 93% in terms of revenue.
ADI posted great number and issues upside preannouncement. Gained 13% today. Have to re-read my DD on it and find out why I didn’t buy it then. From $61 to $91 in six days. Wow. I hate chasing stocks on fire.
KANA went up 16% on its alliance with IBM. CSCO alliance announced on Monday. Have to DD the past CSCO/IBM effects on other companies. Double bottom and monster green volume with good news. Why did I sell this the other day?
Starbucks (SBUX) as halted earlier this afternoon. It will assume a $20.6 million charge in the October quarter from its investment in Living.com. That furniture Web site is closing its doors and filing for bankruptcy, blaming an inability to raise capital. Another dot.com biting the dust.
Prudential lowering view on defense sector to HOLD from ACCUMULATE. Specifically cuts rating Boeing (BA) and Lockheed Martin (LMT) to HOLD from ACCUMULATE and General Dynamics (GD) to ACCUMULATE from STRONG BUY. Firm not bullish on Boeing deal to acquire Jeppesen Sanderson Inc. from Tribune Co (TRB) for $1.5 bln in cash.
DLJ downgraded HD, COST and WMT. This morning, Prudential lowering TJX Cos (TJX) to HOLD from STRONG BUY, while Salomon Smith Barney cutting Home Depot (HD) to OUTPERFORM from BUY.
Portal Software (PRSF) 54 3/8 +3 1/16: A flood of positive announcements are driving shares of this customer management and billing software developer higher. IBM agreed to incorporate Portal's Infranet technology in IBM's worldwide ASP Prime Solution Centers. Portal also announced that through a collaboration with Andersen Consulting, Portal will offer circuit-switched voice billing capabilities in conjuction with IP capabilities through their Infranet ICP product. By extending Infranet to include voice billing capabilities, customers will be able to add voice based functionality to their existing data based system without having to run simultaneous billing software systems. The extension into voice is a natural one for Portal's Infranet, and should increase market appeal for the software. The announcement should have negative implications for smaller competitor, Daleen (DALN) which offers a competing voice/data billing software product. Despite consistently beating Street estimates on strong revenue growth, PRSF shares are trading only slightly higher than their January levels. Tomorrow's scheduled Q2 earnings release coming on the heels of today's positive announcements could provide another catalyst for the shares. Portal will release Q2 earnings after the close tomorrow, and the First Call consensus mean is $0.01 EPS, but as in past quarters, we expect upside. Of the three sell-side research previews we looked at, all of them are expecting software license revenues in the $39.6-39.9 mln range and service revenues of $17.0 mln, bringing the total revenue estimate to $56.6-56.9 mln. Gross margins should show a slight improvement from last quarter's 79%. We expect slight upside to EPS and revenue estimates, and if the prediction holds true and the market cooperates, we would expect further short-term upside to PRSF shares. - Matt Gould, Briefing.com. Chart shows consolidation but broke 50/10/200 day neutral stack.
Sawtek (SAWS) 42 7/8 +3/4: One thing that drives most investors crazy is when a stock they own drops sharply even though the company reports good news... At this point, SAWS shareholders are probably on the verge of checking into the looney bin as they have watched their stock plunge 42% since July 14th -- the day the company reported the highest quarterly earnings per share and net sales figures in its 21-year history... On a percentage basis, earnings surged 83% to $0.34 on a yoy jump in sales of 69% (sales were also up an impressive 17% sequentially. From briefing.com
I really need to DD this one. Still in a negative channel, but coming close to breaking the 10 day EMA. 50 day EMA about to cross under the 200 day EMA, which would be bearish.
Maybe everyone has cash waiting for the Nasdaq crash that doesn’t come on command. I think sector investing is one way to ride momentum up and lessening risk. I think a lot of money on the sides waiting for the FOMC meeting next week and options expiration Friday.
Jack |
