15:22 ET Applied Materials (AMAT) 51.26 +1.57 (+3.1%) : -- Technical -- Recent test of its 50 day moving average has led to some
upside progress amid lighter volume but caution in front of its after hours earnings report has helped to limit enthusiasm. Consensus estimate
is $0.33 for the current quarter. Congestive resistance is at 52 with a more important barrier at 53 (200 day moving average). It has
struggled to close above the latter for the last month.
15:09 ET McDATA (MCDT) 32.44 +0.61 (+1.9%): Company reaffirms that its quarter is on track; comment made at the CSFB
Communications Tech Conference.
15:08 ET Comverse Tech (CMVT) 66.21 -2.77: -- Update -- CSFB out in defense of Comverse following story in Israeli publication
that company will lay off 750 instead of 400 (see 12:03 story); CSFB says that the story is inaccurate and that the layoff total will be 400;
says CMVT will earn $0.42/share this qtr.
14:49 ET Sun Microsystems (SUNW) 17.79 -0.32 (-1.7%): -- Technical -- Vacillating nears its 50 day simple ma all session (17.6) but
thus far has been unable to build on the modest Fed related push. Failure at this support initially exposes supports at 16.90 and 16.
14:35 ET Market Action : Initial reaction positive but uncertainty regarding a turnaround being reflected by current market action. Short
term while 2088 Nasdaq, 10,816 Dow, and 1245.36 S&P 500 are intact will remain positioned for a upside extension.
14:26 ET Fed Policy : To clarify an earlier comment, the Fed statement was bullish in terms of future rate cuts, not in terms of the economy.
In fact, the Fed's economic view stands in contrast to the market's. They clearly put little weight on recent consumer data, and appear to
believe (as Briefing.com does) that the consumer will be dragging into the mire of falling corporate profitability. They also put little weight on
arguments that inflation is a risk or that long-term productivity growth is faltering -- these are bullish indications for future rate cuts.
14:23 ET Fed Policy : The Fed's next meeting concludes on June 27, at which another rate cut is a good bet given our view that the
consumer will be the next leg down for the economy. But make one important note: the Fed did not say that they are likely to cut rates again
-- they never say that. Policy makers only indicated that the balance of risks lies on the side of excessive economic weakness, not inflation.
What they do next is dependent entirely on the economic data from now until Jun 27.
14:18 ET Fed Announcement : The Fed's announcement was very bullish. The Fed removed its comment about "monitoring developments
closely" and thus the likelihood of an intermeeting cut. But there was nothing in the announcement that indicated the Fed sees a turn in the
economy. Policy makers continued to make the following points: capital spending is declining, there is a negative equity wealth effect, and
importantly they expressed continued confidence in the view that productivity growth remains strong and inflation risks remain low. Dow
moves from -50 to unchanged and Nasdaq from +6 to +29.
14:15 ET Fed Announcement : Fed cuts the funds rate by 50 bp to 4% and maintains easing bias.
14:06 ET Market Action : Anxiety level rising with investors stepping to the sidelines as Fed announcement time (14:15 ET) draws near.
14:04 ET Nordstrom (JWN) 17.93 -0.07 (-0.4%) : Announced the appointment of Mike Koppel to the position of CFO. Move not
significant surprise as he has been with company since 1999 and has been acting CFO since September.
13:27 ET Eli Lilly (LLY) 84.40 -0.04 (-0.05%): Discloses in 10-Q filing that it has received a subpoena from the Massachusetts Attorney
General related to Medicaid reimbursement.
13:22 ET priceline.com (PCLN) 4.84 +0.54 (+12.5%): -- Technical -- Steady upside progress today with the stock now flirting with
short term resistance at 5/5.1 (congestion/top of May 9 gap). On a normal day it would not be surprising to see some consolidation near this
resistance in the wake of the substantial gain but Fed could spark follow through buying. Next resistance is at 5.50.
13:21 ET Aremissoft (AREM) 15.70 -2.77: William Blair, which previously had a LT BUY rating on AREM, has pulled that rating amid
rumors about AREM's business practices. Wm Blair emphasized that it has not been able to confirm any of the rumors, but recommends
waiting on the sidelines until the facts become clear.
13:00 ET Cisco Systems (CSCO) 19.48 +0.91: Cisco moving higher; we're hearing from CIBC World Markets that the company priced
new employee options last night; this is consistent with what Cisco indicated on its recent conference call and should not come as a surprise.
Many nevertheless see this as a positive development as it might indicate that Cisco management sees a bottom ahead. Given that
management has badly misjudged its market over the past six months, it's debatable whether much weight should be put on management's
expectations.
12:44 ET Breakout or Breakdown : -- Technical -- Two stocks in completely different sectors (YHOO, AVNX) have come to the same
crossroad at the same time. Both are currently bumping up against a long term trendline while vacillating near their 50 day simple ma (17.1
and 15, respectively) as the Fed time nears. Sustained breach of the trendlines (17.6 and 16.9, respectively) bolsters the view that the April
rally will be resumed while a penetration of the moving average implies near term vulnerability.
12:24 ET Xbox Plays : Anticipation of Xbox release acting as an earnings driver continues to draw investors to the gaming software group.
Major names include ERTS, THQI, ATVI. Xbox ardor has helped lift software developer Take-Two Interactive (TTWO) and Xbox
graphics chip supplier NVIDIA (NVDA) to new one-yr highs over the past week.
12:03 ET Comverse Tech (CMVT) 64.26 -4.72: Trading floor sources attributing CMVT's slide today to an article on an Israeli site -
Israel's Business Arena - which reports that Comverse has already laid off 450 employees in Israel alone despite announcing recently that it
only planned to lay off 200 in Israel and 200 elsewhere. Report says that total layoff figure for all regions could soon hit 750.
11:55 ET Celestica (CLS) 50.94 +0.60 (+1.2%): Contract manufacturer reiterating guidance at CIBC Electronics for Building Info
Infrastructure Conference; maintains Q2 earnings view of $0.40-$0.42 (consensus $0.40) and revenue forecast of $2.6-$2.8 bln.
11:38 ET BEA Systems (BEAS) 34.24 +1.25 (+3.8%): Goldman Sachs making upbeat comments ahead of earnings report this evening;
firm thinks BEAS could report upside to license number and would be surprised if company lowers guidance in business areas other than
service; solid quarter creates risk of short-squeeze developing.
11:33 ET Juniper Networks (JNPR) 53.40 -0.37 (-0.68%): -- Technical -- Steady march lower this month has led to a test of support
near the late April low and the 50 day simple ma at 52/51.75 area over the last several days. Minor penetrations have elicited no follow
through interest thus far but the lackluster recovery is a near term concern. Supports on a breakout are at 49.34 (50% of April rally), 46 and
44.5 (62%). On the upside, resistances are at 55 and 57.
11:14 ET Computer Sci (CSC) 35.54 -2.06 (-5.4%): -- Technical -- Over the last four sessions has failed to build value above it 50 day
simple ma (at 37.6) with the earnings/lowered guidance driving prices lower today. Next supports are at 35.1 (38% of April/May rally) and
34 (May 04 low/50%). Need push through 36 to improve intraday bias.
10:57 ET Nortel Networks (NT) 14 +0.25 (+1.8%): -- Update -- As reported earlier, Nortel was one of several equipment vendors
selected to supply $1.5 bln in mobile phone gear to CHU. NT reporting that the value of its portion of the deal is about $275 mln.
10:56 ET Nasdaq Composite : -- Technical -- Runs to resistance in the 2105 congestion area and then edges slightly lower. Intraday
watching support at 2090/2085 for an indication of the strength of this move. Stabilization above this area leaves the door open to further
gains with initial resistance at 2115. Failure and follow through beyond 2077 raises potential for a new pullback low.
10:40 ET Momentum Watch: Death Care : One of the market's strongest sectors over the past week has been funeral home group --
more euphemistically known as "death care." Interest in sector sparked by blowout numbers reported last wk by world's largest funeral
home operator Service Corp (SRV 6.63 +0.04). Since May 9 report, SRV has rallied 42% to a new 52-week high. Shares of competitors
Carriage Services (CSV 5.42 +0.79) and Stewart Enterprises (STEI 7.08 +0.31) have trailed the move to make new one-yr highs of their
own. |
