12:05 ET Dow -15, Nasdaq +2, S&P -3.21: [BRIEFING.COM] The bullish sentiment of the first half hour of trading was popped by a much weaker-than-expected April new home sales report. It was a big miss as the slide in April was the largest drop since April 1997. The housing market had been surprisingly resilient, but this is the first hint that the consumer is finally feeling the pressure of rising layoffs and reduced job security. The indices then sold off sharply, but have since stabilized.... In general, techs and cyclicals have been weak today while defensive groups like tobacco, food and beverages are being sought by investors....Of note, wireless chipmaker TriQuint Semi (TQNT 21.07 -3.74) is off sharply after guiding down its forecast. CSFB is calling this the "biggest recession" ever in wireless and fiber optics. Overall, chip stocks have been weak today including ANAD -6%, LSCC -5%, RFMD -7%. CIBC World Markets making negative comments on the enterprise software space has dampened enthusiasm there...Busy day for the retailers. Despite generally positive earnings reports, the group has been under pressure, especially the smaller cap apparel names. On the positive side, Gap Inc (GPS 32.41 -0.02) was upgraded by Lehman to Strong Buy from Buy as it believes this "best-in-class" retailer has reached an inflection point and is poised for a continued turnaround....Among the cyclicals, paper stocks remain weak as Salomon downgraded four names: IP, BCC, MEA, TIN as the group has enjoyed a nice run lately....Fuel cell stocks attracting traders as they look beyond tech for other groups recently in favor. PLUG was awarded an important contract. SOX -1.7%... NYSE Adv/Dec 1268/1612... Nasdaq Adv/Dec 1677/1751.
11:30 ET Dow -29, Nasdaq -5, S&P -4.50: [BRIEFING.COM] Indices remain close to their session lows on the weak new home sales data. The oil drillers are very weak today for a couple of reasons. First, with the Senate now a Democratic majority, the increased drilling initiative proposed by Bush will encounter tougher hurdles. Also, Pride (PDE 27.59 -5.06) deal with Marine Drilling (MRL 26.11 -1.11) is not as much of a premium as others would like to see in a takeout. Machinery stocks weak thanks in part to an ABN Amro downgrade of Caterpillar (CAT 54.35 -0.65)...Other than GYMB +26%, many small cap retailers are under pressure such as BEBE, CLE, PVH....Overall, banks and biotech stocks are still attracting buyers while cyclicals continue to be shunned.. NYSE Adv/Dec 1214/1596... Nasdaq Adv/Dec 1557/1773.
11:00 ET Dow -45, Nasdaq -12, S&P -6.55: [BRIEFING.COM] Weal April new home sales data took the wind out of a strong opening in the market. On the Nasdaq, 2235 continues to hold as support, but a drop through that level would test next support at 2215....Fuel cells being energized by Plug Power (PLUG +15%) receiving $7 mln contract from a public utility to supply 75 of Plug's first commercial fuel cell systems. HYGS +6%, BCON +5%...With techs coming under pressure, defensive groups like food, tobacco, beverage stocks seeing renewed interest. Cyclicals are out of favor today such as paper, railroads, steel, and chemicals on downgrades and the April new home data is not reassuring on the economy. NYSE Adv/Dec 1159/1569... Nasdaq Adv/Dec 1507/1666. |
