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Thomson I-Watch Midday Update
thomsoninvest.net
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Time 12:17 PM
Last Change %chg
DJIA 11278 62.9 0.6
Nasdaq Comp 4228.2 21.9 0.5
S&P 500 Index 1523.17 5.5 0.4
Russell 2000 538.07 0.2 0.0
PSE High Tech 1174.2 3.9 0.3
Semiconductor 1149.9 -3.0 -0.3
10 Year T-Note 57.04 -0.3 -0.4
30 Year T-Bond 56.67 -0.1 -0.1
Advance/Decline:
NYSE 1.12
NASDAQ 1.01
Volume: (millions)
NYSE 415.2
NASDAQ 795.79
#New Highs #New Lows
NYSE 87 17
NASDAQ 119 33
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Notable Market Movers:
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* Investors bid up shares following the release of this morning's
better-than-expected employment report. Then another wave of buying
hit the market after the release of NAPM Index, launching the major
market indices further into positive territory. However, profit
taking quickly set in, erasing a good portion of the gains. The
Dow Jones Industrial Average is trading up 0.6%. Solid gains in
techs and a recovery in consumer product issues have offset a wave
of selling in JP Morgan (JPM). The tech-laden Nasdaq Composite has
held on to a 0.5% gain, on solid blue-chip technology shares.
Volume has dipped noticeably from yesterday's session, but is decent
for a pre-holiday Friday.
* Institutional Money Flows:
Beaten-down retailers are rebounding from oversold levels. FD has
risen $1 35/264 to $29 9/16, LOW has recouped $1 91/264 to $46 3/16,
GPS has added $1 1/8 to $23 3/8, and BBY has rebounded $1 3/16 to $63
13/16.
Lehman Brothers upped its gasoline and oil forecasts and made
positive comments on several integrated oil issues, which has buoyed
the sector. RD has gained $1 171/264 to $62 7/8, TX has added
$1 11/264 to $52 9/16, and XOM has tacked on $1 11/264 to $82 11/16.
Investors are battering Internet consulting firms again today.
Several analysts downgraded shares of Viant (VIAN) after the company
said that it expects to report a 3Q loss, compared with the First
Call consensus estimate for a $0.08 profit. Addittionally, Legg
Mason, SG Cowen, ING Barings, and Merrill Lynch downgraded shares of
Scient (SCNT), noting that the prospects for the sector are
deteriorating. VIAN has sank $5 3/16 to $8 11/16, SCNT has fallen
$4 13/16 to $22 1/4, DTPI has dived $12 1/16 to $51 3/4, PXCM has
skidded $4 3/4 to $19 7/16, and SAPE has slid $8 1/2 to $44.
* The NAPM Index fell below the 50.0 level for the first time since
January 99. A reading below 50.0 suggests a contraction in the
manufacturing sector. The August reading came in at 49.5, which
was below the Thomson IFR consensus estimate of 52.3. Additionally,
the prices index slipped to 56.2 in August from 61.9, which is
its lowest level in more than a year and suggests that inflationary
pressures are easing.
* The employment report pointed to several softening trends in the
labor market. The unemployment rate edged up to 4.1% versus
expectations of a 4.0% reading, while the average hourly earnings
inched slightly higher to $13.80 from $13.76, and the average
workweek fell. Payrolls dropped by 105k in August, following a 51k
drop in July. The drop was more than the Thomson IFR consensus
forecast for a 33k decline. A tighter monetary policy is impacting
interest rate sensitive sectors.
* After moving higher on the favorable economic data, Treasury Bonds
have since moved into negative territory. The bellwether 30-year
Bond is trading down 3/32 at 108 8/32, while the yield stands at
5.67%.
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The following is a review of the 2 most recent I-Watch reports issued
this morning.
PHA -- Drug Mfr - Major -- Healthcare
01-Sep-00 12:01:17 Over the last three months, Pharmacia and Co has
maintained an upward trend, making progressively higher highs and
lower lows. However, in the last two weeks, the stock has run into
resistance around $59, due to the recent political pressure on the
pharmaceutical sector. Today, PHA has dipped $117/128 to $58 1/8,
extending its pullback from $59. The I-Watch's pre-trade price
chart shows buyers have given way to the selling pressure for much
of the session, adjusting their bids lower. However, the support has
created a solid floor of support around $58 (try the 5-minute view
of I-Watch). Keep an eye on I-Watch for continued super buy
messages, which would suggest that this support level can hold.
Roughly 1.4 million shares have changed hands compared to the 10-
day average daily volume of 2.7 million shares. Institutional
activity is heightened with block trades related to nearly 70% of
total volume.
ERICY -- Comm Equipment -- Technology
01-Sep-00 11:37:54 In the last month, steady institutional support
has helped push shares or Ericsson up 27% from its August 3 low of
$16 1/2. In today's session, ERICY has tacked on $3/8 to trade at
$20 7/8, as the stock tries to break through resistance around $20.
A few significant blocks at the start of the session has helped to
push the stock higher. At 9:36 and 10:16, 100k-share blocks crossed
at the best ask, suggesting that a "Smart Money" buyer was behind
the deals. Volume, however, is moderate, which suggests that the
stock may have difficulty following through today-- just under 5
million shares have crossed, which is about one-half ERICY's 10-
day average daily volume. Institutional investors however, are
driving the activity, with block trades contributing to over 50%
of total volume. The I-Watch pre-trade chart illustrates support
from some value-conscious growth investors, while more-aggressive
holders continue to pare their positions. Ongoing worries of
slowing handset growth will keep many of the growth players from
adding to their positions in the stock. The message volume chart
shows super buy messages running in pace with the super sell
messages, which has kept the stock in a narrow trading range
throughout the session. Watch for continued super buy messages to
suggest that the stock can hold onto its gains. |
