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Strategies & Market Trends : Mu Gamma Lambda -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (3025)	7/31/2001 6:47:41 AM
From: Rich1	Respond to of 10077

The Big Picture Tuesday, July 31, 2001 Printer-Ready Version Market Continues In Doldrums Investor's Business Daily Some markets scare you out. This one has been wearing out investors for three months. Monday’s trading maintained the dull selling pressure. The Nasdaq dropped 0.6%. The Dow industrials and S&P 500 both slipped 0.1%. Despite the dip, NYSE advances beat declines. The broad market continues to hold up as the major averages drift lower. You can see the divergence in the daily and weekly advance-decline lines. Both are moving sideways. With little economic or profit news, volume limped lower. The Nasdaq traded 1.34 billion shares, down 16% from Friday’s below-average session. NYSE volume slipped 11%, falling below 1 billion shares for the first time in a week. Wall Street is losing patience with the market’s pace. Strategists from three big brokerages — J.P. Morgan, Credit Suisse First Boston and UBS Warburg — lowered their outlooks for the S&P 500. While two of the strategists still expect the S&P to end the year higher, Doug Cliggott of J.P. Morgan sees the big-cap index falling to 1100. It’s actually encouraging to see Wall Street lose its resolve. Like other contrarian sentiment indicators, the brokerages are usually bullish at the top and bearish at the bottom. But don’t try to time the market off them. The best way to stay in sync with the market is to follow the major averages and leading stocks. The Dow, S&P and Nasdaq can’t sustain a rally for more than a few days, although they’re not selling off dramatically like earlier in the year. And it’s tough to find more than a couple quality stocks making any headway. It’s time to lay low and wait for a better environment. For how long? The conventional wisdom says earnings may stay soft into next year. But the market typically rallies before profits clearly turn around. That’s why the market itself should always be your primary indicator. At any time, a new rally can emerge in as little as four days. The economic data will pick up Tuesday. Consumer confidence, personal income and spending are scheduled for release. The consumer has been carrying the economy. Expect Wall Street to pay close attention to the numbers. Food-related stocks offered a variety of tastes Monday. Whole Foods Market (WFMI) zoomed 2.85 to a new high of 34.80 on more than four times normal trade. The natural foods chain cleared a 32-week base Friday after beating fiscal third-quarter earnings views by a penny. But dairy products provider Suiza Foods (SZA) slid 1.08 to 54.60 on fast trade. Sysco (SYY), the largest food service distributor in the nation, dropped 1.05 to 26.83. Medicals also offered a mixed bag. Acute care provider Select Medical (SLMC) rose 1.22 to 19.22 on nearly four times its 50-day average volume. The firm came public April 5 at $10 a share. Diagnostic Products (DP) climbed 2 points to 39.40 and McKesson HBOC (MCK) 1.17 to 40.12. But Ivax (IVX), which tried to break out July 19, gapped down 5.22 to 32.69 on huge volume. Bedford Laboratories gained FDA approval to sell paclitaxel, which will compete with Ivax’s generic version of breast and ovarian cancer drug Taxol. Aviron (AVIR) fared worse, tanking 33%. An FDA advisory panel last week recommended rejecting the biotech firm’s flu vaccine, FluMist.