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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Vitas who wrote (25586)	12/5/2001 11:34:08 PM
From: Ibexx	Read Replies (1) \| Respond to of 52237

Prudential's Closing Market Commentary (12/5/01): ____________ Closing Stock Commentary Closing Stock (12/05) 12-05-2001 17:53 ET Brought to you by Larry Wachtel. This commentary, edited for use on the Internet, is broadcast on New York radio (station WINS, 1010 AM). The roar was heard in the canyons of Wall Street today as a powerful advance kicked in from the opening bell. Yesterday's impressive afternoon rally set the tone for improving overseas markets and a strong New York opening. The trend began to accelerate when the Purchasing Managers Non-Manufacturing Index came in well above expectations. We then had the saga of the round numbers. The Dow Industrial Average blasting through 10,000 while Nasdaq exceeded 2000. Finally, the huge volume suggests money managers are making that leap of faith relative to economic recovery and are committing some of the abundant sideline cash. The Dow Industrial average rose 220 points, led by IBM, 3M Corp, Caterpillar, Home Depot, JP Morgan, Microsoft and Intel. Nasdaq gained 83 with semiconductors in the lead among the big percentage gainers was Intel, Xilinx, Maxim and Applied Material. Stocks were also helped by Salomon Smith Barney boosting estimates for S&P profits for the first time in two years. Strategists for the firm believe U.S. economic growth will recover quite rapidly over the course of 2002. Big board breadth was affirmative with a 2-1 upside ratio but volume was really eye-catching, totaling 1.7 billion shares on the New York Exchange and 2.7 billion shares on Nasdaq. In both cases, upside volume swamped the downside variety. The huge volume conjures up the "boat is leaving the dock" syndrome. This involves money managers who want better economic clarity but can no longer play the waiting game. The sharp rise in the National Association of Purchasing Management (NAPM) Non-Manufacturing Index represents another sign of economic bottoming. Last week it was good numbers for housing and new orders for durable goods. This week we had a jump in personal consumption expenditures while total consumer spending is running ahead of the third quarter by an annual rate of 6%, the biggest increase in nearly four years. Construction is another big chunk of the economy that is now adding to GDP. As one Wag put it, the recession is ending just as the National Bureau of Economic Research officially declares it has started.(ggggg-ibexx) Price firming for memory chips got the semiconductor stocks moving with the index up 41 points. Shares of Micron, Texas Instruments, and Advanced Micro were in the forefront. Intel was strong ahead of an analyst meeting tomorrow. Signs of an improvement in personal computer demand sent Dell Computer close to a new high while IBM did. Energy stocks improved after Russia pledged its output, signaling cooperation with the OPEC oil cartel. Shares of Exxon Mobil and Chevron Texaco gained along with oil service stocks like Schlumberger and Vargo Intl. Auto Parts stocks surged on the back of Auto Zone which rose over 12 points after exceeding estimates. In the meantime, Enron rose for a third day as concerns over the impact of the company's flame out abated. This allowed some relief for financial stocks like JP Morgan Chase and Citigroup. Ford Motor slid after warnings that its fourth quarter loss will be wider than expected. AOL Time Warner climbed despite the announced retirement of Chairman Jerry Levin. Needless to say, the market has reached overbought extremities that suggest a less dramatic upside pace. But the tale of the tape is not to be ignored. Don't fight it, it's bigger than both of us. Ibexx