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To: calgal who wrote (1960)	5/7/2003 5:02:09 PM
From: calgal	Respond to of 10965

By some measures, bull may be back URL:http://www.usatoday.com/money/markets/2003-05-06-newbull_x.htm By Adam Shell, USA TODAY NEW YORK — It may not feel like the good times are back on Wall Street. But major stock indexes have been marching steadily higher since April and are flirting with levels that could mark a new bull market. After climbing 7.84 points to 934.39 Tuesday, the Standard & Poor's 500 index has now rallied 20.3% from its Oct. 9 bear market low. A 20% gain off a low meets the narrow but commonly used definition of a new bull market. The Dow Jones industrials are just 155 points shy of meeting the 20% rule. The Nasdaq composite is up nearly 37% since October. A new bull born? The S&P 500 index closed Tuesday more than 20% above its low, a threshold that some say marks the start of a bull market. Nasdaq composite 36.8% Standard & Poor's 20.3% Dow Jones industrials 17.9% Source: USA TODAY research A 20% move doesn't guarantee that the gains will stick. Big rallies from deeply depressed levels are common, but often short-lived. All three indexes have surged 20% on a few occasions since the market decline began in 2000 only to relapse and hit fresh lows. Still, the market's recent rise, sparked by the end of the war and better-than-expected first-quarter profit reports, has put the major indexes within striking distance of meeting more stringent definitions of what constitutes a new bull. If the Dow powers higher and tops these stricter rules, it provides stronger confirmation that a major shift from a down market to an up market is underway, says Richard Moroney, editor of the Dow Theory Forecasts newsletter. For clues to determine if the three-year bear is over, focus on the following key levels for the Dow, which closed at 8588 Tuesday. Each signifies a new bull market has begun, based on the various definitions. Dow 8744. This level would mark a 20% rise from its Oct. 9 low of 7286.27 and satisfy the 20% rule. Dow 8932. Taking out its Nov. 27, 2002, high of 8931.68 satisfies two separate bull market definitions. Under Ned Davis Research's formula, the Dow must be up 13% from its low after 155 calendar days. The 155-day period ended March 13, but at that time the Dow was below the 13% threshold, so it must break the Nov. 27, 2002, high before triggering a bull market, says research analyst Sam Burns. The key variable here is that the market posts solid double-digit gains that don't quickly evaporate. Under the classic Dow Theory, the Dow would have had to successfully retest its October low and then rebound to surpass the prior high it hit in the most recent run-up. So the Dow would also have to surpass the 8931.68 high hit last November. The Dow transports average must also hit new highs, which it has. Dow 10,353. Under InvesTech Research's rule, the Dow must rally 20% off its low and set a 12-month high. To accomplish that, the Dow would have to top 10,353.08, its closing level on May 17, 2002. While that appears to be a tall order now, with the Dow almost 1,800 points below that level, the bar becomes far easier to top as we head closer to August. In early August the 52-week high will drop below 9000.