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Strategies & Market Trends : Can you beat 50% per month? -- Ignore unavailable to you. Want to Upgrade?

To: Smiling Bob who wrote (7084)	5/12/2004 10:29:28 AM
From: Smiling Bob	Respond to of 19256

10k quickly becoming resistance that mkts will not bother challenging much more. 9920 now Whipsaw economy and government with misdirected and selfish priorities U.S. stocks in reverse gear on concern over oil prices Wednesday May 12, 10:08 am ET By Mark Cotton NEW YORK (CBS.MW) - U.S. stocks moved lower Wednesday on investor concern over the impact of high oil prices on economic growth, with interest rate worries and the unstable situation in Iraq further dampening sentiment. ADVERTISEMENT The Dow Jones Industrial Average (^DJI - News) was down 75 points, or 0.8 percent at 9,945, wiping out the prior session's gains and dipping below the psychologically key 10,000 mark. Twenty-four of the thirty Dow components were moving lower. The Nasdaq Composite (NasdaqSC:^IXIC - News) fell 26 points, or 1.3 percent, to 1,905. The S&P 500 (CBOE:^SPX - News) fell 8.40 points, or 0.8 percent to 1,087.05 and the Russell 2000 index (CBOE:^RUT - News) of small-cap stocks dropped 1.7 percent to 539.39. Advancers outpaced delcliners by a 19-to-9 margin on the New York Stock Exchange and by a 20-to5 score on the Nasdaq. On a sector-sector basis, chip stocks reversed course after gaining 2.5 percent in the prior session, with the Philadelphia Semiconductor Index (Philadelphia:^SOXX - News) dropping 1.6 percent. Internet and bank stocks were losing ground while shares of chemical companies were under pressure. Energy and oil services stocks were among the gainers, buoyed by the strength in crude oil prices. The CBOE Oil Index (CBOE:^OIX - News) rose 0.5 percent and the Philadelphia Oil Service Index (Philadelphia:^OSX - News) gained 0.6 percent. "I certainly would not expect a rousing 'up' day," said Barry Hyman, equity market strategist at Ehrenkrantz King Nussbaum. "There are some intermediate-term concerns that the market has to deal with such as interest rates, Iraq, the budget deficit and oil." "Oil is a problem if it stays above $40. The longer it stays up there, the more it will tend to dampen economic growth," said Hyman. Also hitting sentiment were Commerce Department figures showing the U.S. trade deficit widened by 9.1 percent to a record $46 billion, well-above analyst estimates. "Anytime you run a deficit whether it's the budget, which is susbstantial, or a trade gap, it is inflationary and the market is certainly worried about inflation," said Hyman. Demand for oil set to rise The prospects of a significant pullback in oil prices dimmed, after an industry report suggesting global demand is accelerating. The International Energy Agency, in its monthly oil market update, hiked its projections for demand this year; it now expects 2004 global demand to grow by close to 2 million barrels a day to a total of 80.6 million barrels a day. Oil for June delivery, which hit a 13-year high Tuesday, was last up 8 cents at $40.14 a barrel. On the currency markets, the dollar edged higher against the euro, and was virtually unchanged against the Japanese yen. Against the British pound, the dollar handed back almost all of its prior session gains prompted by a weaker-than-expected UK manufacturing report. Sterling was up 1.2 percent at $1.7772. U.S. treasury prices were little changed after this morning's trade figures. But the weaker-than-expected data prompted a flight to safe-haven investments, giving gold a boost after recent weakness. Qualcomm lifts outlook In stock-specific news, Qualcomm (NasdaqNM:QCOM - News) raised its fiscal third quarter and 2004 earnings and revenue forecast due to greater-than-anticipated WCDMA royalties, stronger orders and faster migration to new phone chips. Qualcomm shares were off 13 cents at $64.59 in early trading in line with the broader market pullback. Cisco dips After gaining 2.9 percent ahead of its earnings release Tuesday, shares of Cisco Systems (NasdaqNM:CSCO - News) were down 1.3 percent. Analysts delivered a broadly upbeat assessment of the networking giant's third quarter earnings, which beat by expectations by a penny on an adjusted basis. But Bear Stearns analyst James Yang did raise some concerns over a 20 percent increase in inventory quarter-over-quarter, which could be vulnerable to risks of slow downs if demand does not hold up. Yang also highlighted a 9 percent decline in router sales and carrier sales that were "relatively sluggish." Yang however upped his earnings estimates on the group to reflect an overall performance which he described as "impressive." In other news, Citigroup (NYSE:C - News) will buy Principal Financial Group's (NYSE:PFG - News) residential mortgage subsidiary in a deal valued at $1.6 billion, the companies announced Wednesday. Citigroup shares slipped 0.2 percent while Principal Financial shares dropped 0.4 percent. Broker calls Lehman Brothers overnight raised its rating on International Paper (NYSE:IP - News) to equal-weight from underweight, citing "a recent correction in shares with positive earnings per share momentum (especially in pulp, paper, and paperboard markets)." Analysts recommended investors "take profits in shares of Louisiana Pacific (NYSE:LPX - News) and swap into IP." Shares of International Paper edged up 0.7 percent to $39.50 while Louisiana Pacific shares fell 3.7 percent to $21.80. biz.yahoo.com