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To: Donald Wennerstrom who wrote (51362)	3/6/2011 2:46:27 PM
From: Sam	3 Recommendations Read Replies (1) \| Respond to of 95406

Monday Morning Outlook: Rising Anxiety as Bull Market Turns Two Stocks finished a choppy week more or less unchanged by Todd Salamone 3/5/2011 12:58 PM schaeffersresearch.com The major market indexes went on a roller-coaster ride last week, as soaring oil prices incited inflationary concerns. By the time the dust settled, though, stocks finished five drama-filled days more or less where they started. As we look ahead to a new week, Todd Salamone believes the bulls may still have the edge -- but highlights a few critical technical levels to watch amid continuing global turmoil. Meanwhile, Rocky White celebrates the bull market's two-year anniversary by looking back at previous winning streaks for the Dow industrials, and uncovers the best-performing sectors during the market's latest bust-and-boom cycle. Finally, we wrap up with updates on a few sectors of note, along with a preview of the week ahead. What the Trading Desk Is Expecting: Choppy Action as Indexes Test Key Levels By Todd Salamone, Senior Vice President of Research "With all the talk about the SPX doubling a couple of weeks ago, it appears some hedge fund managers may have taken this as a cue to become less aggressive in accumulating equities. Our analysis of option activity on the iShares Russell 2000 Index (IWM), PowerShares QQQ Trust (QQQQ), and SPDR S&P 500 ETF (SPY) shows the combined buy-to-open put/call ratio on these funds rolling over, suggesting that the purchase of portfolio protection that usually occurs with equity accumulation has slowed. Previous such rollovers in the ratio have preceded range-bound periods or declines. The bright side is that with retail cash still flowing into domestic equity funds -- and in the early innings of doing so, as discussed last week -- the market still has a source of demand that it did not have during previous instances in which hedge funds managers had their fill... But the negative is that retail players are less apt to hedge their portfolios, and more prone to panic-sell on negative headlines." -- Monday Morning Outlook, Feb. 26, 2011 If last week is any indication of what lies ahead in the immediate future, a period of choppy trading may be in store as geopolitical tensions drive oil prices higher on supply-side concerns. For example, at its trough and peak on Wednesday and Thursday, the S&P 500 Index (SPX) traded 20 points below and 12 points above the prior week's close, before ending the week at 1,321.15 -- just 1.27 points above the previous Friday's close. In fact, it took a rally in the last half-hour of Friday's session to put the SPX into positive territory for the week. Daily declines of 1.6% and 0.73% sandwiched a 1.7% advance on Thursday. The key SPX levels of 1,300 and 1,333 came into play once again, with the 1,300 area marking the lows on Wednesday afternoon. Meanwhile, the 1,333 area was the site of the SPX's peak late Thursday afternoon, before rumors of political unrest spreading to Saudi Arabia once again sent crude oil higher and stocks lower. Remember, the 1,333 level marks a double of the SPX's March 2009 low, and since rallying above this level in mid-February, the index has traded slightly lower. The CBOE Market Volatility Index (VIX --19.06) comes into this week trading at a critical juncture. Last week, we discussed the late-February pop in the "fear index" that was capped at the VIX's 200-day moving average, which is currently situated at 22.31. This week, we'll take an even longer-term look at the VIX, using its 80-week moving average -- which is currently sitting at 22.34, within just 0.03 point of its 200-day moving average. Like its 200-day counterpart, the 80-week trendline has had historical significance. Bulls would prefer to see the VIX remain below these long-term moving averages, while caution should be exercised if the index were to move above them. Moreover, we have mentioned the historical importance of the 20 area for the VIX in previous commentaries. The VIX, in fact, traded above 20 for most of the day Friday, but managed to close back below this level for the second consecutive week. This action in the VIX favors the bulls as we enter this week's trading. Clearly, news flow from the Middle East and North Africa is driving the dramatic day-to-day action in equities, as the SPX's double lows are challenged. At the same time, the round-number 1,300 level on the SPX has provided firm support in a market that has so far proven to be relatively resilient amid a 31% surge in oil prices during the past two-and-a-half weeks. The technical and sentiment backdrops continue to favor the bulls, but the uncertainty related to overseas developments warrants the use of portfolio protection in the event of a continued spike in oil driven by supply-side concerns. Indicator of the Week: The Bull Market's Two-Year Anniversary By Rocky White, Senior Quantitative Analyst Foreword: Wednesday of this upcoming week will mark exactly two years since the Dow bottomed in 2009. Since then, the Dow is up about 85%. This week, I'll look back at other such high-flying rallies over a two-year period. Also, I'll look at some specific sectors to see which groups have and have not participated in the rally. Dow Rallies: An 85% rally over two years is quite rare for the Dow. The table below shows each time the Dow has accomplished this feat over a two-year period, going all the way back to 1900. This is only the ninth occurrence. The table also shows how the Dow fared over the next three months, six months, one year and two years after hitting this technical milestone. The returns are summarized in the second table below. Summary of Returns After hitting a two-year bull market anniversary, the Dow has tended to continue its rally during the next six months. However, the returns are bearish in the longer term. One year after this event, the Dow averages a loss of 2.7%. Two years later, the Dow was higher only 25% of the time averaging a significant 6.3% loss. Sector Performance: I looked at some popular exchange-traded funds (ETFs) over the last few years to compare how individual sectors performing during the 2008 crash, and since the market bottom. Below is a table showing the best ETF returns since the March 9, 2009 bottom. Precious metals are very popular right now, so it's not a huge surprise that SPDR S&P Metals and Mining ETF (XME) and iShares Silver Trust (SLV) are on this list. SLV has been especially impressive, as it has gained about 150% -- even including the 2008 market crash. The financial and real estate sectors have really performed well, but remember: Those sectors got crushed during the crash. I think the appearance of the SPDR S&P Retail ETF (XRT) on this list will come as quite a surprise for many people. Even if you bought at the 2007 market top, this ETF has returned a respectable 22% over the last three years. This next table shows the worst-performing sectors during the rally. Of the sector ETFs that I considered -- about 30 of them -- only PowerShares DB US Dollar Index Bullish Fund (UUP) and iShares Barclays 20+ Year Treasury Bond Fund (TLT) were down. Both of those assets were actually up during the crash. These are considered "safe havens," and money has started leaving these funds and flowing into riskier assets like stocks and commodities. Thanks to overseas turmoil, the U.S. Oil Fund (USO) has been up over the last few weeks -- but over the last two years, the fund's returns are pretty modest compared to other assets. The Health Care Select Sector SPDR Fund (XLV) and the PowerShares DB Agriculture Fund (DBA) are also up modestly during the rally. Below are some broader-based ETFs that I thought might be interesting to look at. Focusing on the major indexes, it's not a surprise that iShares Russell 2000 Index Fund (IWM) has performed the best during the rally -- small-cap names are typically more volatile than big-cap stocks. What's interesting, though, is that during the crash, the IWM's return was very similar to the returns of the larger-cap SPDR S&P 500 ETF (SPY) and SPDR Dow Jones Industrial Average ETF Trust (DIA) funds. The big caps, evidently, were not much of a "safe" play during the crash. The performance of iShares MSCI Emerging Markets Index Fund (EEM) is pretty similar to the U.S. index fund returns. Last but not least, I've also included the returns of SPDR Gold Trust (GLD). Of all the ETFs I considered, GLD was the only one that showed positive returns during the 2008 crash and during the rally of the last two years. This Week's Key Events: Fed Presidents Bookend a Light Week Schaeffer's Editorial Staff Here is a brief list of some of the key events this week. All earnings dates listed below are tentative and subject to change. Please check with each company's respective website for official reporting dates. Monday * The economic calendar kicks off Monday with updates on consumer credit and employment trends, as well as comments from Fed Presidents Dennis Lockhart and Richard Fisher. On the earnings front, Ciena (CIEN), Urban Outfitters (URBN), Perfect World (PWRD), and Casey's General Stores (CASY) will release their quarterly reports. Tuesday * On Tuesday, we'll hear the latest report on chain-store sales from ICSC-Goldman Sachs. Notable earnings reports include Suntech Power (STP), Dick's Sporting Goods (DKS), AeroVironment (AVAV), and Korn/Ferry (KFY). Wednesday * Wednesday brings us word on wholesale inventories for January, the latest MBA mortgage applications survey, and the regularly scheduled update on domestic petroleum supplies from the Energy Information Administration (EIA). Meanwhile, the day's earnings docket includes H&R Block (HRB), American Eagle Outfitters (AEO), Hercules Offshore (HERO), and Molycorp (MCP). Thursday * The weekly report on jobless claims hits the Street on Thursday, along with import/export data for January. Canadian Solar (CSIQ), National Semiconductor (NSM), Clean Energy Fuels (CLNE), and Smith & Wesson (SWHC) share the earnings stage. Friday * We wrap up the week with the preliminary Thomson Reuters/University of Michigan consumer sentiment survey for March, along with comments from New York Fed President William Dudley. Retail issues AnnTaylor Stores (ANN) and Citi Trends (CTRN) round out the week's roster of earnings reports.

To: Donald Wennerstrom who wrote (51362)	3/6/2011 3:16:09 PM
From: rsie	Read Replies (2) \| Respond to of 95406

siliconinvestor.com don, did i read this right? during the downturn, readings of 10,20,and 30 were seen? in the bpNDX? and i see a 1-5 reading in the latter part of 2002? thanks

To: Donald Wennerstrom who wrote (51362)	3/7/2011 1:16:44 AM
From: Donald Wennerstrom	2 Recommendations Respond to of 95406

Cheap, Ultrafast Broadband? Hong Kong Has ItBy RANDALL STROSS Published: March 5, 2011 HONG KONG residents can enjoy astoundingly fast broadband at an astoundingly low price. It became available last year, when a scrappy company called Hong Kong Broadband Network introduced a new option for its fiber-to-the-home service: a speed of 1,000 megabits a second — known as a “gig” — for less than $26 a month. In the United States, we don’t have anything close to that. But we could. And we should. Verizon, the nation’s leading provider of fiber-to-the-home service, doesn’t offer a gig, or even half that speed. Instead, it markets a “fastest” service that is only 50 megabits a second for downloading and 20 megabits a second for uploading. It costs $144.99 a month. That’s one-twentieth the speed of Hong Kong Broadband’s service for downloading, for more than five times the price. One thing working in Hong Kong’s favor, of course, is its greater population density, enabling broadband companies to reach multiuser dwellings at a much lower cost. But density is only part of the explanation. The personality of Hong Kong Broadband should be noted, too. A wholly owned subsidiary of City Telecom, it is an aggressive newcomer. It was willing to suffer seven years of losses while building out its fiber network before it turned profitable. Hong Kong Broadband’s principal competitor is an older company, PCCW, which has several other lines of business, including phone, television and mobile. PCCW also offers gigabit service to the home and benefits from the same population density. But PCCW’s price is more than twice as much as Hong Kong Broadband’s. Despite its low prices, Hong Kong Broadband now operates in the black. Inexpensive pricing of gigabit broadband is practical in American cities, too. “This is an eminently replicable model,” says Benoit Felten, a co-founder of Diffraction Analysis, a consulting business based in Paris. “But not by someone who already owns a network — unless they’re willing to scrap the network.” In the United States, costs would come down if several companies shared the financial burden of putting fiber into the ground and then competed on the basis of services built on top of the shared assets. That would bring multiple competitors into the picture, pushing down prices. But it would also require regulatory changes that the Federal Communications Commission has yet to show an appetite for. Dane Jasper, the chief executive of Sonic.net, an Internet provider based in Santa Rosa, Calif., says that most broadband markets in the United States today are dominated by one phone company and one cable company. “Why doesn’t Verizon offer gigabit service?” Mr. Jasper asks. “Because it doesn’t have to.” In its earnings report for the quarter ended Dec. 31, Verizon said its fiber-based Internet service, which serves 12 states and the District of Columbia, was available to 12.8 million premises, an increase of 10 percent from the previous year. When I asked about its lack of gig service, C. Lincoln Hoewing, Verizon’s assistant vice president for Internet and technology issues, said, “We already offer 150 megabits,” referring to a tier of fiber-based service that is marketed for $195 a month to small businesses in many of its markets. It “seems to be satisfying demand,” he said. In a follow-up e-mail, a Verizon spokeswoman addressed the company’s lack of a gig service by saying that it offers “speeds that exceed what customers can and do use.” As long as a gig is expensive, a lack of customer interest shouldn’t be surprising. In October, EPB, the municipal electric utility in Chattanooga, Tenn., introduced a gig option in its fiber-to-the-home Internet services. A spokeswoman said the option, which costs $349.99 a month, currently has only about 20 customers. It is true that residential customers would now be hard-pressed to fully use anything close to a gig. Uncompressed, broadcast-quality HD video, for example, uses 23 megabits a second. But it is possible to imagine situations — a doctor’s office consultation, say, involving specialists scattered around the country, poring over the patient and her cerebral angiogram simultaneously — where multiple, two-way video feeds could chew up a lot of bandwidth. All parties would need the ultrafast connections. But that level of capacity seems distant because each party needed to make it happen — customers, software developers and Internet providers — is waiting for the others to show up first. GOOGLE doesn’t want to wait. It and Sonic.net are preparing an experimental deployment of gigabit service to 850 faculty and staff homes in a Stanford University subdivision. Separately, Google plans to select one or several cities where it will offer gigabit service at what it calls “a competitive price” to at least 50,000, and potentially 500,000, people. In a post on the company blog titled “Think Big With a Gig,” it says, “We want to see what developers and users can do with ultra-high speeds, whether it’s creating new bandwidth-intensive ‘killer apps’ and services, or other uses we can’t yet imagine.” Mr. Jasper of Sonic.net says the history of computing shows us that “no matter how much storage we have or how fast the computing processing speed or network connection speed, applications arise to utilize them.” While companies like Verizon don’t seem to be in a rush, that little Hong Kong business is saying: A gig? Sure. Join this grand experiment early. At $26 a month, it’s a low-cost ticket to the future. Randall Stross is an author based in Silicon Valley and a professor of business at San Jose State University. E-mail: stross@nytimes.com nytimes.com