Dow Jones 30: Industrials Index

[setravis]

Stocks Keep Advance Going.......


6/4/2007


Stocks in the U.S. spent much of Monday struggling with losses, but late in the session buyers emerged and put the blue-chip indices deeper into record territory.

The Dow Jones Industrial Average closed up 8.21 points at 13,676.32, and the S&P 500 was higher by 2.84 points at 1539.18. The Nasdaq tacked on 4.37 points to 2618.29.

Only 13 of the Dow's 30 members posted gains. Still, the pullbacks were limited. Alcoa (AA:) , with a 1.1% decline to $40.99, was the biggest loser. Wal-Mart's (WMT:) 3.5% increase to $51.21 buoyed the index.

For the S&P, the climb marked its fourth straight all-time high. The Dow set a new standard for the 27th time this year.

A new day brought another series of deals, but selloffs overseas made the domestic market a bit jittery early. Europe fell after Russian's president, Vladimir Putin, said his country's missiles would be aimed at the continent if the U.S. moved ahead with plans to install an antimissile system there.

China's CSI 300 was battered again, plunging 7.7% amid reports that the nation's government isn't inclined to intervene to stop the local market's recent slump. However, Hong Kong and Tokyo both escaped the downturn and ended to the upside.

Meanwhile, mergers and acquisitions were continuing to make headlines. One pact will see Flextronics (FLEX:) spend $3.6 billion for fellow electronics manufacturer Solectron (SLR:) .

Flextronics was down 1.4% to $11.54, while Solectron jumped 15% to $3.88.

Also in the tech sector, Palm (PALM:) is selling 25% of itself to the private-equity firm Elevation Partners, and reports indicate that TPG and Silver Lake Partners are near a deal to take over Avaya (AV:) .

Palm surged 9.2% to $17.57, and Avaya was up 4% at $16.72.

Elsewhere, Qiagen (QGEN:Nasdaq) said it will buy Digene (DIGE:Nasdaq) for $1.6 billion, and Accredited Home Lenders (LEND:Nasdaq) will be acquired by Lone Star Funds for $400 million.

Digene soared 27%, and Accredited was better by nearly 10%.

A pair of energy transactions have also been signed, with Dominion (D:NYSE) agreeing to sell most of its U.S. onshore natural gas and oil exploration and production operations for roughly $6.5 billion, and Atlas Pipeline Partners (APL:NYSE) saying it will pay $1.85 billion to assume control of Anadarko's (APC:NYSE) interests in the Chaney Dell and Midkiff/Benedum natural gas gathering and processing systems.

Additionally, Reuters said American Express (AXP:NYSE) might sell its private banking business sometime in the coming weeks, and AXA (AXA:NYSE) has reached a preliminary arrangement to unload its Dutch insurance operations to SNS Reaal.

On the research front, Morgan Stanley, JPMorgan, HSBC and Wachovia upgraded Wal-Mart, and Bear Stearns lifted its rating on Sirius (SIRI:) .

CIBC took Motorola (MOT:) up to sector outperformer from sector performer.

Sirius edged ahead by 0.4%, but Motorola eased 0.3%.

The economic calendar was practically empty. One report that did come in showed that factory orders for April rose only 0.3%. Analysts surveyed by Bloomberg had been looking for a 0.7% increase.

Treasury prices were on the rise. The 10-year note was up 5/32, lowering the yield to 4.93%, and the 30-year bond was advancing 14/32, yielding 5.03%.

As for commodities, precious metals and energy futures were mixed. Oil gained $1.13 to $66.21 a barrel. Gold slipped 60 cents to $676.30 an ounce.

[setravis]

Bears Take a Round.......


6/5/2007


Stocks in the U.S. were pressured from the start and closed lower Tuesday as a rise in bond yields and the belief that the Federal Reserve won't be rushing to cut rates kept the market weak.

The Dow Jones Industrial Average lost 80.86 points, or 0.6%, to 13,595.46 and was led lower by DuPont (DD:) and Home Depot (HD:) .

Of its 30 components, only Procter & Gamble (PG:) , Caterpillar (CAT:) and Exxon Mobil (XOM:) were in positive territory.

The S&P 500 gave back 8.23 points, or 0.5%, at 1530.95, and the Nasdaq was down 7.06 points, or 0.3%, to 2611.23.

By ending lower, the S&P snapped a four-day streak of record closes. On Monday, the S&P was up 2.84 points at 1539.18.

Contributing to the softness were comments from Fed Chairman Ben Bernanke, who said that in the coming quarters the economy will probably advance at a moderate pace that will be close to or slightly below the "trend rate of expansion."

However, he added that while core inflation has gradually ebbed, its level remains somewhat elevated. Many of his statements were similar to those found in the Fed minutes released last week.

During prepared remarks to the International Monetary Conference in South Africa, the central bank chief noted that real gross domestic product has increased at an average rate of about 2% in the past four quarters.

" [The] adjustment in the housing sector is still ongoing, and the slowdown in residential construction now appears likely to remain a drag on economic growth for somewhat longer than previously expected," but there haven't been major spillovers to other parts of the economy, he said.

All told, he didn't say anything to suggest policymakers might be planning to ease anytime soon, and many market participants have been hoping to see the fed funds target rate lowered this year from 5.25%.

Meanwhile, bond prices were slumping, and that was pushing up yields. The 10-year note was losing 11/32 in price, yielding 4.98%, and the 30-year was down 21/32, yielding 5.07%.

Overnight, stocks in China recovered from the prior session's selloff, with the CSI 300 Index gaining 3.5% to 3635. Hong Kong's Hang Seng and Tokyo's Nikkei each were up about 0.5%.

Europe declined. London's FTSE surrendered 0.5%, and Frankfurt's DAX and the Paris Cac shed around 0.7%.

Ahead of the Day's session in New York, a deal that had been reported as likely was confirmed. Avaya (AV:) said it would be acquired by Silver Lake Partners and TPG Capital for $8.2 billion, or $17.50 a share.

Elsewhere, Moody's (MCO:) raised its growth forecast for the year, and FuelCell Energy (FCEL:) topped Wall Street's earnings and revenue estimates. Bed Bath & Beyond (BBBY:) indicated that its first-quarter results could miss estimates.

Among the research calls, Friedman Billings Ramsey boosted its price targets on a number of refiners, including Frontier Oil (FTO:) , Holly (HOC:) , Sunoco (SUN:) , Tesoro Petroleum (TSO:) and Valero (VLO:) .

CIBC and JPMorgan downgraded Openwave Systems (OPWV:) , and UBS lowered its rating on Juniper Networks (JNPR:) . Also, Bank of America raised its price target on Amazon.com (AMZN:Nasdaq) to $79 from $62.

[setravis]

Rate Worries Slam Stocks.......


6/6/2007


Stocks in New York took more losses Wednesday as continuing worries about the current interest rate environment kept the sellers in charge.

The Dow Jones Industrial Average was down 129.79 points at 13,465.67, and the S&P 500 was off 13.57 points at 1517.38. The Nasdaq lost 24.05 points to 2587.18. All the pullbacks equated to declines of around 0.9%.

Only five stocks, including Verizon (VZ:NYSE) and Wal-Mart (WMT:NYSE) , escaped the damage on the Dow.

IBM (IBM:NYSE) , Intel (INTC:NYSE) and DuPont (DD:NYSE) were the biggest drags, each dropping more than 2%.

The downturn marked the second consecutive rough session for U.S. shares. On Tuesday, stocks fell as bond yields rose and concerns mounted that the Federal Reserve doesn't have plans to ease in the immediate future.

Previously, the Dow surrendered 80.86 points to 13,595.46, and the S&P fell 8.23 points at 1530.95, breaking a four-day streak of record closes. The Nasdaq gave back 7.06 points to 2611.23.

Bonds steadied as the new day arrived, but the fears about rates carried over. The 10-year note was up 6/32 in price, yielding 4.97%, and the 30-year added 2/32 to yield 5.08%. Higher yields lead to jitters about liquidity and also make fixed-income securities more competitive against stocks.

Just a handful of economic data are being released this week, and that has given market forces the freedom to drive trading.

The latest report, revised government figures on productivity, showed a 1% gain in the first quarter, in line with expectations. That was down from the preliminary reading of 1.7% growth. At the same time, labor costs jumped 1.8%.

Meanwhile, the White House's Council of Economic Advisers is now predicting that gross domestic product will climb 2.3% from the fourth quarter of 2006 to the same period this year. The administration had been expecting a 2.9% expansion.

Globally, stocks were generally weaker. Tokyo's Nikkei and Hong Kong's Hang Seng each lost around 0.1% overnight. London's FTSE was down 1.4%, while Frankfurt's DAX plunged 1.9%. The Paris Cac fell 1.6%.

The European Central Bank, as had been expected, lifted its key interest rate by 25 basis points to 4%. The hike was the ECB's eighth in the last year and a half. At the same time, the Bank's chief said the eurozone's inflation outlook for next year hasn't been altered.

After the move, the euro lost ground to the dollar, declining to $1.35 from $1.352 previously. However, the greenback was softer against other major currencies, including the yen and the pound.

Domestic corporate news was a bit on the slow side. Dell (DELL:) was up 0.3% after the Financial Times reported that Michael Dell is hoping to make a series of purchases that would help make the company stronger in computer services, rather than just hardware.

Prudential Financial (PRU:NYSE) set plans to close down its Prudential Equity research, sales and trading business, effective immediately, and is stopping coverage of the sectors and companies it covers. Shares were down 1.1%.

Elsewhere, sandwich seller Panera Bread (PNRA:) took a 14% dive after it cut its second-quarter profit forecast.

Among the Day's research calls, Thomas Weisel downgraded Boyd Gaming (BYD:) , and Credit Suisse upgraded Teva Pharmaceutical (TEVA:) . Morgan Stanley lifted its rating on Moody's (MCO:) , but it cut Whole Foods (WFMI:) .

Oppenheimer reduced its fiscal 2007 earnings estimates for Motorola (MOT:NYSE) by 2 cents to 29 cents a share, and the stock slipped 0.8%.

The firm said it's concerned about the production pace of the company's new phones, Apple's (AAPL:Nasdaq) upcoming iPhone and new offerings from Nokia (NOK:NYSE) .

As for commodities, crude futures were better by 35 cents to $65.96 a barrel after the Energy Department's weekly inventory results. Gold lost 50 cents at $674.60 an ounce.

[setravis]

Stocks Break Out of Funk.......


6/9/2007


Bond yields finally stopped rising Friday and oil prices tumbled, giving stocks in New York an opportunity to come out of their three-day slump.

The Dow Jones Industrial Average jumped 157.66 points, or 1.2%, to 13,424.39, and the S&P 500 added 16.95 points, or 1.1%, at 1507.67. The Nasdaq was higher by 32.16 points, or 1.3%, at 2573.54.

That marked quite a turnaround from the prior three sessions, when the Dow gave away roughly 400 points, including a decline of 198.94 points, or 1.5%, to 13,266.73 on Thursday. The S&P fell 49 points since Tuesday, and the Nasdaq dropped 77 points over the same span.

Largely responsible for the recent selloff were traders resetting their expectations about inflation and interest rates.

The yield on the 10-year Treasury was lately at 5.11%, as the price for the note ticked ahead 5/32. Earlier, the yield hit 5.24%, its highest level in five years. The 30-year bond was better by 6/32 in price, well off its nadir, and yielding 5.22%.

As fixed-income securities saw their downturn halt, equities gathered upside momentum. Also aiding the recovery was a plunge of $2.17 in crude futures to $64.76 a barrel.

However, even with the bounceback to end the week, yields will likely remain in focus for the foreseeable future.

Pimco's Bill Gross, one of the most influential bond market observers on the planet, now believes the 10-year could climb all the way to 6.5% sometime in the next five years. Previously, he had seen 5.5% as the most likely top.

Central banks worldwide have been tightening rates in their effort to keep prices stable. This week alone, the European Central Bank and policymakers in New Zealand have hiked. The Federal Reserve in the U.S. has kept its fed funds target at 5.25% since last June.

When 2007 began, many investors were looking for at least one Fed easing this year, but the hopes of such a move have been gradually fading.

While the domestic housing sector has been soft, most other areas of the economy have remained at least somewhat solid. As a result, the Fed has repeatedly indicated that it's more concerned about the outlook for inflation than it is for a slowdown.

Now, fed funds futures are pricing in odds above 40% that officials will actually lift rates by a quarter point before 2008 arrives, whereas last month they carried a 0% chance.

Bloomberg reported that the experts it polled believe the U.S. economy will grow at a 2.6% annual pace in the current second quarter, up from the consensus forecast of 2.2% in May. Growth should then accelerate to 2.9% by the last quarter of the year, the survey revealed.

Meanwhile, Chicago Fed President Michael Moskow, who's retiring in August, remarked before the open that the recent move in rates hasn't affected his economic outlook. He said during a televised interview that "inflation expectations are well-contained," but he suggested the Fed will remain on guard about excessive price increases.

On the economic calendar, the lone report showed a narrower trade gap than analysts had been expecting. The government said the April deficit fell more than 6% from March to $58.5 billion. Estimates had been for a gap of around $63.5 billion.

Among companies in the news, Tyco (TYC:) said it would split into three separate publicly traded firms, spinning off its health care and electronics operations to stockholders. Shares of Tyco gained 3.6%.

McDonald's (MCD:) posted global same-store sales that rose 8.7% in May, and it also got an upgrade from Deutsche Bank to buy from hold. The stock, a component of the Dow, advanced 2.4%.

Elsewhere on the research front, Bank of America downgraded Nike (NKE:) and Foot Locker (FL:) to neutral from buy.

JMP Securities lifted its rating on Broadcom (BRCM:Nasdaq) , and Deutsche took Genentech (DNA:NYSE) to a buy from a hold.

National Semiconductor (NSM:NYSE) gained 14.7%, leading other chips stocks higher, following its latest quarterly results and outlook. National predicted after the last close that sales for the current quarter could be above Wall Street's targets.

Texas Instruments (TXN:NYSE) rose 4.6%, and STMicroelectronics (STM:NYSE) tacked on 2.5%.

[setravis]

Higher Yields Hem In Stocks.......


6/11/2007


The major averages in New York bounced back and forth Monday and finally closed little changed as another rise in bond yields again had traders rattled.

The Dow Jones Industrial Average edged up 0.57 point to 13,424.96, and the S&P 500 gained 1.45 points at 1509.12. The Nasdaq slipped 1.39 points to 2572.15.

Last week, the U.S. market was crushed Tuesday through Thursday as a sharp rise in yields sidelined the bulls. The Dow lost 400 points during the three-session span, while the S&P sank 49 points and the Nasdaq plunged 77.

On Friday, stocks were able to recover part of the losses, with the Dow jumping 157.66 points to 13,424.39, and the S&P 500 adding 16.95 points to 1507.67. The Nasdaq rose 32.16 points to 2573.54.

Considering the action of the past few days, traders were keeping a close eye on the movement of the fixed-income market. Lately, the 10-year Treasury was down 10/32 in price, yielding 5.15%, and the 30-year bond was dropping 21/32, yielding 5.26%. Prices and yields move in opposite directions.

Pimco bond expert Bill Gross, who last week said the yield on the 10-year could reach 6.5% in the next five years, was out with new comments to Bloomberg, saying this time that it might take six months or more before the Federal Reserve moves to cut rates.

The fed funds target has been 5.25% since last June, and coming into this year many traders were looking for at least one reduction. However, those hopes have taken repeated blows in recent months as signs of economic strength and the potential for inflation have persisted.

Meanwhile, among stocks, a handful of small deals were making news on the merger front, but the day was absent any of the giant private-equity takeouts that have become almost commonplace.

IBM (IBM:) said it will acquire Sweden's Telelogic in a transaction worth about $745 million, and Back Yard Burgers (BYBI:) agreed to be taken private in an arrangement worth around $38 million.

Meanwhile, another bidder for Dow Jones (DJ:) could eventually be a possibility after all, according to a published report. The Wall Street Journal said General Electric (GE:) and Microsoft (MSFT:) discussed a way to combine some parts of the publishing company with NBC/Universal by countering News Corp.''s (NWS:) $5 billion offer, but they couldn't reach a pact.

Nucor (NUE:NYSE) fell 6% after saying its second-quarter profit will miss analysts'' estimates, citing lower shipments from its bar mill group. Other steel stocks slid as well.

On the research side, Credit Suisse initiated coverage of IntercontinentalExchange (ICE:) with an outperform rating and New York Mercantile Exchange (NMX:) with a neutral. The firm downgraded MarketAxess (MKTX:) to underperform from neutral and CBOT Holdings (BOT:NYSE) to neutral from outperform.

Elsewhere, Friedman Billings upgraded Wachovia (WB:) , and HSBC lifted its view on Nike (NKE:) . Also, UBS upgraded H&R Block (HRB:) .

Calyon took United (UAUA:NYSE) down to add from buy and slashed its price target by $21 to $38. Additionally, it cut AirTran (AAI:NYSE) to neutral from add and reduced its target by $1 to $12.

Stock indices were generally stronger overseas. Tokyo's Nikkei was up 0.3%, and Hong Kong's Hang Seng advanced 0.5%. London's FTSE and the Paris Cac each rose 1%, and Frankfurt's DAX was better by 1.5%.

As for commodities, crude oil climbed $1.21 to $65.97 a barrel, and gold increased $8.70 to $659 an ounce.

[setravis]

Bulls Refuse to Yield.......


6/13/2007


Positive economic data and a decline in bond yields propelled stocks sharply higher in New York Wednesday, providing some relief to investors who've been pummeled by the fixed-income market in recent sessions.

After a brief midday hiccup, the Dow Jones Industrial Average roared back to close up 187.34 points, or 1.41%, to 13,482.35, its best single-biggest point gain for the year. Still, the blue chip average remains down more than 1% for the month thus far.

Twenty-nine of the Dow's 30 components finished in the black, with a 2.9% rise in Alcoa (AA:) leading the way. Only Verizon (VZ:) sat out the rally.

Elsewhere, the S&P 500 rose 22.67 points, or 1.52%, to 1515.67, and the Nasdaq was up 32.54 points, or 1.28%, at 2582.31.

Contributing to the change in mood was the fact that bonds have settled down, at least for the moment. At 4:10 p.m. EDT, the 10-year Treasury was up 21/32 in price, dropping the yield to 5.21%, just below the current fed funds rate of 5.25%. The 30-year was advancing 1-21/32, lowering the yield to 5.29%.

Though that still leaves yields higher than some traders want to see, any sign that they're leveling off is welcome news for the equity markets. With only rare interruptions, stocks have been repeatedly pounded since early last week as yields have soared.

The Federal Reserves regional business survey, known as the beige book, helped to boost stock prices following its 2 p.m. EDT release.

The report said that U.S. economic activity continued to expand at a modest pace between late April and early June, without an increase in price pressures. Consumer spending was generally positive, and most districts reported an increase in manufacturing activity, according to the report.

"The beige book gave us a nice up tick as there was no evidence of pricing pressure," said Larry Wachtel, senior market analyst with Wachovia Securities. "We can't make progress lately unless the bond market allows us to. As long as the bond market behaves, we should be able to recover."

A stronger-than-expected reading on retail sales also gave stocks strength. Before the bell, the Commerce Department said retail sales rose 1.4% last month, the largest gain in over a year and double what economists had anticipated. Excluding autos, retail sales were up 1.3% in May, also well above forecasts.

"This is a much stronger report than seemed likely in the face of the clear slowdown in chain store sales," said Ian Shepherdson, chief economist with High Frequency Economics. "Given that chain store sales have weakened further in early June, this cannot be sustainable, but for now the data will certainly add to the view that consumers are not being badly affected by the jump in gas prices."

Separately, the Labor Department said its import price index rose 0.9% in May, higher than expectations. Petroleum prices rose 2.7% for the month, boosting the headline number. Over the past year, import prices have risen 1.1%.

The data gave bulls confidence to jump back in the market after surging yields sent stocks tumbling in the prior session. On Tuesday, the Dow lost 129.95 points, or 0.97%, at 13,295.01, and the S&P 500 was lower by 16.12 points, or 1.07%, to 1493. The Nasdaq fell 22.38 points, or 0.87%, to 2549.77.

Among the corporate names in the news, a judge in Italy has reportedly indicted Citigroup (C:) , UBS (UBS:) , Deutsche Bank (DB:) and Morgan Stanley (MS:) for not doing enough to prevent the collapse of dairy giant Parmalat in 2003.

Novartis (NVS:) received approval from European regulators for the flu vaccine Optaflu, and Jones Apparel Group (JNY:) is close to reaching a pact to sell Barneys to the government of Dubai, the New York Post reported.

Novartis was higher by 0.9% to $54.80, and Jones tacked on 1.1% to $29.20.

As for the Day's research calls, RBC upgraded Sapient (SAPE:) , and Bear Stearns downgraded Alcan (AL:) . UBS put Prudential (PRU:) on its strategic stock list and removed Costco (COST:) .

Sapient rose 6.5% to $8.03, and Alcan closed up 1.3% at $83.49. Prudential added 2.5% to $100.81, and Costco gained 1.5% to $55.97.

Other moves saw JPMorgan initiate coverage of Nokia (NOK:) with an overweight rating, and Citigroup lifted Blockbuster (BBI:) to buy from hold.

Nokia ended higher by 59 cents, or 2.2%, to $28.09. Blockbuster jumped 32 cents, or 8.1%, to $4.27.

As for commodities, energy prices crept higher in the wake of the Energy Department's weekly inventory report, which showed a meager gain in crude inventories. Gasoline stocks were unchanged from last week, and distillate stocks rose by only 300,000 barrels.

The front-month July crude contract finished up 91 cents to $66.26 a barrel, and gasoline added 2 cents at $2.15 a gallon.

Metals prices were little changed. Gold dipped by 40 cents to end the day at $652.70 an ounce, and silver was lower by 3 cents at $13.06 an ounce.

Markets overseas were mixed. London's FTSE added 0.6%, but Frankfurt's DAX was unchanged. Tokyo's Nikkei was weaker by 0.2%, and Hong Kong's Hang Seng eased 0.3%.

[setravis]

Stocks Extend Recovery Effort.......


6/14/2007


Stocks in New York rallied for a second straight session Thursday as a stabilizing situation in the bond market kept buyers interested in equities.

The Dow Jones Industrial Average rose 71.38 points, or 0.53%, to 13,553.73. Twenty-three of the Dow's 30 components were positive, led by a 4.7% jump in General Motors (GM:) .

At the same time, the S&P 500 added 7.30 points, or 0.48%, to 1522.97, and the Nasdaq climbed 17.10 points, or 0.66%, to 2599.41.

Helping the move were hopes that the rate-related plunge of recent days is over, or at least moderating. The 10-year Treasury was down 3/32 in price, yielding 5.21%, and the 30-year bond was off 7/32, yielding 5.30%.

On Wednesday, yields sank, and that, along with upbeat economic data, gave the U.S. market a lift.

The Dow surged 187.34 points, or 1.41%, to 13,482.35 and recorded its best point gain of the year. The S&P climbed 22.67 points, or 1.52%, to 1515.67, and the Nasdaq was up 32.54 points, or 1.28%, at 2582.31.

"Bonds rallied in the face of retail sales growth of up 1.4%, a better-than-expected beige book report, and rising import prices," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "You can't say that the economic data favored bonds, which made the rally all the more notable."

Both stock and bond traders pored over the latest incoming data for clues about inflation and the overall health of the economy. Before the opening bell, the Labor Department said its producer price index for May showed that inflation ticked higher at the wholesale level.

The headline index rose 0.9%, which was slightly above projections. The core index, excluding food and energy, rose an expected 0.2%. The core rate has increased 1.6% year over year, up from April's 1.5% rise, but is within the Federal Reserves comfort range of 1% to 2%.

Ian Shepherdson, chief economist with High Frequency Economics, said that the overshoot in the headline number was due to energy, while the core rate was benign.

"In the energy component, gasoline prices rose 10.2%, rather more than we expected," he said. "The lagged effect of the rise in core materials prices a year ago still points to upside risk for core finished goods in the next few months, but any acceleration will not last long."

Peter Cardillo, chief economic strategist with Avalon Partners, said that it was impressive that the market managed to hold on to gains as oil pushed above the $67-a-barrel level.

Crude oil jumped $1.39 to end the day at $67.65 a barrel, its highest level since late April. Meanwhile, precious metals overcame early weakness. Gold rose $3.20 to $655.90 an ounce, and silver was up 10.5 cents at $13.16 a barrel.

"The PPI data gave the market some relief, and investors continued to buy," said Cardillo. "Today's rise is worrisome because bond yields are still high and energy is continuing to rise. We're closing our eyes to that, and I think these danger signs will give us trouble."

On Friday, the consumer price index, viewed as the more important of the two inflation measures, will be out.

"Tomorrow's headlines will be all about the CPI," Cardillo said. "Any negative news out of that report will reverse investors'' enthusiasm."

Elsewhere on the economic docket, the government said initial jobless claims were unchanged from last week at 311,000. The less-volatile four-week moving average rose by 3,750 to 311,250.

Meanwhile, among stocks, shares of Sanofi-Aventis (SNY:) dropped 4% to $41.33 following the news that advisers to the Food and Drug Administration said the agency should reject the company's weight-loss drug Zimulti. The stock also fell hard in Europe.

On the deal-making front, Liberty Media (LCAPA:) and EchoStar (DISH:) are joining forces to bid for satellite-communications provider Intelsat, according to a report in The Wall Street Journal. The report also said an auction for Intelset could get bids exceeding $5.5 billion. Liberty rose 1% to close at $117.76, while EchoStar finished unchanged at $44.93.

As for earnings, Goldman Sachs (GS:) posted a second-quarter profit of $2.33 billion, or $4.93 a share, up 1% from the year-ago quarter. Analysts expected earnings of $4.79 a share, according to Thomson First Call. Still, worries about the subprime market sank shares by $7.89, or 3.4%, to $225.75.

Bear Stearns (BSC:) also posted second-quarter results before the open but said that profits fell to $361.7 million, or $2.52 a share, down 33% from last year. Excluding items, the investment bank earned $3.40 a share, falling short of estimates. After falling by 2.3%, the stock rebounded to rise 11 cents, or 0.1%, at $149.60.

Goldman and Bear Stearns are among several investment banks reporting this week. Lehman Brothers (LEH:) topped estimates on Tuesday. Morgan Stanley (MS:) is set to report next week.

Overseas, stocks were uniformly stronger. Tokyo's Nikkei was up 0.6%, and Hong Kong's Hang Seng climbed 1.4%. The FTSE in London added 1.4%, and the Frankfurt DAX gained 2.2%.

[setravis]

Stocks Get Another Lift.......


6/15/2007


Stocks closed higher again Friday as investors cheered positive inflationary data, and Wall Street heads in to the weekend with three straight days of gains.

The Dow Jones Industrial Average was up 85.76 points, or 0.6%, to 13,639.48, as 25 of its 30 components were positive, led by a 4.4% surge in Intel (INTC:) .

The S&P 500 climbed 9.94 points, or 0.7%, to 1532.91, and the Nasdaq Composite rose 27.30 points, or 1.1%, to 2626.71.

All told, the Dow added 1.6% this week and the S&P 1.7%. The Nasdaq was the best performer, increasing 2%.

Giving stocks a boost was a benign report on consumer-level inflation. The Labor Department's consumer price index climbed 0.7% for May, slightly ahead of expectations. However, the core index, which excludes food and energy prices, was below estimates with a 0.1% rise.

The closely monitored core inflation figure is now up 2.2% over the past 12 months, down from 2.3% in April.

The data follow Thursday's producer price index, which rose a greater-than-expected 0.9% in May. The core PPI rose 0.2%, as expected. The PPI report measures inflation at the wholesale level.

The CPI is considered the more important of the two when it comes to influencing Federal Reserve decisions on interest rates, but both are factored into the central Bank's planning.

"The core [CPI] number is something the market is comfortable with, despite the fact that the headline number remained strong," said Michael Sheldon, chief market strategist with Spencer Clarke LLC. "First-quarter data were fairly weak, but there's a clear trend of improvement. Second-quarter growth is likely to be more positive than previously thought."

For the past few sessions, the bond market hasn't been nearly as punishing as it was last week and early this week, and that helped stocks regain their footing. Around 4 p.m. EDT, the 10-year Treasury was up 17/32 in price, yielding 5.15%, and the 30-year bond was higher by 25/32, yielding 5.25%.

"The interest rate picture is still driving equity markets, and that's likely to continue," said Sheldon. "The rise in interest rates has taken investors by surprise because of the strength in the move and how quickly rates rose. Investors had previously expected multiple rate cuts, but that theory is now changing. The Fed may be out of the picture for the rest of 2007 or may even raise rates."

Elsewhere on the economic docket, the New York Fed said its Empire State Manufacturing Index rose to a reading of 25.8 in June, compared with 8.0 in May. The index was expected to jump to 12.0.

Economic headlines were not free of disappointment, though. Industrial production was unchanged in May, below the 0.2% forecast. Capacity utilization fell to 81.3% from 81.5%, also missing estimates. The University of Michigan said its consumer sentiment index fell to a reading of 83.7 in May from 88.3 the previous month, short of the target of 87.8.

Meanwhile, new speculation about dealmaking was giving investors a chance to think about something besides interest rates. According to Bloomberg, Nymex Holdings (NMX:) might seek a sale to NYSE Euronext (NYX:) , Deutsche Boerse or Chicago Mercantile Exchange (CME:) .

The report cited people who were close to the matter and said Nymex could be valued at $14.3 billion.

Additionally, the same news service said Home Depot (HD:) is poised to get offers worth around $10 billion for its contractor-supplies division from separate private-equity groups.

The Wall Street Journal reported that Google (GOOG:) is planning an R&D center in Shanghai for later this month as it bids to take on Baidu.com (BIDU:) , the search market leader in China.

Away from stocks, oil prices reversed early weakness to reach a high of $68.30 for the day. Crude oil closed with a gain of 35 cents at $68 a barrel. Precious metals also rebounded to finish higher. Gold was up $2.80 at $658.70 an ounce, and silver tacked on 9.5 cents at $13.26 an ounce.

Overseas, stocks were uniformly stronger. Tokyo's Nikkei was up 0.7%, and Hong Kong's Hang Seng also climbed 0.7%. The FTSE in London added 1.2%, and the Frankfurt DAX climbed 2.3%.

[setravis]

On the way to 14000.......
Last time we hit the 13-day MA we started back up.
Doesn't look like sellers are banging down the exit doors.
The other indices look good.The Chinese don't give a s#*# what Alan thinks.

Someone really lit the bulls tail on fire this time !
On the way to 14000.......and I still feel this way...If it will pass 13850 we are good to go !

Technicals
Record Volume.......

Last Price Quote is:
1.08%above 13-day EMA
3.02%above 50-day EMA

[setravis]

Stock Rally Takes a Break.......


6/18/2007


U.S. stocks closed slightly to the downside Monday, as an upturn in oil markets and volatile bond prices had investors taking a breather after three straight sessions of gains.

The Dow Jones Industrial Average surrendered 26.50 points, or 0.19%, at 13,612.98. The S&P 500 was off 1.86 points, or 0.12%, at 1531.05, and the Nasdaq was only 0.11 point lower at 2626.60.

About 2.53 billion shares changed hands on the New York Stock Exchange, with decliners beating advancers by a 6-to-5 margin. Volume on the Nasdaq reached 1.77 billion shares, and losers outpaced winners 8 to 7.

The New York market ended last week with three days of big rises. The Dow finished at 13,639.48, up 1.6% for the five sessions. The S&P went out at 1532.91 after its 1.7% gain, and the Nasdaq closed at 2626.71, a climb of 2% for the week. The gains came as bond yields cooled down after surging in the prior week.

"It was a relatively quiet day after a big run-up last week, and it's encouraging there wasn't a selloff after that," said Robert Pavlik, chief investment officer with Oaktree Asset Management. "With all that's gone on, the stock market will keep an eye on oil and bonds and any [Federal Reserve comments] for the rest of the week, as it doesn't look like we're going to get much else."

In the new session, bond prices swung back and forth. After initially rising and then falling, the 10-year Treasury was again up 3/32 in price, yielding 5.15%. The 30-year bond was unchanged in price, yielding 5.26%.

" [Interest rates] are going up, as the economy seems to be regaining momentum and the first quarter was the only rest the economy was going to get," said Paul Nolte, director of investments with Hinsdale Associates. "The yield curve, for the first time in over a year, is actually ''normal,'' with higher rates for each maturity out to 10 years."

Marc Pado, U.S. market strategist with Cantor Fitzgerald, said "investors are willing to tolerate higher rates if they come with the benefit of stronger growth. The initial surge pushed rates up to 5.33%, causing the market to shift its focus away from a Federal Reserve rate cut."

The economic docket is empty and will be light for the next four sessions. The next report comes Tuesday at 8:30 a.m. EDT, when the Commerce Department will post housing starts and building permits for May.

Elsewhere, July crude topped $69 a barrel to close at its highest mark since September 2006. Oil finished higher by $1.09 to $69.09 a barrel. Metals were also stronger, including a gain for gold of $1.20 to $659.90 an ounce.

Corporate news was light. Among the names in the headlines, Alcoa (AA:) is reportedly being eyed by Australia's BHP Billiton (BHP:) . Alcoa has been pressing to acquire Alcan (AL:) , but it hasn't been able to reach a deal to this point.

Alcoa rose 0.7% to $41.88, and BHP Billiton was higher by 1.3% to $58.60. Alcan shrugged off early weakness and finished up 0.8% to $83.55.

One confirmed merger will see Finish Line (FINL:) buy Genesco (GCO:) for $54.50 a share, or $1.5 billion. Finish Line shed $1.10, or 8.7%, to $11.53. Meanwhile, Genesco jumped $4.15, or 8.4%, to $53.75.

Also on the deal front, Wendy's (WEN:NYSE) said it is pursuing a possible company sale. The fast-food chain also cut its guidance for the year, and shares slid $1.47, or 3.7%, to close at $38.26.

Cephalon (CEPH:) said U.S. regulators approved its drug Nuvigil for treating excessive sleepiness associated with three disorders. However, the development failed to lift shares, and Cephalon was off by $1.22, or 1.5%, to $82.64.

Several firms were issuing upgrades. Citigroup raised its rating for both Blockbuster (BBI:) and Bristol-Myers Squibb (BMY:) to buy from hold. Blockbuster tacked on 2 cents, or 0.4%, to $4.60. Bristol-Myers was lower by 45 cents, or 1.5%, to $30.31.

UBS raised Molson Coors Brewing (TAP:) to buy from neutral, and RBC Capital Markets upgraded Sapient (SAPE:) to outperform from sector perform. Molson was higher by $1.29, or 1.4%, to $93.22. Sapient slumped 37 cents, or 4.6%, to $7.66.

Overseas, stocks rose in Asia, where the Tokyo Nikkei advanced 1% and the Hong Kong Hang Seng surged 2.7%. Europe, however, was mixed. London's FTSE and the Paris Cac were fractionally lower, and Frankfurt's DAX was better by 0.1%.

[setravis]

Stocks Eke Out Gains.......


6/19/2007


Stocks in New York, coming off their first decline since early last week, struggled to find their footing Tuesday but ultimately did close slightly to the upside.

The Dow Jones Industrial Average rose 22.44 points, or 0.16%, to 13,635.42. The index benefited from a 3.2% increase in General Electric (GE:) , which put the stock at a five-year high.

The S&P 500 was up 2.65 points, or 0.17%, at 1533.70, and the Nasdaq tacked on 0.16 point, or 0.01%, to 2626.76.

"We're consolidating close to the highs of last week, but volume has been light and volatility has been low," said Phillip Roth, chief technical market analyst with Miller Tabak. "There's not a lot of upside, but it's not over. There is typical laggard stock participation, including General Electric today, showing that investors are still out there hunting."

About 2.71 billion shares changed hands on the New York Stock Exchange, with advancers beating decliners by a 6-to-5 margin. Volume on the Nasdaq reached 1.89 billion shares, and winners outpaced losers 8 to 7.

On Monday, the U.S. market took a break from the three-session surge that ended last week, edging lower as oil again became part of the equation with a climb past $69 a barrel.

The Dow slipped 26.50 points, or 0.19%, to 13,612.98, and the S&P 500 lost 1.86 points, or 0.12%, at 1531.05. The Nasdaq was fractionally weaker at 2626.60.

Crude prices inched even higher in the new session amid more violence in Nigeria, which hurts the country's oil output. After trading lower, crude rebounded to add a penny and finish at $69.10. Gasoline, meanwhile, was lower by 2 cents at $2.23 a gallon.

Long-term Treasuries, which also have been a main focus for traders, rallied. The 10-year note was up 13/32 in price, yielding 5.08%, and the 30-year bond was higher by 26/32, yielding 5.19%.

In the week's first economic release, the Census Bureau said U.S. housing starts fell a greater-than-expected 2.1% in May to 1.47 million annualized units. On average, economists were looking for new construction to total 1.48 million units.

The report did have a silver lining, as building permits rose 3% to 1.50 million last month, above the anticipated 1.48 million annual pace.

Still, Ian Shepherdson, chief economist with High Frequency Economics, said there was little solace in the housing report.

"The downward trend remains firmly in place, and there is no prospect of any near-term relief, given the huge inventory overhang in the new-home market," Shepherdson said. "Both starts and permits were supported by increases in the multifamily home sector, which tends to be much more volatile than the single-family numbers."

On the corporate side, Yahoo! (YHOO:) said after the prior session's close that Terry Semel is stepping down as CEO and giving up the post to co-founder Jerry Yang. Still, that wasn't enough for Deutsche Bank, which cut its price target on the stock to $26 from $28. Yahoo! shares ended the day lower by 49 cents, or 1.7%, to $27.63.

Best Buy (BBY:) lost ground after the electronics seller posted first-quarter earnings of $192 million, or 39 cents a share, down 18% from a year ago. Results fell short of the Thomson First Call target of 49 cents a share, and the retailer cut its profit outlook for the year. Best Buy fell $2.83, or 5.9%, to $45.18.

On the flip side, shares of Expedia (EXPE:) surged after the Internet travel company said it would buy back $3.5 billion of its own stock. The shares jumped $3.64, or 14.3%, to end the day at $29.14.

Elsewhere, News Corp. (NWS:) and Time Warner (TWX:) received buy ratings at Bank of America, while the firm gave Viacom (VIA.B:) and Disney (DIS:) neutral ratings.

News Corp. added 0.3% to $23.68, and Time Warner rose 1.7% to $21.24. Viacom tacked on 0.2% to $42.94, and Disney finished up 0.6% to $34.76.

Overseas in Asia, the Tokyo Nikkei advanced 0.1%. In Europe, London's FTSE was 0.3% lower, and Frankfurt's DAX was worse by 0.8%.

[setravis]

Are you ready for the long hot summer?
My area we are already in a severe drought...



Stocks Manage Modest Gains.......


6/21/2007


Stocks in New York were all over the map early Thursday, but by the afternoon they had gone positive and stayed that way through the close, recapturing some of the ground they lost during the previous session.

After falling by as much as 90 points earlier, the Dow Jones Industrial Average turned around and rose 56.42 points, or 0.42%, to 13,545.84. The S&P 500 was up 9.35 points, or 0.62%, at 1522.19. The Nasdaq advanced 17 points, or 0.65%, to 2616.96.

"Volatility certainly reigned today," said Jay Suskind, head of institutional equity trading with Ryan Beck & Co. "There's a level of volatility that will give us this type of action because the market can't find its way. With concern over higher interest rates and the subprime mess, there will be this uncertainty that will plague the market for some time to come."

On Wednesday, the market took a late tumble as Treasury prices fell, driving up yields. The Dow sank 146 points, or 1.07%, to 13,489.42, and the S&P 500 lost 20.86 points, or 1.36%, to 1512.84. The Nasdaq dropped 26.80 points, or 1.02%, to 2599.96.

Lately, government bonds were softer. The 10-year note was down 8/32 in price, yielding 5.16%, while the 30-year bond was losing 18/32, yielding 5.28%.

About 2.96 billion shares changed hands on the New York Stock Exchange, with advancers beating decliners by a 6-to-5 margin. Volume on the Nasdaq reached 1.99 billion shares, and winners matched losers.

Energy stocks, which suffered during the prior session, rebounded strongly. Chevron (CVX:) , Hess (HES:) , Marathon Oil (MRO:) and Occidental Petroleum (OXY:) all finished higher by 2.2% or more.

Meanwhile, several deals were in the works or being struck. Canada's BCE (BCE:) , who has talked with potential partners for several weeks, said it has been discussing the chance of a merger with its fellow communications company Telus (TU:) .

BCE added $1.12, or 3.1%, to $37.89, while Telus slid $1.83, or 3%, to close at $58.90.

Luxottica Group (LUX:) is planning to acquire Oakley (OO:) in an arrangement worth $29.30 a share, or a little over $2 billion in total. Luxottica jumped 9.1% to $38.02, and Oakley surged 12.8% to $28.45.

Following the prior close, Dow Jones (DJ:) said its board would take control of negotiations about a possible sale to Rupert Murdoch's News Corp. (NWS:) . Until now, Dow's controlling shareholders, the Bancroft family, have had the lead role in the matter. Dow Jones was lower by 1.6 % to $59.71, and News Corp. tacked on 0.5% to $23.71.

General Electric (GE:) , which said shortly after the midday mark that it would not pursue an acquisition of Dow Jones, finished higher by a penny at $38.80.

Among the Day's research calls, Piper Jaffray downgraded Home Depot (HD:) to market perform from outperform, and Citigroup cut its rating on Prudential (PRU:) to hold from buy. Home Depot closed down 0.2% to $39.95, and Prudential lost 0.8% to $99.51.

On the economic front, the Labor Department said initial jobless claims unexpectedly rose by 10,000 last week to 324,000. Economists had expected claims to come in at 311,000. Elsewhere, the Conference Board said leading economic indicators rose 0.3% in May, slightly above the consensus. The gain helped reverse a 0.5% decline in April.

The Philadelphia Federal Reserve said its manufacturing index for June jumped to a reading of 18.0, more than double expectations.

As for commodities, the front-month August crude contract lost 21 cents to $68.65 a barrel. Gasoline was up by a penny at $2.24 a gallon. Precious metals were weaker. Silver futures fell 16 cents to $13.09 an ounce. Gold futures lost $8.60 to $651.40 an ounce

Overseas, stocks climbed in Asia but eased in Europe. Tokyo's Nikkei tacked on 0.2%, and Hong Kong's Hang Seng jumped 1.3%. London's FTSE slipped 1.2%, and Frankfurt's DAX shed 2.1%.

[setravis]

Stocks Awash in Red.......


6/22/2007


Stocks follow the path of least resistance, and in the absence of much news on the economy and the corporate side, that path was to the downside Friday.

The Dow Jones Industrial Average sank 185.58 points, or 1.37%, to 13,360.26, and the S&P 500 fell 19.63 points, or 1.29%, to 1502.56. The Nasdaq slumped 28 points, or 1.07%, at 2588.96.

An entire week of uneven trading reversed the gains from the previous week. After adding 1.6% last week, the Dow fell 2% over the last five sessions. The S&P 500 lost 2%, and the Nasdaq finished the week down 1.4%.

"One-hundred-point swings on the Dow have become the standard, it seems," said Larry Wachtel, senior market analyst with Wachovia Securities. "The entire month of June has been following this norm. This is part and parcel of a bull market that has been rallying but is overextended and overbought. There's a lack of catalysts, and within this thin atmosphere we're bound to have these swings."

About 3.89 billion shares changed hands on the New York Stock Exchange, with decliners beating advancers by a 3-to-1 margin. Volume on the Nasdaq reached 2.74 billion shares, and losers outpaced winners 2 to 1.

Bond prices jumped in the absence of economic data. The 10-year Treasury was up 9/32 in price, yielding 5.16%, and the 30-year bond was adding 22/32 to yield 5.25%.

Rising energy futures pressured the major indices. Oil was higher by 49 cents to $69.14 a barrel, and gasoline gained 4 cents at $2.28 a gallon.

Precious metals were mixed. Gold was up $2.80 to $657 an ounce, while silver dipped 7 cents at $13.02 an ounce.

Aside from oil-related measures, most subsector indices ended in the red. The Philadelphia/KBW Bank Sector Index was lower by 1.6%, the Nasdaq Biotech Index finished down 1.5%, the Philadelphia Semiconductor Sector Index lost 1.5%, and the Amex Airline Index was off 0.9%.

The S&P Retail Index was also lower, despite a jump in shares of Macy's (M:) on speculation the retailer was an acquisition target. Macy's finished up $2.56, or 6.6%, to $41.43.

Among other names in the news, BP (BP:) is near an arrangement that would see it surrender its interest in a $20 billion natural gas project in Russia to a government-controlled concern. BP ended up 53 cents, or 0.8%, to $69.76.

Back in the U.S., investors finally got a chance to trade private-equity firm Blackstone Group (BX:) , which priced its initial public offering at the high end of the expected range after the prior close. Shares began trading on the New York Stock Exchange, rising as high as $38. Blackstone finished its first day at $35.06, up 13%.

Meanwhile, on the research front, Gap (GPS:) was initiated with an outperform rating and a $24 price target at Friedman Billings Ramsey. At the same time, the firm downgraded Starbucks (SBUX:) to market perform from outperform, took it off the Top Picks list and slashed its target by $18 to $26.

Gap off by 12 cents, or 0.6%, to close at $19.34. Starbucks fell 72 cents, or 2.7%, to $25.54.

Elsewhere, ThinkEquity upgraded Crocs (CROX:) to buy, and Lehman cut Abercrombie & Fitch (ANF:) to equal weight from overweight.

Crocs rose 99 cents, or 2.2%, to $46.91, while Abercrombie lost $2.87, or 3.8%, to $73.71.

Most markets overseas were in the red, but Hong Kong's Hang Seng gained 0.2%. Tokyo's Nikkei slipped 0.3%. London's FTSE and Frankfurt's DAX both eased 0.2%.

[setravis]

More Struggles for Stocks.......


6/26/2007


Stocks in New York closed slightly lower again Tuesday, as a session marked by wild swings through positive and negative territory ended on a down note.

After rising as much as 100 points earlier, the Dow Jones Industrial Average lost 14.39 points, or 0.11%, to 13,337.66.

"Headwinds affecting the market continue to be energy prices and interest rates, as well as housing woes," said Michael Sheldon, chief investment strategist with Spencer Clarke LLC. "The more recent concern has been the problems in the subprime market and spillover into other sectors, and that's making investors very nervous."

The S&P 500 was down 4.85 points, or 0.32%, at 1492.89, and the Nasdaq was lower by 2.92 points, or 0.11%, at 2574.16.

Sheldon added that traders should keep an eye on the June lows for the market, which would be 1490 on the S&P 500, 13,259 on the Dow, and 2541 on the Nasdaq.

"If we move below those levels on a closing basis, we're likely to see a pick-up in selling among jittery investors," he said.

About 3.30 billion shares changed hands on the New York Stock Exchange, with decliners beating advancers by a 5-to-3 margin. Volume on the Nasdaq reached 2.05 billion shares, and losers outpaced winners 8 to 7.

Lower energy prices tempered the pullback, as traders turned their attention away from the Nigerian strike to questions involving Venezuelan production. Crude ended down $1.41 to $67.77 a barrel, and gasoline lost 5 cents to $2.25 a gallon.

Earlier, the Commerce Department said new-home sales fell 1.6% last month to an annual rate of 915,000 units, below economists'' expectations. A hefty downward revision was made to April's figure, which was changed to 930,000 units from 981,000.

In other negative news on the housing front, the S&P/Case-Shiller home-price index showed that prices in 10 major U.S. cities fell 2.7% in April, while homebuilder Lennar (LEN:NYSE) reported an unexpected loss for its recent quarter.

The news comes a day after the National Association of Realtors said existing-home sales for May fell slightly to an annual pace of 5.99 million from a revised 6.01 million in April. The inventory of homes on the market reached a 15-year high.

Ian Shepherdson, chief economist with High Frequency Economics, said there is no evidence the housing market will recover anytime soon.

"We think the underlying rate of decline has slowed, but the direction of sales is still downwards," he said. "The supply problem may now be stabilizing, but it remains huge. The three-month average level of sales has bounced a bit in the past couple of months, but we doubt this marks the start of any sustained recovery."

The Philadelphia Housing Sector Index was lower by 2%. Among individual names, Hovnanian (HOV:) dipped 4.1%, Pulte Homes (PHM:) slid 3.1%, and Centex (CTX:) lost 2.3%.

Elsewhere on the economic docket, the Conference Board said its consumer confidence index fell to a reading of 103.9 in June from 108.0 last month. The latest reading was a 10-month low for the index. Economists had expected a slight decline to 106.0.

Government bond prices eased after the Day's economic releases. The 10-year note was down 5/32 in price, yielding 5.10%, and the 30-year bond was off 8/32, yielding 5.21%. The dollar was losing ground against the world's major currencies.

The market's wobbliness came after a day of wild swings in the prior session. On Monday, stocks rallied in the first half of trading, but it all fell apart in the afternoon. The Dow, for a time up more than 100 points, surrendered its gains and closed with a loss of 8.21 points, or 0.06%, to 13,352.05.

The S&P 500 dropped 4.82 points, or 0.32%, to 1497.74, and the Nasdaq fell 11.88 points, or 0.46%, to 2577.08.

"Technically, the market took a big blow on Friday, [and Monday''s] snapback bounce proved to be little more than a trade and not a major market turn," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "Now we have to focus on what will make this decline accelerate. If we break below these levels, we could see acceleration to the downside."

Back on the corporate side, Lennar tumbled 3.1% after the builder said it lost $244.2 million, or $1.55 a share, for the quarter ended May 31, reversing a profit of $324.7 million, or $2 a share, in the year-earlier period. The latest quarter includes a charge of $1.33 a share. Revenue slumped 37%, and the company also forecast a loss for the third quarter.

Dow Jones (DJ:) could be closer to being taken over, as it's believed to be near a deal with News Corp. (NWS:) that would be aimed at ensuring its editorial operations have certain guarantees under any acquisition. Dow Jones rose 2.2% to $58.77, while News Corp. closed down 0.8% to $23.31.

Altria (MO:) expects to record a charge of $325 million in the second quarter as part of its plan to improve global cigarette production, which will include moving some output overseas. Altria added 88 cents, or 1.3%, to $69.63.

Shares of Target (TGT:) were lower after the retailer said it expects June comp sales to be near the lower end of its previous forecast of a gain of 3% to 5%. Target lost $1.25, or 2%, to close at $62.91.

Among metals, gold dropped $9.40 to $645.30 an ounce, and silver ended down 59 cents to $12.41.

Overnight in Asia, markets were slightly weaker. Tokyo's Nikkei and Hong Kong's Hang Seng each shed 0.1%. As for Europe, London's FTSE slipped 0.4%, and Frankfurt's DAX gave back 0.9%.

Wednesday will feature earnings from retailer Bed Bath & Beyond (BBBY:) and food giant ConAgra (CAG:) .

[setravis]

Fed Statement Leaves Stocks Flat.......


6/28/2007


Stocks ended little changed Thursday after traders dissected a Federal Reserve policy statement that came with a tempered view on inflation but overall few surprises.

The Dow Jones Industrial Average initially spiked after the statement, but it wavered and ultimately closed down 5.45 points, or 0.04%, at 13,422.28. The S&P 500 was off 0.63 point, or 0.04%, at 1505.71. The Nasdaq added 3.02 points, or 0.12%, to 2608.37.

The Federal Reserve Open Market Committee, as expected, kept its fed funds target rate at 5.25% for the eighth straight meeting.

While the FOMC reiterated in its policy statement that the adjustment in the housing sector is ongoing, the Fed altered language when referring to economic growth, now saying that recent indicators showed that "growth appears to have been moderate during the first half of this year."

The Fed also removed the term "elevated" in describing inflation. It said that readings on core inflation "have improved modestly in recent months," but that "a sustained moderation in inflation pressures has yet to be convincingly demonstrated."

Any future rate changes, the Fed said in repeating past comments, will depend on the outlook for both inflation and economic growth, as indicated by incoming data.

"It's no big surprise, but there are a few interesting points," said Steven Sheldon, CFA and principal of SMS Capital Management. "They are aware that housing is a problem, but that the economy is holding up pretty well. It looks as though they're going to continue to be on hold, until the housing sector gets worse or the labor market gets tighter."

Richard Yamarone, director of economic research with Argus Research, said that investors shouldn't expect a change in interest rates from the Fed "for a while."

"If you are a Fed official with the ability to influence monetary policy, you really have to have a compelling argument to increase rates at a time when the most interest rate-sensitive sector is mired in recession," Yamarone said. "Furthermore, the latest developments in the subprime arena and the unknown effect on the hedge fund and financial markets are also good reasons to adopt a wait-and-see approach to policymaking."

Government bonds slipped following the Fed's announcement. The 10-year note was down 9/32 in price, yielding 5.11%, and the 30-year bond fell 9/32 to yield 5.21%. The dollar was little changed against the world's major currencies.

Dampening enthusiasm was a sharp increase in energy prices, as questions swirled around Venezuelan production. Exxon Mobil (XOM:) and ConocoPhillips (COP:) still have not come to an agreement with Venezuela's state-run oil firm allowing the companies to continue to pump there.

After topping $70 a barrel earlier, crude ended the day higher by 60 cents at $69.57 a barrel. Gasoline added a penny to $2.27 a gallon. As for precious metals, gold was higher by $5.60 to $650.40 an ounce, and silver was up 17 cents to $12.37.

Investors also digested new government data that showed the domestic economy performed slightly better during the first quarter than initial reads had indicated. The Commerce Department said gross domestic product rose 0.7% last quarter, up from a preliminary 0.6%, but was still below the 2.5% annual pace in the fourth quarter.

Economists expected a revision to 0.8%. The year-over-year change in inflation was raised to 2.3%, up from 2.2%.

The GDP report was the last of three that will be released on the first quarter.

In another report, the Labor Department said that initial jobless claims fell by 13,000 last week to 313,000. The less volatile four-week moving average rose 1,000 to 316,000.

To date, the Dow has gained 7.7% for the year, the S&P 500 is up 6.2%, and the Nasdaq has risen 8% in 2007. However, for the month of June, the Dow is down 1.4% and the S&P 500 has lost 1.6%. The Nasdaq is flat for the month.

Breadth in Thursday's session weakened a bit and volume was also lower compared to earlier in the week. About 2.79 billion shares changed hands on the New York Stock Exchange, with advancers beating decliners by a 10-to-7 margin. Volume on the Nasdaq reached 1.93 billion shares, as winners outpaced losers 8 to 7.

In corporate news, Capital One (COF:) gained 1.1% after the company said it would eliminate 2,000 positions and restructure some of its operations in a bid to save around $700 million on a pretax basis. The stock rose 87 cents to $79.67.

Elsewhere, Bed Bath & Beyond (BBBY:) and Red Hat (RHT:) posted better-than-expected earnings, and LSI (LSI:) offered a disappointing forecast and said it will cut jobs. Bed Bath & Beyond fell 3.9% to $36.09, and Red Hat slumped 7.5% to $22.37. LSI dropped 11.5% to $7.65.

When the new day arrived, so did more earnings. Constellation Brands (STZ:) beat estimates on an adjusted basis and named Rob Sands as CEO, while General Mills (GIS:) was short of Wall Street's targets and guided lower for the year. Constellation finished up 3.5% to $24.98. General Mills lost 2% to $58.27.

On the research front, Cisco Systems (CSCO:) was upgraded to buy from neutral at Merrill Lynch, with a $31 price target, and Lehman upgraded Intel (INTC:) to overweight from equal weight, lifting its target by $4 to $28.

Cisco added 58 cents, or 2.1%, to $27.85. Intel was higher by 13 cents, or 0.6%, to close at $23.92.

JPMorgan took action on a number of airlines, upgrading Southwest (LUV:) , Alaska (ALK:) , Continental (CAL:) , UAL (UAUA:) , AMR (AMR:) and US Airways (LCC:) .

The firm downgraded small carriers Republic Airways (RJET:) and SkyWest (SKYW:) .

Overseas, stocks rose. Tokyo's Nikkei was up 0.5%, and Hong Kong's Hang Seng climbed 1.1%. London's FTSE was higher by 0.7%, and Frankfurt's DAX rose 1.5%.