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Stocks firm despite lackluster earnings

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The broader market averages are rather firm this morning as the Dow Industrials (INDU) trades higher by 65 points lead by gains in Du Pont (NYSE:DD) $43.88 +2%, Walt Disney (NYSE:DIS) $21.67 +2.2% and Minnesota Mining and Mfg. (NYSE:MMM) $112 +2.3%.

Sector weakness from this morning can still be found in the GSTI Software Index (GSO.X) -2%, Networking (NWX.X) -1.7%, Disk Drive (DDX.X) -1.4% and Retail (RLX.X) -1%.

One index I continue to monitor closely as it plays into the scenario for a longer-term bullish economic environment is the Dow Transportation Average (TRAN) 2,758 +0.38%.

Dow Jones Trans. Average - Weekly chart

Traders/investors that like to put together scenarios and then measure them with what the various indexes are doing are closely monitoring and placing some bets in the transports. I'm expecting good support on any pullbacks in this index at the 2,590 and my case for a bullish economy going forward would be in place as long as this group trades above the 2,590 level. Right now, I think we're about half way in making a firm decision on economic growth going forward, but a move above the 2,933 level may have this group telling us that things are picking up on the economic growth front.

Trucking stocks sorted by volume

Railroad stocks sorted by volume

Air Freight stocks sorted by volume

Airline stocks sorted by volume

This isn't all of the various transportation stocks, but if a subscriber will either print these out for future reference or jot down some stock symbols in their logbooks, they'll have them handy for future reference.

Added to my long list of things to do is to get a section on the web site that has a list of the various stocks the make up the different indexes. Many times, a subscriber can visit the different web sites of the AMEX (www.amex.com) Standard and Poors, CBOE and PHLX to find the various sectors and their components too.

Jeff Bailey
Senior Market Technician
Option Investor

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