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Stock futures point to lower open

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The day after the Fed decided to leave interest rates where they are as signs of economic recovery slowly develop leaves investors wondering when the Fed begins to move rates higher.

This morning's housing data mimics that of the first day of spring. February housing starts jumped 2.8% to a 1.769 million rate, which was higher than the 1.630 million rate economists were looking for. It was the higher level of starts since December 1998. Additionally, building permits climbed 1.8% to 1.752 million in February, also better than economists forecast of 1.650 million.

Despite the more robust housing data that would help build a solid foundation for continued economic recovery, stock futures are drooping lower.

S&P futures are down 5.7 points at 1,168, while NASDAQ futures trade lower by 16 points at 1,494.5 and Dow futures slip 65 points at 10,610.

Fair value for the S&P 500 today is $2.55. HL Camp & Company has their computers set for program buying at $3.51 and set for selling at $1.29. Fair value for the NASDAQ-100 today is $8.00.

Semiconductor book-to-bill rises to 0.87

The chip equipment sector has fresh data to ponder after yesterday afternoon's semiconductor book-to-bill numbers showed that February's North American-based book-to-bill ratio rose to 0.87, up from January's reading of 0.81. A book-to-bill of 0.87 means that $87 worth of new orders was received for every $100 of product billed for the month. Meanwhile, the 3-month average of worldwide bookings in February was up 10% from January, but still a staggering 56% below ratios found in 2001.

Salomon lowers revenue/earnings estimates on Intel

Salomon Smith Barney analyst Jonathan Joseph is lowering his second-quarter revenue and earnings estimates on semiconductor giant Intel (NASDAQ:INTC) based on a lower seasonal outlook. "While still early, we now believe Intel (INTC) could record a modest seasonal decline in second-quarter revenue," Joseph told clients. In addition to the second quarter being the seasonally weakest quarter of the year, he believes it may also be impacted by booking corrections and flat second-quarter prices. Joseph currently has Intel (INTC) rated "buy" with a $45 price target.

Jeff Bailey
Senior Market Technician
Option Investor

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