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Stocks remain under pressure

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Stocks attempted a rally in the last two hours of trading as the Dow Industrials (INDU) 9,049 -0.65% got back within 12 points of yesterday's close, but the 9,100 level looks to have been a near- term point of contention for a push higher.

Stocks seemed to get a bit of a boost late this afternoon on word that S&P upped newly IPO'd CIT Group's (NYSE:CIT) $22.22 -3.39% senior unsecured debt to A from BBB+. CIT rallied back close to today's offering price of $23 on the news, but like the Dow Industrials, has pulled back from it best afternoon levels. CIT Group (CIT) is today's most actively traded stock on the NYSE at 63.6 million shares traded. That's nearly 1/3 of today's 200 million share offering.

Shares of WorldCom (NASDAQ:WCOME) $0.06 are once again the most actively traded stock on the NASDAQ Composite, once again testing the computerized trading platform at a brisk 562 million shares, but well off yesterday's staggering 1.5 billion share pace.

Runner up in volume today on the NASDAQ Composite for most active are shares of networking giant Cisco Systems (NASDAQ:CSCO) $12.52 -4.3% as investors contemplate reduced IT spending among corporations and today's cutting of earnings estimates from Salomon Smith Barney.

Volume on the two major exchanges is brisk today with NYSE volume currently at 1.4 billion shares, and NASDAQ volume just over the 2 billion share mark.

Breadth is decidedly negative today with decliners outnumbering advancers by a 3 to 1 margin on the NYSE and similar 3 to 1 negative breadth at the NASDAQ.

All of the indexes I follow on a daily basis are in the red with Semiconductors (SOX.X) -4.81%, but still trading above their September lows of 343.93, Fiber Optic (FOP.X) -4.44% and Internet (INX.X) -4.38% leading sector losers.

The Treasury bond market is now closed, but saw bullish action today. The benchmark 10-year YIELD ($TNX.X) finished its trading session with a YIELD of 4.74%, just off its lowest YIELD level of the session which was 4.731%. Still a very defensive posture with this bond's YIELD below the 4.801% level.

Jeff Bailey
Senior Market Technician
Option Investor

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