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Mixed market ahead of President Bush's "Wall Street" speech

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Stocks are mixed this morning as investors await President Bush's scheduled 11:15 AM EST speech in which many expect the President to announce that he plans to seek longer jail terms for corporate criminals and boost funding for the Securities and Exchange Commission as part of a plan to restore an "ethic of corporate responsibility."

This morning's market action depicts that of an uncertain and even untrusting type of market environment, as the US$ Index (dx00y) 105.78 -0.47% sinks to new yearly lows and gold stocks as depicted by the Gold/Silver Index (XAU.X) 75.28 +3.76% leads the morning sector winners list.

The Dow Industrials (INDU) 9,275 +0.01% has been teeter tottering on either side of unchanged this morning with strength seen in Microsoft (NASDAQ:MSFT) 54.35 +2.7%, Caterpillar (NYSE:CAT) $48.46 +1.27% and American Express (NYSE:AXP) $37.36 +0.97 being offset by weakness in Eastman Kodak (NYSE:EK) $27.39 -2.25%, Coca Cola (NYSE:KO) $56.37 -1.58% and Intel (NASDAQ:INTC) $18.21 -1.45%.

Shares of Retek Inc. (NASDAQ:RETK) $7.07 -59% were hammered lower after the retail-management software company warned that third- quarter and full year earnings would miss estimates.

Retek Inc. Chart - $1 and $0.50 box

The chart of RETK (prior to today's action) is the type of point and figure chart I think bears should be looking for. The bearish vertical count of $8 gave some downside room and hinted that there might be some downside to be had in the stock. The recent "rally" to $20 from a spread-triple-bottom sell signal at $17 gave bears plenty of up-ticks to get short before today's bad news.

Today's earnings warning from Retek (RETK) follows last week's earnings warning from JDA Software (NASDAQ:JDAS) $12.20 -21% and has shares of Manhattan Associates (NASDAQ:MANH) $20.84 -25.88% under heavy selling pressure today as investors fear a potential warning form that retail-management software maker is in the wings.

Jeff Bailey
Senior Market Technician
Option Investor

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