While off their highs of the session, the major indexes hold gains with the Dow Industrials (INDU) 8,108 holding a 53-point gain, S&P 500 Index (SPX.X) 859 showing a 3.5-point rise and NASDAQ-100 Index (NDX.X) 987.78 holding a 4.8-point gain after this morning's economic data that showed a 1.2% jump in construction spending, and an ISM Index reading of 53.9%, which shows some growth in the manufacturing sector.
All of the major indexes did trade today's R1 from daily pivot analysis, but have edged back off of their best levels of the session, with session highs coming at approximately 11:00 AM EST, when traders at the NYSE observed 2-minutes of silence in memory of the seven astronauts onboard the Space Shuttle Columbia.
At 10:00 EM EST, stocks moved to their best levels of the session after the Institute for Supply Management said its closely watched ISM Index fell to 53.9% from a revised higher 55.2% in December (preliminary was 51.3%), but had January's 53.9% coming in slightly above forecast. Still, the slight rate of decline in manufacturing activity from December to January was closely matched with economist's expectations. Both December's and January's reading above 50% indicate modest expansion or growth of business activity at the industrial level.
Other economic data released at 10:00 AM EST that gave a lift to the major indexes had the Commerce Department reporting that construction spending rose 1.2% in December to $848 billion, the biggest gain since last February. However, the Commerce Department noted that total construction spending for 2002 was just 0.4%, the slimmest amount of growth since 1991.
Many economist's say that the ISM data was still "rather good" despite a big run-up in December, that many thought might be a statistical fluke. While construction spending can be volatile and impacted by weather patterns across the U.S., two strong months in a row is considered a bullish sign for the economy.
A quick update on some of the "aerospace" stocks mentioned earlier this morning and Saturday have Dow component Boeing (NYSE:BA) $31.07 -1.65% trading lower on 2 million shares, which is close to matching average daily volume of 2.5 million shares. Lockheed Martin (NYSE:LMT) $49.98 -2.13% is holding above in November-January lows of $48.65 with 1.6 million shares trade, also heavy considering average daily volume of 2.4 million shares. Hardest hit among those stocks with some space shuttle program exposure is Alliant Tech Systems (NYSE:ATK) $48.78 -10% on volume of 3.3 million share, which exceeded average daily volume of 392,000 shares by a factor of nearly 10. The broader Defense Index (DFX.X) 147.95 -0.25% trades down just fractionally.
Internet auctioneer eBay (NASDAQ:EBAY) $74.34 -1.07% is off fractionally. This weekend the company removed offers to sell debris from the Space Shuttle Columbia from its auction site. The company said "In addition, eBay will cooperate fully with law enforcement agencies requesting information about users attempting to list illegal items." It should be noted that NASA is a government entity and all pieces of debris are owned by the Federal government. Any collection of debris would be deemed steeling of government property and potentially becoming a federal offense.
Shares of Cisco Systems (NASDAQ:CSCO) $13.54 +1.25% are this morning's most actively traded stock ahead of tomorrow's fiscal second quarter earnings release. Technicals had the stock back above its longer-term 200-day SMA earlier this morning and currently trading right back on this trending lower moving average. Analyst's polled by Multex look for the company to reports EPS of $0.13 per share (excluding charges), compared to a 9-cent gain in the same period a year ago.