Trading curbs are in as the Dow Industrials (INDU) 9,163 +1.35% holds a 122-point gain and off its session high of 9,215.88 with fast food retailer McDonalds (NYSE:MCD) $21.05 +9.18 leading component gains after the company said it saw a 2.2% rise in global May comparable unit sales and a 6.3% rise for the U.S. The news has ignited today's bullish enthusiasm as some analysts covering the stock were expecting slightly negative global comparables.
Shares of Yum! Brands (NYSE:YUM) $28.94 +1.9%, which operates several fast food chains and profiled as bullish in our past intra-day commentary after triggering a triple-top buy signal at $26.00 and breaking above downward trend is benefiting from today's news out of McDonalds. The bullish vertical count column for YUM continues to grow and currently builds to a longer-term price objective of $44. As of last night, Dorsey/Wright and Associates' Restaurant Sector Bullish % (BPREST) was reading "bull confirmed" at 61.82% and as it relates to the more overbought level of 70%, may offer bulls a more attractive sector risk profile and field position for further gains.
Sector action is broadly positive, but we're starting to see some sectors begin to show fractional losses with the Gold/Silver Index (XAU.X) 76.99 -0.91%, Dow Jones Home Construction (DJUSHB) 451.87 -0.78%, Oil Service (OSX.X) 96.91 -0.66%, Oil Index (OIX.X) 278.40 -0.23% and the Dow Jones Transportation Index (TRAN) 2,507 -0.17% the sectors I currently show in the red.
An early surge in the Biotechnology Index (BTK.X) 502.76 +2.44% to a morning high of 514.11 has faded a bit as Biogen (NASDAQ:BGEN) $47.77 -2.66% reverses from a session high of $50.52 after the company reaffirmed full-year 2003 guidance for revenue growth in the mid-teens and EPS of $1.72-$1.85, but reiterated that the company expects current quarterly earnings to be uneven during 2003 as the company continues to drive the launch of its Amevive and Phase III clinical trials of Antegren.
The broader S&P 500 Index (SPX.X) 996.50 +1.05% holds a 10.5- point gain, but off its highs of 1,007.69 and brief piercing of our MONTHLY R2 of 1,006.50. While trading curbs were in place on the test of MONTHLY R2, it would still be my thought that this was a logical level that some pit traders note as a level to take some gains. Current trade is right at today's DAILY R2 of 998.15 and when looking at our Pivot Matrix, was the next closest level of support after a test of MONTHLY R2.
The NASDAQ-100 Index (NDX.X) 1,245 +1.12 shows a 14-point gain currently, with its Tracking Stock (AMEX:QQQ) $31.00 +1.93% now at the lows of the session. Tech sector action has the GSTI Software Index (GSO.X) 134.54 +3.87% as today's current sector winner. Shares of PeopleSoft (NASDAQ:PSFT) $18.49 +22.4% lead the sector's gains after Oracle (NSADAQ:ORCL) $13.10 -1.94% made an unsolicited offer to buy PSFT for $16.00 per share.