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Metallica!

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I was never a "heavy metal" fan in my youth, but bulls were nodding their heads to a bullish beat for anything with a metallic taste, be it ferrous, non-ferrous, or precious.

Nucor (NYSE:NUE) $90.50 +4.72% erected itself to close at a new all-time high and helped lead the Dow Jones U.S. Steel Index (DJUSST) 132.19 +4.92% to challenge its recent all-time closing high of 132.79 from September 9.

Intermediate steel processor, Steel Technologies (NASDAQ:STTX) $25.72 +13.75, which serves industrial customers who require steel of precise type and thickness looks like a cat on a hot tin roof.

Money managers scrambled to show a little copper exposure in their portfolios by quarter's end with Phelps Dodge (NYSE:PD) $93.60 +4.76% surging more than $4.00 per share to close at an all-time high.

Dow component Alcoa (NYSE:AL) $32.70 +4.27% held of a late charge from heavy equipment maker Caterpillar (NYSE:CAT) $76.90 +3.33%, which upped full-year revenue guidance on strong global demand for its earthmoving equipment. Alcoa's chief rival Alcan (NYSE:AL) $47.24 +4.9% surged more than $2 per share as bulls popped the top on a cold one.

All this, with the dollar little changed against its weighted basket of 6 major foreign currencies as the U.S. Dollar Index (dx00y) 88.14 -0.16% edges down 0.15 points and traded pretty much smack in the middle of its daily range.

U.S. Market Watch - 09/28/04 Close

The AMEX Gold Bugs Index ($HUI.X) 223.89 +3.64% edged out the Airline Index (XAL.X) 42.55 +3.32% for today's sector winner, afer Newmont Mining (NYSE:NEM) $44.29 +3.96% assured investors that gold reserves at two of its mines in Ghana were expected to rise 33% from last year's estimates as step-out drilling continues.

A second-consecutive earnings warning this month from network chipmaker Cypress Semiconductor (NYSE:CY) $8.60 -3.26% has the NWX.X and SOX.X looking like a matched pair the past 5 sessions, with both indices down just over 7.2%. Cypress closed at a new 52-week low.

After the close, chip equipment giant Applied Materials (NASDAQ:AMAT) $16.21 -1.21% refused to make any comment toward an unsolicited mini-tender offer being made by TRC Capital Corp., a Toronto-based company to purchase up to 6 million shares of AMAT's stock (roughly 0.35% of shares outstanding) as of August 1, for a price of $16.15 per share in cash.

According to reports, TRC made the offer on 09/22/04 when AMAT's shares had closed at $17.11.

Market Snapshot / Internals - 09/28/04 Close

The major indices found their lows not long after today's release of September Consumer Confidence, and with little "good news" released just prior to 03:00 PM EDT when Caterpillar (NYSE:CAT) raised full year revenue guidance, one might envision some institutional window dressing taking place ahead of Thursday's close as the third-quarter draws to an end.

Pivot Matrix -

The SPX/SPY as well as the OEX all kissed their WEEKLY S1s just after the Conference Board released its September Consumer Confidence (96.8 vs. Aug. 98.7 and forecasted 99.5), but bulls, perhaps aided by some end of quarter window dressing pressed the SPX higher to the close.

S&P 500 Index Chart - Daily Intervals

It was speculated that when the SPX didn't break below its 50-day SMA that buyers showed renewed optimism ahead of tomorrow morning's final second-quarter GDP figures, where economists' expect a modest upward revision to 3.0% from 2.8%.

As of today's close, the SPX is down 2.7% from its second-quarter close of 1,141.

Not unlike equities that found a dip lower after the consumer confidence figures, Treasury yields reversed off their lows of the session. Economists look for the second-quarter chain deflator to be unrevised at up 3.2% from the previously reported 3.2%.

Russell 2000 Index (RUT.X) - Daily Intervals

The small caps of the Russell 2000 ($RUT.X) were today's percentage gainer and many of these components are more thinly traded. IF we're seeing some end of quarter window dressing by institutions, then it might make sense that some of these smaller to mid-cap names get the bigger buy side boost.

Pacholder High Yield (PFH) - Daily Intervals

Traders and investors should still be keeping a close eye on a "junk bond" type asset class. There are some similarities present TODAY in the RUT.X as found in the PHF back in July as the PHF reclaimed its 200-day SMA, slipped back below, then powered further higher. A steady Fed interest rate policy has been kind to "junkers." While I don't expect any surprises in tomorrow's GDP revisions, it doesn't hurt to be prepared.

Jeff Bailey

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