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Daily Newsletter, Monday, 09/08/2003

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PremierInvestor.net Newsletter                 Monday 09-08-2003
                                                  section 1 of 2
Copyright (c) 2003, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================

In section one:

Market Wrap:      Vote of Confidence
Play of the Day:  Da Bulls

===============================================================
MARKET WRAP  (view in courier font for table alignment)
===============================================================
     09-08-2003            High     Low     Volume Advance/Decline
DJIA     9586.29 + 82.95  9599.34  9503.41 1.62 bln   2012/ 814
NASDAQ   1888.62 + 30.38  1888.65  1863.88 2.02 bln   2115/1014
S&P 100   518.50 +  5.53   518.50   512.49   Totals   2960/3263
S&P 500  1031.64 + 10.25  1032.41  1021.39
RUS 2000  517.13 +  8.26   517.21   509.76
DJ TRANS 2761.68 + 14.39  2777.04  2743.36
VIX        18.79 -  0.58    19.54    18.79
VXN        29.55 -  1.15    31.38    29.50
Total Volume 4,058M
Total UpVol  3,350M
Total DnVol    655M
52wk Highs     913
52wk Lows       17
TRIN          1.14
PUT/CALL      0.67
===============================================================

===========
Market Wrap
===========


Vote of Confidence
by James Brown

Investors continue to cast their vote confidently to the bulls as
the S&P 500 notches a new 15-month high and the NASDAQ composite
claims a new 18-month peak.  Most of the gains were concentrated
in technology and biotech issues but the rally was once again
very broad-based with nearly every sector closing in the green
save for Retail and Gold.  Historically a weak season for the
equity markets this September is proving to be anything but.

The Dow Jones Industrial average added almost 83 points to close
at 9586.  The COMPX rose more than 30 points to 1888 and the SPX
inched up one percent to 1031.  Contributing to the general mood
in the U.S. were positive sessions for the Japanese, English and
German exchanges.  The market internals for the U.S. were
strongly positive with 20 stocks rising for every 8 losers on the
NYSE and 21 winners for every 10 decliners on the NASDAQ.  New
52-week highs were a little less than what we've come to expect
at 463 between the two exchanges but they continue to stomp new
lows, which rang in at 10.  Overall volume could have been
stronger but up volume beat down volume by 3.9-to-1 on the NYSE
and more than 6-to-1 on the NASDAQ exchange.

Chart of the NASDAQ Composite:


Chart of the S&P 500 Index:


Chart of the Dow Jones Industrials:


The weekend headlines were all about the President's request for
another $87 billion to rebuild and defend Iraq and Afghanistan.
Yet when Wall Street opened for business this morning it wasn't
the ballooning deficit on investors' minds.  Instead traders were
more concerned with grabbing their share of the ever-rising tech
tidal wave that has swept away the bulls and bears in recent
sessions.  Shares of IBM lead that charge today after Credit
Suisse First Boston upgraded the stock from "neutral" to "out
perform" while lifting their earnings estimates for 2004 and
raising their price target from $87 to $102.

CSFB believes IBM will be a great candidate to catch any "late-
cycle" I.T. spending and shares of Big Blue added 2.47% to close
just under overhead resistance at $90.  But IBM wasn't the only
news contributing to the 1.7% gain in the GHA hardware index.
Research firm IDC raised its own forecast for the global PC
market this morning.  The firm said Q2 PC shipments were nearly
10% stronger than expected and they raised their estimates for
all of 2003 by 8.3%.

Semiconductor bears are probably still suffering from a wave of
vertigo or is it dij` vu?  It was just last Thursday that UBS
raised their outlook for the chip equipment sector.  Today it was
Smith Barney's turn to lift their outlook on the industry from
"market weight" to "over weight".  The analyst believes that the
improving fundamentals and economic conditions can push industry
revenue growth to 20 percent in 2004 and 30 percent in 2005,
which is a four percent increase from current estimates.
Semiconductors also got a boost this morning when Taiwan
Semiconductor (TSM) said they expect Q3 shipments to rise 10
percent over previous quarters and they see Q4 tracking inline at
Q3 levels.  First Albany came out with several opinions today as
well and one of them was to raise chip stocks Altera (ALTR) and
Xilinx (XLNX) from "neutral" to "buy".

This fresh round of positive chip news was not lost on shares of
Intel (INTC) which added 1.6% after launching two new Itanium 2
chips, which will target low-end servers and put more pressure on
Sun Microsystems' (SUNW) business.  Lastly, shares of
communication chipmaker, RF Micro Devices (RFMD), sprang up over
16 percent after raising its Q2 outlook based on strong customer
activity.

Tech issues were also buoyed by EMC Corp (EMC) who received an
"out perform" rating and a $16 price target from SoundView.
Plus, Nextel Communicatoins (NXTL) reaffirmed its full-year
guidance of $1 a share backed by growing revenues and subscriber
growth.

Out performing the 2.84% gain in the SOX semiconductor index was
the booming biotech index.  The BTK added 3.89% inspired by a 32
percent gain in shares of Regeneron Pharmaceuticals (REGN).  REGN
announced that French company Aventis would pay $125 million down
and up to 50 percent of the profits for REGN's experimental VEGF
Trap treatment to fight cancer.  The deal is estimated to be
worth upwards of $500 million for REGN.  The VEGF trap treatment
uses anti-angiogensis, which blocks blood vessel growth to the
cancerous area.  Shares of Amgen (AMGN) and Genentech (DNA), the
No. 1 and No. 2 biotech firms, respectively, were up strongly on
the day.  DNA previous reported success earlier this year with
their Avastin drug, which also uses anti-angiogensis to treat
colon cancer.

Overshadowed by the big gains in biotech was a strong day for the
DRG drug index.  Last Friday in the Market Monitor I outlined a
bullish breakout of the descending channel in the oversold DRG.X
and suggested that bullish traders who would prefer not chasing
the tech train look here.  Barron's apparently agrees.  Over the
weekend a Barron's article highlighted the low P/E's in the group
combined with the 2% and 3% yields for big caps like Pfizer
(PFE), Merck (MRK) and Johnson and Johnson (JNJ) making them
tempting values, especially compared with to the tech sector.
The news pushed Merck to the top gainer in the Dow Jones
Industrials with a 3.1 percent gain.

The FDA was in a giving mood today as well.  Barr Labs (BRL)
rocketed 8.4% by the close after the FDA approved BRL's Seasonale
Extended-Cycle oral contraceptive.  The new drug can reduce a
woman's menstrual cycle to just four times a year.  Watson
Pharmaceutical (WPI) also received an FDA approval for its
generic version of the Percocet pain reliever produced by Endo
Pharmaceuticals (ENDP).  By the end of the day WPI was up 7.2%,
the DRG.X was up 1.94% and even ENDP added 3.8%.

Last week we continued to suggest that traders needed to stay
sharp because the rally has come so far now that analysts could
start to downgrade stocks based on valuation concerns.  We
started to see a couple of these opinions late last week and
they've begun anew today.  This time the Retail sector was the
main target.  Sanford Bernstein's retail analyst cut their
ratings on Wal-Mart (WMT) and Target (TGT) from "out perform" to
"market perform".  The research note was actually titled "Time to
take some profits" as the analyst felt that these shares had
already priced in a strong second half for 2003 and double-digit
growth for 2004.  This came on the same day that WMT said their
weekly same-store sales are on track to meet their September
goals of 3-5 percent growth.  RBC Capital Markets chimed in with
two downgrades of their own for Gap Inc (GPS) and Ann Taylor
Stores (ANN) from "out perform" to "sector perform".  Lehman
Brothers actually disagreed and felt that the retail sector was
poised to perform well heading into Christmas after the stronger
than expected back-to-school season.

Speaking of end-of-year projections, The S&P Investment Policy
Committee raised their year-end forecast for the S&P 500 from
1030 to 1085 or about +5 percent.  They're really stepping out on
a limb since the SPX closed at 1031 today.  The outlook is based
on improving economic conditions and rising corporate earnings.
However, Smith Barney's institutional equity strategist, Tobias
Levkovich, was less enthusiastic.  Tobias is targeting a year-end
target of 1075 for the S&P 500 but forecasts 2004 will be bearish
with a year-end target of 1025.  Levkovich believes that the
markets will remain range bound and that contrary to popular
belief we are not in a new bull market.

Whatever the long-term outlook is, short-term traders have to
contend with the trend this week.  Honestly, I'm surprised to see
the markets higher ahead of the September 11th anniversary and we
could still see some profit taking in the next couple of
sessions.  Yet until that occurs the best bet may be to just keep
raising your stops on any current profitable positions.  Look for
news on Nokia (NOK) tomorrow with their mid-quarter update and
headlines from the Bear Stearns Healthcare conference, Lehman
Brothers Financial Services conference, and the Merrill Lynch
Media & Entertainment conferences which are all in session
tomorrow.




===============
Play-of-the-Day  ( BULLISH )
===============


Qualcomm - QCOM - close: 42.48  change: +1.28 stop: 39.99*new*

Company Description:
Based on its proprietary CDMA technology, QCOM is engaged in
developing and delivering digital wireless communications
services.  The company's business areas include integrated CDMA
chipsets and system software and technology licensing.  QCOM owns
patents that are essential to all of the CDMA wireless
telecommunications standards that have been adopted or proposed
for adoption by the worldwide standards-setting bodies.
Currently, QCOM has licensed its CDMA patent portfolio to more
than 80 telecommunications equipment manufacturers around the
world.

Why we like it:
Almost.  QCOM almost broke free of its recent congestion zone.
After presenting at the SG Cowen Conference Thursday, QCOM began
gaining.  Friday, prices temporarily broke above the recent
congestion zone, but the midday tech weakness carried QCOM down,
too.

At the conference, QCOM commented that the company expects the
turning point for W-CDMA to occur in 2005.  The company expects
less than 10 million mobile devices to employ that technology in
2004, however.  COO Tony Thornley did not know when China would
be likely the issue the awaited licenses for phone companies to
offer high speed services.  Investors initially reacted by buying
QCOM, sending it higher in after-hours trading, but, during the
overnight Asian session, cell-phone maker NTT DoCoMo said mobile-
phone subscriptions may decline throughout the industry in the
second half of the year.  We waited to see how QCOM would open
Friday morning, and we cheered by an open at the top of the
recent congestion zone.

Like QCOM, the XTC, the North American Telecommunications Index,
printed a candle with a long upper shadow.  Unlike QCOM's, the
XTC's candle came at the top of a rally, and so might have more
bearish implications than QCOM's, which came during
consolidation.  The possibility exists, however, that QCOM forms
a broadening pattern at the top of its recent climb, and
broadening patterns can be typical of market tops.  So far, QCOM
continues to find support just above $40.00, not broadening the
bottom support.

Still, a retreat in the XTC might carry QCOM down, too, so
traders might confirm that XTC finds support near 520 on any
retreat.  The NWX, the Networking Index, printed a doji at the
top of a rally, also signaling that this related index might
retreat to confirm support after its recent rally.

New entries can still be found on a pullback and bounce from
above $40.00, but confirm that support is holding in the XTC and
NWX, too.  Momentum entries can be sought on a breakout above
$42.00, but confirm strength in the same two indices before
entering on momentum.

Why This is our Play of the Day
When QCOM broke out above the $40 level on August 27th, the
bullish prospects looked too good to pass up, and we felt
compelled to add the stock to our bullish playlist, as that was
the first trip over that level since last December.  However, we
knew that a continuation straight up the chart was going to be a
low odds bet due to the fact that price was pressed right up
against the upper Bollinger band.  Simply put, the stock needed
some time to consolidate that breakout, with the Bollinger bands
continuing to expand so that the stock could continue northwards.
Well, we got that consolidation over the past week and today QCOM
blasted higher by 3.1% on pretty solid volume too.  By no means
is the stock out of the bears' woods, as it is right up against
the December 2002 high ($42.89) and then will have to face the
March 2002 highs near $44.  But the technicals are pointing
higher with a quad-top breakout on the PnF chart and a tentative
bullish price target of $55.  QCOM should now find solid support
near the $41 level, with additional support offered by the 10-dma
($40.82).  Intraday dips back near that level should provide for
favorable entry into the play.  Note that our stop rises to
$39.99 tonight, as the bears should not be able to effect a move
back under the $40 level if there is any life in this bullish
move.

Annotated Chart of QCOM:



Picked on August 13th at  $32.99
Change since picked        +2.30
Earnings Date           10/30/03 (unconfirmed)
Average Daily Volume =     886 K



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send email to Contact Support
=================================================================
DISCLAIMER
=================================================================

This newsletter is a publication dedicated to the education
of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
in making an informed decision regarding trading in stocks. It
is possible at this or some subsequent date, the editors and
staff of PremierInvestor.net may own, buy or sell securities
presented. All investors should consult a qualified professional
before trading in any security. The information provided has
been obtained from sources deemed reliable but is not
guaranteed as to accuracy or completeness. PremierInvestor.net
staff makes every effort to provide timely information to its
subscribers but cannot guarantee specific delivery times due to
factors beyond our control.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
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Newsletter, or any Premier Investor Network newsletter please
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Copyright ) 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                  Monday 09-08-2003
                                                   section 2 of 2
Copyright (c) 2003, All rights reserved.
Redistribution in any form is strictly prohibited.

The entire newsletter is best viewed in COURIER 10 for alignment
=================================================================

Split Announcement:   KVA

Closed Plays:         C, STJ

Stop Loss Updates:   WPI, TWR, QCOM

Trading Ideas
  Value Plays With Bullish Signals
  Breakout to Upside (Stocks $5 to $20)
  Breakout to Upside (Stocks over $20)
  Breakout to Downside (Stocks over $20)
  Recently Overbought With Bearish Signals (Stocks over $20)


==================================================================
 Split Trader/ Stock Splits
==================================================================

-------------------
Split Announcements
-------------------


KVA prescribes a 3-for-2 stock split

During today's trading session, KV Pharmaceutical's (NYSE:KVA)
Board of Directors declared a 3-for-2 stock split of its common
shares.

The stock split will be payable on September 29th, 2003 to
shareholders on record as of September 18th.

This is KVA's first stock split since the third quarter of 2000.


About the company:
KV Pharmaceutical Company is a fully integrated specialty
pharmaceutical company that develops, acquires, manufactures and
markets controlled release and tastemasked pharmaceutical products
using proprietary drug delivery and tastemasking technologies. The
company markets its technology-distinguished products through
ETHEX Corporation, a national leader in pharmaceuticals that
compete with branded products, and Ther-Rx Corporation, its
emerging branded drug subsidiary. KV has consistently ranked as
one of America's fastest growing small companies, most recently by
Forbes in its October 2002 issue.

(Source: Company Press Release)

==================================================================
Active Trader - Non Tech Stock Plays
==================================================================

============
Closed Plays
============

  --------------------
  Closed Bearish Plays
  --------------------


Citigroup, Inc. - C - close: 44.52 change: +0.18 stop: 45.00

Our bearish Financial play on C has been on life support for over
a week now, as the stock continues to benefit from the strength
in the overall Banking index (BKX.X)  After gradually working
through its descending trendline, the stock finally tapped the
$45.00 level (exactly) on Monday, ending our misery by stopping
us out of the play.  C was definitely a weakling in the sector,
but the rising tide lifted even this leaky boat.  Use any early
weakness tomorrow morning to exit open positions at a more
favorable level, but don't let it get away from you to the
upside.  Honor those stops.

Picked on August 24th at  $43.10
Change since picked        +1.42
Earnings Date           10/13/03 (unconfirmed)
Average Daily Volume =  12.6 mln



St. Jude Medical - STJ - close: 53.75 change: +1.18 stop: 53.75

Apparently STJ has just been building up a head of steam over the
past two weeks, as the narrow tight-range action over that period
of time broke to the upside with some strength on Monday.
Today's 2.24% gain was the best one-day performance for the stock
since early August and with the move coming on expanding volume,
it's clear that any hope for a downside move has been squashed.
With the stock closing right on our $53.75 stop, there's nothing
to be said except the farewells.  STJ traded above that level
intraday so any open positions should have been stopped out.  But
for those of you holding onto bearish positions, don't let it get
away from you.  Place a stop just over today's intraday high and
use a pullback near the $53.50 level to manage a more favorable
exit from the play.

Picked on August 27th at  $51.80
Change since picked        +1.95
Earnings Date           10/15/03 (unconfirmed)
Average Daily Volume =  2.22 mln




=================================================================
Stop Loss Adjustments
=================================================================

Bullish
------------

WPI - Raise from $39.99 up to $41.10

TWR - Raise from $4.50 up to $4.75

QCOM – Raise from $38.49 up to $39.99


==================================================================
  Trading Ideas
==================

This section contains stocks that meet criteria which may make
them of interest to long and short side traders.  These are not
recommendations, nor have they been reviewed by PremierInvestor
editors for investment potential.  However, each of them has
technical and fundamental characteristics that make them worthy
of further review by traders and investors looking for fresh ideas.
New stocks will appear daily following the market close.

Value Plays With Bullish Signals
---------------------------------
Ticker  Company Name               Close     Change

MRK     Merck & Co                 52.59     +1.59
WYE     Wyeth                      46.36     +1.10
PGN     Progress Energy            42.73     +1.00
CPB     Campbell Soup Co           26.61     +0.75
UCL     Unocal Corp                31.90     +0.82
CEPH    Cephalon Inc               48.40     +1.33
HTCH    Hutchinson Technology Inc  34.51     +1.29
CYD     China Yuchai Int Ltd       18.31     +2.22


---------------------------------------
Breakout to Upside (Stocks $5 to $20)
---------------------------------------

ASML    ASML Hldgs Nv Ny Reg Shs   16.89     +1.16
XMSR    XM Satallite Radio Hldgs   14.58     +1.11
RFMD    RF Micro Devices Inc       10.46     +1.45
SWKS    Skyworks Solutions Inc     12.12     +1.01
PKN     Petrokazakhstan Inc        17.45     +1.12
ABGX    Abgenix Inc                15.67     +2.16
ASTSF   ASE Test Limited Ord Shr    9.75     +1.70


---------------------------------------
Breakout to Upside (Stocks over $20)
---------------------------------------

SNE     Sony Corp                  36.40     +2.65
NAB     National Australia Bank   101.81     +2.39
STM     Stmicroelectronics Nv      27.15     +1.16
CHIR    Chiron Corp                56.35     +1.68
SPC     Saint Paul Companies Inc   36.56     +1.15
CIT     CIT Group CI A             28.90     +1.35
KMP     Kinder Morgan En Prtn Lp   41.74     +1.20
BGEN    Biogen Inc                 40.82     +1.54


-------------------------------------------
Breakout to Downside (Stocks over $20)
-------------------------------------------

CEO     Cnooc Ltd (ADR)            36.23     -1.22
UTSI    Utstarcom Inc              38.49     -4.14
MIK     Michaels Stores Inc        43.30     -1.46
HU      Hudson United Bancorp      36.27     -1.53
RGLD    Royal Gold Inc             23.43     -1.14
AMWD    American Woodmark Corp     48.20     -2.34


-----------------------------------------
Recently Overbought With Bearish Signals (Stocks over $20)
-------------------------------------------

DOX     Amdocs Ltd                 21.21     -0.64
APH     Amphenol Corp              54.80     -0.35
FDP     Fresh Del Monte Produce    26.30     -0.70
MANH    Manhattan Associates Inc   31.30     -1.00
JASA    Jo-Ann Stores Inc          29.10     -1.30
MOV     Movado Group Inc           23.00     -0.55
AIP     American Israeli Paper     42.00     -4.25
JAS-B   Jo-Ann Stores Inc CI B     25.08     -1.12



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To stop receiving this PremierInvestor.net Newsletter,
send email to Contact Support
=================================================================
DISCLAIMER
=================================================================

This newsletter is a publication dedicated to the education
of stock traders. The newsletter is an information service
only. The information provided herein is not to be construed
as an offer to buy or sell securities of any kind. The
newsletter picks are not to be considered a recommendation
of any stock but an information resource to aid the investor
in making an informed decision regarding trading in stocks. It
is possible at this or some subsequent date, the editors and
staff of PremierInvestor.net may own, buy or sell securities
presented. All investors should consult a qualified professional
before trading in any security. The information provided has
been obtained from sources deemed reliable but is not
guaranteed as to accuracy or completeness. PremierInvestor.net
staff makes every effort to provide timely information to its
subscribers but cannot guarantee specific delivery times due to
factors beyond our control.

Please read our disclaimer at:
http://www.optioninvestor.com/page/oin/aboutus/disclaimer.html

*****************************************************************
ADVERTISING INFORMATION

For more information on advertising in PremierInvestor.net
Newsletter, or any Premier Investor Network newsletter please
contact Contact Support.

*****************************************************************

Copyright 2003  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.

DISCLAIMER

Option Investor Inc is neither a registered Investment Advisor nor a Broker/Dealer. Readers are advised that all information is issued solely for informational purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy, nor is it to be construed as a recommendation to buy, hold or sell (short or otherwise) any security. All opinions, analyses and information included herein are based on sources believed to be reliable and written in good faith, but no representation or warranty of any kind, expressed or implied, is made including but not limited to any representation or warranty concerning accuracy, completeness, correctness, timeliness or appropriateness. In addition, we do not necessarily update such opinions, analysis or information. Owners, employees and writers may have long or short positions in the securities that are discussed.

Readers are urged to consult with their own independent financial advisors with respect to any investment. All information contained in this report and website should be independently verified.

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