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Daily Newsletter, Tuesday, 10/14/2003

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PremierInvestor.net Newsletter                Tuesday 10-14-2003
                                                   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:      187 and Counting
Watch List:       SANM, TGT, XL, SPW and more!
Market Sentiment: What's New?

=================================================================
MARKET WRAP  (view in courier font for table alignment)
=================================================================
      10-14-2003           High     Low     Volume Advance/Decline
DJIA     9812.98 + 48.60  9812.98  9732.31 1.57 bln   1831/1358
NASDAQ   1943.19 +  9.70  1043.33  1922.82 1.75 bln   1958/1162
S&P 100   523.30 +  2.33   523.31   518.70   Totals   3789/2520
S&P 500  1049.48 +  4.13  1049.49  1040.84
W5000   10211.14 + 43.40 10211.14 10126.80
RUS 2000  531.84 +  4.27   531.88   525.78
DJ TRANS 2881.66 +  6.90  2890.38  2857.44
VIX        17.37 -  0.18    17.79    17.20
VXO (VIX-O)19.39 +  0.06    19.95    19.05
VXN        26.49 -  0.28    27.33    26.31
Total Volume 3,569M
Total UpVol  2,301M
Total DnVol  1,187M
52wk Highs  967
52wk Lows    18
TRIN       1.12
NAZTRIN    0.51
PUT/CALL   0.70
=================================================================

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


187 and Counting

The Dow managed to climb another +48 points in front of the
Intel earnings announcement and is now only 187 points away
from Dow 10,000 once again. The Nasdaq, not to be outdone,
added +9 to 1943 and only 57 points away from NAZ-2000. But,
putting them all to shame was the Russell-2000 which tacked
on +4.27 and closed near 532.00 and a three year high. This
is a very bullish move and suggests that fund managers are
not afraid of the next two weeks and are putting money into
the market.

Dow Chart


Nasdaq Chart


S&P 500


The good news just kept rolling in and started with the
California Manufacturing Survey. The headline number rocketed
to 63.3 for the 3Q from 47.5 in the 2Q. If California is
growing in the manufacturing area can the rest of the country
be far behind? After two quarters of declines, a number under
50, this was a very strong rebound. The high tech component
rose to 71.3 from 43.4 and employment showed strong gain to
51.5 from 39.6. New orders had a huge jump to 72.3 from 47.1.
Great news for Arnold that he is taking control just as the
momentum turned.

Elsewhere the Kansas City Fed Manufacturing Survey jumped
to 31 for September from only 20 in August. Unlike the CA
survey any positive number is an increase in conditions and
a negative number a contraction. Only prices received still
lingered at -1 and negative. The headline number was a multi
year high and well above any recent readings. Production,
shipments and new orders all jumped significantly and even
job growth grew slightly. Unfortunately the Kansas District
Surveys tend to be on the bullish side so this report was
well received but not overly so.

In the Richmond District the news was not as good. The same
manufacturing survey for that district turned negative with
a headline number of only -7 and down from the flat line
last month. The only improving components were the backlog
of orders which improved to a still negative -14 and the
six month outlook which improved to 33 from 31. The employee
component dropped -11 points to -22 and the lowest level
since Dec-2001. The overall report clearly showed a
declining manufacturing sector in the Richmond district.

The Weekly Chain Store Sales fell -0.5% for last week and
the Bank of Tokyo was quick to revise the outlook for Oct
down to +3.5% from the +4.5% to +5.0% just last week. The
outlook for a consumer led recovery in the 4Q is slowly
fading and all hopes are for businesses to pickup and take
control. Unemployment is still high and shrinking claims
checks are hurting the consumer base.

Over all it was a very positive day. JNJ announced strong
earnings and beat the street with pharmaceuticals up +13%
and medical devices up +20%. Merrill Lynch beat the street
by +18 cents but mostly on cost cutting from about -20,000
jobs over the last two years, -400 last quarter. Bank of
America posted earnings of $1.92 as mortgage fees tripled.
BAC took a charge of $100 million to cover mutual fund
probe expenses. BAC said the consumer sector was stronger
than they had expected and a major drop in loans due to
the higher mortgage rates had not occurred. While these
numbers were outstanding Merrill warned that the good
times might not last. They said investor sentiment was
very strong and that was one reason they were expecting a
substantial correction in the 4Q. First Data reported
earnings that were inline with estimates but took a hit
on broker comments that the internals were weaker than
expected. FDC specializes in payment systems with its
Western Union unit growing +14%.

The big news of the day was Intel after the close. They
beat estimates by +2 cents and revenue by +.08 billion.
They guided to $8.1-$8.7 billion for the current quarter
compared to prior estimates of $8.32 billion. The median
of their current estimates would be $8.4 billion so this
is a slight increase. The key number was the estimate that
gross margins would be around 60%. It was 58.2% in the 3Q.
Intel's earnings grew +15% over last quarter and Andy Bryant
said that was the highest 3Q growth rate in over 25 years.
The company reported record shipments of processors, chipsets
and motherboards. They said the most demand was from Russia,
India and China. They said the mature economies like the
U.S. were growing much slower. Intel said it was growing
market share in most sectors due to the absence of strong
competition. Profits for the 3Q was more than double the
same quarter in 2002 and highlights the weak comparisons
across the tech sector. Flash memory revenue fell nearly
-25% due to a weak market and strong competition in that
product line. With profits of $1.7 billion for the quarter
and estimates of something over $2 billion in the 4Q it
would appear Intel is firing on all cylinders. On the
conference call Andy Bryant was pounding the soapbox on
their performance. The initial news had some analysts
pegging $45 as a fair value for their stock based on the
current earnings ramp. For the economic outlook Intel
said PC unit growth was only modest and their earnings
came from a higher value processor mix rather than a flood
of new PCs. Intel said it was an "orderly market" and there
was no rush to buy and no real inventory buildup.

Other chip companies reporting after the bell were NVLS,
LLTC and PWAV. NVLS reported earnings of +0.04 cents when
estimates were flat. NVLS said they expected bookings to
increase +5% to +10%. LLTC reported earnings that beat the
street by a penny and said demand was improving in all
markets. PWAV missed estimates by a penny but affirmed
guidance for the 4Q. PHG announced before the open and
beat earnings estimates but cautioned that the consumer
outlook for the 4Q could be weak.

The net of all the chip/tech earnings was that business was
improving but at an orderly, (read slow), rate into the
4Q. Most quarterly guidance was for a seasonal +5% to +8%
growth rate. Definitely not a blowout. Intel is winning the
profit battle because they have no real competition and
they are keeping the prices high for their high performance
chips and those are the chips most vendors are buying. The
cheap chips do not appear to be moving well. I read that
as businesses are adding sparingly and the consumer market
is still weak. Also, the majority of the gains were not in
the U.S. but in Europe and Asia. That means our economy is
still in the slow growth mode.

Two Fed heads spoke today and Bernanke was quoted as saying
that growth in 2004 should be in the 4% range. That is well
below the generally accepted +5% to +6% rates making the
rounds. He qualified the statement saying it could be higher
IF inventory rebuilding or a strong pickup in the economies
of our trading partners occurred. He repeated the lack of
job growth problem and said the timing of a recovery in jobs
was still unclear. The main tone of his speech and that of
Ferguson was that deflation was less of a problem than before.
They said inflation was still tame but the shifting of focus
away from the deflation worry immediately magnified the
inflation concerns. They both went out of their way to stress
that the Fed would remain neutral for some time. Many Fed
watchers feel the 1Q may be the trip wire for a rate hike
despite their continued denial. If the Q4 shows any major
gains in the economy most feel they will be hard pressed to
prevent hiking rates by March. This put pressure on bonds
and helped keep the markets in check until late afternoon.

Contrasting the +4% official Fed growth targets, Goldman
Sachs raised their growth rates to +6.5% for 2004 and up
from +5%. This is an incredible jump and indicates the
bullish sentiment already in the market. This contrasts
with a comment by John Chambers in Geneva where he said
"the IT recovery is muted and customers remain in a show
me state." The recovery is going to be impacted by rising
oil which traded over $32 today and the rising interest
rates. How much they will impact the recovery is unknown.

Tomorrow we get earnings from GM and IBM, both Dow components
and IBM could be a challenge for the tech sector. Several
analysts went on record today as expecting IBM to downplay
the recovery and possibly warn that IT spending was still
very light. IBM is the leading indicator for how larger
companies are investing in capex. If that large expenditure
component has not triggered then analysts will start pushing
recovery estimates into 2004 and writing off the 4Q. That
may be hard to do in the face of the Intel earnings but
there was no real table pounding on business demand by
Intel.

Russell 2000


S&P Small Cap Index


The markets responded well today and the Dow close over
9800 was a key event. There is no material resistance
between us and Dow 10,000 other than the IBM earnings. The
market is very bullish and sentiment is strong across all
sectors. Earnings are coming in strong and investors are
racing to place bets. The strongest indication of sentiment
by the funds is in the Russell-2000. This index of small
cap stocks would be the most volatile and most in danger
of any October drop. Instead of trading cautiously it set
a new three year high at 530 and showing no signs of any
weakness. The S&P Small Cap Index closed at 255 and is
very close to an all time high. This is very bullish
considering the calendar. If funds are buying heavily in
the small caps before the fund year end in two weeks then
there is the possibility that we are not going to see any
massive fund selling after option expiration.

With IBM tomorrow plus more than 100 other companies and
another 225 reporting on Thursday we will be buried with
reports. The flood of earnings across all sectors this week
will give investors a clear picture of the 4Q without having
to wait for the next three weeks of earnings to unfold.
With options expiration on Friday and nearly half of the
S&P earnings over this week it sets up a dangerous period
for next week. Once the expectations component expires with
the passage of earnings there is nothing left to pull buyers
off the sidelines.

On Sunday I suggested we could see an attempt on Dow 10,000
by Thursday and it looks like that could easily come to
pass. The Dow has gained nearly 500 points in the last ten
sessions and the Nasdaq is following suit. The S&P has the
closest near term resistance at 1050 but with futures rising
in after hours it appears that resistance will be broken at
the open. The bullish percent on all the major indexes is
approaching recent extreme highs once again. The difference
is that the oscillators for those indexes are actually rising
and could do so for several more days. My outlook from last
week is still the same. Should we actually touch Dow 10000
and Nasdaq 2000 I am betting we will see some immediate profit
taking. I would plan on it and either bail from long positions
as we near that level or at lease snug up your stops and
consider some index puts. Should we break that level the
Dow has further resistance at 10100, 10300, and 10500.
Without some really blowout guidance over the next couple
days it may be really difficult for the Dow to move much
above the 10,000 level. We are very extended, especially
over the last ten days and once earnings are over we could
see some consolidation before pressing higher. The October
roller coaster is coming to the top of that long first hill.
We can't see the other side yet so we don't know if it is
another hill or a cliff. Enjoy the ride and keep those
seatbelts fastened.

Enter Very Passively, Exit Very Aggressively!

Jim Brown
Editor



==================================================================
WATCH LIST
==================================================================

The PremierInvestor.net watch list is not designed to be read
as full fledged stock picks.  Rather we would prefer to offer
it as an extra tool in today's investor toolbox.  Think of it
as a radar screen with your own radar operator pointing out
interesting developments, technical patterns or potential plays
that you may or may not have seen on your own.  Due to time
constraints we do glance at the news but rarely do we have
time to fully read pertinent news stories, due background
research and other necessary screens that investors should do
before making a decision.  A common exercise is to read the
entry, glance at the sector and other stocks in that industry
and then compare what's happening in the stock to what's
happening in the broader market indices.  We hope you enjoy
the Watch List and that it proves to be a useful tool for your
own trading success.

STOCKS WORTH WATCHING
---------------------------------

Sanmina-SCI Corporation - SANM - close: 10.83 change: +0.13

WHAT TO WATCH: Entry setups don't get much better than this!
SANM has been banging on the $11.00 resistance level with
increasing regularity while maintaining its consistent trend of
higher lows.  With just over a week until earnings (10/23), a
breakout over $11 looks like an ideal momentum entry for a run at
next solid resistance in the $13.00-13.50 area.




---

Target Corp. - TGT - close: 40.67 change: +0.56

WHAT TO WATCH: In late August TGT made a serious run over $40,
but couldn't hold it, coming back to confirm strong support in
the $37-38 area.  Now, with the Retail index surging to new
highs, TGT is back over $40 and looking like it is headed for new
highs.  A dip and rebound from the $40 level looks like a good
entry strategy in anticipation of a breakout over $42 and a
possible run at $44 ahead of earnings in November.




---

XL Capital Ltd. - XL - close: 79.76 change: +0.55

WHAT TO WATCH: Insurance stocks have been surging higher lately,
with the Insurance index (IUX.X) breaking above the $280
resistance level.  Shares of XL have been chipping away at the
$80 resistance level over the past couple weeks and a breakout
looks imminent.  Use an entry trigger just above $80 and use an
upside target of $84 ahead of earnings on October 29th.




---

S P X Corp. - SPW - close: 50.32 change: +0.72

WHAT TO WATCH: Turned back from just above $50 in early
September, shares of SPW are making another convincing run at
that resistance level, helped along by the broad market strength.
Use an entry trigger above $50.75 and look for a run into
earnings to carry the stock up near next resistance in the
$53.50-54.00 area.  Earnings are scheduled for October 28th.






===================
On the RADAR Screen
===================

TARO $62.05 - There appears to be no end in sight to TARO's
bullish action.  After breaking out over $60 last week, the stock
has gone vertical, and is now looking quite extended.  This is an
aggressive play, but TARO may just keep soaring right into
earnings next Thursday.  A pullback into the $64.00-64.50 area
looks like the best we can expect in the way of a dip-buying
entry.

DOX $21.30 - The past couple months have not been very kind to
shares of DOX, as the stock has continued to meander lower, with
support being found in the $18.50-19.00 area.  That way until
today, when the stock soared more than 7%, finally breaking the
descending trendline.  Volume was strong as well, so this looks
like the beginning of a solid breakout ahead of earnings on
November 5th.  Consider entries near current levels or on a
pullback near $20.00-20.50 and target a rally up to the $24
level.

FRE $59.00 - Finally shaking off all the allegations of wrongdoing by
its former management, shares of FRE finally broke out late last week
and then cleared long-term trendline resistance just above $58 on
Tuesday.  Entries near current levels look good to run to next
resistance near $61.50, with an outside chance of a rally up to strong
resistance at $64.



===============================
Market Sentiment
===============================


What's New?
- J. Brown

Investor sentiment is getting pretty easy to read these days.
The deluge of earnings news has been good with most companies
beating estimates and offering positive comments going forward.
At least that's how investors are interpreting all the data and
post announcement conference calls.  Bullish investors tend to
look at life through rose-colored glasses.  Reality tends to be a
bit less enthusiastic.  Whatever your bias, this morning the tone
was set with strong results from Dow component Johnson-and-
Johnson (JNJ), Wall Street titan Merrill Lynch (MER) and the
third biggest U.S. bank, Bank of America (BAC).  All three beat
their estimates.

I will note that it was interesting to see the market's reaction.
The tone may have been positive but the markets traded sideways
most of the session before the usual afternoon fade higher.
Commentators and industry experts would like to see more volume
on these gains (as would we all).  Still, we're not complaining.
It's been a long time since the INDU closed above 9800.  Both the
DJIA and the NASDAQ composite are within striking distance of
significant milestones with 10,000 and 2000 looming just ahead.

Contributing to the overall enthusiasm has been two recent
revisions to the Q3 GDP estimates.  In the last two days we've
heard from Goldman Sachs and Lehman Brothers.  GS raised their
outlook from 5% to 6.5% Q3 GDP growth while LEH raised theirs to
6% GDP growth.  This is a very robust pace.  If the job situation
can continue to improve then there may be nothing to stop this
market.  However, I will add that there are new rumblings from
the street that the extreme bullishness now is likely to lead to
a sizeable pull back in the fourth quarter.  More grumblings from
the wounded bears?  It's possible.

I'm not sure I subscribe to a massive Q4 pull back but I will
certainly agree that we're very overbought short-term and could
use a good multi-day consolidation.  Any such stall in the
markets advance may have to wait with the parade of earnings
churning at full speed.  Big Blue (IBM) is the big cap name to
watch tomorrow and MSFT headlines the announcements for Thursday.

I know I'm beginning to sound like a broken record here... it's
okay to play the trend but at these levels you'd better watch
your stops.



-----------------------------------------------------------------

Market Averages

DJIA ($INDU)

52-week High:  9812
52-week Low :  7197
Current     :  9812

Moving Averages:
(Simple)

 10-dma: 9634
 50-dma: 9439
200-dma: 8752

S&P 500 ($SPX)

52-week High: 1049
52-week Low :  768
Current     : 1049

Moving Averages:
(Simple)

 10-dma: 1034
 50-dma: 1011
200-dma:  938

Nasdaq-100 ($NDX)

52-week High: 1422
52-week Low :  795
Current     : 1420

Moving Averages:
(Simple)

 10-dma: 1384
 50-dma: 1331
200-dma: 1165


-----------------------------------------------------------------

Wow! That new VIX is falling fast and near the 17 level is definitely
a warning sign for the bulls.  Even the old VIX, based on the OEX, is
still hovering around 19.  Meanwhile the VXN is near all time lows
as the NASDAQ surges toward the 2000 mark.

CBOE Market Volatility Index (VIX) = 17.37 -0.18
Nasdaq Volatility Index (VXN)      = 26.49 -0.28

-----------------------------------------------------------------

          Put/Call Ratio  Call Volume   Put Volume

Total          0.70        866,472       605,892
Equity Only    0.56        700,315       391,386
OEX            0.83         37,908        31,590
QQQ            0.93         63,494        59,151


-----------------------------------------------------------------

Bullish Percent Data

           Current   Change   Status
NYSE          73.7    + 0     Bull Confirmed
NASDAQ-100    79.0    + 2     Bear Correction
Dow Indust.   83.3    + 0     Bull Correction
S&P 500       80.8    + 1     Bull Confirmed
S&P 100       79.0    + 0     Bull Correction


Bullish percent measures the number of stocks in an index
currently trading on a buy signal on their point and figure
chart.  Readings above 70 are considered overbought, and readings
below 30 are considered oversold.

Bull Confirmed  - Aggressively long
Bull Alert      - Cautiously long
Bull Correction - Pause or pullback in upward trend
Bear Alert      - Take defensive action if long
Bear Confirmed  - High risk if long, good conditions for shorting
Bear Correction - Pause or rebound in downtrend

-----------------------------------------------------------------

 5-Day Arms Index  1.02
10-Day Arms Index  0.90
21-Day Arms Index  1.13
55-Day Arms Index  1.06


Extreme readings above 1.5 are bullish, and readings below .85
are bearish.  These signals don't occur often and tend be early,
but when they do, they can signal significant market turning
points.

-----------------------------------------------------------------

Market Internals

            -NYSE-   -NASDAQ-
Advancers    1648      1941
Decliners    1160      1139

New Highs     425       411
New Lows        7         7

Up Volume    835M     1276M
Down Vol.    676M      447M

Total Vol.  1535M     1752M
M = millions


-----------------------------------------------------------------

Commitments Of Traders Report: 10/07/03

Weekly COT report discloses positions held by small specs
and commercial traders of index futures contracts at the
Chicago Mercantile Exchange and Chicago Board of Trade. COT data
can be found at www.cftc.gov.

Small specs are the general trading public with commercials being
financial institutions. Commercials are historically on the
correct side of future trend changes while small specs tend
to be wrong.

S&P 500

After two weeks of little movement we're beginning to see
commercial traders edge toward a more bearish position.  Looking
at the small traders we see a reduction in short positions and
they remain overall net bullish.


Commercials   Long      Short      Net     % Of OI
09/09/03      418,958   486,209   (67,251)   (7.4%)
09/23/03      395,123   397,858   ( 2,735)   (0.0%)
09/30/03      395,713   397,577   ( 1,864)   (0.0%)
10/07/03      390,232   402,964   (12,732)   (1.6%)

Most bearish reading of the year: (111,956) -  3/06/02
Most bullish reading of the year:   18,486  -  6/17/03

Small Traders Long      Short      Net     % of OI
09/09/03      176,401    81,444    94,957    36.8%
09/23/03      139,482    87,981    51,501    22.6%
09/30/03      144,681    96,801    47,880    19.8%
10/07/03      138,644    88,018    50,626    22.3%

Most bearish reading of the year:  (1,657)- 5/27/03
Most bullish reading of the year: 114,510 - 3/26/02


E-MINI S&P 500

We're definitely seeing a small trend in the commercials'
positions in the e-minis.  Long positions have jumped strongly,
outpacing new short positions, and the overall net short
attitude is dwindling.  Retail traders remain heavily net
long.


Commercials   Long      Short      Net     % Of OI
09/09/03      370,909   237,610    133,299    21.9%
09/23/03      109,417   204,026   ( 94,609)  (30.2%)
09/30/03      163,828   218,991   ( 55,163)  (14.4%)
10/07/03      212,273   225,377   ( 13,104)  ( 3.0%)

Most bearish reading of the year: (354,835)  - 06/17/03
Most bullish reading of the year:  133,299   - 09/02/03

Small Traders Long      Short      Net     % of OI
09/09/03       59,692   130,270   (70,578)  (37.1%)
09/23/03      175,750    62,558   113,192    47.5%
09/30/03      131,698    65,259    66,439    33.8%
10/07/03      134,990    63,560    71,430    36.0%

Most bearish reading of the year: (77,385)  - 09/02/03
Most bullish reading of the year: 449,310   - 06/10/03


NASDAQ-100

We're still not seeing much movement in commercials willing
to commit one way or the other in the NDX.  They're currently
net short but the margin is fading.  Small traders haven't
changed much either and remain net long.


Commercials   Long      Short      Net     % of OI
09/09/03       44,677     62,369   (17,692) (16.5%)
09/23/03       32,648     42,565   ( 9,917) (13.2%)
09/30/03       33,571     42,993   ( 9,422) (12.3%)
10/07/03       33,253     40,861   ( 7,608) (10.3%)

Most bearish reading of the year: (21,858)  - 08/26/03
Most bullish reading of the year:   9,068   - 06/11/02

Small Traders  Long     Short      Net     % of OI
09/09/03       28,788    13,370    15,418    36.6%
09/23/03       17,862     9,880     7,982    28.8%
09/30/03       19,803     9,917     9,886    33.3%
10/07/03       18,182     9,688     8,494    30.5%

Most bearish reading of the year: (10,769) - 06/11/02
Most bullish reading of the year:  19,088  - 01/21/02

DOW JONES INDUSTRIAL

It's the same story here in the DJ futures.  There is little
change between the commercials or the small traders over all
positions.


Commercials   Long      Short      Net     % of OI
09/09/03       25,807    10,756   15,051      41.2%
09/23/03       15,911     9,123    6,788      27.1%
09/30/03       16,561     8,932    7,629      31.5%
10/07/03       16,277     9,528    6,749      26.2%

Most bearish reading of the year: (8,322) -  1/16/01
Most bullish reading of the year: 15,135  - 10/16/01

Small Traders  Long      Short     Net     % of OI
09/09/03        7,429    13,796   (6,367)   (30.0%)
09/23/03        7,505     7,779   (  274)   ( 1.8%)
09/30/03        7,578     8,125   (  547)   ( 3.5%)
10/07/03        7,392     7,910   (  518)   ( 3.4%)

Most bearish reading of the year:  (8,777) - 10/12/01
Most bullish reading of the year:   8,523  -  8/26/03

-----------------------------------------------------------------




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Do not duplicate or redistribute in any form.
PremierInvestor.net Newsletter                Tuesday 10-14-2003
                                                   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
=================================================================

Play of the Day:     Getting Closer

Active Trader (Non-Tech)
  Closed Bullish Plays:  GENZ

High Risk/Reward
  Closed Bullish Plays:  ORB

Stock Splits/Announcements:  USNA

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)


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


Marsh & McLennan - MMC - close: 47.95 change: -0.50 stop: 49.50

Company Description:
As the world's largest insurance brokerage company, MMC could be
called the ultimate middleman.  After purchasing UK broker
Sedgwick Group, the firm formed Marsh, Inc. to hold its risk and
insurance units including J & H Marsh & McLennan (risk and
insurance brokering); Guy Carpenter & Co. (reinsurance); Seabury
& Smith (insurance program management services); and Marsh &
McLennan Risk Capital (insurance industry investment and advisory
services).  The company also owns Putnam Investments, which
provides investment management services such as research and
accounting for publicly held investment companies.

Why we like it:
Our patience was tested on Friday, as MMC gapped lower at the
open, reaching right to the 200-dma ($47.45).  That was as far
down as it went though, as buyers propped the stock up at that
point, allowing it to rise modestly by the close.  The downtrend
that has been in place since the middle of June is still intact,
but MMC has not yet satisfied our entry trigger, despite trading
a new 5-month intraday low.  We're still looking for a break of
the 200-dma to trigger our entry into the play, and with the rise
of the 200-dma over the past week, we can now raise that trigger
to $47.40.  An entry on the initial break of that level is one
way to play, but given the way in which the stock continues to
bounce after each new lower low, a better entry is likely to
present itself on the next failed rebound.  Traders willing to
wait for that rebound can look to enter on a rollover in the
$48.00-48.50 area.  We're lowering our stop to $49.50, which is
still above the descending trendline, the 30-dma ($49.04) and
last Monday's intraday high of $49.48.

Why This is our Play of the Day
We don't normally like to list untriggered plays as our Play of
the Day, but in the case of MMC, we're going to make an
exception.  Last week, the stock rebounded from the 200-dma, but
once again the rebound was soundly rejected at the descending
trendline.  Despite another bullish session in the Insurance
index (IUX.X), MMC shed just over 1% and is poised to deliver the
breakdown we've been anticipating.  We still need to see a drop
below our $47.40 trigger before initiating new positions, but
once that level gives way, we're looking for an acceleration of
the current downtrend as we head into the company's earnings
announcement next Tuesday.  Target an initial drop to the $44-45
area, although $42 is still a viable possibility if the bears
weak from their slumber.  Note that we've got a tight stop on the
play at $49.50, which is just above last week's intraday high and
well above the descending trendline and the 50-dma ($49.35).

Annotated Chart of MMC:


Picked on October 5th at  $48.18
Change since picked        -0.23
Earnings Date           10/21/03 (unconfirmed)
Average Daily Volume =  1.79 mln



==================================================================
ACTIVE TRADER (AT) Section
==================================================================

============
CLOSED PLAYS
============

  --------------------
  Closed Bullish Plays
  --------------------

Genzyme Corp. - GENZ - close: 49.99 change: +1.09 stop: 47.40

We gave GENZ all the time we could to break out over resistance
ahead of earnings, but the bulls just couldn't get the job done.
As mentioned over the weekend, we were looking to exit the play
ahead of earnings, and with the announcement coming out tomorrow
morning, obviously this play is done.  We'll chalk it up as a
moderate success, as the stock gained a little over 5% from our
picked price.  While the stock could break out on positive
reception of the earnings results, we're sticking with our
discipline of closing out open positions ahead of earnings.

Picked on October 1st at  $47.50
Change since picked        +2.49
Earnings Date           10/15/03 (confirmed)
Average Daily Volume =  2.90 mln




==================================================================
HIGH RISK/HIGH REWARD (HR) section
==================================================================

============
CLOSED PLAYS
============

  --------------------
  Closed Bullish Plays
  --------------------

Orbital Sciences - ORB - cls:  chng: + - stop: 9.34

We thought Friday that ORB might be ready to blast off again, and
it did so this week, finding support at its 30-dma and the
ascending channel.  Tuesday, it moved up to $10.00 and the
midline of that rising channel.  Lockheed Martin Corporation
(LMT) issued a press release announcing that ORB would join LMT
and Northrop Grumman (NOC) in competing for a NASA contract.  The
contract will be for full-scale development of the OSP, Orbital
Space Plane.  That announcement, an earnings run, and perhaps a
bit of short-covering helped propel ORB up 2.80 percent on more
than double average daily volume. ORB will announce earnings
Thursday, however, and it's our policy to close plays before
earnings releases.

Picked on Sep 3 at   $9.18
Change since picked: +0.72
Earnings Date:    10/16/03 (confirmed)
Average Daily Volume:  347 thousand





==========================
Stock Splits/Announcements
==========================


USNA announces a 2-for-1 stock split with Earnings

After today's closing bell, USANA Health Sciences Inc.'s
(NASDAQ:USNA) Board of Directors declared a 2-for-1 stock split of
its common shares.

The payable date on the stock split is October 30th, 2003 to
shareholders on record October 24th.  After the stock split USNA
will have approximately 19 million shares outstanding.  This is
USNA's first stock split since the middle of 1998.


About the company:
USANA develops and manufactures high-quality nutritionals,
personal care, and weight management products that are sold
directly to Preferred Customers and Associates throughout the
United States, Canada, Australia, New Zealand, Hong Kong, Japan,
Taiwan, South Korea and the United Kingdom. More information on
USANA can be found at http://www.usanahealthsciences.com.
(Source: Company Web Site)



==================
  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

BAC     Bank of America            82.50     +0.76
FRE     Freddie Mac                59.00     +0.88
ONE     Bank One                   41.70     +0.55
GD      General Dynamics           85.07     +2.45
AZO     AutoZone Inc               94.42     +1.40
DHI     D.R.Horton Inc             38.48     +0.68

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

SPOT    PanAmSat Corp               17.99     +1.93
VCLK    ValueClick Inc              10.50     +1.04
GERN    Geron Corp                  16.15     +1.74
GES     Guess? Inc                  12.71     +1.47
RATE    BankRate Inc                19.82     +1.67
BLTI    Biolase Tech                13.74     +1.39

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

FDX     Fedex Corp                  73.65     +2.30
STT     State Street Corp           52.66     +2.87
CFC     Countrywide Financial       97.18     +1.77
SSP     E.W.Scripps Co              92.88     +4.89
KMI     Kinder Morgan Inc           57.00     +1.10
ETN     Eaton Corp                  98.90     +3.16
POT     Potash Corp                 80.11     +1.81

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

WYE     Wyeth                       44.55     -1.21
FDC     First Data Corp             37.20     -2.66
UNTD    United Online Inc           25.44     -5.48

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

MCO     Moody's Corp                 56.67     -3.01
ADTN    Adtran Inc                   69.55     -3.95
JBHT    JB Hunt Transport            26.60     -1.62
AVID    Avid Tech                    54.03     -4.76



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