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PremierInvestor.net Newsletter                   Monday 04-26-2004
                                                    section 1 of 2
Copyright (c) 2004, 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:  Stocks Suffer Monday Blues
Watch List:   MYGN, PDLI, POWI, KLAC

===============================================================
MARKET WRAP  (view in courier font for table alignment)
===============================================================
     04-26-2004            High     Low     Volume Advance/Decline
DJIA    10444.73 - 28.11 10512.79 10418.12 1.57 bln   1121/1705
NASDAQ   2036.77 - 13.00  2059.08  2031.75 1.68 bln   1283/1786
S&P 100   554.62 -  2.18   559.15   553.29   Totals   2404/3491
S&P 500  1135.53 -  5.07  1145.08  1132.91
RUS 2000  589.45 -  1.26   596.41   588.67
DJ TRANS 2970.21 - 31.50  3020.81  2966.25
VIX        14.77 +  0.76    15.22    14.39
VXO        14.89 +  0.67    15.26    13.91
VXN        21.83 +  1.15    22.39    21.28
Total Volume 105.2M
Total UpVol   38.0M
Total DnVol   65.7M
52wk Highs     224
52wk Lows      114
TRIN          3.20
PUT/CALL      0.66
===============================================================

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

Stocks Suffer Monday Blues
by James Brown

Stocks edged lower on Monday after their bullish start faded
quickly into a sluggish session.  Sparking the early morning
strength was big news in the biotech sector and a big contract
win for Dow-component Boeing.  Unfortunately, a red-hot new home
sales number rekindled investors' inflation fears and caution
overruled optimism.  This is still a big earnings week for Wall
Street but the next round of economic reports could hog the
spotlight.

The Commerce Department released the new home sales numbers for
March about 10 o'clock ET and the results were very strong.
Sales rose nearly 9% to a seasonably adjusted rate of 1.23
million.  This broke the previous record of 1.2 million from last
June.  Investors chose to interpret the news as yet another
potential catalyst for the Federal Reserve to hike rates sooner
than expected.   I know this subject has been beaten to death so
I won't belabor the issue but a 1/4-point or 1/2-point rise is
not going to kill the economic rebound.  However, with the next
Fed meeting on Tuesday, May 4th this will remain a staple for
analysts and media to discuss ad nauseam.

Investor sentiment also took a blow when UBS announced its
monthly Index of Investor Optimism for April slipped 12 points
from 85 to 73.  This was the lowest level since October and
continues a steep decline from its recent high in January at 108.
Speaking of sentiment the volatility indices, usually seen as a
measure of investor fear and confidence, shot higher today with
the VIX adding 5.4%, the VXO adding 5% and the VXN jumping 5.5%.
These may seem like big moves considering the generally mild
losses in the major indices but all of them were near multi-year
lows and remain so.

Global markets were mixed today.  The Japanese NIKKEI added 43
points to close at 12,163 while its Chinese counterpart, the Hang
Seng index, lost 251 points to close at 12,132.  European stocks
were also muddy.  The English FTSE was virtually unchanged at
4571.   The German DAX jumped 22 points to 4125 while the French
CAC lost 25 to 3785.  Here at home the Dow Industrials slipped 28
points to 10,444.  The NASDAQ Composite fell 13 to 2036 and the
S&P 500 index dropped 5 points to 1135.

The worst performers were semiconductors, homebuilders,
healthcare stocks and tech-related issues.  The best performers
were biotechs, defense, energy and gold, although gold stocks
retreated strongly from their highs of the session.  Gold futures
have rallied for three days in a row now but gold bugs appear to
be struggling to get the precious metal back above the $400 an
ounce level.  Noteworthy has been the action in the U.S. dollar.
The greenback hit a new relative high this morning and pierced
its simple 200-dma before falling back into its recent trading
range.  If the dollar turns south then we should see the rise in
gold continue.  Likewise if the dollar breaks out then gold will
most likely sink lower again.  I also want to mention some of the
energy stocks.  Some of the larger players like CVX and COP
closed at or near new highs.  Fueling the move was a jump in
crude prices that closed just under $37 a barrel.  The suicide
boat attacks in Iraq two days ago have renewed fears over supply
disruptions and considering the growing global demand oil prices
will probably remain relatively high.

Market internals ended the session with a bearish tone.
Declining stocks out paced advancers 17 to 11 on the NYSE and
almost 18 to 13 on the NASDAQ.  Likewise down volume swamped up
volume almost 2 to 1 on the NYSE and 5 to 3 on the NASDAQ.

Chart of the Dow Industrials:



Chart of the NASDAQ Composite:



Monday's big story was OSI Pharmaceuticals (OSIP) and its Tarceva
treatment for lung cancer.  OSIP has been co-developing Tarceva
with Genentech (DNA) and Roche, a Swiss healthcare company.  OSIP
announced this morning before the opening bell that its Phase III
trials for Tarceva had hits its primary and secondary "end
points" for improving survival in non-small cell lung cancer
patients.  Investor reaction was overwhelming.  OSIP closed at
$38.14 on Friday and opened Monday morning at $84.60.  Intraday
the stock soared to $98.70 and closed up more than 140% at
$91.10.  OSIP's good fortune also boosted shares of DNA, which
gapped higher and ended at $131.99, up 11.6%.  What you may find
interesting is that OSIP hasn't even released the clinical trial
data yet.  That's not expected to happen until the June meeting
of American Society of Clinical Oncologists.  A few analysts are
skeptical and believe the reaction could be overdone.  Merrill
Lynch chose to downgrade the stock from "buy" to "neutral".  If
the drug is eventually approved it could launch in early 2005 and
may hit sales of more than $900 million in the U.S. of which half
go to Genentech.  We are always super cautious about shorting
biotech stocks for reactions like today's jump in OSIP can be
extremely hazardous to your financial health.

Another big story today was a drug merger in France between
Aventis (AVE) and French rival Sinofi-Synthelabo (SNY).  The move
was strongly encouraged by the French government who feared they
would lose AVE to Swiss-based Novartis (NVS) when AVE rejected a
hostile bid by SNY earlier this year in January.  If AVE and SNY
had failed to merge many believed that SNY would become a
takeover candidate from drug giants Pfizer or GlaxoSmithKline.
The new deal, announced on Sunday, was a larger all cash offer
and would create the world's third-largest drug producer.  SNY
will pay close to $65 billion, which is a 14% increase from its
previous offer.  Unfortunately, it was only a 4% premium from
AVE's close on Friday and both AVE and SNY traded down on the
news.

Closer to home was news that Dow-component Boeing (BA) had
secured its first contract for its new 7E7 airliner.  And what a
contract!  Japan's All Nippon Airways ordered 50 of the new
planes, the first new model from BA since 1990.  The value of the
deal is said to be worth $6 billion at the list price of $120
million per plane but it's widely known that major airliners tend
to negotiate significant discounts.  It's a major win for BA who
has been fighting with archrival Airbus.  BA hopes to win more
deals from airliners seeking to cut costs since the E in the 7E7
stands for efficiency.   The new passenger jet is said to have
larger windows and wider aisles but will be made with lighter
materials and use new, better fuel-efficient engines.  Fuel is
the second biggest expense next to labor for the airline industry
so a projected 15% to 20% reduction in fuel is a huge cost
savings.  BA was the Dow's best performer up 1.86% to $43.24.

There were a handful of other Dow components making headlines.
Wal-Mart (WMT) failed at its descending trendline of resistance
and dropped 1.4% to $58.14 after announcing that its April same-
store sales would be at the low end of its 4-6% forecasts.
General Motors (GM) also failed at resistance at the $50.00 mark
despite gapping higher on an upgrade and positive analyst
comments from Lehman Brothers.  LEH raised its outlook on GM,
Ford and DaimlerChrysler.  MSFT was also a drag on the Dow with a
1% decline.  The move was probably just profit taking after
Friday's huge rally.  You may have heard that MSFT signed a
multi-year deal with JDAS to develop the .Net platform but odds
are this news was overshadowed by MSFT's investment in Google.
Wall Street has gone Google-crazy and it doesn't matter where you
look people are talking about when the search engine company will
finally IPO.

Personally I'm getting tired of hearing about Google's potential
IPO since regular every day investors will probably have little
chance of securing any shares prior to its first trade.  If
you're curious why the financial media is buzzing over Google's
IPO plans you'd have to turn to a decades-old regulation stating
that privately held companies with more than 500 security holders
and more than $10 million in assets have to open their books
within 120 days of the end of their fiscal year when they surpass
these thresholds (source: the Associated Press).   Evidently
Google has issued stock options to a large chunk of their 1,000-
plus employees and the deadline to file their annual report is
this Thursday.  Of course the Wall Street Journal reported this
afternoon that Google had chosen CSFB and Morgan Stanley to lead
the underwriting for an IPO.  While that settles the question of
"if" they will IPO Wall Street is still salivating for the
"when".

There was additional merger news after the closing bell, which
could sent healthcare stocks higher Tuesday.  UnitedHealth Group
(UNH), a healthcare insurer, announced it would buy Oxford Health
Plans (OHP) for close to $5 billion in cash and stock.  The news
leaked out within the last 30 minutes of trading and shares of
OHP spiked higher on the news.  Since we're talking about
insurance stocks the group could also get a boost from Chubb's
positive earnings report after the bell this evening.  Estimates
were for $1.42 a share and Chubb reported $1.61.  The company
said they were on their way to meeting or beating its full-year
estimates but traders might not react well to its revenue
numbers, which were just shy of expectations.

Tech investors will also be eager to note that chip stock Silicon
Labs (SLAB) reported earnings after the bell that were 4 cents
better than expectations.  Revenues soared more than 78% to
$113.6 million; which was also above estimates.  The company
followed up by guiding higher on its second quarter revenues.
Hopefully this will be a positive catalyst for the SOX
semiconductor sector tomorrow.  The SOX was one of today's worst
performers and broke down below its simple 200-dma while closing
just above support near the 470 level.

Tomorrow will be pretty busy on the earnings front.  A few of the
larger companies that report before the opening bell tomorrow
are: DuPont (DD), ImClone (IMCL), Level-3 Communications (LLL),
PACCAR (PCAR), R.J.Reynolds (RJR) and Verizon (VZ).  Wall Street
will also digest the latest Consumer Confidence numbers for April
and the Existing Home sales numbers.


==================================================================
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
---------------------------------

Myriad Genetics Inc. - MYGN - close: 19.14 change: +1.35

WHAT TO WATCH: We've been looking at MYGN as a potential breakout
candidate in recent weeks and Friday's earnings report seems to
have provided the necessary catalyst, helped along by additional
bullish news in the Biotechnology sector.  The stock broke out
over $19 on Monday and looks headed for a test of next resistance
near $21.50 enroute to a test of major resistance at $25.  Dips
near $18 will provide optimal entries, although aggressive
traders can chase the stock higher above today's $19.50 intraday
high.




---

Protein Design Labs, Inc. - PDLI - close: 26.93 change: +0.96

WHAT TO WATCH: We've been looking at PDLI in recent weeks in the
expectation that the stock would break out and continue higher
ahead of its May 4th earnings report.  Things certainly seem to
be tracking in line with our expectations, with the stock
breaking out on Monday and hitting fresh 2-year highs.  Entries
near $26 still look favorable for a quick bullish play towards
the key $30 level.  Just make sure to exit any open positions
ahead of the company's earnings report.




---

Power Integrations Inc. - POWI - close: 27.95 change: -1.49

WHAT TO WATCH: After a valiant attempt at a rebound from its
recent lows, POWI once again failed at 200-dma resistance and has
been dropping sharply over the past few days.  Price is
approaching key support just above $27 and if it breaks, POWI is
likely to pay a visit to next strong support in the $22-24 area.
Use a trigger under $27.




---

KLA-Tencor Corp. - KLAC - close: 45.16 change: -1.43

WHAT TO WATCH: Investors that bought the bottom of the post-
earnings drop in KLAC were in for a rude awakening this morning
as the stock sold off hard in sympathy with the rest of the
Semiconductor sector.  Look for a break under $44 before
considering entries and then target a drop to next strong support
near $40.  Look for continued weakness in the SOX to confirm the
viability of the play before entering.




---


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

FLML $30.78 - After trading in a tight consolidation pattern,
FLML delivered a nice little breakout over the $30 level on
Monday and is looking strong.  But it isn't today's breakout that
concerns us, as the company is due to release its quarterly
earnings on Thursday.  That report could provide the catalyst to
break the stock over stronger resistance near $32 for a test
first of $35 and then $38 resistance.  Wait for the post-earnings
breakout move and then climb aboard.

BJS $45.00 - With the price of crude oil holding near its recent
highs, shares of BJS are wedging up near all-time highs as well.
Unfortunately, we can't consider a play on the stock here, due to
earnings about to be released tomorrow.  But a post-earnings
breakout over the $46 level could get things moving towards the
$50 level.

CREE $20.10 - To the consternation of the bulls, CREE's earnings
report did nothing to slow the stock's slide and Monday's close
right at the key $20 support level looks ominous.  Use a trigger
under $20 and target a drop into the $17-18 area, which should be
very strong support.


=================================================================
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 2004  PremierInvestor.net. and
The Premier Investor Network.
Do not duplicate or redistribute in any form.





PremierInvestor.net Newsletter                   Monday 04-26-2004
                                                    section 2 of 2
Copyright (c) 2004, All rights reserved.
Redistribution in any form is strictly prohibited.

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

Stop Loss Updates:   URBN
Closed Plays:        IMAX
Split Announcement:  KIND


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)


==================================================================
Stop Loss Updates
==================================================================

URBN - long
Adjust from $44.00 up to $45.00


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

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

IMAX Corp. - IMAX - close: 5.51 change: +0.33 stop: 5.40

It looks like IMAX finally found a viable bottom last week, as
the strength of the stock's rebound over the past 3 sessions
demonstrates.  After scaling the 10-dma on Friday, the stock
pushed through its 20-dma today and hit our stop in the process.
The clue as to the strength of this rally is evident after
today's session, with the stock seeing heavy buying as volume
more than doubled the ADV.  Fortunately, we had tightened our
stop close to break even, so the damage is minimal.

Picked on April 14th at      $5.25
Change since picked          +0.31
Earnings Date                  N/A
Average Daily Volume =       644 K





==================================================================
Stock Splits
==================================================================

Announcements
-------------

KIND nurses a 2-for-1 split

This evening after Monday's closing bell Kindred Healthcare, Inc.
(NASDAQ:KIND) announced its Q1 earnings results and with that
announcement a 2-for-1 stock split.

The split, approved by the Board of Directors, will take the form
of a 100% stock dividend.  This dividend is payable on May 27th,
2004 to shareholders on record as of May 10th.


About the company:
Kindred Healthcare, Inc. is a national healthcare services company
operating hospitals, nursing centers, institutional pharmacies and
a contract rehabilitation services business. (source: company
press release)


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

TOT     Total Sa (ADS)             95.56    +0.61
CMCSK   Comcast Corp CI A Spcl     28.65    +0.91
CVX     Chevrontexaco Corp         92.25    +0.56
MWD     Morgan Stanley             53.66    +0.63
DEO     Diageo Plc (ADS)           56.17    +0.69



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

BVF     Biovail Corp               18.50    +1.51
ABGX    Abgenix Inc                17.70    +3.00
DNDN    Dendreon Corp              15.69    +1.58
REGN    Regeneron Pharm Inc        15.30    +1.71


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

DNA     Genetech Inc              131.99    +13.77
NVS     Novartis Ag (ADS)          44.67    +2.24
HSY     Hershey Foods Corp         90.09    +2.53
TXU     TXU Corp                   33.53    +3.90
CHIR    Chiron Corp                47.30    +1.87


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

SNY     Sanofi-synthelabo (ADS)    30.79    -2.04
WY      Weyerhaeuser Co            64.14    -2.45
IGT     Internat Game Tech         39.27    -2.38
AOC     AON Corp                   26.49    -1.33
VAR     Varian Medical Systems Inc 87.87    -4.26


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

BDX     Becton Dickinson & Co      51.34    -1.47


=================================================================
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 2004  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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