Schaeffer's Trading Floor Blog

Good Morning

by 4/29/2005 8:06 AM
Stocks quoted in this article:

I ended yesterday's session by saying the market "needed" a positive reaction and, as luck (?) would have it, we see stock futures staging a strong bounce this morning. With an hour and a half until the open, the S&Ps are more than five points above fair value. Oil is down 22 cents to 51.55 while gold is up 2.20 to 434.60.

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Final Figures

by 4/28/2005 5:04 PM
Stocks quoted in this article:

Today was not the session the bulls were hoping for...

Index Index Value Point Change Percent Change
S&P 500 (SPX) 1143.2 -13.2 points -1.14 percent
Dow Jones Industrial Average (DJIA) 10070.4 -128 points -1.3 percent
Nasdaq Composite (COMP) 1904.2 -26.2 points -1.36 percent
Russell 2000 (RUT) 575.0 -12.1 points -2.06 percent
CBOE Market Volatility Index (VXO) 16.56 2.66 points 19.1 percent

...as we saw across the board selling of the major indices with the small cap group getting hit especially hard.

Overall we see that only bonds, drug stocks and oil managed to avoid showing a loss on the day...Earlier today we saw that oil was down two percent so you can surmise that it bounced this afternoon...And even though oil rebounded, oil related stocks did not...The NWX was the biggest mover but we already touch on this group...gold was down only slightly but gold stocks continue to get hammered...

As I said, not the session the bulls were hoping for as the COMP closed below last week's low and finished at its lowest level since last October. The RUT also broke below last week's lows and tagged a new low for 2005. The SPX and DJIA are still holding above their recent lows, but not by much.

The reaction to Microsoft's earnings appears to be taking on a slightly upbeat tone as some suggest that once all the charges are sorted out, the tech behemoth met or beat EPS estimates. And given the action today, the market is going to need a "positive" reaction as today's action leaves us on shaky ground. That is where I will pick up tomorrow...

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Microsoft

by 4/28/2005 4:30 PM
Stocks quoted in this article:

The numbers from Microsoft are out...but don't expect to make immediate sense of them as the reported EPS numbers are not comparable to published consensus estimates due to some charges. This sort of confusion has been the recent trend and I already lamented this issue when we looked at Amazon's numbers. It does appear that revenue was a bit lighter than expected.

The shares have been all over the board so we will likely need to wait until the morning to get a better handle on the situation. I did want to note the intraday chart below that shows the action heading into the report...


Chart Courtesy of Thomson/ILX

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At the Close

by 4/28/2005 4:06 PM
Stocks quoted in this article:

A disappointing close for the bulls...


Chart Courtesy of Thomson/ILX

...as the SPX (as well as the other major market indices) finished at the lows for the session...


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Checking Back on QLGC

by 4/28/2005 3:35 PM
Stocks quoted in this article:

Earlier this month I checked back on QLogic (QLGC) as the stock was breaking support. Below is an updated chart...


Created with SuperCharts by Omega Research

I had expected that the shares would have enough pluck to challenge the former support near 38. However, they failed to make it that far before rolling over and breaking below last week's lows, which is the site of the support zone I added to this chart. I have also added the 50-day moving average which is showing signs of weakening momentum. A check of Zacks shows that analysts are still firmly in the bullish camp with 72 percent of the ratings a "buys". The company is scheduled to report earnings next week so this may be one to keep an eye on.

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