Thursday, March 22, 2001 10:44:35 PM
Portfolio up 2.1%, Dow down 1.03%, Nasdaq up 3.69%, S&P500 down 0.41%, J-Blimps up 8.3%, Fuel cells/Alt Energy up 2.1%, Gorilla Hunters up 6.2%, Gilder2001 up 4.4%, OC-192 up 7.6%.
NYSE Volume: 1.73 bln...Adv: 779...Dec: 2333 You want capitulation volume, here it is. Day 2 of 2/1 decline
Up Volume 432.80 Down Volume 1295.05 day 3
New Highs 54 New Lows 270
Nasdaq Volume: 2.48 bln...Adv: 1507...Dec: 2287
Up Volume 1719.61 Down Volume 727.34
New Highs 17 New Lows 506 Huge nine day
Put/Call ratio 0.79 (Range 0.58 to 0.97)
Under 0.40 is Very Bullish sentiment, 0.40-59 Bullish, 0.60-0.79, Neutral, 0.800-0.99 Bearish, Over 1.00 Very Bearish. When many are bullish, this may be time to take profit.
April natural gas $5.21 per million British thermal units. Up 17 cents.
VIX 39.70
When it runs below 20, usually a good time to take some profits. If above 35, good time to buy. The VIX, intraday, hit 37.72 on Dec. 21 and posted a 52-week high of 41.53 in last April's carnage.
Sector Watch
Breakout of the day
Semis ($SOX) 626.39 +68.37 +12.25% RMBS + MU + Cowen’s = $$$$$
Note: I know people who shorted the semis on the rise yesterday when most went down. They either covered at a loss or on pins and needles. This is a strong double top breakout busting through resistance levels of 580 and 620. Support at 550.
Collapse of the day
Dow Utils ($UTIL) 348.66 -13.50 -3.73% Independent power producers provide about 30 percent of California's electricity from a variety of sources including wind, solar and other sources. Because many of the companies, known as Qualifying Facilities, or QFs, haven't been paid they've begun to withhold power, contributing to blackouts in the state Monday and Tuesday.
California has suffered from $6.2 billion in excessive wholesale power costs over the past 10 months, according to a report by managers of the state's power grid.
Note: Descending triple bottom breakdown. 384 was support level that collapsed. Support at 332. This position by CA indicates the fighting may get ugly.
QQQ at $42 Up 6.02% Chart: 3/21 Trend reversal signaled by Friday. Bingo. Right on the money. This is the largest up volume in QQQ since it started! Do not underestimate this. There was strong institutional buying forcing involuntary short covering.
Blocks: 1218/1005 pos for 1 day. Volume%: 76 Volume total was 130M.
One stock
Micron Tech (MU) Up 11.16% SG Cowen expects stock to trade up over the near-term, as it appears the DRAM business has bottomed and that Q2 EPS will be at least in line with consensus. After the close, MU announced it would delay reporting its Q2 results until next week. According to Cowen, indication by company that chip operations for the qtr were "slightly profitable" is probably a little above market expectations
Note: Add the CC last night and this note of sunshine and the semis exploded.
Portfolio Watch
Rambus (RMBS) Up 32.74 EBN posted a story on its website late last night claiming that the delay in the Rambus/Infineon (IFX) trial announced last week is a positive for Rambus, as it gives the company more time to investigate a 1992 document that Rambus cites as evidence that Infineon deliberately copied its technology. " The Rambus charged that a confidential planning document showed the then-Siemens Semiconductor division "deliberately copied" its technology.
At one time Rambus moved up and down depending on which way Intel (INTC) breathed, and now it's which way the court battles go," said Gary Harmon, Rambus' chief financial officer. Indeed, Rambus' stock has a history of rising and falling 20% in a day on the mere hint of news. Harmon said there's been no change in plans to go to trial. In a note to clients Thursday morning, Morgan Stanley Dean Witter analyst Mr. Edelstone said new documents brought into the case, as well as U.S. District Judge Robert E. Payne's decision to delay the start of the jury trial in Richmond, Va., are two factors that might work in Rambus' favor. Documents recently admitted into the trial, including an Infineon internal memo, suggest that "Infineon's DRAM design uses intellectual property patented in Rambus' DRAM architecture," Mr. Edelstone said. Mr. Edelstone said he thinks the judge's extension of the trial favors Rambus because Judge Payne ordered Infineon to perform a thorough search of all its employees' files and ensure no files, including those on computer, are erased or destroyed. "Based on the new evidence, we believe that the potential for Infineon to want to settle out of court has increased significantly," he said. The 1992 briefing was belatedly discovered on an old hard disk and the document was turned over to Rambus attorneys only at midnight last Friday. The specific document surfaced only this week after a transcript of last week's hearing resulting in the trial delay became available.
According to the transcript, David Monahan, Rambus lead attorney, characterized the Siemens Semiconductor document as showing the firm "was knowledgable of the Rambus technology, contrary to their sworn denials. They said 'We're going to make it public domain We're going to change some parts.' They deliberately copied and misappropriate the invention."
By contrast, the Infineon attorneys argued that the document supported their contention that Rambus had synchronous DRAM proprietary technology as early as 1992 that they failed to disclose to the JEDEC (Joint Electron Devices Engineering Council) open industry standards deliberations on SDRAM. They denied the then-Siemens Semiconductor division or JEDEC copied any Rambus IP but rather developed an entirely different SDRAM specification. The specific portion of the 1992 Siemens Semiconductor session minutes discussed "the Rambus interface problem. And how Rambus created an integrated memory concept."
The minutes said, "A JEDEC committee on MOS memory has attempted for roughly a year to define a universally usable successor for the previous DRAM, the so-called synchronous DRAM (SDRAM).
"The original idea of SDRAM is based on the principles of a simple clock input (IBM toggle pin) and the complex Rambus structure. NEC (Rambus license holder) was first to suggest a leaner 'public domain' version based on this, synchronous controls, 2 bank, 4-field internal clock bus, 4-word register at the data output and possible low level interface (similar to GTL), while leaving off the proprietary Rambus control protocol.
"It has become clear that Rambus memory can easily be converted into a SDRAM (1 or 2 bank) or conventional DRAM," according to the document quoted by Monahan.
He also referred to a slide presentation by Meyer of Sept. 30, 1992 that referred to making this SDRAM design 'public domain.'
The transcript showed that the court ordered Rambus to take a deposition of Meyer last week, while Infineon President Schumacher was allowed to return to Germany on condition that his deposition would be taken this week.
The transcript released this week also revealed that even Rambus attorneys conceded that Judge Payne's narrow interpretation of the firm's SDRAM patent definitions would eliminate one Rambus patent.
However, attorney Monahan argued that three other SDRAM patents in the case aren't affected by the ruling.
Infineon asked that Judge Payne dismiss the case because the firm's SDRAMs don't use any of the multiplexed bus or read/write or block size specifications cited in the Rambus patents.
The judge said he wasn't open at that time to considering any more of the many motions for summary judgment filed by both sides, although he opened the door to possible consideration in the future.
Still pending also in the case is a federal court of appeals ruling on Rambus request for a Writ of Mandamus barring Judge Payne's waiver of attorney-client privilege to allow Infineon depositions on Rambus legal discussions on the JEDEC policy requiring disclosure of pending patents.
Note: Easy to watch if long. Day trading it is another matter. $33 is resistance so this baby could run tomorrow. This post by Monty Lenard on Mar. 21 describes the feeling of the shorts today. “There was one time when I boxed a position but it was when I shorted RMBS and they tried to tear my head off.
I boxed it until it topped and sold the long and held the short but I agree with you that it is not a good practice and sure isn't fun.”
Oracle Corp (ORCL) up 5.08% Wit SoundView field checks indicate business conditions are challenging, with many customers having delayed deals, or chosen to execute considerably smaller deals... Firm chooses to maintain its Strong Buy rating on belief that ORCL shares are at or near a bottom.
NTAP up 16.72%
AMAT, BRCD up double digits
DRMD, PHA, MDT down 5%
Watch List things to watch but not trade
JDS Uniphase (JDSU) Roberston Stephens downgrades to LT ATTRACTIVE from BUY on concerns that March is shaping up to be another tough month for communications components companies. Components companies indicating that their customers continue to be silent in their ordering to the extent that some of the past weeks have seen no net bookings. Could take well over 2 qtrs for excess inventory situation to fix itself such that the EMS players and the OEMs can begin reordering product again.
This follows Micron’s CC exactly.
The book-to-bill ratio hits 0.77 in February, worse than January's 0.80
Note: Rate of decline is slowing.
Semi Recession : ABN AMRO calls this the worst semiconductor recession since 1974. That said, firm still expecting a V-shaped recovery in the group, starting in late-Q3 (within the context of a U-shaped U.S. economic cycle). Looking at the past 5 down cycles since 1980, IC Insights found that in no case did qtr/qtr decline last more than 3 qtrs.
Note: Not seen this data before.
Bear Stearns [BSC] At current market prices of $44.13, the valuation measure of market price to book value per share is 1.38 times, approaching its ratio of 1.21 times per-share book value reached in October 1998
Note: Maybe a dabble in one should occur.
Sun Microsystems (SUNW) Most recent round of channel checks by CSFB indicate continuing weakness in the server market, which appear to be leading to slowing sales growth and increasing pricing pressure. Firm reducing estimates to reflect lingering macro and capacity issues. Reduces Q4 EPS to $0.09 from $0.11 and revenue est. to $4.5 bln from $4.8 bln. FY02 forecast lowered to $0.54 from $0.66 and to $21.8 bln from $24.2 bln.
Note: Weakness now, but for how long.
Procter & Gamble, the consumer products giant, plans to cut 9,600 jobs worldwide in a further effort to save money and boost sales growth.
Note: P&G products have quiet been hiked so sales growth will be tough.
Cree (CREE) Increases stock repurchase program announced in January by 3 mln shares to a total of 7 mln.
Note: They announced the first one at $30’s.
TXN reports good reception of their combo PDA/cellphone in European trials.
Note: Just a word passed on the sly. Need to figure out what is actually meant by this.
Utd Parcel Svc (UPS) Guides down Q1 EPS to $0.49-$0.51 (mean $0.58) to reflect the slowing economy. If current economic conditions persist, Q2 earnings will fall in the range of $0.55-$0.60 (mean $0.64).
Note: A surprise since Fedex was strong.
Speaking Wednesday at a semiconductor conference in Austin, SSB analyst John Joseph said chip makers must continue cutting capital spending in this downturn. "We will be in decline through August of 2001, at least," he added, pegging the real start of the chip downturn to August 2000. Semiconductor stocks typically start an up-tick two to three months after business conditions start to improve, he noted, putting a recovery in chip stock prices in October or November, at the earliest. Joseph said Taiwanese chip set and DRAM makers are "beginning to see a tightening in the (supply) chain," a possible indication of better business conditions. He forecast a 22% decline in shipments of microprocessor units this year, the first such decline since 1985.
Note: Joseph is the hot semi analyst.
Morgan Stanley on Machinery : In light of Deere & Co. (DE) warning, firm advises buying on weakness. Earnings risk in the group is less now than in previous downturns. Several quarters of depressed industrial demand, coupled with aggressive production cuts, have left inventories at half to a third of the levels leading up to previous cyclical downturns. Would stick with Caterpillar (CAT), Parker-Hannifin (PH), Ingersoll-Rand (IR), and Terex (TEX).
Note: All ready to sell and I saw this note. Why fight the Fed?
"What we have is a confidence crisis, not an economic crisis" said Alfred Goldman, chief market strategist at A.G. Edwards & Sons, as the Dow industrials plumbed the depths early Thursday. "Folks are just selling stocks willy-nilly."
Note: Willy-nilly, must be a technical term. <gg>
Immunex (IMNX) Immunex and American Home Products Corporation (AHP) announced that guidance from an independent data monitoring board indicates that ongoing studies of ENBREL (etanercept) in chronic heart failure (CHF) would not be able to meet efficacy endpoints. Based on this guidance, the companies have decided not to proceed with the large Phase 2/3 clinical studies in CHF;
Note: Biotechs would normally be hit with this.
British researchers are developing a new kind of optical fiber that could surpass the known data transmission limitations of fiber. Augmented with a pattern of microscopic air holes that runs their entire length, these aptly-named holey fibers have a variety of surprising optical properties, not the least of which is single mode operation at all wavelengths and the ability to withstand the transmission of huge amounts of energy or data. To produce the fibers, researchers aligned an array of thin glass tubes, melted them together, and then stretched them to make a single fiber several kilometers long and about 125 microns across. While it's previously been suggested that such fibers would be predominantly used to transmit power -- or even matter -- their data transmission capabilities could be instrumental to the development of optical computers.
Note: Still in research, check back in five years.
TIBCO Software (TIBX) Reports Q1 earnings of $0.06 a share, $0.03 better than the First Call consensus of $0.03, vs year-ago earnings of $0.01; revenues rose 95.5% to $82.10 mln from a year-ago of $42.00 mln;
Note: A big surprise. Looks good.
Quote of the Day
"People are feeling really wounded because they bought stocks at 100 times revenues, and they can't understand why their life's savings is gone," SUNW CEO McNealy told Reuters. "People, get a grip! Look at what you did! 'Hey, that truck hit me!' Well, you play in the freeway, you are going to get hit by a truck... We didn't predict the wild and crazy up and we didn't predict the wild and crazy down. And we're not alone. When things get back to normal, I'll be dead."
Note: Maybe that why he sold some stock.
Summary
Dow set an intraday low not seen since February 1999 at 9107. I felt 9600 and 9100 were support level. Apparently program trading for buying and covering triggered also. 200 points up in the last hour.
Smarter shorts covered early today. A squeeze of the season could occur tomorrow. This was overall short covering as the advance/decline on the Nasdaq is still bearing and the Hi/Lo a monster toward the negative. The QQQ is another matter as the rally is very selective. John Maynard Keynes used to blame big stockmarket swings on what he called the ‘animal spirits’ of investors. We may break that Friday streak of seven down in a row.
The VIX is right, the put/call is not.
Jack
NYSE Volume: 1.73 bln...Adv: 779...Dec: 2333 You want capitulation volume, here it is. Day 2 of 2/1 decline
Up Volume 432.80 Down Volume 1295.05 day 3
New Highs 54 New Lows 270
Nasdaq Volume: 2.48 bln...Adv: 1507...Dec: 2287
Up Volume 1719.61 Down Volume 727.34
New Highs 17 New Lows 506 Huge nine day
Put/Call ratio 0.79 (Range 0.58 to 0.97)
Under 0.40 is Very Bullish sentiment, 0.40-59 Bullish, 0.60-0.79, Neutral, 0.800-0.99 Bearish, Over 1.00 Very Bearish. When many are bullish, this may be time to take profit.
April natural gas $5.21 per million British thermal units. Up 17 cents.
VIX 39.70
When it runs below 20, usually a good time to take some profits. If above 35, good time to buy. The VIX, intraday, hit 37.72 on Dec. 21 and posted a 52-week high of 41.53 in last April's carnage.
Sector Watch
Breakout of the day
Semis ($SOX) 626.39 +68.37 +12.25% RMBS + MU + Cowen’s = $$$$$
Note: I know people who shorted the semis on the rise yesterday when most went down. They either covered at a loss or on pins and needles. This is a strong double top breakout busting through resistance levels of 580 and 620. Support at 550.
Collapse of the day
Dow Utils ($UTIL) 348.66 -13.50 -3.73% Independent power producers provide about 30 percent of California's electricity from a variety of sources including wind, solar and other sources. Because many of the companies, known as Qualifying Facilities, or QFs, haven't been paid they've begun to withhold power, contributing to blackouts in the state Monday and Tuesday.
California has suffered from $6.2 billion in excessive wholesale power costs over the past 10 months, according to a report by managers of the state's power grid.
Note: Descending triple bottom breakdown. 384 was support level that collapsed. Support at 332. This position by CA indicates the fighting may get ugly.
QQQ at $42 Up 6.02% Chart: 3/21 Trend reversal signaled by Friday. Bingo. Right on the money. This is the largest up volume in QQQ since it started! Do not underestimate this. There was strong institutional buying forcing involuntary short covering.
Blocks: 1218/1005 pos for 1 day. Volume%: 76 Volume total was 130M.
One stock
Micron Tech (MU) Up 11.16% SG Cowen expects stock to trade up over the near-term, as it appears the DRAM business has bottomed and that Q2 EPS will be at least in line with consensus. After the close, MU announced it would delay reporting its Q2 results until next week. According to Cowen, indication by company that chip operations for the qtr were "slightly profitable" is probably a little above market expectations
Note: Add the CC last night and this note of sunshine and the semis exploded.
Portfolio Watch
Rambus (RMBS) Up 32.74 EBN posted a story on its website late last night claiming that the delay in the Rambus/Infineon (IFX) trial announced last week is a positive for Rambus, as it gives the company more time to investigate a 1992 document that Rambus cites as evidence that Infineon deliberately copied its technology. " The Rambus charged that a confidential planning document showed the then-Siemens Semiconductor division "deliberately copied" its technology.
At one time Rambus moved up and down depending on which way Intel (INTC) breathed, and now it's which way the court battles go," said Gary Harmon, Rambus' chief financial officer. Indeed, Rambus' stock has a history of rising and falling 20% in a day on the mere hint of news. Harmon said there's been no change in plans to go to trial. In a note to clients Thursday morning, Morgan Stanley Dean Witter analyst Mr. Edelstone said new documents brought into the case, as well as U.S. District Judge Robert E. Payne's decision to delay the start of the jury trial in Richmond, Va., are two factors that might work in Rambus' favor. Documents recently admitted into the trial, including an Infineon internal memo, suggest that "Infineon's DRAM design uses intellectual property patented in Rambus' DRAM architecture," Mr. Edelstone said. Mr. Edelstone said he thinks the judge's extension of the trial favors Rambus because Judge Payne ordered Infineon to perform a thorough search of all its employees' files and ensure no files, including those on computer, are erased or destroyed. "Based on the new evidence, we believe that the potential for Infineon to want to settle out of court has increased significantly," he said. The 1992 briefing was belatedly discovered on an old hard disk and the document was turned over to Rambus attorneys only at midnight last Friday. The specific document surfaced only this week after a transcript of last week's hearing resulting in the trial delay became available.
According to the transcript, David Monahan, Rambus lead attorney, characterized the Siemens Semiconductor document as showing the firm "was knowledgable of the Rambus technology, contrary to their sworn denials. They said 'We're going to make it public domain We're going to change some parts.' They deliberately copied and misappropriate the invention."
By contrast, the Infineon attorneys argued that the document supported their contention that Rambus had synchronous DRAM proprietary technology as early as 1992 that they failed to disclose to the JEDEC (Joint Electron Devices Engineering Council) open industry standards deliberations on SDRAM. They denied the then-Siemens Semiconductor division or JEDEC copied any Rambus IP but rather developed an entirely different SDRAM specification. The specific portion of the 1992 Siemens Semiconductor session minutes discussed "the Rambus interface problem. And how Rambus created an integrated memory concept."
The minutes said, "A JEDEC committee on MOS memory has attempted for roughly a year to define a universally usable successor for the previous DRAM, the so-called synchronous DRAM (SDRAM).
"The original idea of SDRAM is based on the principles of a simple clock input (IBM toggle pin) and the complex Rambus structure. NEC (Rambus license holder) was first to suggest a leaner 'public domain' version based on this, synchronous controls, 2 bank, 4-field internal clock bus, 4-word register at the data output and possible low level interface (similar to GTL), while leaving off the proprietary Rambus control protocol.
"It has become clear that Rambus memory can easily be converted into a SDRAM (1 or 2 bank) or conventional DRAM," according to the document quoted by Monahan.
He also referred to a slide presentation by Meyer of Sept. 30, 1992 that referred to making this SDRAM design 'public domain.'
The transcript showed that the court ordered Rambus to take a deposition of Meyer last week, while Infineon President Schumacher was allowed to return to Germany on condition that his deposition would be taken this week.
The transcript released this week also revealed that even Rambus attorneys conceded that Judge Payne's narrow interpretation of the firm's SDRAM patent definitions would eliminate one Rambus patent.
However, attorney Monahan argued that three other SDRAM patents in the case aren't affected by the ruling.
Infineon asked that Judge Payne dismiss the case because the firm's SDRAMs don't use any of the multiplexed bus or read/write or block size specifications cited in the Rambus patents.
The judge said he wasn't open at that time to considering any more of the many motions for summary judgment filed by both sides, although he opened the door to possible consideration in the future.
Still pending also in the case is a federal court of appeals ruling on Rambus request for a Writ of Mandamus barring Judge Payne's waiver of attorney-client privilege to allow Infineon depositions on Rambus legal discussions on the JEDEC policy requiring disclosure of pending patents.
Note: Easy to watch if long. Day trading it is another matter. $33 is resistance so this baby could run tomorrow. This post by Monty Lenard on Mar. 21 describes the feeling of the shorts today. “There was one time when I boxed a position but it was when I shorted RMBS and they tried to tear my head off.
I boxed it until it topped and sold the long and held the short but I agree with you that it is not a good practice and sure isn't fun.”
Oracle Corp (ORCL) up 5.08% Wit SoundView field checks indicate business conditions are challenging, with many customers having delayed deals, or chosen to execute considerably smaller deals... Firm chooses to maintain its Strong Buy rating on belief that ORCL shares are at or near a bottom.
NTAP up 16.72%
AMAT, BRCD up double digits
DRMD, PHA, MDT down 5%
Watch List things to watch but not trade
JDS Uniphase (JDSU) Roberston Stephens downgrades to LT ATTRACTIVE from BUY on concerns that March is shaping up to be another tough month for communications components companies. Components companies indicating that their customers continue to be silent in their ordering to the extent that some of the past weeks have seen no net bookings. Could take well over 2 qtrs for excess inventory situation to fix itself such that the EMS players and the OEMs can begin reordering product again.
This follows Micron’s CC exactly.
The book-to-bill ratio hits 0.77 in February, worse than January's 0.80
Note: Rate of decline is slowing.
Semi Recession : ABN AMRO calls this the worst semiconductor recession since 1974. That said, firm still expecting a V-shaped recovery in the group, starting in late-Q3 (within the context of a U-shaped U.S. economic cycle). Looking at the past 5 down cycles since 1980, IC Insights found that in no case did qtr/qtr decline last more than 3 qtrs.
Note: Not seen this data before.
Bear Stearns [BSC] At current market prices of $44.13, the valuation measure of market price to book value per share is 1.38 times, approaching its ratio of 1.21 times per-share book value reached in October 1998
Note: Maybe a dabble in one should occur.
Sun Microsystems (SUNW) Most recent round of channel checks by CSFB indicate continuing weakness in the server market, which appear to be leading to slowing sales growth and increasing pricing pressure. Firm reducing estimates to reflect lingering macro and capacity issues. Reduces Q4 EPS to $0.09 from $0.11 and revenue est. to $4.5 bln from $4.8 bln. FY02 forecast lowered to $0.54 from $0.66 and to $21.8 bln from $24.2 bln.
Note: Weakness now, but for how long.
Procter & Gamble, the consumer products giant, plans to cut 9,600 jobs worldwide in a further effort to save money and boost sales growth.
Note: P&G products have quiet been hiked so sales growth will be tough.
Cree (CREE) Increases stock repurchase program announced in January by 3 mln shares to a total of 7 mln.
Note: They announced the first one at $30’s.
TXN reports good reception of their combo PDA/cellphone in European trials.
Note: Just a word passed on the sly. Need to figure out what is actually meant by this.
Utd Parcel Svc (UPS) Guides down Q1 EPS to $0.49-$0.51 (mean $0.58) to reflect the slowing economy. If current economic conditions persist, Q2 earnings will fall in the range of $0.55-$0.60 (mean $0.64).
Note: A surprise since Fedex was strong.
Speaking Wednesday at a semiconductor conference in Austin, SSB analyst John Joseph said chip makers must continue cutting capital spending in this downturn. "We will be in decline through August of 2001, at least," he added, pegging the real start of the chip downturn to August 2000. Semiconductor stocks typically start an up-tick two to three months after business conditions start to improve, he noted, putting a recovery in chip stock prices in October or November, at the earliest. Joseph said Taiwanese chip set and DRAM makers are "beginning to see a tightening in the (supply) chain," a possible indication of better business conditions. He forecast a 22% decline in shipments of microprocessor units this year, the first such decline since 1985.
Note: Joseph is the hot semi analyst.
Morgan Stanley on Machinery : In light of Deere & Co. (DE) warning, firm advises buying on weakness. Earnings risk in the group is less now than in previous downturns. Several quarters of depressed industrial demand, coupled with aggressive production cuts, have left inventories at half to a third of the levels leading up to previous cyclical downturns. Would stick with Caterpillar (CAT), Parker-Hannifin (PH), Ingersoll-Rand (IR), and Terex (TEX).
Note: All ready to sell and I saw this note. Why fight the Fed?
"What we have is a confidence crisis, not an economic crisis" said Alfred Goldman, chief market strategist at A.G. Edwards & Sons, as the Dow industrials plumbed the depths early Thursday. "Folks are just selling stocks willy-nilly."
Note: Willy-nilly, must be a technical term. <gg>
Immunex (IMNX) Immunex and American Home Products Corporation (AHP) announced that guidance from an independent data monitoring board indicates that ongoing studies of ENBREL (etanercept) in chronic heart failure (CHF) would not be able to meet efficacy endpoints. Based on this guidance, the companies have decided not to proceed with the large Phase 2/3 clinical studies in CHF;
Note: Biotechs would normally be hit with this.
British researchers are developing a new kind of optical fiber that could surpass the known data transmission limitations of fiber. Augmented with a pattern of microscopic air holes that runs their entire length, these aptly-named holey fibers have a variety of surprising optical properties, not the least of which is single mode operation at all wavelengths and the ability to withstand the transmission of huge amounts of energy or data. To produce the fibers, researchers aligned an array of thin glass tubes, melted them together, and then stretched them to make a single fiber several kilometers long and about 125 microns across. While it's previously been suggested that such fibers would be predominantly used to transmit power -- or even matter -- their data transmission capabilities could be instrumental to the development of optical computers.
Note: Still in research, check back in five years.
TIBCO Software (TIBX) Reports Q1 earnings of $0.06 a share, $0.03 better than the First Call consensus of $0.03, vs year-ago earnings of $0.01; revenues rose 95.5% to $82.10 mln from a year-ago of $42.00 mln;
Note: A big surprise. Looks good.
Quote of the Day
"People are feeling really wounded because they bought stocks at 100 times revenues, and they can't understand why their life's savings is gone," SUNW CEO McNealy told Reuters. "People, get a grip! Look at what you did! 'Hey, that truck hit me!' Well, you play in the freeway, you are going to get hit by a truck... We didn't predict the wild and crazy up and we didn't predict the wild and crazy down. And we're not alone. When things get back to normal, I'll be dead."
Note: Maybe that why he sold some stock.
Summary
Dow set an intraday low not seen since February 1999 at 9107. I felt 9600 and 9100 were support level. Apparently program trading for buying and covering triggered also. 200 points up in the last hour.
Smarter shorts covered early today. A squeeze of the season could occur tomorrow. This was overall short covering as the advance/decline on the Nasdaq is still bearing and the Hi/Lo a monster toward the negative. The QQQ is another matter as the rally is very selective. John Maynard Keynes used to blame big stockmarket swings on what he called the ‘animal spirits’ of investors. We may break that Friday streak of seven down in a row.
The VIX is right, the put/call is not.
Jack
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