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Email Version, Section 2, Thursday 04/19/2001
The SplitTrader.com Newsletter           Thursday 04/19/01 1 of 1
Copyright 2001, All rights reserved.
Redistribution in any form is strictly prohibited.

 - Your World Leader for Trading Stock Splits on the Internet -

Posted online for members at: http://www.SplitTrader.com

To view this email newsletter in HTML format with imbedded
charts and graphs, click here:

http://www.splittrader.com/htmlemail/041901_1.asp
==================================================================

In This Newsletter:
===================

Market Commentary - Fed Is On Our Side
Definition of the Day
Thursday's Split Announcements - CHS
Friday's Expirations
Stock Plays - New - Updates - Drops
Friday's Play-of-the-Day - HRB

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


Market Commentary
=================

Fed Is On Our Side

With the Fed out in front blocking, investors are now more
willing to take the ball and run.  Today, as it turned out, was
no exception.  Buyers again stepped into stocks, even after heady
gains yesterday put many issues into overbought territory.

Although it might be quite some time before we can all do our
touchdown dance (tech won't come back overnight) we can be rest
assured that the Fed is done playing chicken with the economy.
The sigh of relief that the market let out yesterday was heard
around the world and in corporate boardrooms everywhere.  If
Pfizer (NYSE:PFE) could only bottle this euphoria, Prozac would
be a thing of the past and PFE would be at $300 by next week.

To put this fourth rate cut by the Fed in perspective, you'd have
to go back to the 1930's to witness a time when the market didn't
react positively to a fourth rate cut.  Otherwise, historically
speaking, 126 days after the fourth rate cut the market has been
up 9.57% on average.  After 190 days the market has been up 13.8%
on average, and after 252 days, up 18.99% on average.

To further illustrate how investor psychology has done a flip-
flop over the course of just two trading sessions, you need only
look to the trading action in tech stocks due to report earnings.
You would never have seen traders pile into tech stocks that were
about to report earnings last year, but that is precisely what
has been going on as of late.

Optimism has washed over the Street and traders are obviously now
willing to take on more risk.  The spate of better than expected
earnings from big tech names lately has certainly helped fuel
this optimism.  The question remains, however, will the market
keep its chin up now that the Fed has acted and earnings again
take center stage.

Today's Markets

It was up, up and away again today.  Knowing how the average
investor thinks, I bet every Joe 401(k) participant was
frantically calling their administrator to switch back into
aggressive growth funds yesterday afternoon.  The result of this
sudden activity was massive amounts of cash inflows that mutual
funds had to put to work.  And judging by the closing figures, it
looks like most of that cash found a home in tech stocks today.

The NASDAQ (COMPX) jumped 102.50, or 4.93% to 2181.68 in heavy
trade of 2.6 billion shares.  Advancers beat decliners 2404 to
1510.  Up volume swamped down volume by more than 5 to 1.

The DOW (INDU) took a less direct route higher today.  After
dipping negative in the morning and again in the afternoon, the
DOW finally made a decisive move higher into the close.  NYSE
volume totaled 1.4 billion shares and advancers beat decliners
1630 to 1428.  The DOW's gains were slightly misleading, however,
as IBM, Microsoft (NASDAQ:MSFT), Intel (NASDAQ:INTC) and Proctor
and Gamble (NYSE:PG) made up the lion's share of the move.  They
were up $8.20, $2.59, $1.21 and $1.53 respectively.

Teasurys floundered while stocks continued to see strong bids.
The 30-year bond slid 1 full point to yield 5.735% and the 10-
year note fell 1/2 to yield 5.215%.

Stocks and Sectors on the Move

As expected, the big movers today were those companies reporting
earnings.  On the downside, we saw continued weakness in the
drugs, utilities, tobacco, and brokerage stocks as money rotated
out of defensive issues back into tech.

On the earnings front, EMC Corp. (NYSE:EMC) reported profits of
$0.18/share, which was in line with analysts' previously lowered
expectations.  The stock took off after the news and ended the
day up $6.15 to $42.81.

Turning to computer hardware stocks, Apple Computer (NASDAQ:AAPL)
ripened by $2.93 today, ending the day up at $25.72, a level not
seen in the stock since last October.  This move higher was in
response to blowout earnings of $0.11/share, which beat estimates
by $0.10!  Needless to say, other computer makers reveled in
Apple's good news.  Dell Computer (NASDAQ:DELL) added $2.02 to
close at $30.49 and Gateway (NYSE:GTW) was lifted by $0.72 to
close at $18.02.

In after hours earnings news, Microsoft (NASDAQ:MSFT) reported
profits of $0.44/share, besting estimates by two pennies.  In
addition, MSFT beat revenue and sales estimates for the quarter,
much to investors' delight.  The stock was up strongly in after
hours trade.

Also joining the earnings parade after hours was Sun Microsystems
(NASDAQ:SUNW).  The server company had mixed news for the Street.
SUNW reported earnings of $0.08/share, hurdling estimates by a
penny, but it indicated that sales fell well below par.  In
addition, revenues were only up 2% over the year ago period, a
far cry from the sizzling 45% growth rate that the company had
previously enjoyed.  At last check, SUNW was up slightly in after
hours trade.

Checking in on analyst actions, Morgan Stanley Dean Witter put a
charge into software stocks by upgrading their rating on Oracle
(NASDAQ:ORCL) from "neutral" to "outperform".  They sited a move
up in Oracle's roll out date for its flagship product as the
impetus behind the upgrade.  On the kind words from Morgan, ORCL
moved ahead by $2.39 to close at $20.31.

Other software stocks such as Siebel Systems (NASDAQ:SEBL),
Computer Associates (NYSE:CA) and Agile Software (NADAQ:AGIL)
also received upgrades form Morgan Stanley and were richly
rewarded by reinvigorated tech investors.

Looking Forward, Always Forward

It looks like investors have come full circle and are back to the
buy-the-dip mentality.  And with no economic data due out until
next week and encouraging earnings news staring us in the face,
it may be more of the same; namely the last one into tech buys
the beer.

However, I will have to concur with my Splittrader counterpart,
S.P. Brown, when he mentioned yesterday that he doesn't think
this rally can go on much longer.  It is a simple fact that
markets don't go parabolic for long.  Additionally, hedge funds
and short sellers are no doubt out there chomping at the bit to
short this NASDAQ market as it nears resistance at 2250.

When stocks start moving 10, 20 and 30% in a spate of just a few
days (as many have over the last week) it helps to step back and
take the market's real pulse.  To this end, we will be again
watching the cyclicals, as measured by the Morgan Stanley
Cyclical Index (CYC.X), to see that they hold up after the recent
rate cut.  It is important that these stocks hold up, as they are
the old economy, brick and mortar companies that have the funds
to buy products from the tech companies.  For the tech rally to
really take hold, the rest of the economy has got to show signs
of life.

Chart of the Morgan Stanley Cyclical Index:



After a week like this, it often helps to take a deep breath and
evaluate.  I know we won't be making any major shifts in our
Splittrader plays until the market settles back and gives us a
clearer picture of what is really going on behind the scenes.

There will be plenty of opportunities to grab some tech on the
eventual pullbacks.  We will be looking for previous resistance
levels in the big techs to act as support on these pullbacks and
will time entries near levels of support to keep the down side
risk at a minimum.  That being said, if you have a long-term
investment horizon (one year plus) and feel comfortable with more
market gyrations, now might be a good time to go shopping in the
biotech, financial and semiconductor sectors instead of trying
micro-manage as we do when shorter term trading.

Have A Nice Weekend

Craig Seidler
Assistant Editor
www.SplitTrader.com


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Definition of the Day
=====================

National Association of Securities Dealers (NASD)

This is a non-profit organization. The NASD is responsible for the
regulation and the operation of member security dealers.

For the complete definition, please go to:
http://www.splittrader.com/glossary/viewglossary.asp?glossaryid=245


===================
Split Announcements
===================

Thursday, April 19, 2001, Before the Bell

Chico's Gets Outfitted for Company's Third Stock Split

Before the opening bell, Chico's FAS, Inc. (NYSE:CHS) announced
the Board of Directors' approval of a 3-for-2 stock split,
payable in the form of a 50% stock dividend to shareholders of
record on May 2.  The payable date is May 16, with the stock
trading on a split-adjusted basis on May 17, effectively
increasing the outstanding shares to approximately 27 million.

For the complete announcement, please go to:
http://www.splittrader.com/announcements/041901_1.asp


====================================
Friday's Expirations by Payable Date
====================================
Trading Split-Adjusted April 23:

Cardinal Health (CAH) splits 3:2
MBIA Inc (MBI) splits 3:2


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=====================
SplitTrader.com Plays
=====================

The PLAY LEGEND:

SplitTrader.com Play Recommendations.

Play-of-the-Day is our number one play recommendation for the
following trading day.
Updates are just that - updates on continuing plays.
New plays are brand new for the newsletter.
Drops are closing plays that we feel have lost the advantage.

You will see:
Stock Symbol, Company Name, Closing Price, (change for the week)
Picked at date and Change since picked

Terms:
BoD = Board of Directors meeting
ADV = Average Daily Volume
dma = daily moving average

On the SplitTrader.com website we have very detailed profiles
for the stocks we play.  Please take the time to visit the site
and look up a stock's profile if you are interested in more
information.
================================================================


=========
NEW PLAYS
=========


NEW SPLIT RUN PLAYS 04/19/01
============================

SOTR - SouthTrust Corporation $46.96 +0.98 (+1.85)

SouthTrust Corporation is a regional bank holding that operates 641
banking offices in nine states in the southeast. The company provides
banking, trust, mortgage, leasing, and brokerage services. Shares of
SOTR have performed well despite a tough market. On Thursday, the stock
hit an all-time high of $47.20, representing 90% gain over the past
year. SOTR is moving higher on news of a rate cut from the Fed, a strong
earnings report, and a 2:1 stock split, payable on May 11th. We believe
that SOTR may be ready for a split run now that most of the major banks,
have announced earnings and the Fed has become more aggressive. From a
technical standpoint, SOTR has support at Wednesday's intra-day high of
$46.41 with additional support at $45.41, the 5-dma. Resistance is
Thursday's intra-day high of $47.20 and then possibly $48 or $50. Look
for entry points on a bounce off of $46.41 or a breakout above $47.20 on
volume of at least 500,000 shares by noon. We plan to set stops at $44
to limit potential losses.

Picked on April 19th @ $46.96
Change since picked +0.00
Stop Loss @ $44.00

 


NEW SPLIT CANDIDATE PLAYS 04/19/01
==================================

None


NEW MOMENTUM PLAYS 04/19/01
============================

None


=======
UPDATES
=======


SPLIT RUN PLAY UPDATES 04/19/01
===============================

PFGC - Performance Food Group $53.46 -0.59 (-0.45)

If you used PFGC as your only window into the market, you would think we
have entered a lackluster period reminiscent of late summer doldrums.
In reality, all of the action following Greenspan's surprise rate cut
has been in the technology and financial sectors.  On the plus side, we
have seen virtually no rotation out of PFGC into these "hot" sectors.
This fact is encouraging and we still believe that PFGC has an excellent
chance to stage a nice rally heading into their earnings report and 2:1
split at the end of the month.  PFGC will probably offer traders a nice
opportunity once it moves above the $54.50 resistance.  This potential
move will be even more enticing to traders if it occurs with midday
volume of more than 80,000 shares tomorrow.

Picked on March 25th @ $49.50
Change since picked +3.96
Stop Loss @ $52.50

 


SPLIT CANDIDATE PLAY UPDATES 04/19/01
=====================================

HRB - H & R Block, Inc.  $54.03 +1.19 (+3.26)

H & R Block keeps the momentum alive, as its shares advance to
mark its fourth-consecutive winning session.  It appears as if
investors are putting their tax refunds right back into the
company that helped them get those refunds in the first place.
Although, as evidenced by the recent pick up in daily volume, it's
not just the retail investor that has become enamored with HRB.
The stock has broken through resistance at $53.30 on volume
roughly 20% higher than the three-month daily average of 500,000,
which means there is some conviction behind the recent advance.
Looking at the chart, it appears as though HRB is making a
parabolic move higher, which has us thinking that a pullback could
be imminent.  However, if HRB does settle back, we will watch for
previous resistance at $53.30 to provide support, bolstered by the
5-dma at $52.20.  As for resistance, we are looking at today's
high of $54.20 and then the $55 level.  New plays could be
initiated on a successful retest of the $53.30 level or an advance
through today's high on volume that would put HRB on track to
trade 500,000 for the day.

Picked on April 18th@ $52.85
Change since picked $1.18
Stop Loss @ $49.25

 

===

MKC - McCormick & Company $41.69 +0.91 (-0.01)

McCormick & Company made a nice recovery on Thursday. Shares of
MKC hit an intra-day low of $40.06 early in the session. However,
the stock bounced back to a close of $41.69 after trading through
its 50-dma at $40.33. MKC has made four consecutive lower lows and
it is now in a short-term downward trend. On the positive side,
the 50-dma has provided a springboard for the stock over the past
6 months so MKC may be ready for a rally. Going forward, there is
support at Wednesday's intra-day low of $40.70 with stronger
support at $40.33, the 50-dma. Resistance is the 10-dma at $41.87
and then the April 10th intra-day high of $42.50. Look for a
bounce off of $40.70 or a move above $41.87 on midday volume
greater than 75,000 shares before opening new positions. We are
leaving our stops at $38.75 as downside protection.

Picked on March 29th @ $41.43
Change since picked +0.26
Stop Loss @ $38.75

 

===

OMC - Omnicom Group $92.50 +1.35 (+6.00)

Omnicom has proven to be enticing to traders because the rate cut
should stabilize the economy and ensure a "soft" landing.
Omnicom, a major player in the advertising industry, should
benefit from a stabilized economy because their clients will be
more willing to expand their advertising budgets in an attempt to
capture more business as the economy improves.  Analysts expect
Omnicom to report solid earnings of $0.51 a share for the first
quarter on April 24th, despite general weakness in the overall
economy last quarter.  Combine a solid first quarter with the
prospects of an improving economy and one can see why Omnicom has
been an excellent performer this week.  That said, it looks like
the stock has found some resistance at $92.50.  A move above this
resistance tomorrow, accompanied by first hour trading volume
exceeding 200,000, may give traders their next good entry
opportunity. Money Flow and the MACD are both still outstanding.
Although the RSI is fast approaching an overbought indication,
this rally may have enough steam to carry the stock higher into
the April 24th report. Please note that we have raised our stop to
$89.00 in an attempt to lock in this week's profits.

Picked on April 15th @ $86.50
Change since picked +6.00
Stop Loss @ $89.00

 

===

SPW - SPX Corporation $99.90 +0.05 (+3.59)

SPW continued an ascent to higher levels on Wednesday, gaining 5%
to close at a one month high of $99.85. More importantly,  the
stock was able to advance above last week's consolidation and
could now be ready to overtake the century mark. In Thursday's
trading session, however, SPW shares did take a breather, but
still managed to close higher by 5 cents. Volume was held under
the three-month average, as 362,500 shares were traded.  In the
last hour of trading, the stock saw some pretty impressive buying,
which suggests that traders were fighting to get in before a
potential follow through tomorrow. Bolstering the possibility of a
further run are positive readings in both the MACD and On Balance
Volume. So, what we'd like to see now is for momentum players to
start hitting the offer and lift trading volume above its three-
month ADV of 488,400 shares. This will add strength to the run and
could potentially attract more attention to the stock as we near
the May earnings report. Of course, this would be the best-case
scenario, but we like what we see thus far. Keeping this in mind,
we'll now look for an important psychological test to come at
$100. An entry point could come when SPW shares move swiftly
through this level on midday volume of at least 245,000 shares. A
sharp bounce off support at $99 could also present a low-risk
entry, when followed by similar midday volume. We're recommending
that stops be lifted to $98, which will help to protect profits.

Picked on April 12th@ $96.31
Change since picked +3.59
Stop Loss @ $98.00

 


===

TARO - Taro Pharmaceutical Industries $53.65 +2.66 (+3.00)

The ongoing growth in managed care organizations, which typically
are heavy buyers of generic drugs, is another potential catalyst
that is keeping TARO shares on the rise. As for the chart, after
clearing resistance set back on 4/11/01, shares continued rallying
today. At this point, TARO shares look free to run. We can,
however, expect some resistance to come at $55, but after this
test we don't see the next challenge coming until $60. Looking at
the short-term technicals, the MACD is continuing a sharp uptrend,
suggesting higher prices could be in the works. The stochastics
are a bit rich at 95, but with TARO's extended uptrend, this is a
normal occurrence. We want to point out that Wall Street is
certainly staying bullish on the stock, as all three firms
following the stock hold a Buy rating. As far as an entry point is
concerned, conservative traders may want to wait for a close above
$55 on volume above the three-month ADV of 146,800 shares. Given
TARO's extended uptrend, we are now recommending that stops be
raised to $51.

Picked on April 10th@ $49.45
Change since picked +4.20
Stop Loss @ $51.00

 


MOMENTUM PLAY UPDATES 04/19/01
===============================

UNP - Union Pacific Corporation $59.50 +0.50 (+2.52)

Union Pacific has broken out to a new 52-week high after 14
sessions of sideways trading. On Wednesday, shares of UNP hit an
intra-day high of $59.10 following a surprise rate cut from the
Fed. On Thursday, the stock hit a 52-week high of $59.60 before
pulling back to close at $59.50 on volume of 1.18 million shares.
UNP is beginning to surge as we move closer to its earnings report
scheduled on April 26th before the bell. The stock has cleared
major resistance, so it may be able to keep its upward momentum
alive for a few more days. In the meantime, support is now up to
Thursday's intra-day low of $58.75 with additional support at
$57.63, the April 2nd intra-day high. Resistance has moved up to
the 7/19/99 intra-day high of $60.68 and then the 6/10/99 intra-
day high of $62.25. Traders may consider starting new plays on a
bounce off of $58.75 or a breakout above $60.68 on volume of at
least 600,000 by noon. Our stops remain at $54.50.

Picked on April 3rd @ $57.35
Change since picked +2.15
Stop Loss @ $54.50

 


=====
DROPS
=====


SPLIT RUN PLAY DROPS 04/19/01
=============================

BJS - BJ Services Company $76.35 -1.95 (-2.21)

Shares of BJ Services continued to pullback from Tuesday's fall
and pierced our stop of $75 in Wednesday's trading session.
Although no news was responsible for the fall, traders felt that
BJS's recent rally was a good enough reason to part with their
shares. It's also likely that the stock was under selling pressure
from traders moving money into technology issues.

Picked on April 8th@ $71.75
Profit/Loss = +3.25 (+5%) (Stopped Wednesday @ $75.00)
Best Profit = +4.94 (+7%)

 


SPLIT CANDIDATE PLAY DROPS 04/19/01
===================================

EQT - Equitable Resources, Inc. $77.50 +1.02 (+2.59)

Equitable Resources, Inc. began to sell off heading into its
earnings announcement on Friday morning. On Wednesday, shares of
EQT traded to an intra-day low of $75 before bouncing back to a
close of $76.80 on volume of 370,000 shares. We were stopped out
at $75, so we are dropping EQT tonight.

Picked on March 27th @ $67.20
Profit/Loss = + 7.80 (+12%) (Stopped Wednesday @ $75.00)
Best Profit = +10.30 (+15%)

 

===

THC - Tenet Healthcare Corp $42.93 -2.22 (-2.63)

The shocking rate cut yesterday caused market participants to
reevaluate their portfolios, and, unfortunately, many of them
decided that health care stocks were not the place to be.  Selling
safety stocks such as THC and buying technology value stocks has
been this week's theme.  Consequently, we were immediately stopped
out of this new position.

Picked on April 17th @ $46.98
Profit/Loss -3.10 (7%) (Stopped Wednesday @ $43.88)
Best Profit +0.02 (0%)

 


MOMENTUM PLAY DROPS 04/19/01
=============================

ACI - Arch Coal Incorporated $33.10 -1.73 (-0.85)

After providing us with a sharp rally through all of last week,
ACI shares may have finally encountered a top. Wednesday's sharp
bounce off $36.25 was trailed by heavy selling that sent the stock
falling to our stop at $33. Although a rebound could take place at
any time, we feel that with the stock's extended rally it's
probably a good time to exit with a profit.

Picked on April 5th@ $31.50
Profit/Loss = +1.50 (+ 5%) (Stopped Wednesday @ $33.00)
Best Profit = +4.80 (+15%)

 

===

KMB - Kimberly-Clark $63.51 +0.76 (-2.02)

The rotation out of cyclical stocks into technology shares
extended the pullback in KMB.  In fact, KMB dropped below its 200-
DMA of $63.13 yesterday and we were subsequently stopped out of
this position.  KMB's correction will likely continue until the
current technology stock euphoria and bottom fishing subsides.

Picked on April 1st @ $67.83
Profit/Loss -5.33 (8%) (Stopped Wednesday @ $62.50)
Best Profit +0.69 (1%)

 


========================
Friday's Play-of-the-Day
========================

HRB - H & R Block, Inc.  $54.03 +1.19 (+3.26)

Thursday's Comment:

H & R Block keeps the momentum alive, as its shares advance to
mark its fourth-consecutive winning session.  It appears as if
investors are putting their tax refunds right back into the
company that helped them get those refunds in the first place.
Although, as evidenced by the recent pick up in daily volume, it's
not just the retail investor that has become enamored with HRB.
The stock has broken through resistance at $53.30 on volume
roughly 20% higher than the three-month daily average of 500,000,
which means there is some conviction behind the recent advance.
Looking at the chart, it appears as though HRB is making a
parabolic move higher, which has us thinking that a pullback could
be imminent.  However, if HRB does settle back, we will watch for
previous resistance at $53.30 to provide support, bolstered by the
5-dma at $52.20.  As for resistance, we are looking at today's
high of $54.20 and then the $55 level.  New plays could be
initiated on a successful retest of the $53.30 level or an advance
through today's high on volume that would put HRB on track to
trade 500,000 for the day.

Picked on April 18th@ $52.85
Change since picked $1.18
Stop Loss @ $49.25

 


************************Advertisement*************************
Tired of waiting on trades to execute?
Does your broker offer Stop Losses on Options?

Trade instantly with Stop Losses at PreferredTrade Inc.
Stop Losses based on the option price or the stock price.
Move your trading into the next millennium with PreferredTrade.

Anything else is too slow!

http://www.sungrp.com/tracking.asp?campaignid=2118
**************************************************************


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