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Email Version, Section 1, Monday 05/14/01
The Newsletter           Monday 05/14/2001 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 -

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In This Newsletter:
Market Commentary - Can the Fed Break the Trading Doldrums?
Definition of the Day
Monday's Split Announcements - SDS, CRTQ
Tuesday's Expirations
Tuesday's Play-of-the-Day - STU

Market Commentary

Can the Fed Break the Trading Doldrums?

The market was characterized by more listless trading today, as
all eyes are focused upon tomorrow's FOMC meeting.  The past
several rate cuts were accurately predicted.  However, while most
economists believe that tomorrow's meeting will result in a rate
cut of 50-basis points, there is growing concern that the cut may
only be 25-basis points.  This difference in opinion may result in
some added volatility once the official action is revealed at
approximately 2:15 EDT tomorrow.

Today, though, the market was relatively calm.  The NASDAQ (COMPX)
extended its period of profit taking as it dropped for the fourth
straight day.  Officially, the NASDAQ dropped 25.51 points to
2081.92.  Volume was very light with only 1.32 billion shares
traded.  Losers outpaced winners by a 22 to 16 margin.

There was broad weakness among the major technology stocks.  That
said, the declines were mostly mild among some of the most active
technology names.  Intel (NASDAQ:INTC) lost $0.53 to $27.41, Cisco
Systems (NASDAQ:CSCO) slipped $0.48 to $18.57, Sun Microsystems
(NASDAQ:SUNW) fell $0.74 to $18.11 and JDS Uniphase (NASDAQ:JDSU)
gave up $0.55 to $20.14.

A couple of major technology stocks managed to buck the trend.
Oracle Systems (NASDAQ:ORCL) picked up $0.14 to $16.04, Ciena
(NASDAQ:CIEN) gained $1.22 to $59.95 and BEA Systems (NASDAQ:BEAS)
rallied $0.62 to $32.99.

Declines in technology stocks caused a rotation into financial and
cyclical stocks, which helped the Dow Jones Industrials (INDU) to
rally 56.03 points to 10,877.33.  The NYSE saw very low volume of
only 846 million shares and advancers slipped by decliners by a
rate of 16 to 14.

SunTrust Banks (NYSE:STI) was a noticeable decliner on the NYSE
following the company's unsolicited $13.6 billion offer to buy
Wachovia (NYSE:WB), which was already in negotiations to be
acquired by First Union (NYSE:FTU) for $12.7 billion.  Traders
reacted to the new bidding war by dropping STI $4.81 to $60.00 and
pushing WB higher by $3.85 to $64.75.  FTU picked up $0.56 to

Shaw Group (NYSE:SGR), a major supplier of piping systems for
power plants, saw its share price decline $2.59 to $55.00,
apparently in reaction to the announced IPO of Global Power, which
supplies equipment to gas-turbine power plants and will trade
under the symbol of "GEG" when its IPO is completed later this
week.  Although the two companies do not directly compete, the IPO
is giving traders an excuse to take some profits in the highflying
shares of SGR and to perhaps diversify their holdings among other
energy equipment companies.

There was a ton of action in the biotechnology stock universe due
to several announcements coming from the National Cancer
Conference in San Francisco. Some of the decline in the
Biotechnology Index (BTK), which fell 12.83 to 530.37, can be
attributed to the drop in technology stocks in general.  However,
some of the specific declines can be attributed to some
disappointing clinical trial results that were presented today at
the conference.  ImmunoGen (NASDAQ:IMGN) reported disappointing
results from its Phase I/Phase II study for its new treatments for
certain colorectal, pancreatic and small cell lung cancers.  IMGN
dropped $1.07 to $16.67.  OSI Pharmaceuticals (NASDAQ:OSIP) and
Genentech (NYSE:DNA) both dropped after showing only modest
results for their jointly developed treatment for head and neck
cancers.  OSIP fell $3.33 to $40.22 and DNA lost $2.56 to $48.04.

There was some good news coming from some of the conference
participants.  ImClone Systems (NASDAQ:IMCL) reported encouraging
tumor response rates and patient survival rates when using its
C225 drug for pancreatic and colorectal cancers in Phase II
trials.  IMCL gained $2.04 to $40.46.  Biotechnology leader Amgen
(NASDAQ:AMGN) showed some positive trial results as well and
rallied $0.35 to $60.95.

Merger and acquisition activity in the oil and gas sector really
bolstered the share price of many second tier energy stocks and
this trend continued today.  Kerr-McGee (NYSE:KMG) has agreed to
purchase HS Resources (NYSE:HSE) for $1.7 billion.  KMG will pay
$66.00 for each HSE share with 70% to be paid in cash and 30% to
be paid with KMG stock.  KMG slipped $0.48 to $70.09 but HSE
soared $11.15 to $64.43.

The merger activity in the oil and gas sector led to continued
interest in our Current Play list denizen Cross Timbers Oil
(NYSE:XTO), which rallied $0.94 to $28.94.  Elsewhere on our list,
Biomet (NASDAQ:BMET) gained $0.88 to $41.48, Student Loan
(NYSE:STU) picked up $1.03 to $68.68 and OM Group (NYSE:OMG) moved
up $58.60.

The previously mentioned rotation out of technology into financial
and oil stocks was evident in today's sector results.  The PHLX
Semiconductor Index (SOX) dropped 15.55 to 602.25.  The AMEX
Networking Index (NWX) fell 9.76 to 443.83.  The PHLX Bank Index
(BKX) rallied 10.58 to 881.07. The AMEX Oil and Gas Index (XOI)
gained 5.66 to 580.77.

Retail stocks could be the focus of early trading tomorrow because
not only is Home Depot (NYSE:HD) reporting its earnings before the
market opens but the market will also be watching the pre-open
results from Wal-Mart (NYSE:WMT), expected to post profits of
$0.31 and J.C. Penney (NYSE:JCP), which is expected to post
profits of $0.10.

Early trading will most likely be light, as the uncertainty over
the Fed's move will probably keep traders on the sidelines.  There
could be a continuation of the modest technology declines on the
NASDAQ.  The critical support is still 2000.  If the Fed only cuts
rates by 25-basis points, this support may be tested in late
afternoon trading.  A close below 2000 would be discouraging.
However, a bounce off 2000 could signal the end of this current
round of profit taking in the technology sector.  It is also a bit
discouraging for bulls that the MACD just turned negative and has
offered a sell signal.  Unless the Fed cuts rates by 50 basis
points, the NASDAQ could be looking at more modest declines.

The Dow Jones Industrials (INDU) is also probably facing declines
if the Fed only cuts rates 25 basis points.  Just like the NASDAQ,
the DJIA's MACD just turned negative and has offered a sell
signal.  10,640 should offer some support but be careful if the
DJIA drops and subsequently closes below this level.  A solid
rally following a 50 basis rate cut could cause the MACD to
reverse course and hence render the current sell signal
meaningless.  There continues to be solid resistance at 11,000 and
a meaningful rally probably will not occur until the DJIA can
close decisively above this resistance.

Honestly, the most likely scenario is that both the NASDAQ and the
DJIA will continue to stay in a consolidation mode for the time
being, perhaps through the entire summer.  Traders will have to
continue to seek profits by staying on top of the various sector

Good Luck!  And may all of your trades be winning ones!

Jim Booth
Research Analyst

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Definition of the Day


An option strategy where both a call and a put are purchased on
the same underlying security with the same dates of expiration but
and strike prices that are equally out of the money.

For the complete definition, please go to:

Monday's Split Announcements

Monday, May 14, 2001, Before the Bell

SunGard authorizes stock split, cuts deal with Williams

Before the opening bell, SplitTrader candidate, SunGard Data
Systems Inc. (NYSE:SDS) announced the board of directors'
approval of a 2-for-1 stock split of its common outstanding
shares.  June 18 is the payable date for the company's third
split, effectively increasing the outstanding shares to about 266
million shares and raising the float to 260 million.

On May 11, SunGard shareholders met at the company's Annual
Meeting at which time they approved an amendment to the
Certificate of Incorporation to increase the number of authorized
common shares from 320 million to 800 million, offering ample
room for the current stock split.

For the complete announcement, please go to:


Monday, May 14 2001, During the Market

Cortech follows cellular example and divides common stock

During regular trading today, biopharmaceutical company Cortech,
Inc. (NASDAQ: CRTQ) approved a 2-for-1 stock split on its common
stock, payable June 1, 2001 in the form of a 100 percent stock
dividend. This event was announced in conjunction with the
Company's first quarter earnings report.

Cortech, Inc. currently has approximately 1.88 million shares
outstanding, 900.0 thousand in the float, and 5.0 million shares
are authorized for issuance to the public. This is the first
split in CRTQ's history and will effectively increase the
outstanding common stock to 3,695,618 shares.

For the complete announcement, please go to:

Tuesday's Expirations by Payable Date

Trading Split-Adjusted May 16, 2001

AXA Group (AXA) splits 2:1
Washington Mutual (WM) splits 3:2

===================== Plays

The PLAY LEGEND: Play Recommendations.

Play-of-the-Day is our number one play recommendation for the
FOLLOWING trading day.

You will see:
Stock Symbol, Company Name, Closing Price, Change for the Week.
Following the play you will find: Picked at Date and Change Since

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

At the website, we have comprehensive profiles
for each stock that we are playing or have played in the past, as
well as hundreds of others. Please take the time to visit the site
to view the profile of the stock(s) you wish to learn more about.

Play of the Day (For Tuesday)
Monday, May 14, 2001

STU - Student Loan Corp. $68.68 +1.03

Sunday's Comment:

Student Loan Corporation held up relatively well on Friday
considering that the stock is now reflecting the $0.70 dividend
payment. Shares of STU hit an intra-day high of $68.77 before
pulling back to close at $67.65 on volume of 12,200 shares. The
stock has made three consecutive higher highs on top of higher
lows and STU is starting to form a short-term upward trend as we
approach the Annual Meeting on May 16th. We are looking for a
split announcement out of the meeting. Until then, support is
holding steady at Thursday's intra-day low of $67.15 with stronger
support at $66.60, Tuesday's intra-day high. Resistance is the 10-
dma at $68.97 and then the May 3rd intra-day high of $69.95. A
bounce off of $67.15 or a move above $68.97 on midday volume of at
least 15,000 shares may be possible entry points. Our stops remain
at $65.

Monday's Update:

On April 19th, Student Loan Corp. reported net income of $22.3
million, or $1.11 per share, for the first quarter of 2001, a
decrease of $4.5 million, or $0.23 a share, compared to the same
quarter in 2000.  The decrease was attributed to less favorable
spreads between the interest rates earned on the company's student
loan assets. When the less-than-stellar earnings results were
released, STU shares sold off from a high of $79.60 on April 19th
to a low of $64.90 on May 8th.  The sell-off appears to have
provided traders with a buying opportunity, as STU shares have
stabilized and advanced to today's close of $68.93.  More
importantly, though, we think STU's shares could continue to
advance.  To that end, the company's stochastic is showing the
stock to be oversold.  Moreover, On-Balance Volume is beginning to
trend higher again, which suggests momentum is again building.  At
current price levels, STU has support at the $65 level, with
additional support provided by the 100-dma at $63.56.  Overhead,
STU could run into resistance at its 50-dma at $70.55.  In the
past, though, STU has been able to breach this level with relative
ease.  Before taking the plunge, traders should be forewarned that
STU is thinly traded. In fact, its three-month average daily
volume is 30,000 shares, so it may be difficult to get a favorable
bid/ask spread.  With that said, traders considering a position in
STU should look for strong volume, 15,000 shares or more traded by
noon EDT, on a move through Monday's intra-day high of $68.99 or a
bounce off recent consolidation at $67 before placing their

Picked on May 10th @ $68.20
Change since picked +0.48
Stop Loss @ $65.00


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