Indices
Dow + 31.86  I   Nasdaq + 11.04  I  S&P 500 + 4.49 

Market Wrap
(Briefing):

Late-day buying interest sent the stock market's major averages out of flat-line vacillation mode and to 2006's sixth day of gains. Resisting the consolidation efforts that set in Tuesday, buyers added to the indices' average 3.7% gain despite a profit warning from DuPont (DD 41.78 -0.77) and a 1% jump in the price of crude.

Due to the Dow component's slashed fourth quarter earnings forecast, the blue chip average wavered throughout most of the session, and the Materials sector (-0.9%) was the worst performer.

As investors' attention shifts towards the impending torrent of Q4 earnings reports, DuPont's sharp downside guidance blew a bearish air through what had been a generally upbeat futures trade before the open. The fact that DuPont's disappointment was pinned in part on the one-time, external impacts of hurricanes Katrina and Rita, however, helped minimize its effect upon the broader market.

With respect to the earnings front, Genentech (DNA 89.26 -4.08) delivered a solid Q4 report following Tuesday's close, but relatively disappointing sales of its growth-driving cancer drug Avastin drove the stock lower. Contributing to Healthcare's negative stance were declines in both Johnson & Johnson (JNJ 62.40 -0.70) and Boston Scientific (BSX 25.27 -1.21). In spite of its previous reluctance and a lowered bid that BSX had trumped, J&J is reportedly making last-ditch efforts to acquire the beleaguered medical device maker Guidant (GDT 70.45 +1.06). Utilities (-0.3%) also suffered some selling pressure Wednesday.

Another session of outperformance across the Technology (+1.0%) board served as the market's best source of support. Led by upgraded Broadcom (BRCM 58.55 +2.82) shares, semiconductors continued their streak - driving what is now a near 12% year-to-date gain in the SOX index. The hardware industry put in an equally strong performance; upgraded Hewlett-Packard (HPQ 31.37 +0.59) shares underpinned the bullishness Apple (AAPL 83.78 +2.92) catalyzed with its preliminary sales results Tuesday. Bank of America's raised price target and upped iPod estimates spurred further upside for AAPL.

A mixed inventory report from the Department of Energy initially sparked a market-dragging drop in the Energy sector, but traders' attention appeared to turn from higher than expected builds in gasoline and distillates to a considerably sharper than expected drop in crude supply. As a result, crude futures jumped 1.1% and re-incited buying action across the Energy sector that fostered a supportive 0.5% gain. At the same time, crude's rise had a muted impact upon other areas of the market.

The Consumer Discretionary sector (+0.4%), in particular, was unfazed. Home improvement retail was its brightest patch; Home Depot (HD 42.90 +1.10) extended the rise that Tuesday's acquisition news fueled, as it was helped by Banc of America adding it to the firm's Fresh Money Focus List and 30-Stock Model Portfolio. Lifted by Boeing (BA 70.64 +1.54), the Industrial sector (+0.2%) recovered late in the afternoon. The company beat out Airbus for a 68 plane, $11.8 billion contract with state-run Air India - the largest deal in the country's civil aviation history - and can be largely credited for the Dow's afternoon rise. Relative strength in brokers kept the influential Financial sector (+0.4%) on positive ground, a position that helped the broader market sustain Wednesday's gains.

---

Trade system guidelines (edited):
Only available to Newsletter Subscribers.

---

Today's Picks - January 12, 2006

1.   GME - GAMESTOP CORP

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-12-06		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open not enter the trade unless it trades above 39.36

2.   UPL - ULTRA PETROLEUM

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-12-06		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open not enter the trade unless it trades above 60.90

3.   AQNT - AQUANTIVE

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-12-06		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* Please Note: If the stock gaps down at the open not enter the trade unless it trades above 29.50

==============================
EOD = End of day.
LOD = Low of day.
PDC = Previous Day's Close.
S/R = Support/Resistance.
==============================