Indices
Dow + 25.85  I   Nasdaq + 22.17  I  S&P 500 + 7.11 

Market Wrap
(Briefing):

Stocks rebounded nicely following two days of consolidation as broad-based buying spurred by upbeat corporate news (e.g. earnings, dividend increases, M&A activity) helped stocks regain some upside traction amid above-average volume. A recovery in overseas markets, especially a 2.3% rebound in the Nikkei 225 following a two-day decline of nearly 6% which had many worried about a pending collapse, also calmed investors' nerves before the opening bell.

With regard to sector strength, Energy turned in the day's best performance, as Schlumberger (SLB 114.87 +6.55) raising its dividend 19% and a late-day surge in crude oil prices (+1.5%), coupled with upgrades (and ensuing record highs) on Halliburton (HAL 71.75 +1.73) and Baker Hughes (BHI 72.47 +3.89), played into our Overweight rating on the sector. Materials turned in the next best performance but the sector's 1.0% surge did not have as much of an impact on the overall market as did strength across the board in Technology. Tech got a huge boost from gains from several chip stocks, spurred by Advanced Micro Devices' (AMD 37.13 +3.76) strong Q4 earnings and improved margins as well as several analyst upgrades within the semiconductor space. Not even conservative guidance from Apple Computer (AAPL 79.03 -3.45), which prompted shareholders to keep knocking the stock from historic highs, could prevent the tech sector from extending its year-to-date gain to over 4.0%.

Consumer Discretionary also posted a solid gain, as investors welcomed reports that Walt Disney (DIS 26.24 +1.02) -- a suggested holding in Briefing.com's portfolio for active investors -- is in "serious discussions" to acquire Pixar Animation Studios (PIXR 58.87 +1.61). Upgrades in the retail group (i.e. EBAY, BBY and SKS) also added support which helped offset weakness in homebuilding. Weaker than expected Dec. housing starts and building permits, suggesting that the housing industry is leveling off, motivated investors to temporarily look past strong earnings reports from DHI and BZH and consolidate the group's 4.6% year-to-date surge.

Health Care was also been in focus following better than expected Q4 earnings from Pfizer (PFE 24.96 +0.87), which also increased its dividend 26%, and UnitedHealth Group (UNH 60.19 -1.03), which initially sold off on the news but recovered into the close, lending credence behind our promising outlook for HMOs. Despite the Philly Fed unexpectedly falling to 3.3 -- the lowest reading since last June and well below expected expansion of 13.0 -- Industrials got a lift from Union Pacific (UNP 85.02 +6.44), which hit an all-time high after handily beating expectations and providing upbeat comments about 2006.

Financial, however, failed to inch back into positive territory as quarterly disappointments from Washington Mutual (WM 43.33 -1.08) and BB&T Corp (BBT 41.08 -0.83) overshadowed Merrill Lynch's (MER 72.05 +2.20) impressive Q4 report and 25% dividend hike. Perhaps also weighing on the sector were concerns about a flattening yield curve, as the yield on 10-yr note (-10/32) rose to 4.37% amid a sharp decline in jobless claims to a very low 271,000 (consensus 315K) and renewed threats from Osama Bin Laden about terrorist attacks inside the U.S.

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

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Today's Picks - January 20 2006

1.   CSX - CSX CORP

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-20-06		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 52.55

2.   FDRY - FOUNDRY NETWORKS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-20-06		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 14.95

3.   ATHR - ATHEROS COMMUNICATIONS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-20-06		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 15.13

4.   TDW - TIDEWATER

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-20-06		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 54.74

Previous Trades

KOMG - KOMAG INC

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-19-06		Long	44.07	44.96	Below 43.06	up to + 59 cents per share (44.66)

MDT - MEDTRONIC

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
01-19-06		Long	59.75	59.98	Below 59.40	up to + 12 cents per share (59.87)

NUE - NUCOR CORP

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	did not setup

LSTR - LANDSTAR SYS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	did not setup

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