Indices
Dow + 62.00 at 10,551.94  -   Nasdaq + 6.29 at 2,068.70  -  S&P 500 + 8.14 at 1,189.41 

Market Wrap
(From Briefing):

Stocks extended Monday's gains following another round of solid earnings reports, respectable economic data and healthy corporate fundamentals... Better than expected quarterly results from the majority (11 of 16) of large-cap names (i.e. BSX, HCA, EMR, ASD, XEL and IR) out with results in the morning helped overshadow only 2 disappointments (ASN and MBI)... Avon Products (AVP 43.56 +1.34) matched estimates, as did TYC and UCL, but guided Q1 earnings in line with forecasts and announced a $1 bln stock buyback... Speaking of buybacks, reports citing more than $30 bln in share repurchase programs coupled with over $120 bln in M&A deals, announced in January alone, also contributed to strong market internals that kept sentiment positive throughout the session and maintained gains in virtually every sector... In economic news, the ISM manufacturing index fell to 56.4 in January, from 57.2 in December, which was roughly in line with economists' forecasts of a decline to 57... New orders, which account for roughly 30% of the total survey, fell to 56.5 in January from 62.6 in December, but the more closely watched employment component was strong, rising to 58.1 in January versus 56.1 in December, ahead of Friday's non-farm payrolls figures... Dec construction spending showed a stronger than expected rise of 1.1% (consensus +0.5%) and an upward revision of +0.3% to Nov's original decline of 0.4%, as total construction spending in 2004 posted the largest gain since 1996, climbing 9% to a record $998.4 bln... Stronger than expected earnings from Valero Energy (VLO 56.76 +4.73) and an upgrade on Exxon Mobil (XOM 53.08 +1.48) pushed both stocks to new 52-week highs and helped the energy sector shrug off a 2.2% decline in oil prices... Crude oil futures ($47.12/bbl -$1.08) erased all of Monday's gains following worries that OPEC may cut production earlier than anticipated (before the end of Q1)... News that American Express (AXP 56.70 +3.35) will spin off its personal finance unit to shareholders in Q3 helped the Dow outperform the Nasdaq and provided a lift to the financial sector (+1.2%)... Homebuilding (+1.9%) also surged, as several housing stocks (i.e. HOV, MTH, TOL) touched new 52-week highs, while gains of more than 1.0% in semiconductor and disk drive paced the way for technology... Solid gains in health care, materials, telecom services, utility and transportation helped offset modest, late-day weakness in retail... The dollar held relatively tight ranges against major currencies most of the day ahead of the G7 meeting later in the week, pushing gold futures ($422.90/oz) to a new three-week low... Treasuries, which were relatively unchanged ahead of economic reports, were under modest pressure into the close, keeping the benchmark 10-year note off 2 ticks to yield 4.13%... But bonds spent most of the session drifting unenthusiastically as traders prepared for the FOMC meeting, unanimous that the Fed will boost rates another 25 bp to 2.5%...NASDAQ Adv/Dec 1770/1353.

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Today's Picks - February 02, 2005

1.   XTO - Xto Energy

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 36.63

2.   KBH - Kb Home

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 111.98

3.   BZH - Beazer Homes Usa

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 153.90

4.   GT - Goodyear Tire

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 16.09

5.   OXY - Occidental Pet

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 59.46

6.   JNJ - Johnson And Johnson

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		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 do not enter the trade unless it trades above 65.42

7.   CAG - ConAgra Foods

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		Short	Below 15 min low	Cover 1/2 once risk covered	Above HOD at time of setup
	* Please Note: If the stock gaps up at the open do not enter the trade unless it trades below 28.95

8.   TYC - Tyco

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-02		Short	Below 15 min low	Cover 1/2 once risk covered	Above HOD at time of setup
	* Please Note: If the stock gaps up at the open do not enter the trade unless it trades below 34.35

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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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