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Market Wrap
(From Briefing):

The market opened higher following another round of strong earnings reports and strengthened into the close, despite a 1/4 point rate hike, after the Fed kept its policy statement unchanged... As widely expected, the Fed raised the fed funds rate by 25 basis points to 2.5% and maintained balanced risk assessment, with declaration that it believes policy accommodation can be removed at a pace that is likely to be measured... Meanwhile, the major indices closed higher for the third consecutive session for the first time in 2005, with the S&P 500 rising for the sixth time in seven sessions as nearly 2/3 of its constituents, having already reporting quarterly results, have beaten forecasts... The majority of S&P components (9 of 14) again turned in better than expected quarterly results, with Boeing's (BA 52.27 +1.23) Q4 earnings of $0.11 (consensus $0.04) and encouraging FY05 and FY06 outlook laying the groundwork for broad-based buying in blue chips... Airline (+1.9%) was also strong after several air carriers posted strong Jan traffic figures while gains in Internet, following robust Q4 earnings from Google (GOOG 205.96 +14.06), coupled with strength in software (+0.8%), in the wake of encouraging Q1 guidance from Adobe Systems (ADBE 62.29 +4.39), helped offset weakness in semiconductor, hardware and networking... Strong Q4 results and upside FY05 guidance from Rohm & Haas (ROH 47.22 +2.86) boosted chemicals (+1.3%) as oversold conditions in shares of Merck (MRK 28.50 +0.67) pushed the drug maker higher and helped the pharmaceutical sector (+0.9%) maintain respectable gains... Energy took full advantage of solid earnings from Devon Energy (DVN 42.56 +1.04) and an analyst upgrade on Valero Energy (VLO 59.01 +2.05) despite crude oil prices losing nearly 1.0% ($46.69/bbl -$0.43) following a mixed weekly oil inventory report... Crude oil inventories fell 300K barrels (consensus +2.1 mln barrels, distillates only fell 2.9 mln barrels (consensus -2.1 mln) while gasoline inventories rose 1.6 mln barrels, (consensus +700K)... An earnings miss from Countrywide Financial (CFC 35.95 -2.08) was really the only notable earnings disappointment, keeping financial stocks (-0.2%) underwater all day, while a warning from Cummins (CMI 72.79 -6.25) that FY05 earnings will fall short of expectations, despite nearly tripling Q4 profits, left the engine maker among the biggest laggards on the NYSE... Treasuries, despite rebounding slightly following the Fed's remarks, finished relatively unchanged, as the benchmark 10-year note closed flat, yielding 4.13%... The dollar also closed relatively flat, after clinging to modest gains against both the euro (1.3038) and the yen (103.78), as there again was no mention of the greenback (via a budget deficit comment) in the policy statement...NYSE Adv/Dec 2023/1321...NASDAQ Adv/Dec 1679/1410.

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Today's Picks - February 03, 2005

1.   WMB - Williams

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 17.66

2.   WAT - Waters

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 50.25

3.   WFT - Weatherford

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 55.87

4.   OIH - Oil Sv HOLDRs

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 90.67

5.   RDC - Rowan

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 29.13

6.   PDE - Pride Intl

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 24.11

7.   TJX - T J X

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 25.84

8.   MVK - Maverick Tube

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
02-03		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 33.23

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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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