Indices
Dow - 75.37 at 10,766.23  -   Nasdaq - 13.68 at 2,051.72  -  S&P 500 - 7.77 at 1,203.60 

Market Wrap
(Briefing):

Renewed inflation worries following mixed economic data, coupled with another rise in oil prices, higher interest rates and hardly any upside catalysts aside from resurgence in M&A activity, overturned last week's three-day rally... Jan personal income fell 2.3%, less than economists expected (consensus -2.6%), due to the downside of Microsoft's Dec dividend payment which left a 3.7% gain, while personal spending was flat (consensus +0.1%)... However, an increase of 0.2% in the inflation indicator for consumer prices and a 0.3% rise in the core PCE deflator, the largest increase since Oct. 2001, were slightly disconcerting given the 0.8% jump in January's core PPI data... Data, coupled with nervousness surrounding a slew of other important economic data out later this week, higher oil prices and higher bond yields, underpinned a cautious sentiment throughout the session... Crude oil futures, after surpassing $52/bbl in pre-market trade, closed up $0.26 at $51.75/bbl in volatile trading while treasuries closed near their lows of the session, with the benchmark 10-year note finishing off 23 ticks to yield 4.35%, rates not seen in three months... Inflation issues, improving manufacturing conditions, the resignation of Lebanon's government and speculation of a large Euro/US trade running through very thin trading all contributed to pressure in bonds... Meanwhile, Feb Chicago PMI checked in at 62.7 (consensus 60.5), as both the production and new orders components rose to very strong 68.5 levels, but Jan new home sales unexpectedly dipped 9.2% to 1.106 mln (consensus 1.125 mln), as the Dec gain was revised to 5.6% (from 0.1%)... Disappointing home sales and higher bond yields spurred profit taking in the homebuilding sector (-1.6%) following last week's stellar performance... Biotech (-5.5%), however, was hammered the hardest after Biogen Idec (BIIB 38.55 -28.73) and Elan Corp (ELN 8.03 -18.87) voluntarily withdrew their multiple sclerosis drug Tysabri following two serious adverse events (one death and one serious central nervous system disease)... After soaring nearly 22.0% in 2005 alone, investors finally booked some profits in energy stocks (-0.40%) while semiconductor (-1.4%) failed to take advantage of positive sector comments from Lehman... Autos also plummeted after both General Motors (GM 35.65 -1.24) and Ford Motor (F 12.63 -0.37) were downgraded at Banc of America while an upgrade on Best Buy (BBY 54.02 +2.33) and strength in Wal-Mart (WMT 51.69 +0.20), following better than expected Feb comps growth of 4.0%, minimized losses in retail... Health care, financial, utility, materials and consumer staples were also influential leaders to the downside... Computer hardware (+1.4%), however, was lifted by strength in HPQ (+0.7%) and SUNW (+0.5%) while transportation (+0.3%) benefited from Yellow Roadway's (YELL 59.25 -2.06) proposed $1.37 bln acquisition of USF Corp (USFC 47.74 +8.92)... Other notable merger news included confirmation that Federated (FD 55.50 -1.29) will acquire May Dept. Stores (MAY 34.55 -0.80) for roughly $11 bln while Mylan (MYL 17.60 +0.66) terminated its $4.0 bln agreement to buy King Pharmaceuticals (KG 9.48 -0.77)...NYSE Adv/Dec 1307/2071...NASDAQ Adv/Dec 1313/1836.

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

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Today's Picks - March 01, 2005

1.   WFMI - Whole Foods Market

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 102.97

2.   JBHT - Hunt Transport

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 48.10

3.   ENDP - Endo Pharmaceuticals

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 22.59

4.   GENZ - Genzyme Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 55.96

5.   JNJ - Johnson & Johnson

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 65.60

6.   ETR - Entergy Corp

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
03-01		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 69.09

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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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