Indices
Dow - 16.71 at 10579.77  I   Nasdaq + 9.25 at 2175.99  I  S&P 500 + 2.13 at 1231.16 

Market Wrap
(Briefing):

The major averages finished the day in split fashion, as Texas Instruments helped tech while DuPont's disappointment weighed on the Dow... Before any of this morning's 29 S&P components (17 surprised, 5 missed and 7 matched forecasts) posting quarterly results had a chance to influence the day's trading, underlying sentiment had already improved following Texas Instruments' (TXN 31.96 +1.36) strong Q2 report, which hit the wires after the bell last night... TXN beat expectations by $0.03, issued an encouraging Q3 outlook, raised its dividend 20% and announced a $2.0 bln share buyback plan... Even though TXN is no longer the indicator for the overall economy it once was, the market placed heavy significance on its report, as 8 out of 10 economic sectors trade higher... Providing the bulk of the day's leadership was Technology... In addition to TXN's strong report helping bellwethers like INTC and CSCO post gains of more than 1.0%, the sector also got a boost from a new 52-week in Motorola (MOT 20.70 +0.16), after making a series of upbeat announcements at its analyst meeting, as well as huge earnings-related gains of 17.0% and 8.0% in shares of Avaya (AV 10.74 +1.51) and Tellabs (TLAB 9.64 +0.75)... Offsetting some of the sector's gains, however, was an 11.6% selloff in shares of Lexmark (LXK 60.62 -7.93), which matched Q2 estimates but issued downside Q3 guidance... Consumer Discretionary was also an influential leader to the upside, getting a boost from General Motors (GM 36.97 +1.10) as well as strong earnings from McGraw Hill (MHP 46.66 +2.23) and Starwood Hotels (HOT 63.41 +0.93)... GM surged after GMAC agreed to sell up to $55 bln of its U.S. retail automotive assets to Banc of America (BAC 44.59 -0.07) over 5 years... Health Care also showed relative strength, benefiting from a noticeable rebound in biotech stocks ahead of Biogen Idec's (BIIB 38.82 +0.32) earnings after the bell as well as strong Q2 reports from Waters (WAT 44.45 +3.75)... Industrials traded higher, led by better than expected Q2 earnings and upside FY05 guidance from Lockheed Martin (LMT 64.00 +1.49), which perhaps got an additional lift following this morning's successful launch of the Space Shuttle Discovery... Despite Q2 EPS of $0.63 from Verizon Communications (VZ 34.21 +0.19) missing forecasts by a penny, an 18% surge in profit growth driven by strength in its wireless business helped Telecom Services post a respectable gain... Interest-rate sensitive areas like Financial and Utilities also traded higher amid a modest pullback in benchmark yields on the 10-year note (+3/32)... The latter was in focus all day amid better than expected Q2 earnings from Southern Company (SO 35.30 +0.09) and the possibility that several days of excessive heat could push electricity usage to record levels... The Materials sector, however, plummeted following a slew of quarterly disappointments and solid gains in the greenback... DuPont's (DD 41.15 -2.89) Q2 profits more than doubled but earnings of $0.90 per share, which fell $0.06 shy of forecasts, and in-line FY05 guidance weighed on the diversified chemicals group (i.e. DOW, PPG and EMN) - the day's worst performing S&P group... The dollar climbed against the yen (112.45) and euro (1.2017) after China's central bank said it will not allow the yuan to strengthen in the "foreseeable future" following last week's revaluation... Even though crude oil prices ($59.20/bbl +$0.20) closed higher for the third consecutive session, Energy also lost ground as investors locked in recent sector gains... Despite recording the best quarter in its history, beating analysts' Q2 expectations by $0.06 and issuing an upbeat outlook for FY06, Valero Energy (VLO 82.51 -1.74) - the best performing S&P component (+64%) during the first half of 2005 - finished the session with the sector's second worst performance...NYSE Adv/Dec 1922/1355...NASDAQ Adv/Dec 1792/1261.

---

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

---

Today's Picks - July 27, 2005

1.   KG - KING PHARMACEUTICALS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		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 11.22

2.   IRF - INTERNATIONAL RECTIFIER

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		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 56.20

3.   JEC - JACOBS ENGR GROUP

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		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 59.84

4.   BER - BERKLEY W R

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		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 36.95

5.   BJS - BJ SVCS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		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 59.95

6.   CYBX - CYBERONICS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-27		Short	Below 15 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 38.67

Previous Trades

BHI - BAKER HUGHES

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26	07-26	Long	56.91		closed	up to - 82 cents per share

ASN - ARCHSTONE SMITH

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26		Long	42.17 (42.37)	Reached	42.17	up to + 48 cents per share (42.65)

LLL - L-3 COMMUNICATIONS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26		Long	Above 15 high	Sell 1/2 once risk covered	Below LOD at time of setup
	* did not setup

BJS - BJ SVCS

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26	07-26	Long	59.36	Reached (59.95)	Closed (59.36)	up to + 59 cents per share (59.95)
	* Please Note: If the stock gaps down at the open do not enter the trade unless it trades above 58.65

PBR - PETROLEO BRASILEIRO

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	* did not setup

AMD - ADVANCED MICRO DEVICES

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-26		Short	Below 15 low	Cover 1/2 once risk covered	Above HOD at time of setup
	* did not setup

SWN - SOUTHWESTERN ENERGY

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25		Long	53.90	Reached (55.00)	54.60	up to + 1.87 per share (55.77)

DO - DIAMOND OFFSHORE DRILLING

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25	07-26	Long	58.20	59.20	Closed (57.89)	up to - 31 cents per share

RIG - TRANSOCEAN INC

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25	07-26	Long	58.86	60.53	Closed 58.16	up to - 70 cents per share

NE - NOBLE CORPORATION

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25	07-26	Long	67.91	69.40	Closed (67.28)	up to - 63 cents per share

BR - BURLINGTON RES

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25		Long	62.58	Reached	62.75	up to + $1.28 per share (63.86)

XLE - SELECT SECTOR SPDR

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-25	07-26	Long	47.52	Reached	Closed (47.52)	up to + 69 cents per share (48.21)

CAM - COOPER CAMERON

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-22	07-26	Long	69.43	Reached	Closed below 70.44	up to + $1.85 per share (71.28)

PFE - PFIZER

Entry Date	Exit Date	Position	Entry Price	Target Price	Stop Price	Max P/L
07-21		Short	26.94	26.68 Reached	26.42	up to + 74 cents per share (26.20)