No replies to this topic

[TTHQ Staff]

Todd Market Forecast Stock Market Update for the close on Thursday 06/02/05

www.toddmarketforecast.com

Available Mon- Friday after 6:00 p.m. Eastern, 3:00 Pacific.

DOW + 3 on 600 net advances

NASDAQ COMP. + 10 on 100 net advances

STOCK MARKET ANALYSIS:

We like to take dull sessions like this to talk about the big picture. One of the themes for the past couple of weeks is speculation that the Fed is nearing the completion of its rate increases and yesterday, for the first time, a Fed Governor by the name of Fischer actually suggested that we are very close to the termination. His exact phrase was the "eighth inning". For our foreign subscribers, that is a baseball term meaning very near the end.

If this is true, the stock market should have some great things ahead. Historically, after the Fed completes its rate increases, stocks surge. This time around, the central bank has raised rates 8 times in a row. Looking back for the past 15 years, we note that the previously, the most rate increases was 7 in a row, ending in early 1995. We all know what happened after that. The stock market embarked on one of the great uptrends of its history.

On Thursday, the stock market spent a lackluster day marking time in front of the dreaded non farm payrolls to be released tomorrow morning before the opening. If this figure is a big surprise, it will most likely govern trading on Friday.


NEWS AND FUNDAMENTALS:

Initial claims came in at a greater than expected 350k. The consensus was for 325k. First quarter productivity gains were revised up to 2.9% from a previous 2.6%, but under the expected 3.0%. Labor costs rose 3.3% which was more than the consensus 2.2%. Factory orders were the best in 5 months at 0.9%, but were still under the anticipated rise of 1.1%. Crude oil inventories added 1.49 mln. The consensus was for a rise of 125k. Gasoline inventories rose 1.3 mln. The consensus was for a rise of 400k and finally, distillates added 783k. The expectation was for a rise of 1.45 mln.

On the stock front, Abercrombie and Fitch, Children's Place, CVS and Nordstrom reported solid same store sales and rose 11%, 4%, 4% and 4%. Amkor Technology was upgraded by Lehman an jumped 15%. Chicago Mercantile added 8% on reports of heavy trading increases.

On the negative side, Ciena had a smaller than expected loss, but still gave up 2%. Pier 1 Imports had a larger than expected loss and sank 6%. Regal Entertainment was downgraded by Bear Stearns and dropped 5%. Sun Microsystems sank 3% after agreeing to buy Storage Technology.


BOTTOM LINE:

Our S&P and NASDAQ intermediate term systems are back on a buy signal as of the close on Thursday, April 21, 2005. Mutual fund investors are 100% invested in a growth fund or S&P 500 Index fund of their choice.

SPY and QQQQ traders are on the sidelines for now.

For new subscribers, the QQQQ and SPY are exchange traded funds or Spiders.

The former mimics the Nasdaq 100 and the latter mimics the S&P 500. ---- Additionally, an m.i.t. order means "market if touched" It means that your order becomes a market order if the price is touched.

OTHER MARKETS

We are on a buy signal for bonds.

We are on a buy for the dollar and a sell for the Euro.

We are on a sell signal for gold.

We remain long term positive on all major world markets, including those of the U.S., Britain, Canada, Germany, France and Japan.

STEVE TODD

A SHORT BIOGRAPHY

Editor and publisher of the Todd Market Forecast, a monthly stock market newsletter with an included nightly hotline. Steve Todd has a degree in history with a minor in mathematics. This should be a good combination for stock market analysis.

Steve has published articles on the economy and stock market in the following publications: Barron’s, Stock Market Magazine, Futures Magazine, The National Educator, and others.

His stock market commentary is heard on the following stations: CNBC, Bloomberg, CNNfn, Associated Press Radio, Business Radio Network, CKNW in Vancouver, British Columbia, KFWB, Los Angeles and ROBTV in Toronto, Ontario.

RANKED # 1 BY TIMER DIGEST

Timer Digest of Greenwich, CT monitors and ranks over 100 of the nation’s best known advisory services. If you have heard of an advisor, it is likely that he or she is monitored and ranked by Timer Digest.


Once per year, in January, Timer Digest editor Jim Schmidt gives the rankings for all services monitored for multi year time frames. The latest survey has us ranked # 1 for the past ten years.

Managed accounts available.

Newsletter cost is $50 per quarter or about 55 cents per day.

TODD MARKET FORECAST
26861 Trabuco Rd. # E 182
Mission Viejo, CA 92691
www.toddmarketforecast.com
e mail – stvd@cox.net
phone 949 581 2457