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Monday, July 10, 2006

Market Wrap for Monday, July 10, 2006

Main Stock Tickers: EMC, ELMG, SNDK, FSL, SGR, HD, HANS, KRON, LUV, FL, PGL, SLB, HTG, HELE, AA

DJIA 11,103.55; Up 12.88 (0.12%)
NASDAQ 2,116.93; Down 13.13 (0.62%)
S&P500 1,267.34; Up 1.86 (0.15%)
10YR Bond 5.13%

While the overall markets were up most of the day, the markets did give up many of the gains toward the end of the day. Paulson also took over as the new Treasury Chief, and that was as short of a discussion on Wall Street as quantum physics in the football locker room.

Shortly before the open, EMC (EMC) decided to come clean and issue an earnings and revenue warning for the quarter, as so many other tech leaders have had to do; EMC closed down another 6.8% at $10.41.

EMS Tech (ELMG) was another tech disaster closing down 18% at $15.69 after issuing an earnings and revenue warning.

SanDisk (SNDK) was a chip-related name that bore the worst trading day of flash names on news of Freescale (FSL) being first to market with nonvolatile MRAM; SNDK closed down 8.2% at $43.56 and FSL closed up 0.8% at $28.48.

Shaw Group (SGR) fell 14% to close at $22.08 after its narrower losses missed street estimates and it announced a clerical error die to internal control issues had led to a prior revenue overstatement.

Home Depot (HD) managed yet another 1% drop to close at $35.00, another 52-week low, after KB Homes (KBH) said the woes and weakness in the housing sector could persist into 2007; KBH closed down 1.4% at $45.12.

In what is a traditional post-split trading fashion, Hansen Natural (HANS) fell 9.3% to close at a post-split adjusted price of $46.23.

Another enterprise software company, Kronos (KRON), tumbled 14.9% to close at $29.46. It had been down about 20% at one pint before recovering after the initial sell-off, and that was after the shares were already right at new 52-week lows before the bad news.

Southwest Airlines (LUV) rose 2.3% to $17.38 after reports it may consider assigning seats to speed up loading times. Will they still be called the cattle car?

Foot Locker (FL) shares rose a sharp 10% to close at $27.33 after online reports that a KKR-led private equity buyout is coming in the stock. Even shares of the Gap (GPS) rose 5.7% to close at $17.57 on hopes of consolidation among the laggards in the sector.

Peoples Energy (PGL) also rose another 1.1% to close at $39.09 after it announced its already discussed merger with WPS (WPS); WPS actually closed up 0.60% probably on relief that it wasn’t at a much higher buyout price.

Despite the fact that the Saudis are going to pull out more production from old reserve wells and even with gas prices down on the day, shares of Exxon Mobil (XOM) and Schlumberger (SLB) both rose on the day; XOM rose 0.3% to $63.04 and SLB rose 1.2% to $63.50.

Heritage Property Investment Trust (HTG) closed out up 2.7% at $35.94 after receiving a $36.16 buyout from an Australian venture.

Helen of troy (HELE) rose 2.4% to close at $18.72, even though missing result estimates.

Alcoa (AA), another DJIA component, closed down 0.4% at $33.41 ahead of its earnings report today after the close; and this will officially kick off earnings season for Q2.

Jon C. Ogg
July 10, 2006
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