| Group | Commentary |
| Energy | Well before the start of this major bull market we advised you of the coming rally in petroleum prices. We also recommended buying natural gas and energy shares. Natural gas shares are still likely to gain strength. TAKE PROFIT in all energies on current seasonal strength. If you are long petroleum stocks and/or petroleum equipment stocks place CLOSE trailing stops inasmuch as many of these stocks have moved up too quickly and too persistently. THIS INCLUDES suppliers such as HAL. TOP EXPECTED VERY SOON! |
| Internet | We looked for a strong recovery in the Internet sector. Prices have rallied as expected. We advised you to begin accumulating quality shares for a LONG TERM move to higher levels. Time frame 1-3 years. Raise stops to lock in profits. The more than 100% gains in some of these stocks is cause for concern. Valuations were too high. YAHOO (YHOO) was recommended as a buy in the 26-29 area Recommendation to BUY YHOO @ 33.50 or lower on a scale down to 30 with a near term target of 37 or higher was filled. Profit should have taken. BUY again @ 34.45 or lower. |
| Genetic BioTech |
For many weeks we advised you as follows "this remains our favorite area of long term accumulation. We believe that it is just a matter of time before major cures for serious diseases are discovered. We believe that cloning technology is advancing rapidly and that it will be the forefront of life extension and health improvement". We are still very bullish on this sector for the long term. THE HUGE CORRECTION DOWN IN BIIB WAS CONSIDERED A BUYING OPPORTUNITY. A rally has started. AVERAGE IN FOR A LONG TERM POSITION. |
| Airlines | This area is still a gamble but smaller carriers such as Southwest, Jet Blue and Ryan Air have good long term potential on declines to short term support. The recommendations were correct and you should have taken profits as advised. I believe that traffic will improve considerably and with it profits. I advised buying on the current decline in AMR to enter speculative longs. Longs from the $5-6 range should be CLOSED OUT NOW. I advised you to BUY Southwest (LUV) in the $14-$15 range and to exit. BUY again at 13.75 or lower. |
| Drug | An excellent and stable long term growth area. Accumulate on a scale down basis. Considered the larger firm whose prices are currently depressed. Recommendation to BUY TEVA in the 28-30 range with a target of 44 was filled. HOLD and ADD on a daily close above 32.10 |
| Financial / brokerage | We expected the brokerage business to come back strongly and advised longs, all of which should have been closed out at profits. LONG NITE @ 7.75 or lower. HOLD and add on daily close above 8.55 |
| Health Care | Buy UNH in the 46-48 range with a target of 67+ |
| Precious Metals/Mining | We have long favored this area and we continue to recommend accumulation on a scale down basis during the current correction down. Consider also platinum and, in particular, palladium mining shares on the current declines. SEASONAL topped as expected. I advised taking partial profits as well as the use of a trailing stop to lock in the balance of profits. You should have been stopped out at excellent profits. See METALS page for new long recommendations. HOLD long term positions. |
| Computer & Technology | There are still many excellent bargains in this area. We advised you to "Accumulate for the long term with the understanding that risks are still significant". Many of our specific recommendations have made large percentage gains. You should have taken profits as advised. AWAIT NEW BUY ADVICE |
| Banking | You should have been long Bank of New York (BK) in the $25-$28 range as recommended and you were advised to take profits in the 33 area. STAND ASIDE. |
| Insurance | We have favored this sector for quite some time with the understanding that terrorism could negatively impact bottom line profits. Nonetheless, there are still many good buys in this area for the long term. We continue to like Allstate. If you are long from the 33 area as recommended then lock in 85% of profits with a trailing stop. |
| Entertainment/Gaming | As in many other sectors, opportunities abound. We advised you that stocks in this area were good long term buys, particularly in the gaming sector. HOLD LONGS. |
| Automobile | We expected a major buying opportunity in GM. TAKE PROFIT ON longs from $26.50. BUY Ford 10.20 or lower. |
| Telecom | A recovery is overdue but the risks are significant. Accumulate positions. |
| Utilities | We like a long term approach to this sector. The long term cycles are bottoming and substantial recoveries are expected over the next few years. |
| Food / Restaurant |
Heinz, ADM, Campbell, Avaya, and McDonald's (for higher risk) were favored in this category.
I advised you to TAKE PROFITS and to buy again late in July. Stand aside. |
| Defense / Aerospace | Continue to BUY on declines to support for long term and HOLD. |