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Keep On Trucking


Freight, airlines are moving up.


The morning papers, for the most part, have featured the same front page photo of a smiling President Bush, looking like Alfred E. Neuman but sounding like Marie Antoinette.

While the president's bedside manner left a lot to be desired, I think his point is clear: The country's made it through a lot worse, and will do so again.

I really think the big difference is that Americans used to feel they would win in the long run. It wasn't arrogance, but a belief that doing the right thing -- which included digging in -- was part of solving any problem.

As it turns out, the President's point was underscored by a 250-point rally in the Dow and record-breaking sessions for battered industries like banks and airlines. Now, you might feel that any overly enthusiastic government official is under-informed, or that he's just channeling Bobby McFerrin. At the end of the day, however, we have to make our own fortunes and live with adversity from time to time.

(That doesn't mean we shouldn't demand more from our leaders. But look at these guys on Capitol Hill - what a pathetic sight, beating up on academics and old Wall Street guys. When are these folks going to become solution-oriented?)

Yesterday was definitely a dart-throwing session, but there were certain stocks and sectors that looked more convincing than others. Speaking of driving trucks - these stocks were more like rocket ships yesterday.

Strong Sectors:

Trucks and freight were up on convincing volume. Key stocks United Parcel (UPS) and Old Dominion (ODFL) were up on great earnings after missing in two of the last four quarters.

Consumer financing stocks look great: MasterCard (MA) was up, but not on the kind of volume we love. For the homebuilders, a key stock is Pulte Homes (PHM).

And it goes without saying that airlines and banks rocked (their best one-day sessions ever) on earnings news - and with a little help from oil, of course.

Amex Airline Index (XAL) shattered the trend line and doesn't have a lot of room up to 19.3.

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Select Financial ETF (XLF) closed at a pivotal resistance point under 19.5. But the real breakout comes with a close above 21.0, preferably on strong volume.

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Weak Sectors:

Copper is declining, perhaps driven by the same forces weighing on crude oil: slower global demand and difficult comparisons. Key stock: Rio Tinto (RTP).

Of course, oil-related stocks were off a lot, and agriculture stocks took a hit as well.

On the issue of pessimism: The National Association of Homebuilders and Wells Fargo released the latest reading on housing sentiment, which has tumbled to an all-time low. This Housing Market Index (HMI) is a weighted, seasonally adjusted statistic derived from ratings from present single-family sales, single-family sales in the next 6 months and buyer traffic.

I guess it would be wise to wait for some kind of uptick. But, man, there isn't a lot more room on the downside - literally. I remember when the number came in at 20.0 last September, and it felt like that was as bad as it could get.

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No positions in stocks mentioned.
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