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The Daily Dow LEXINGTON, Ky. (July 2): With the Federal Reserve meeting today and tomorrow to discuss, among other things, the direction of short-term interest rates and another dire profit warning in the technology sector (this time it was Digital Equipment), the market was a little skittish. On the day, however, it was a very modest 9 point drop for the Dow.
The only news of significance regarding the Foolish Four is that Prudential Securities lowered its rating on 3M from a Buy to a Hold. That knocked the stock down a little over 2 points on the session.
As for the 3M spin-off, Imation <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE:IMN)") else Response.Write("(NYSE:IMN)") end if %>, the company announced its new directors today. The stock certificates should be mailed out around July 15 to 3M shareholders of record as of last Friday's close. The company's stock currently is being traded on a "when issued" basis on the New York and Chicago stock exchanges.
In DuPont news, the energy subsidiary Conoco said one of its Ewing Bank wells set company records for single-well production in the Gulf of Mexico. The well tested at nearly 6000 barrels of oil per day and over 3300 thousand cubic feet of natural gas per day on a 38/64-inch choke.
All eyes will be on the Fed tomorrow. The consensus estimate (or guess) is that the Fed won't hike rates tomorrow), but a short-term movement could be in the cards if the Fed surprises everyone. Whatever happens tomorrow, we long-term Fools will just plod along as usual, being called ostriches by market timers, (f)ools by others.
The recent attacks on the Dow approach by the Wise are funny in a way. They claim the approach can't keep working (although the last five years have shown it to be working just fine, thank you, averaging nearly 34% a year), yet the Wise are unable to offer an alternative that has a proven track record that beats it.
Of course the Dow approach isn't perfect, but until there's an objectively quantifiable approach that proves better over a long period of time, the tortured protestations of the self-serving Wall Street cottage industries aren't going to be enough to make a Fool give it up. As always, accountability provides the ultimate scoreboard. With the Dow approach, you know what kind of history you're working with. Fool on.
Transmitted: 7/2/96
Today's Dow Numbers THE FOOLISH FOUR MODEL (7/2/96) |
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