“Contas equilibradas não significa superávite”

[Ulisses Pereira]

"Market Keys Off Smokestacks, Not the SOX"

By James J. Cramer
12/18/2003 10:13 AM EST


"You have to know what to key on. Wednesday, I saw the market going from red to black because I was keying on the smokestack stocks. You could see that they wouldn't be denied.

But a number of you emailed me and told me I didn't know what I was talking about because the SOX index was screaming that this market was going to sell off, perhaps big.


How quaint! How turn of the century!

There was a time when this market marched to the beat of the SOX index. There was a time when you could look at it and determine how the QQQs (QQQ:Amex - commentary - research) would go and maybe even the S&P 500. It was the tell for some time.

It isn't anymore. This market is changing before our eyes. While tech is important, the lack of important pin action stemming from stocks like Texas Instruments (TXN:NYSE - commentary - research) and Micron (MU:NYSE - commentary - research) and Applied Materials (AMAT:Nasdaq - commentary - research) and KLA-Tencor (KLAC:Nasdaq - commentary - research) of late tells you that you are following a false tell. The SOX predicts nothing right now, nothing at all. Frankly, I would rather watch Lennar (LEN:NYSE - commentary - research) and Toll (TOL:NYSE - commentary - research).

When we look back at 2003, though, the case will be made that this was the market of the Smokestack Seven (plus Phelps Dodge (PD:NYSE - commentary - research) and McMoRan (FCX:NYSE - commentary - research). Those are the tells for this market. You can mimic them with the cyclical index (CYC), but they hold the key to the market.

David Faber and Joe Kernen used to make fun of me in the mid-1990s because, at that point, I said that Pfizer (PFE:NYSE - commentary - research) was the key to the market. As in, if I was on the road and called in to my assistant, I'd ask about Pfizer; it would be all I needed to know about where the market was heading.

In 1999, 2000, 2001 and 2002 I asked for the SOX.

Now I ask for the Smokestack Seven. As long as they are moving up smartly, the major trend is in place, and the major trend, despite what the SOX might be saying to you, is still higher. "

(in www.realmoney.com)


Nota: As "smokestack seven" de que fala o Cramer são: Ingersoll-Rand (IR:NYSE - commentary - research)
American Standard (ASD:NYSE - commentary - research)
Fortune Brands (FO:NYSE - commentary - research)
Caterpillar (CAT:NYSE - commentary - research)
Deere (DE:NYSE - commentary - research)
3M (MMM:NYSE - commentary - research)
United Tech (UTX:NYSE - commentary - research). Ou seja, são as empresas cíclicas.