Industry Group Analysis

This Week: Big Chart Shows Signs of a Change in Leadership

1. Introduction
2. Groups that are Heating Up
3. Groups that are Cooling Off
4. On the Radar Screen this Week
5. Stock in Focus
6. Disclaimer

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1. Introduction

Rotation abounds on the Big Chart as some of the formerly
weak groups are showing some signs of life, while some of
the stronger groups are starting to see their high
percentile rankings slip.  Speculation about lower interest
rates, a growing consensus that the Nasdaq has established
a bottom, and seasonal factors are all spurring the
reallocation of investment dollars.

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2. Groups that are Heating Up

This week's analysis starts right at the top of the Big
Chart with the banking sector.  All three industry groups
within the sector - Banks {.BAN}, Banks/Savings & Loan
{.BSL}, and Banks/Savings Banks {.BSB} - saw their
respective rankings rise last week.  The primary driver
behind this move was an improved interest rate outlook,
though Joe Morford at Dain Rauscher Wessels noted that
merger activity is picking up.  Among the best performers
were Century South {CSBI} (announced merger with BB&T
{BBT}), Charter One Financial {CF}, Imperial Bancorp {IMP}
(testing resistance), and Comerica {CMA}.

Selected groups within the electronics sector improved their
rankings.  Electronics/Motors rebounded back to the 85th
percentile after briefly dropping from green to yellow, two
weeks ago.  The group is being powered by electronics
conglomerate Emerson {EMR}, which set a new record high.
The Electronics/Semiconductors {.ESE} group seems to have
found a bottom, though it still remains among the worst
performing industry groups.  Nonetheless, it's worth noting
that the group's ranking has fallen below the tenth
percentile just twice since the beginning of October.
Electronics/Specialty instruments began its recovery after
posting a big drop on the Big Chart two weeks ago, with
gains by Zygo {ZIGO}, Newport Corporation {NEWP}, and
Trimble Navigation {TRMB}.

Other industry groups that gained ground last week include
Chemicals {.CHE}, Computer/Components {DCO},
Drugs/Biotechnology {.DBI}, Leisure/Race Tracks {.LRT},
Retail/Stores/Discount {.RDI}, and Retail/Stores/Specialty
{.RSP}, which improved its ranking for the fourth consecutive
week.

To view the Big Chart click the link below.

http://clyde.investools.com/T/A24.133.315.2.42265
____________________________________________________________

3. Groups that are Cooling Off

Market sentiment finally coalesced with respect to the
entire utilities sector, and that sentiment was toward
profit taking.  Utilities/Diversified {.UDI} fell out of the
top quintile for the first time in five weeks and only the
second time since the beginning of October.  PG&E {PCG} fell
by more than 10 percent after the president of the California
Public Utilities Commission, Lorretta Lynch, said that
requests for electric rate increases by PCG and Southern
California Edison were premature.  Utilities/Gas/Producer-Gatherer
{.UPG} also dropped out of the top quintile, while
Utilities/Electric/Holding {.UHO} is threatening to turn from
green to yellow.

The beverage sector - which includes Beverages {.BEV},
Beverages/Beer & Ale {.BBA}, Beverages/Bottlers {.BBO},
Beverages/Distillers {.BDI}, Beverages/Soft Drink Syrup
{.BSD} - weakened as investors began funneling more money
into the tech sector.

Other groups that that fell on the Big Chart include
Energy/Oil-Gas/Domestic {.ODO}, Leisure/Casinos-Gaming {.LCG},
Vehicles/Truck-Trailers {.ATT}, and Homes/Hotels-Motels-Inns
{.HOT} - a group that we noted last week was likely to fall.

To view the Big Chart click the link below.

http://clyde.investools.com/T/A24.133.315.3.42265
____________________________________________________________

4. On the Radar Screen this Week

The retail sector could be worth watching over the next few
weeks as holiday shopping picks up.  Though many stores are
relying on discounts to draw in consumers, certain industry
groups within the sector have been improving their rankings;
these groups include Retail/Stores/Department {.RDE},
Retail/Stores/Discount {.RDI}, and the aforementioned
Retail/Stores/Specialty {.RSP}.  Stocks that are performing
well in these groups include Footstar {FTS}, Bebe Stores
{BEBE} and Target {TGT}.

To view the Big Chart click the link below.

http://clyde.investools.com/T/A24.133.315.4.42265
____________________________________________________________

5. Stock In Focus

Foostar {FTS} has more than survived the volatility of the
past several weeks with a six-week gain of 32.0 percent. The
company saw same-store sales increase 13.5 percent in
November and could be on its way to posting a strong December;
particularly since FTS has a history of exceeding analyst
expectations by notable margins.  Footstar operates the
Footaction and Just for Feet chains and, last month, agreed
to acquire the footwear division of J. Baker {JBAK}.

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6. Disclaimer

WallStreetCity,s Industry Group Analysis is published solely
for informational purposes and is not a solicitation or an
offer to buy or sell any stock, mutual fund or other security.
The information obtained from internal and external sources
is considered reliable, but has not been independently
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is no indication of future results.

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