Prime Stock Advisory Letter for January 4th, 1999

Position Statement: In our Prime Recommendation Letter we attempt to identify the recommendation with the highest probability of moving higher.  We recommend that stop orders be placed at the time of purchase,  and once the position has moved profitable we recommend a stop be placed a minimum of 3/8th above the purchase price and moved higher as the position moves higher.
 

Today's Comments:   Today's newsletter contains our annual look at the performance of the various sector indices that we track.  Our regular reports will resume tomorrow.  It is no surprise that the best performing sectors were the Internet related indices,  followed by the other high tech indices.  The S&P 500 gained 26.67%,  the NASDAQ 100 'NDX' gained 85%,  and the Dow Jones Industrial Average gained 16.14%.  The best performing index was the CBOE Internet Index 'INX' which gained over 200%.  The worst performing index was the Amex Natural Gas Index which dropped 36%  I am looking forward to 1999 providing some excellent trading opportunities.  With the S&P 500 'SPX' trading at over 32 times earnings I am not sure how much further the market will advance.
 
 
 
1998 Index Performance Report
Index Name & 
Ticker Symbol 
Dec 31, 1997 
Close 
Dec 31, 1998 
Close 
Point 
Change 
Percentage 
Change
S&P 100 'OEX' 
459.94 
604.03 
144.09 
31.33%
S&P 500  'SPX' 
970.43 
1,229.23
258.80 
26.67%
NASDAQ 100 'NDX' 
990.80 
1,836.01 
845.21 
 85.31%
NASDAQ Comp 'COMPQ' 
1,570.35 
2,192.69 
622.34 
39.63%
Dow Jones Indust 'INDU' 
7,908.25 
9,184.43 
1,276.18 
16.14%
Amex Biotech  'BTK' 
162.42 
 185.13 
22.71 
 13.98%
Amex Pharm. 'DRG' 
533.74 
779.70 
245.96 
46.08%
S&P Healthcare 'HCX' 
540.28 
770.60 
 230.32 
  42.63%
M.S. Consumer 'CMR'
  445.64 
 558.10 
 112.46 
 25.24%
CBOE Comp. Software 'CWX' 
 466.87 
638.42 
 171.55 
 36.74%
Amex Inter@ctive 'IIX' 
 260.25 
 641.14 
380.89 
 146.36%
CBOE Internet 'INX' 
129.26 
 395.65 
266.39 
206.09%
M.S. High Tech 'MSH' 
 447.52 
 874.47 
426.95 
95.40%
Phil Semiconductor 'SOX' 
262.63 
350.56 
87.93 
33.48%
CBOE Technology 'TXX' 
215.79 
425.77 
209.98 
 97.31%
Amex Comp. Tech. 'XCI' 
 438.99 
 796.58 
 357.59 
 81.46%
M.S. Cyclical 'CYC' 
 475.01 
 476.84 
1.83 
  0.39%
CBOE Gaming 'GAX' 
222.98 
166.73
(56.25)
  -25.23%
Phil. Airline Index 'PLN' 
636.80 
689.69 
52.89 
 8.31%
Amex Airline Index 'XAL' 
331.30 
 303.32 
(27.98) 
-8.45%
S&P Transport. 'TRX' 
689.20 
668.71 
(20.49) 
-2.97%
Phil. Phone Index 'PNX' 
341.79 
478.17 
136.38 
39.90%
Amex Telecom. 'XTC' 
590.98 
 908.08 
317.10 
 53.66%
S&P Retail 'RLX' 
 530.13 
848.86 
318.73 
 60.12%
S&P Banking Index 'BIX' 
 640.15 
667.21 
27.06 
4.23%
Phil. Banking Index 'BKX' 
755.35 
805.21
 49.86 
  6.60%
S&P Insurance Index 'IUX' 
581.69 
 594.85 
 13.16 
2.26%
Phil. Utility Index 'UTY' 
310.03 
348.69 
38.66 
12.47%
CBOE Reit Index 'RIX' 
270.03 
234.84 
(35.19) 
-13.03%
Phil. Gold/Silver Index 'XAU' 
74.19 
64.85 
(9.34) 
-12.59%
Amex Broker/Dealer 'XBD' 
470.58 
551.41 
 80.83 
 17.18%
M.S. Commodity 'CRX' 
209.77 
179.12 
(30.65) 
-14.61%
S&P Chemicals 'CEX' 
454.36 
422.36 
 (32.00) 
-7.04%
Phil. Forest & Paper 'FPP' 
282.15 
292.07 
9.92 
3.52%
Amex Natural Gas 'XNG' 
350.83 
 223.90 
 (126.93)
 -36.18%
Amex Oil Index 'XOI' 
454.36 
433.19 
(21.17) 
 -4.66%
CBOE Enviromental 'EVX' 
159.76 
160.56 
0.80 
0.50%

Indices and our opinions of them:

S&P 100, 'OEX': closed @ 604.03 Last Signal:  Called Higher on 12-16 @ 576.12 Current Expectation:  Higher.  The index should test 618.91 on a closing basis.  If this index is down again today a "Sell Signal" could be generated.

S&P 500, 'SPX': closed @ 1,229.23    Last Signal: Called Higher on 12-16 @ 1,162.83  Current Expectation: Higher.  The index should test 1,243.46 on a closing basis.  If this Index is down again today a "Sell Signal" could be generated.

NASDAQ 100, 'NDX':   Closed @ 1,836.01 Last Signal:  Called Higher on 10-13 @ 1,243.40   Current Expectations:  Higher.  This index has exceeded our upside targets.

NASDAQ.CMP. 'COMPQ':  closed @ 2,192.69 Last Signal:  Called Higher on 10-12 @ 1,492.49 Current Expectation:  Higher  This index has exceeded our upside targets.

DOW JONES, 'INDU':  closed @ 9,181.43 Last Signal: Called Higher on 12-22 @ 8,988.85 Current Expectation: Higher.  The index should test 9,374.27 on a closing basis. If this Index is down again today a "Sell Signal" could be generated.

AMEX BIOTECH, 'BTK':  closed @  185.13 Last Signal:  Called Higher on 12-10 @ 172.44 Current Expectation:  Higher.  The index should test 190.07 on a closing basis.  If this index closes above 190.07 then a "CUP PATTERN" will have been completed with a measured move to 275.63

AMEX PHARM., 'DRG':  closed @ 779.70 Last Signal:  Called Higher 12-24 @ 761.73 Current Expectation:  Higher. The index should test 823.86 on a closing basis.

S&P HEALTHCARE, 'HCX':  closed @ 770.60 Last Signal:  Called Higher on 12-24 @ 751.56   Current Expectation:  Higher.  The index should test 792.59 on a closing basis.

M.S. CONSUMER, 'CMR':  closed @ 558.10 Last Signal:  Called higher on 12-22 @ 539.40  Current Expectation:  Higher.  The index should test 628.84 on a closing basis.

CBOE SOFTWARE, 'CWX':  closed @ 638.42 Last Signal:  Called Higher on 12-23 @ 601.46 Current Expectation:  Higher.  The index should test 691.77 on a closing basis.  Our Longer Term target level for this index is 902.05

AMEX INTER@CTIVE, 'IIX':  closed @ 641.14 Last Signal:  Called Higher on 11-18 @ 451.04   Current Expectation:  Higher.  This index has exceeded our upside target levels.  I am expecting it to continue to move higher.

CBOE INTERNET INDEX 'INX': closed @ 396.65   Last Signal:  Called Higher on 11-18 @ 285.17   Current Expectation:  Higher. This index has exceeded our upside target levels.  I am expecting it to continue to move higher.

M.S. HIGH TECH, 'MSH':  closed @ 874.47  Last Signal:  Sell Signal on 12-31 @ 868.11   Current Expectation:  Lower.  The index should test 795.40 on a closing basis.

PHILY SEMICONDUCT, 'SOX':  closed @ 350.56 Last Signal:  Called Higher on 12-18 @ 339.98   Current Expectations: Higher.  The index should test  391.62 on a closing basis.

CBOE. TECH., 'TXX':  closed @ 425.77   Last Signal:  Sell Signal on 12-31 @ 424.30   Current Expectation:  Lower.  The index should test 386.39 on a closing basis.

AMEX COMPUTER, 'XCI':  closed @ 796.58 Last Signal:  Called Higher on 10-12 @ 534.93  Upgraded with a Buy Signal on 10-13 @ 553.31   Current expectation:  Higher.  This index has exceeded our expected target levels to the upside.

M.S. CYCLICAL, 'CYC':  closed @ 476.84 Last Signal:  Called higher on 12-24 @ 467.94   Current expectation: Higher. The index should test 480.55 on a closing basis.

CBOE GAMING, 'GAX':  closed @ 166.73 Last Signal:  Buy Signal on 12-23 @ 157.96 Current Expectation:  Higher.  The index should test 177.12  on a closing basis.

PHILY AIRLINE, 'PLN':  closed @ 689.69 Last Signal:  Buy Signal on 12-21 @ 676.61   Current Expectation:  Higher,  The index should test 694.62 and then 707.39 on a closing basis.

AMEX AIRLINE, 'XAL':  closed @ 303.32 Last Signal:  Buy Signal on 12-21 @ 295.19 Current Expectation:  Higher,  The index should test 304.72 and then 312.48 on a closing basis.

S&P TRANSPORT, 'TRX':  closed @ 668.71 Last Signal:  Buy Signal on 12-21 @ 655.47 Current Expectation:  Higher.  The index should test 670.31 and then 716.49 on a closing basis.

PHILY PHONE, 'PNX':  closed @ 478.17 Last Signal:  Called Higher on 12-17 @ 446.34 Current Expectation:  Higher.  This index has exceeded our upside target levels.

AMEX N.A. TELECOM, 'XTC':  closed @ 908.08 Last Signal:  Called Higher on 11-19 @ 794.39 Current Expectation:  Higher. This index has exceeded our upside target levels.

S&P RETAIL, 'RLX':  closed @  848.86 Last Signal:  Called Higher on 12-8 @ 782.79   Current Expectation:  Higher.  The Index should test 957.89 on a closing basis.

S&P BANKING, 'BIX':  closed @ 667.21 Last Signal:  Sell Signal on 1-4 @ 667.21 Current Expectation:  Lower .  The index should test 663.69 and then 645.39 on a closing basis.

PHILY BANKING, 'BKX':  closed @ 805.21 Last Signal:  Sell Signal on 1-4 @ 805.21  Current Expectation:  Lower.  The index should test 789.13 and then 775.48 on a closing basis.

S&P INSURANCE, 'IUX':  closed @ 594.85 Last Signal:  Sell Signal on 1-4 @ 594.85   Current Expectation:  Lower.  The index should test 584.32 and then 574.25 on a closing basis.

5 YR. BOND %, 'FVX':  closed @ 4.523%    Last Signal:  Called Lower on 12-31 @ 4.530%  Current Expectation:  Lower.  The index should test 4.493% and then 4.450% on a closing basis.

10 YR. BOND %, 'TNX':  closed @ 4.638% Last Signal:  Called Lower on 12-31 @ 4.642%  Current Expectation: Lower. .  This index should test 4.571% and then 4.521% on a closing basis.

30 YR. BOND %, 'TYX':  closed @ 5.084% Last Signal:  Called Lower on 12-31 @ 5.086% Current Expectation:  Lower.  This index should test 5.008%  and then 4.956% on a closing basis.

PHILY UTILITY, 'UTY':  closed @ 348.69 Last Signal:  Sell Signal on 12-28 @ 349.82  Current Expectation:  Lower.  The index should test 340.36 on a closing basis.

CBOE REIT, 'RIX':  closed @ 234.82 Last Signal:  Buy Signal on 1-4 @ 234.84    Current Expectation:  Higher.  The index should test 240.72 on a closing basis

PHILY GOLD/SILVER, 'XAU':  closed @ 64.85   Last Signal:  Called Lower on 11-11 @ 78.10   Current Expectation:  Lower.  The index should test 64.06 and then 60.84 on closing basis. 

AMEX BROKER/DEALER, 'XBD':  closed @ 551.41 Last Signal:  Sell Signal on 12-31 @ 555.29 Current Expectation:  Lower.  The index should test 542.78 and then 517.55 on a closing basis.

M.S. Commodity Index 'CRX': closed @ 179.12 Last Signal:  Buy Signal on 12-24 @ 175.94   Current Expectations:  Higher.  The index should test 182.04  on a closing basis.

S&P CHEMICAL, 'CEX':  closed @ 422.36 Last Signal:  Called Higher on 12-28 @  425.99   Current Expectation:  Higher.  The index should test 453.67 on a closing basis.

PHILY FOREST & PAPER, 'FPP':  closed @ 282.07 Last Signal:  Called higher on 12-22 @ 277.09   Current Expectation:  Higher.  The index should test 295.19 and then 313.86 on a closing basis.

AMEX NAT. GAS, 'XNG':  closed @ 223.90 Last Signal:  Called Higher on 12-24 @ 220.20   Current expectation:  Higher.  The index should test 234.86 and then 251.61 on a closing basis.  208.00 is the all time low on this index.

AMEX OIL, 'XOI':  closed @ 433.19 Last Signal: Called Higher on 11-2 @ 435.07 Current expectation:  Higher.  The index should test 450.07 and then 445.90 on a closing basis.

CBOE ENVIRO, 'EVX':  closed @ 160.56 Last signal:  Called Higher on 1-4 @ 160.56 Current Expectation: Higher.  The index should test 165.96 on a closing basis.


The Sterling Investment series of newsletters is produced by Sterling Investment Services, Inc.  If you would like to receive a chart on any index or stock mentioned in this report please contact us at the below mentioned numbers.  We also offer custom research reports on any stock investment that you may desire information on.  To receive further information on these services please visit our web page at:  www.sterlinginvestments.com   If you would like to contact us our # is 800-275-6901,  fax # (404)-816-8830  Email address is: enelson@sterlinginvestments.com  Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.

FREE Subscription to the Small Cap Advisory Letter

Previous Prime Stock Advisory Letters

Sterling Investment Services Home Page
For those of you who would like to contact me during the day I am also available on line through the AOL Instant Messenger service (It is available through AOL and as a Netscape Plug-In.).  My screen name is "ESN Fin".  I welcome and encourage you to use this method of communication.  I look forward to your use of the AOL Instant Messenger Service.  This is a FREE SERVICE.  You do not need to be an AOL Subscriber to use this service.  A free download of this service is available at www.newaol.com/aim

email: enelson@sterlinginvestments.com
Copyright 1996-97 Sterling Investment Services, Inc.
PO Box 191767, Atlanta, GA. 31119-1767
Fax 404-816-8830
404-816-8240
Home | EMail Service | Fax Service