Schaeffer's Daily Market Blog Features: Johnson & Johnson, Zimmer, Lennar, Boston Scientific, and Pfizer.

CINCINNATI -- Among the stocks featured in the June 26 edition of Schaeffer's Market Blog are Johnson & Johnson (NYSE:JNJ), Zimmer (NYSE:ZMH), Lennar (NYSE:LEN), Boston Scientific (NYSE:BSX), and Pfizer (NYSE:PFE). Schaeffer's Market Blog is just one of the many free market commentaries written every day at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB12M&PAGE=1.

Schaeffer's Market Blog for Monday, June 26, 2006:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1.

10:19 AM Johnson & Johnson Purchases Consumer Products Unit

This morning, Johnson & Johnson (NYSE:JNJ) announced that it agreed to buy Pfizer's (NYSE:PFE) consumer-products unit. JNJ is making the move to boost its presence in personal health care, and will dish out $16.6 billion for the unit. JNJ will expand its stable of products to include the likes of Listerine mouthwash, Nicorette anti-smoking treatments, Sudafed, Rolaids, Benadryl, and Rogaine baldness treatment. In February, PFE decided to put the unit up for sale following February's review of strategic options. According to the New York Times, analysts expected PFE to fetch roughly $14 billion for the unit.

JNJ gapped lower on the news, dropping nearly two percent as PFE is nearly two percent higher. While JNJ lost the support of its 10-day and 20-day moving averages on the news, PFE has been capped by its 20-day moving average.

12:10 PM Zimmer Continues to Drop

After the closing bell sounded on Friday, Zimmer (NYSE:ZMH) got a bit of unwelcome news in the form of a subpoena from the Justice Department's Antitrust Division. According to ZMH, the Justice Department division requested documents for the period beginning January 2001 through the present. According to TheStreet.com, the investigation is into possible violations of federal criminal law, including possible violations of antitrust laws, involving the manufacture and sale of orthopedic implant devices. The company announced that it will fully cooperate with authorities throughout the investigation.

An investigation from the Justice Department is never appreciated, especially from the investing community. The shares gapped lower, which was just the start of a morning that has seen ZMH shed more than eight percent. One of our market gurus, Nick Perry, has had his eye on ZMH for a while now and goes into a technical examination in a Trading Floor Blog post from earlier today. Something I notice, and Nick points out in his post, is that 14 of 21 analysts covering ZMH (according to Zacks) rate it a "buy" or better. For a stock that has lost roughly 20 percent since last March and more than eight percent today, this is a tad disproportionate. Now that round-number support at the 60 level has given way, there is little to help prop the shares up. Short-covering support is nearly non-existent and peak put open interest in near-term options is at the 60 level. There is little to put a bottom to this drop, the 55 level provided a bit of resistance in the past and could switch roles, but the past year tells me I shouldn't hold my breath waiting for support.

12:11 PM Lennar Reports Strong Earnings but Warns of Downturn

Home builder Lennar (NYSE:LEN) reported second-quarter earnings that beat the Street estimate this morning. Net income increased by 39 percent to $324.7 million, or $2 per share, and sales climbed 56 percent to $4.6 billion. Nevertheless, LEN warned of an industry slowdown and cut its 2006 earnings-per-share guidance to the range $8.00 to $8.25, down from previous guidance of $9.25. The stock has been in decline since early April under pressure from its 10-day moving average, but this morning it used the support of this same trendline to jump above the 20-day moving average for the first time since April 11.

12:26 PM Boston Scientific Recalls Pacemakers

Moments ago, my colleague Ed Stenson sent me an email noting that Boston Scientific (NYSE:BSX) is recalling some pacemakers and defibrillators. After a rather humorous Monty Python-esque sketch of a doctor telling a patient that his already-implanted pacemaker was being reclaimed flashed through my head, I figured I would do a bit more investigation. Turns out that BSX is recalling the devices from its sales force and hospital inventories. The reason for the recall is that problems could cause battery depletion or a loss of operation, which is never a good situation when it comes to pacemakers and defibrillators. What's more, the devices in question come from BSX's cardiac rhythm management group, which was part of Guidant, which BSX acquired earlier this year.

2:07 PM Home Builders Up on Strong Earnings

We have another slow day so far, with the Dow up 12 and the S&P 500 Index up three points. Volume is light and internals lean in the bullish camp. Housing is one area having a pretty strong day with the PHLX Housing Sector Index (HGX) up 1.38 percent thanks to Lennar (LEN) beating earnings estimates by 16 cents - allowing LEN to jump almost three percent. Interestingly, LEN also lowered fiscal 2006 guidance, but this doesn't seem to matter much. Speaking of earnings and homebuilders, Beazer Homes USA (BZH) is set to report quarterly earnings tomorrow before the bell. Right now BZH is up 0.80 percent, while fellow home builder Meritage Homes (MTH) is up about two percent.

For more information on these stocks or any stock in your portfolio, feel free to visit our Schaeffer's Equity Scorecard feature. Click here to read all of today's Market Blog: http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1.

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Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .