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Schaeffer's Daily Market Blog Features Milacron, Avon Products, General Electric, AMEX Airlines Index, and H&R Block.

CINCINNATI -- Among the stocks featured in the February 24 edition of Schaeffer's Market Blog are Milacron (NYSE:MZ), Avon Products (NYSE:AVP), General Electric (NYSE:GE), AMEX Airlines Index (AMEX:XAL), H&R Block (NYSE:HRB). Schaeffer's Market Blog is just one of the many free market commentaries written everyday at - 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. .

Schaeffer's Market Blog for Friday, February 24, 2006:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. .

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12:49 PM Milacron Posts Fourth-Quarter Profit

Milacron (NYSE:MZ) has tacked on nearly two percent this afternoon following its earnings report. The Cincinnati-based company banked a fourth-quarter profit of $5.67 million, or a nickel per share, beating its year-ago loss of three cents per share. Sales for the three-month period rose to $217.1 million from $213.1 million. What's more, the company expects modestly favorable comparisons in the first quarter compared to a year ago, both in sales and in segment earnings, before the effect of any restructuring charges. MZ forecasts overall volume growth of four to five percent in 2006.

12:55 PM Avon Products Announces Restructuring Plans

Before the open this morning, Avon Products (NYSE:AVP) announced that the cost to implement its multi-year, four-part turnaround plan would be at the high end of its previously announced $300 million to $500 million range. The firm expects restructuring costs for all initiatives to total about $500 million, with implementation continuing during the next three years. What's more, the cosmetics company expects to realize annual savings in excess of $300 million when the restructuring is completed.

Technically speaking, since the shares gapped lower on September 21, AVP has trended sideways between support at the 25 level and resistance at 29.50. The equity will soon have to face long-term resistance at its 10-month moving average, which is declining into the area. The stock has not finished a month above this trendline since March 2005.

1:43 PM Put Activity Increasing on GE

Put options are becoming the popular play on General Electric (NYSE:GE) of late. The Schaeffer put/call open interest ratio on the stock has trended higher from a low of less than 0.50 back in late 2004 to its current reading of 1.41, which is higher than 94 percent of readings over the past year. Today's put activity includes volume of more than 20,000 contracts and is nearly four times the average level of put volume for the stock. It's possible the pessimism toward the equity is becoming a bit overdone and the shares may find support here near the $32.50 level.

2:45 PM Airlines and Higher Oil

One group that I'm bullish on is airlines and I must say that today's action is encouraging. How in the world could I say that, with the AMEX Airlines Index (AMEX:XAL) down 0.75 percent you ask? Simple, oil is up nearly four percent to almost $63 a barrel, that's how. Higher oil isn't a good thing for airlines and today's strength in the face of higher oil is a nice sign. Historically we're entering a bearish time for energy prices across the board and that could be good for airlines. The obvious reason that oil is higher today is because of more turmoil in the Middle East and Africa. I'm not going to pretend to know what will happen with that, but history says this is a bearish time for energy. Looking at the technical picture for XAL, plus a few other leading airlines, has me thinking that this is still a good place to be invested.

3:40 PM Oil and Gold

So oil finished up nearly four percent you'd think oil companies would have had a banner day wouldn't you? Well, as of right now the AMEX Oil Services HOLDRS Trust (OIH) is up only 1.17 percent and the Select Sector SPDR Energy Fund (XLE) is up 1.42 percent. To me this isn't very good price action. I feel the same about gold stocks. With gold up over $10 an ounce, I'm disappointed to see the XAU up only 2.17 percent. Sure that's a nice day, but it continues the recent trend of the XAU underperforming the metal. Until I see the XAU have a nice up day and gold down, I'd be very skeptical of buying any gold stocks.

3:40 PM H&R Block Down on Disappointing Earnings and More

Things just keep getting worse for H&R Block (NYSE:HRB). The tax preparation firm announced third-quarter earnings yesterday after the closing bell. It earned 19 cents per share, seven cents less than the consensus estimate. The company also lowered its earnings guidance for fiscal 2006. HRB now expects to earn between $1.65 and $1.85 per share in 2006, far lower than the $1.90-2.15 it had expected. The Wall Street consensus was $1.88 per share. And here's something else that could end up as fodder for at least a few late-night talk show jokes. HRB also said that it got its own taxes wrong in recent years. It will restate results for fiscal years 2004 and 2005, plus previous 2006 quarters, mainly because of errors in calculating its state effective income tax rate. The stock is down almost nine percent in response. It made a 16-month low of 22.78 earlier today.

5:18 PM Schaeffer's Radio

Just a reminder that much of our material is now available free of charge in audio form at Every day we present Opening View, which looks at the state of the markets before the bell, and Market Recap which summarizes the day's events after the market closes. In addition, we have interviews with traders, plus short bulletins during the day that bring up-to-date news as it happens.

The above are just a few of today's Daily Market Blog entries. Click here to read all of today's Daily Market Blog. .

Take advantage of the timely Schaeffer commentaries by signing up for their free e-newsletters -- Opening View, Market Recap and Monday Morning Outlook. Click here to have the Schaeffer's commentaries delivered to you free via email every day. .

About Schaeffer's Investment Research (

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, , 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: .
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Publication:Business Wire
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Date:Feb 24, 2006
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