Brenda Buttner was joined by: Gary B. Smith, RealMoney.com columnist; Scott Bleier, Fox Business News contributor; Joe Battipaglia, Chairman of Investment Policy at Gruntal & Co. and Mike Norman, The Economic Contrarian Update publisher.

Trading Pit

Is Dow 10K here to stay? Last week the Dow closed well above 10,000 after gaining 401 points. In fact it's the first time the Dow has finished a week above that mark since early January.

Gary B. thinks that the Dow is headed higher. He feels the longer it can stay above 10,000, the better psychologically, because investors won't want to miss the move up.

But not everyone thinks the market is headed up. Mike Norman warned investors about buying on strength and believes that now is not the time to get into the market.

Joe said Dow 10K is here to stay and expect the market to get stronger and head higher because of the strength in the economy.

Scott expects the Dow to test 10,000 and then head higher in the near term. He advised investors to buy big cap cyclical stocks on weakness.

Brenda then asked the panel about the threat of a terrorist attack. She said last week just a whiff of terror stole away rallies two days in a row. Joe responded that another attack would have an immediate adverse reaction to the economy and the market. But our confidence grows with each passing event (like the Olympics) without incident.

Gary B. then charted the Diamonds Trust (DIA), which is a basket of the stocks that comprise the Dow. He likes the Diamonds Trust because he noticed that it has finally broken its downtrend line that was formed last May.

Stock X-Change

Joe, Mike, and Scott all stayed put and took a look at the top performing Dow stocks since the first of the year.

First up, number one in the Dow since January 1st, Boeing (BA). The world's number one aerospace company is up 24% year to date. But Mike thinks that the stock has had its run and is done moving up. He said what concerns him is the company's exposure to the civilian aircraft sector. Joe expects the stock to head higher because Boeing is a powerhouse in two major industries, defense and commercial aircraft. And these industries will continue grow and recover. Scott said the stock can go up, but it will have to go through strong resistance.

The second biggest gainer in the Dow so far in 2002 is Honeywell (HON), which is up 18%. Joe has this stock on his recommended list and sees the stock going to $50. (It closed on Friday at $39.79.) However, Mike thinks it is just too expensive. Scott also likes the stock, and thinks it is a good buy at its current price.

Number three in the Dow this year is Philip Morris (MO), up 17%. Scott likes this stock because it is a cash flow machine and has a hefty yield. Mike does not like the stock because he thinks its price is too high. Joe also likes Philip Morris because it now is able to deal with its tobacco issues and will grow their food business.

Chartman

The Chartman brought in some perfect charts. Charts that are perfectly good, and charts that are perfectly bad.

First he looked at his good charts. ITG (ITG) is at the top of his list because it just broke to a new high above $45. It is strong and getting stronger. He sees the stock at $70 in a year.

His other perfect chart is KB Home (KBH), which is also strong and getting stronger. It just broke to a new high of $44, and he thinks it can get to $60 within a short time.

But the Chartman also knows a bad chart when he sees one, and at the top of his bad list is Nextel (NXTL). He noticed a massive selloff with a dead cat bounce in February. But this bounce only brought it to its downtrend line, not through it.

Also on his list of bad charts is Brocade Communications (BRCD). This chart is weak and getting weaker. It has shown no strength, and has no support until the low teens.

Predictions

Scott: Genesis (GNSS) will be my worst call this year!

Joe: Generic drug stocks like IVAX (IVX) win big!

Gary B: Microsoft (MSFT) up 10%; then drops below $50

Mike: Government numbers game makes interest rates rise!