Indices
S&P 500 1,418.30 +15.8%
DJIA 12,463.15 +19.0%
NASDAQ 2,415.29 +10.4%
Russell 2000 787.66 +18.4%
Wilshire 5000 14,215.82 +13.75%
S&P Barra Growth 652.55 +11.0%
S&P Barra Value 764.25 +20.9%
Morgan Stanley Consumer 695.50 +20.1%
Morgan Stanley Cyclical 893.44 +16.1%
Morgan Stanley Technology 568.20 +9.4%
Transports 4,560.20 +9.8%
Utilities 456.77 +16.6%
MSCI Emerging Markets 114.17 +31.2%
S&P 500 Cum A/D Line 10,927 +16.6%
Bloomberg Crude Oil % Bulls 46.0 +110.0%
CFTC Oil Large Speculative Longs 160,309 +33.0%
Put/Call .88 +15.8%
NYSE Arms 1.56 -5.55%
Volatility(VIX) 11.56 -4.22%
ISE Sentiment 165.0 -13.6%
AAII % Bulls 46.0 -10.0%
AAII % Bears 36.0 +47.3%
US Dollar 83.65 -8.3%
CRB 307.26 -7.4%
ECRI Weekly Leading Index 138.50 +14.0%
Futures Spot Prices
Crude Oil 61.05 unch.
Reformulated Gasoline 161.63 n/a
Natural Gas 6.3 -44.0%
Heating Oil 164.82 -6.2%
Gold 638.80 +22.9%
Base Metals 236.91 +55.4%
Copper 286.60 +32.3%
10-year US Treasury Yield 4.7% +7.1%
Average 30-year Mortgage Rate 6.18% -13.44%
Leading Sectors
Telecom +33.6%
REITs +30.0%
Gaming +25.2%
Defense +25.1%
I-Banks +23.1%
Lagging Sectors
Hospitals +1.52%
Internet +.64%
Semis -2.4%
Homebuilding -9.1%
Coal -9.3%
This Year’s Winners
This Year’s Losers
*1-Year % Total Return
Saturday, December 30, 2006
Friday, December 29, 2006
Stocks Slightly Lower into Final Hour on Year-end Profit-taking
BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Computer longs and Commodity shorts. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is modestly negative as the advance/decline line is lower, most sectors are declining and volume is very light. US stock short interest is just off all-time highs, US stock mutual funds have seen outflows for months and the sentiment of the herd is very pessimistic. In fact, herd sentiment has never been worse in US history with the DJIA making record highs almost weekly. With all the many bears and even many bulls calling for a pullback in January, I wouldn’t be surprised to see stocks start the new year off with a very strong upwards bang after a couple more consolidation days as the anticipated decline fails to materialize and investors jump back on before getting left too far behind again. The S&P 500 is finishing the year with about a 15.5% total return, slightly above my early year prediction of a 15% total return. I expect US stocks to trade modestly higher into the close from current levels on more economic optimism and short-covering.
Thursday, December 28, 2006
Friday Watch
Late-Night Headlines
Bloomberg:
- President George W. Bush declared Jan. 2 to be a national day of mourning after this week’s death of former President Gerald R. Ford.
- The Nasdaq Stock Market said it will close Jan. 2 in honor of former President Gerald Ford. The NYSE may shut down as well.
- Broadway Real Estate Partners LLC, a property-investment and management firm, said it bought Boston’s John Hancock Tower and nine other US buildings today from Beacon Capital Partners LLC for more than $3.3 billion.
- The People’s Liberation Army, the world’s largest regular fighting force, spent 14.7% more this year, according to a Chinese government report. Military spending accelerated after a decade of 9% average increases.
- The Securities Industry and Financial Markets Assoc. recommended US bond markets close early on Jan.2 in honor of former President Gerald Ford.
- Crude oil is falling in NY, heading for a second weekly decline, as mild weather is reducing near-record speculation by investment funds on the commodity.
- Ipsco Inc.(IPS), which makes steel pipe for oil and natural gas explorers, cut its fourth-quarter profit forecast to $3-$3.10/share, citing lower demand for steel plate and tube and higher industry inventories. Ipsco had forecast profit of $3.30-$3.50/share.
- AT&T(T) agreed to new concessions including some price controls to win regulatory approval for its $86 billion purchase of BellSouth Corp.
AP:
- The North Carolina State Bar filed ethics charges against District Attorney Mike Nifong, the prosecutor in the Duke University lacrosse case.
Seoul Economic Daily:
- Samsung Group, Hyundai Motor Group, LG Group and SK Group plan to invest a total of $52 billion next year, 5.3% more than this year, the groups’ chairman told President Roh Moo Hyun yesterday.
Xinhua News Agency:
- China’s Internet users reached 132 million at the end of 2006, the second largest after the US, citing government data.
- China added 66.6 million cell-phone users and 19.6 million fixed-line telephone subscribers during 2006.
Late Buy/Sell Recommendations
Business Week:
- Green Mountain Coffee Roasters(GMCR), which sells coffee products to offices, supermarkets and restaurants, will see its shares climb as it adds customers, citing Richard Driehaus.
- Shares of EMC Corp.(EMC), a data storage company, may rise in 2007 as a result of higher revenue, successful acquisitions and buybacks, citing Jerome Heppelmann, CEO of Liberty Ridge Capital.
- Linear Technology(LLTC) may grow faster than the rest of the semiconductor industry, citing Christiana Bank & Trust fund manager Scott Armiger.
Night Trading
Asian Indices are +.25% to +.75% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.08%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- None of note
Upcoming Splits
- (SIAL) 2-for-1
- (SWS) 3-for-2
Economic Releases
- None of note
Bloomberg:
- President George W. Bush declared Jan. 2 to be a national day of mourning after this week’s death of former President Gerald R. Ford.
- The Nasdaq Stock Market said it will close Jan. 2 in honor of former President Gerald Ford. The NYSE may shut down as well.
- Broadway Real Estate Partners LLC, a property-investment and management firm, said it bought Boston’s John Hancock Tower and nine other US buildings today from Beacon Capital Partners LLC for more than $3.3 billion.
- The People’s Liberation Army, the world’s largest regular fighting force, spent 14.7% more this year, according to a Chinese government report. Military spending accelerated after a decade of 9% average increases.
- The Securities Industry and Financial Markets Assoc. recommended US bond markets close early on Jan.2 in honor of former President Gerald Ford.
- Crude oil is falling in NY, heading for a second weekly decline, as mild weather is reducing near-record speculation by investment funds on the commodity.
- Ipsco Inc.(IPS), which makes steel pipe for oil and natural gas explorers, cut its fourth-quarter profit forecast to $3-$3.10/share, citing lower demand for steel plate and tube and higher industry inventories. Ipsco had forecast profit of $3.30-$3.50/share.
- AT&T(T) agreed to new concessions including some price controls to win regulatory approval for its $86 billion purchase of BellSouth Corp.
AP:
- The North Carolina State Bar filed ethics charges against District Attorney Mike Nifong, the prosecutor in the Duke University lacrosse case.
Seoul Economic Daily:
- Samsung Group, Hyundai Motor Group, LG Group and SK Group plan to invest a total of $52 billion next year, 5.3% more than this year, the groups’ chairman told President Roh Moo Hyun yesterday.
Xinhua News Agency:
- China’s Internet users reached 132 million at the end of 2006, the second largest after the US, citing government data.
- China added 66.6 million cell-phone users and 19.6 million fixed-line telephone subscribers during 2006.
Late Buy/Sell Recommendations
Business Week:
- Green Mountain Coffee Roasters(GMCR), which sells coffee products to offices, supermarkets and restaurants, will see its shares climb as it adds customers, citing Richard Driehaus.
- Shares of EMC Corp.(EMC), a data storage company, may rise in 2007 as a result of higher revenue, successful acquisitions and buybacks, citing Jerome Heppelmann, CEO of Liberty Ridge Capital.
- Linear Technology(LLTC) may grow faster than the rest of the semiconductor industry, citing Christiana Bank & Trust fund manager Scott Armiger.
Night Trading
Asian Indices are +.25% to +.75% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.08%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- None of note
Upcoming Splits
- (SIAL) 2-for-1
- (SWS) 3-for-2
Economic Releases
- None of note
BOTTOM LINE: Asian indices are higher, boosted by technology shares in the region. I expect US equities to open mixed and to rise into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.
Stocks Slightly Higher into Final Hour on Rising Economic Optimism
BOTTOM LINE: The Portfolio is slightly lower into the final hour on losses in my Computer longs and Telecom longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is neutral as the advance/decline line is about even, most sectors are rising and volume is slightly below average. Short interest on the NYSE rose from mid November through mid December and remains near all-time highs despite recent market gains and almost weekly DJIA record highs. Days to cover rose to 6.3 from 6.0 the prior month. Bears remain stunningly complacent, in my opinion, as every rally is viewed as just another shorting/selling opportunity and every pullback is viewed as evidence of a major top. I continue to believe overall investor sentiment towards U.S. stocks has never before in history been this poor with the DJIA making all-time highs. The "mother of all short-covering rallies" will occur. It is just a matter of time. I expect US stocks to trade modestly higher into the close from current levels on more economic optimism, short-covering and portfolio manager performance anxiety.
Today's Headlines
Bloomberg:
- President Bush said today he is “making good progress” toward deciding on changes to US plans in Iraq after meeting at his Texas ranch with top national-security officials.
- OAO Lukoil, Russia’s largest oil producer, and state oil and gas companies from China, South Korea and Malaysia will start exploring oil and natural gas fields in Uzbekistan’s sector of the Aral Sea in March.
- Downtown Chicago office building sales surged to a record $5 billion this year as vacancy rates fell and some investors found returns there as attractive as those in New York and Los Angles.
- US Treasury yields are rising to seven week highs, after industry reports on consumer confidence, existing home sales and manufacturing were stronger than economists expected.
- Meat and milk from cloned pigs, cows and goats may soon be cleared for sale in the US after regulators determined that eating genetically duplicated farm animals doesn’t post safety risks for consumers.
- Copper prices are falling again in NY as inventories continue to rise.
USA Today:
- The number of companies selling stock to the public for the first time, and the amount of money they’ve been able to raise, failed to keep pace with a record-setting DJIA this year.
NY Times:
- Some Wall Street analysts expect a decline in US sales of drug-coated coronary stents to end next year.
AP:
- UAL Corp.’s United Airlines has cut fare prices to capture business in the traditionally slow post holiday period.
MTI:
- Karpat Energo, a Hungarian power plant company, plans to build a $261 million bioethanol plant in northeastern Hungary.
- President Bush said today he is “making good progress” toward deciding on changes to US plans in Iraq after meeting at his Texas ranch with top national-security officials.
- OAO Lukoil, Russia’s largest oil producer, and state oil and gas companies from China, South Korea and Malaysia will start exploring oil and natural gas fields in Uzbekistan’s sector of the Aral Sea in March.
- Downtown Chicago office building sales surged to a record $5 billion this year as vacancy rates fell and some investors found returns there as attractive as those in New York and Los Angles.
- US Treasury yields are rising to seven week highs, after industry reports on consumer confidence, existing home sales and manufacturing were stronger than economists expected.
- Meat and milk from cloned pigs, cows and goats may soon be cleared for sale in the US after regulators determined that eating genetically duplicated farm animals doesn’t post safety risks for consumers.
- Copper prices are falling again in NY as inventories continue to rise.
USA Today:
- The number of companies selling stock to the public for the first time, and the amount of money they’ve been able to raise, failed to keep pace with a record-setting DJIA this year.
NY Times:
- Some Wall Street analysts expect a decline in US sales of drug-coated coronary stents to end next year.
AP:
- UAL Corp.’s United Airlines has cut fare prices to capture business in the traditionally slow post holiday period.
MTI:
- Karpat Energo, a Hungarian power plant company, plans to build a $261 million bioethanol plant in northeastern Hungary.
Job Market Healthy, Consumer Confidence Surges Near Cycle Highs, Chicago Purchasing Manager Improves, Existing Home Sales Rise Again
- Initial Jobless Claims for last week rose to 317K versus estimates of 320K and 316K the prior week.
- Continuing Claims rose to 2530K versus estimates of 2500K and 2514K prior.
- Consumer Confidence for December rose to 109.0 versus estimates of 102.0 and a reading of 105.3 in November.
- Chicago Purchasing Manager for December rose to 52.4 versus estimates of 50.0 and a reading of 49.9 in November.
- Existing Home Sales for November rose to 6.28M versus estimates of 6.19M and 6.24M in October.
- Continuing Claims rose to 2530K versus estimates of 2500K and 2514K prior.
- Consumer Confidence for December rose to 109.0 versus estimates of 102.0 and a reading of 105.3 in November.
- Chicago Purchasing Manager for December rose to 52.4 versus estimates of 50.0 and a reading of 49.9 in November.
- Existing Home Sales for November rose to 6.28M versus estimates of 6.19M and 6.24M in October.
BOTTOM LINE: US initial jobless claims and continuing claims edged up last week, Bloomberg reported. The four-week moving average of claims fell to 315,750, the lowest in six weeks. The unemployment rate among those eligible for jobless benefits, which tracks the US jobless rate, held steady at a low 1.9%. Despite housing and auto production-related job cutbacks, the US job market remains very healthy as other areas are picking up the slack. I continue to believe the job market will remain healthy over the intermediate-term without generating substantial unit labor cost increases.
Confidence among US consumers unexpectedly surged this month to the highest level since April, reflecting recent job and stock gains, Bloomberg reported. The Present Situation Component of the index rose to 129.9, the highest since July, versus 125.4 the prior month. The Expectations Component for the next six months increased to 95.1, the highest since June, versus 91.9 the prior month. The Jobs Are Plentiful component rose to 26.9% versus 25.7% the prior month. The percentage of people who expect their incomes to decrease fell to 7% from 9.1% the prior month and to the lowest since 2001. The overall surge in the index was mainly due to a 15.6% jump in Central Northeast sentiment. Overall, Consumer Confidence has only been higher one other month this cycle. In April it hit 109.8. I continue to believe new cycle highs in confidence will occur over the coming months as energy prices fall further, interest rates remain low, inflation decelerates more, the job market remains healthy, stocks rise further, housing stabilizes at relatively high levels and irrational pessimism lifts.
A gauge of US business activity rebounded from the first contraction in more than three years as orders and production increased, Bloomberg said. The production component rose to 56.2 versus 54.4 the prior month. The new orders component rose to 57.8 versus 52.0 the prior month. The prices paid index was unch. at 60.2. Manufacturing will likely remain muted until the second half of next year.
Sales of previously owned homes unexpectedly rose in November, adding to evidence the housing slowdown is ending, Bloomberg reported. The supply of previously owned homes for sale at the current pace fell to 7.3 months’ from 7.4 months supply in October. The median price of an existing home fell 3.1% to $218,000. I continue to believe the US housing market is stabilizing at relatively high levels.
Wednesday, December 27, 2006
Thursday Watch
Late-Night Headlines
Bloomberg:
- New York City attracted a record 44 million tourists who added $24 billion to the economy in 2006.
Wall Street Journal:
- Bank of Japan Governor Toshihiko Fukui said the central bank will confirm that consumer prices are rising before deciding when to raise interest rates.
Financial Times:
- Apple Computer(AAPL) CEO Steve Jobs was given 7.5 million stock options in 2001 without the company’s board of directors authorizing the action as required. The options under review were handed to Jobs in October 2001, however Jobs later surrendered his options before they were exercised, implying that he didn’t gain any direct benefit from them. Apple has previously stated that its internal investigation revealed no misconduct by any current members of Apple’s management team, including Steve Jobs.
Late Buy/Sell Recommendations
- None of note
Night Trading
Asian Indices are unch. to +.25% on average.
S&P 500 indicated -.08%.
NASDAQ 100 indicated -.11%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- None of note
Upcoming Splits
- (LFC) 2.66-for-1
Economic Releases
8:30 am EST
- Initial Jobless Claims for last week are estimated to rise to 320K versus 315K the prior week.
- Continuing Claims are estimated to fall to 2500K versus 2520K prior.
10:00 am EST
- Consumer Confidence for December is estimated to fall to 102.0 versus a reading of 102.9 in November.
- The Chicago Purchasing Manager report for December is estimated to rise to 50.2 versus a reading of 49.9 in November.
- Existing Home Sales for November are estimated to fall to 6.19M versus 6.24M in October.
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil drawdown of 2,500,000 barrels versus a 6,323,000 decline the prior week. Gasoline supplies are expected to rise by 750,000 barrels versus a 1,058,000 barrel increase the prior week. Distillate inventories are expected to rise by 500,000 barrels versus a 1,206,000 barrel increase the prior week. Finally, Refinery Utilization is expected to rise .3% versus a 1.6% gain the prior week.
Bloomberg:
- New York City attracted a record 44 million tourists who added $24 billion to the economy in 2006.
Wall Street Journal:
- Bank of Japan Governor Toshihiko Fukui said the central bank will confirm that consumer prices are rising before deciding when to raise interest rates.
Financial Times:
- Apple Computer(AAPL) CEO Steve Jobs was given 7.5 million stock options in 2001 without the company’s board of directors authorizing the action as required. The options under review were handed to Jobs in October 2001, however Jobs later surrendered his options before they were exercised, implying that he didn’t gain any direct benefit from them. Apple has previously stated that its internal investigation revealed no misconduct by any current members of Apple’s management team, including Steve Jobs.
Late Buy/Sell Recommendations
- None of note
Night Trading
Asian Indices are unch. to +.25% on average.
S&P 500 indicated -.08%.
NASDAQ 100 indicated -.11%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- None of note
Upcoming Splits
- (LFC) 2.66-for-1
Economic Releases
8:30 am EST
- Initial Jobless Claims for last week are estimated to rise to 320K versus 315K the prior week.
- Continuing Claims are estimated to fall to 2500K versus 2520K prior.
10:00 am EST
- Consumer Confidence for December is estimated to fall to 102.0 versus a reading of 102.9 in November.
- The Chicago Purchasing Manager report for December is estimated to rise to 50.2 versus a reading of 49.9 in November.
- Existing Home Sales for November are estimated to fall to 6.19M versus 6.24M in October.
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil drawdown of 2,500,000 barrels versus a 6,323,000 decline the prior week. Gasoline supplies are expected to rise by 750,000 barrels versus a 1,058,000 barrel increase the prior week. Distillate inventories are expected to rise by 500,000 barrels versus a 1,206,000 barrel increase the prior week. Finally, Refinery Utilization is expected to rise .3% versus a 1.6% gain the prior week.
BOTTOM LINE: Asian indices are higher, boosted by technology shares in the region. I expect US equities to open modestly lower and to rise into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.
Dow Hits Another All-Time High as Energy Prices Fall and New Home Sales Surge
Indices
S&P 500 1,426.84 +.70%
DJIA 12,510.57 +.83%
NASDAQ 2,431.22 +.73%
Russell 2000 797.73 +1.21%
Wilshire 5000 14,306.90 +.74%
S&P Barra Growth 656.01 +.62%
S&P Barra Value 769.36 +.78%
Morgan Stanley Consumer 699.58 +.47%
Morgan Stanley Cyclical 898.08 +1.11%
Morgan Stanley Technology 570.11 +.71%
Transports 4,591.86 +1.13%
Utilities 459.35 +.30%
Put/Call .78 -7.14%
NYSE Arms .49 -43.65%
Volatility(VIX) 10.64 -5.51%
ISE Sentiment 138.0 -8.61%
US Dollar 83.97 -.11%
CRB 306.04 -.13%
Futures Spot Prices
Crude Oil 60.42 -1.11%
Reformulated Gasoline 159.35 +1.39%
Natural Gas 6.12 -3.36%
Heating Oil 161.26 -.66%
Gold 629.90 +.48%
Base Metals 237.11 +.69%
Copper 290.50 +.94%
10-year US Treasury Yield 4.65% +1.12%
Leading Sectors
Steel +2.34%
Homebuilders +1.5%
Networking +1.13%
Lagging Sectors
Biotech +.25%
Hospitals +.23%
HMOs +.05%
Evening Review
Detailed Market Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
Real-time/After-hours Stock Quote
In Play
Afternoon Recommendations
- None of note
Afternoon/Evening Headlines
Bloomberg:
- US stocks surged, propelling the Dow Jones Industrial Average above 12,500 for the first time, as oil tumbled to a one-month low and home sales exceeded estimates. The DJIA is now 19.5% higher for the year.
- Peter Beutel, president of energy consultant Cameron Hanover, says oil may break below $20/bbl. in 4-8 years.
- Natural gas fell 4% to the lowest level in more than 10 weeks as near record speculation by investment funds continues to subside with inventories near all-time highs.
- Democratic Representative Barney Frank, who will head the committee that oversees the SEC, said Congress should cap executive pay after the SEC changed rules for how companies value stock-options.
Dow Jones:
- Boeing Co.(BA) won a $1.15 billion order form the US Army to build 126 Apache helicopters over the next three years.
Boersen-Zeitung:
- SAP AG(SAP), the world’s largest maker of business-management software, expects double-digit growth in the coming years and may raise its dividend for 2006.
S&P 500 1,426.84 +.70%
DJIA 12,510.57 +.83%
NASDAQ 2,431.22 +.73%
Russell 2000 797.73 +1.21%
Wilshire 5000 14,306.90 +.74%
S&P Barra Growth 656.01 +.62%
S&P Barra Value 769.36 +.78%
Morgan Stanley Consumer 699.58 +.47%
Morgan Stanley Cyclical 898.08 +1.11%
Morgan Stanley Technology 570.11 +.71%
Transports 4,591.86 +1.13%
Utilities 459.35 +.30%
Put/Call .78 -7.14%
NYSE Arms .49 -43.65%
Volatility(VIX) 10.64 -5.51%
ISE Sentiment 138.0 -8.61%
US Dollar 83.97 -.11%
CRB 306.04 -.13%
Futures Spot Prices
Crude Oil 60.42 -1.11%
Reformulated Gasoline 159.35 +1.39%
Natural Gas 6.12 -3.36%
Heating Oil 161.26 -.66%
Gold 629.90 +.48%
Base Metals 237.11 +.69%
Copper 290.50 +.94%
10-year US Treasury Yield 4.65% +1.12%
Leading Sectors
Steel +2.34%
Homebuilders +1.5%
Networking +1.13%
Lagging Sectors
Biotech +.25%
Hospitals +.23%
HMOs +.05%
Evening Review
Detailed Market Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
Real-time/After-hours Stock Quote
In Play
Afternoon Recommendations
- None of note
Afternoon/Evening Headlines
Bloomberg:
- US stocks surged, propelling the Dow Jones Industrial Average above 12,500 for the first time, as oil tumbled to a one-month low and home sales exceeded estimates. The DJIA is now 19.5% higher for the year.
- Peter Beutel, president of energy consultant Cameron Hanover, says oil may break below $20/bbl. in 4-8 years.
- Natural gas fell 4% to the lowest level in more than 10 weeks as near record speculation by investment funds continues to subside with inventories near all-time highs.
- Democratic Representative Barney Frank, who will head the committee that oversees the SEC, said Congress should cap executive pay after the SEC changed rules for how companies value stock-options.
Dow Jones:
- Boeing Co.(BA) won a $1.15 billion order form the US Army to build 126 Apache helicopters over the next three years.
Boersen-Zeitung:
- SAP AG(SAP), the world’s largest maker of business-management software, expects double-digit growth in the coming years and may raise its dividend for 2006.
BOTTOM LINE: The Portfolio finished higher today on gains in my Internet longs, Semi longs, Telecom longs and Medical longs. I did not trade in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was very positive today as the advance/decline line finished substantially higher, every sector rose and volume was above average. Measures of investor anxiety were mostly lower into the close. Today's overall market action was very bullish. The May housing futures are now predicting only a 1.9% drop in the average home price by May. This is up from a 5.2% loss projection just a couple of months ago. Negative arguments regarding housing data are well known. The median home price is up over 50% the past few years. In my opinion, you can't have a meaningful consumer slowdown without a home price collapse. Without a meaningful consumer slowdown, a recession is highly unlikely. This is why so many market participants in the current negativity bubble constantly try to scare and dissuade home buyers from stepping in. The possibility of a home price collapse looks increasingly remote, while the many bears tell us to ignore all data that don't fit their doomsday thesis. The bond market seems to agree. Oil is finished near session lows and continues to trade very poorly despite numerous potential upside catalysts and near universal love for the commodity by the investment community and media. Russia said last night that it may pump as much as 12 million tons of crude to Europe via a Ukrainian pipeline next year, almost three times the amount pumped this year, as the country "steps up exports to sustain economic growth." I continue to believe non-OPEC oil production will rise much more than expectations over the intermediate-term.
DJIA Making Another All-Time on Strong Home Sales and Falling Energy Prices
BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Semi longs, Internet longs, Medical longs and Telecom longs. I added to my Apple Computer(AAPL) long today and took profits in a trading long, thus leaving the Portfolio 100% net long. The tone of the market is very positive as the advance/decline line is substantially higher, every sector is rising and volume is slightly below average. Apple Computer (AAPL), which I added to this morning when the stock was down 5%, is now at session highs, rising .30. Piper Jaffray said in a research note this afternoon that it was more confident than ever that Steve Jobs had no involvement in the alleged falsified documents. As well, Hitwise is reporting that Apple's iTunes' market share of visits soared 413% on Christmas Day from a year ago. Moreover, it reported that the Apple Store's market share of visits jumped 110% on Christmas Day vs. a year-ago and that the Apple Store was the fourth most visited Website in its Retail Index. I expect Apple to rise substantially from current levels next year. Today's morning weakness will likely be viewed as an exquisite buying opportunity. The stock remains my second largest long position. I expect US stocks to trade modestly higher into the close from current levels on more economic optimism, short-covering, portfolio manager performance anxiety and lower energy prices.
Today's Headlines
Bloomberg:
- The DJIA is making another all-time high as investor optimism regarding the prospects that the worst of the housing slowdown may be over rose after this morning’s new home sales report exceeded estimates.
- Gerald R. Ford, who became the 38th US president in 1974 has died at the age of 93.
- US Treasuries yields are rising, pushing rates on benchmark 10-year notes to a six-week high, after a government report showed new home sales and prices surged more-than-expected in November.
- Merrill Lynch(MER), the largest US brokerage firm, will offer bigger bonuses next year to financial advisers who bring in wealthier clients and increase the revenue they generate.
- Shares of InterContinental Hotels Group Plc, the world’s biggest lodging company, rose for a second day on speculation that the hotelier may be a takeover target.
- Crude oil fell to a one-month low as mild weather reduced near record speculation by investment funds. As well, natural gas is falling to the lowest price in more than 10 weeks in New York.
- Dennis Gartman, economist and editor of the Gartman Letter, is slightly bearish on base metals for 2007.
- Chile’s state-owned Codelco, the world’s largest copper producer, plans to spend $580 million to upgrade its Andina mine.
- Russia, the world’s second-largest oil exporter, will pump at least 9 million metric tons of crude to Europe via Ukrainian pipeline in 2007, twice as much as this year, as the country steps up exports to sustain economic growth. “We may even increase the volume of Russia oil up to 12 million tons,” Ihor Kiryushyn, CEO of VAT UkrTrasNafta, operator of Ukraine’s pipeline, said today in an e-mailed statement.
Wall Street Journal:
- The National Association of Manufacturers in the US predicts slower economic growth will prompt the Federal Reserve to lower interest rates by a half-percentage point by the middle of 2007, citing the AP.
- The SEC is increasingly hesitant to approve private investments in public equity, or PIPEs.
- Results from late-stage trials of potential treatments by ImClone Systems(IMCL) and Threshold Pharmaceuticals for pancreatic cancer are expected to be released in the first quarter of 2007.
- The FDA has approved an injectable wrinkle treatment called Radiesse that claims to last longer and cost less than its competitors, citing a CEO. BioForm Medical, which makes the treatment, will announce FDA clearance on Wednesday.
- Elected officials and business leaders in the US Virgin Islands are lobbying Congress to ease a tax crackdown they say has hurt the local economy and government revenue.
USA Today:
- The US Transportation Security Administration modified a new screening machine for airline passengers so that it won’t show intimate body parts once testing begins.
NY Times:
- Iran is funding infrastructure projects in Afghanistan in an effort to develop more influence in the country.
AP:
- Weight loss can help reduce the risk of virulent prostate cancer, citing a study by the American Cancer Society and Duke University Prostate Center.
- Verizon Communications(VZ) has opened stores in malls in Texas and Virginia to market its FiOS service package for the company’s fiber optic television service.
Tex Report:
- Taiwan Power Co. will more than double liquefied natural gas consumption in 2017 after building new thermal power plants.
The Guardian:
- BP Plc(BP), Europe’s second-largest oil company by market value, is to become a sponsor member of BWEA, a campaign group for renewable energy.
- The DJIA is making another all-time high as investor optimism regarding the prospects that the worst of the housing slowdown may be over rose after this morning’s new home sales report exceeded estimates.
- Gerald R. Ford, who became the 38th US president in 1974 has died at the age of 93.
- US Treasuries yields are rising, pushing rates on benchmark 10-year notes to a six-week high, after a government report showed new home sales and prices surged more-than-expected in November.
- Merrill Lynch(MER), the largest US brokerage firm, will offer bigger bonuses next year to financial advisers who bring in wealthier clients and increase the revenue they generate.
- Shares of InterContinental Hotels Group Plc, the world’s biggest lodging company, rose for a second day on speculation that the hotelier may be a takeover target.
- Crude oil fell to a one-month low as mild weather reduced near record speculation by investment funds. As well, natural gas is falling to the lowest price in more than 10 weeks in New York.
- Dennis Gartman, economist and editor of the Gartman Letter, is slightly bearish on base metals for 2007.
- Chile’s state-owned Codelco, the world’s largest copper producer, plans to spend $580 million to upgrade its Andina mine.
- Russia, the world’s second-largest oil exporter, will pump at least 9 million metric tons of crude to Europe via Ukrainian pipeline in 2007, twice as much as this year, as the country steps up exports to sustain economic growth. “We may even increase the volume of Russia oil up to 12 million tons,” Ihor Kiryushyn, CEO of VAT UkrTrasNafta, operator of Ukraine’s pipeline, said today in an e-mailed statement.
Wall Street Journal:
- The National Association of Manufacturers in the US predicts slower economic growth will prompt the Federal Reserve to lower interest rates by a half-percentage point by the middle of 2007, citing the AP.
- The SEC is increasingly hesitant to approve private investments in public equity, or PIPEs.
- Results from late-stage trials of potential treatments by ImClone Systems(IMCL) and Threshold Pharmaceuticals for pancreatic cancer are expected to be released in the first quarter of 2007.
- The FDA has approved an injectable wrinkle treatment called Radiesse that claims to last longer and cost less than its competitors, citing a CEO. BioForm Medical, which makes the treatment, will announce FDA clearance on Wednesday.
- Elected officials and business leaders in the US Virgin Islands are lobbying Congress to ease a tax crackdown they say has hurt the local economy and government revenue.
USA Today:
- The US Transportation Security Administration modified a new screening machine for airline passengers so that it won’t show intimate body parts once testing begins.
NY Times:
- Iran is funding infrastructure projects in Afghanistan in an effort to develop more influence in the country.
AP:
- Weight loss can help reduce the risk of virulent prostate cancer, citing a study by the American Cancer Society and Duke University Prostate Center.
- Verizon Communications(VZ) has opened stores in malls in Texas and Virginia to market its FiOS service package for the company’s fiber optic television service.
Tex Report:
- Taiwan Power Co. will more than double liquefied natural gas consumption in 2017 after building new thermal power plants.
The Guardian:
- BP Plc(BP), Europe’s second-largest oil company by market value, is to become a sponsor member of BWEA, a campaign group for renewable energy.
Median New Home Price Has Surged $26,200 in 3 Months
- New Home Sales for November rose to 1047K versus estimates of 1018K and an upwardly revised 1013K in October.
BOTTOM LINE: Sales of new homes in the US rose more than forecast last month as lower mortgage rates and more incentives helped builders reduce inventory, Bloomberg reported. The 3.4% gain followed an increase the prior month that was larger than expected. The median price of a new home rose 5.8% in November to $251,700. This was the biggest year-over-year price gain since June. Moreover, the median new home price is back to it second-highest level on record at $251,700. The only other time it has been higher was April of this year at $257,000. The supply of new homes at the current sales rate fell to 6.3 months’ worth in November, the lowest since May, versus 6.7 months’ worth in October. The ratio has fallen from a high of 7.2 months in July. New home sales soared 22.5% in the Northeast, 22.4% in the Mid-west and 19% in the West. Sales fell 9.3% in the South. I continue to believe the housing market is stabilizing at relatively high levels. With prices approaching record highs and inventories falling rapidly, the case for a housing "hard landing" looks increasingly difficult to make. The 10-year yield is rising 4 basis points on the news and the homebuilding index is outperforming, rising 1.2%.
Tuesday, December 26, 2006
Wednesday Watch
Late-Night Headlines
Bloomberg:
- Crude oil is falling a fourth day in NY on signs lower-than-usual demand and increased gasoline output will slow the drawdown of US fuel stockpiles that are still near 7-year highs.
- Japan’s retail sales rose less than expected in November, signaling that consumer spending may struggle to rebound after falling at the fastest pace in almost a decade last quarter.
- All the variables are in place for US acquisitions in 2007 to surpass this year’s record $3.6 trillion. US stocks are trading close to the cheapest price-to-earnings levels in a decade, Bloomberg data show.
- The yen confounded forecasters by falling this year and may do the same in 2007 as money managers take advantage of Japan’s near-zero percent interest rates to finance investments in bonds from the UK to New Zealand.
- Pakistan plans to construct fences and lay minefields along parts of its border with Afghanistan to stem the flow of insurgents between the two countries, Foreign Secretary Riaz Mohammad Khan said.
- Toyota Motor(TM) Chairman Fujio Cho and Ford Motor(F) CEO Mulally met, the two carmakers said, declining to comment on reports they may increase cooperation on technology.
Financial Times:
- Texas Pacific Group has beaten Blackstone Group LP and Kohlberg Kravis Roberts to become the world’s most prolific buyout firm in 2006, completing 17 deals worth a total of $101 billion.
China Daily:
- TCL Corp., Skyworth Digital Holdings and other Chinese television makers are protesting the Advanced Television System Committee’s request for a royalty fee of $23 for every TV set sold in the US. The committee, representing patent holders such as Thomson SA and Sony Corp., is charging the fee for the right to use digital TV technology, mandatory in the US market by March 2007.
Xinhua News Agency:
- China’s exchange rate will play a “more positive role” in the country’s economic overhaul and in adjusting the trade imbalance, citing central bank governor Zhou Xiaochuan.
Late Buy/Sell Recommendations
- None of note
Night Trading
Asian indices are +.25% to +.75% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.04%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (DLP)/-.26
Upcoming Splits
- (LFC) 2.66-for-1
Economic Releases
10:00 am EST
- New Home Sales for November are estimated to rise to 1015K versus 1004K in October.
Bloomberg:
- Crude oil is falling a fourth day in NY on signs lower-than-usual demand and increased gasoline output will slow the drawdown of US fuel stockpiles that are still near 7-year highs.
- Japan’s retail sales rose less than expected in November, signaling that consumer spending may struggle to rebound after falling at the fastest pace in almost a decade last quarter.
- All the variables are in place for US acquisitions in 2007 to surpass this year’s record $3.6 trillion. US stocks are trading close to the cheapest price-to-earnings levels in a decade, Bloomberg data show.
- The yen confounded forecasters by falling this year and may do the same in 2007 as money managers take advantage of Japan’s near-zero percent interest rates to finance investments in bonds from the UK to New Zealand.
- Pakistan plans to construct fences and lay minefields along parts of its border with Afghanistan to stem the flow of insurgents between the two countries, Foreign Secretary Riaz Mohammad Khan said.
- Toyota Motor(TM) Chairman Fujio Cho and Ford Motor(F) CEO Mulally met, the two carmakers said, declining to comment on reports they may increase cooperation on technology.
Financial Times:
- Texas Pacific Group has beaten Blackstone Group LP and Kohlberg Kravis Roberts to become the world’s most prolific buyout firm in 2006, completing 17 deals worth a total of $101 billion.
China Daily:
- TCL Corp., Skyworth Digital Holdings and other Chinese television makers are protesting the Advanced Television System Committee’s request for a royalty fee of $23 for every TV set sold in the US. The committee, representing patent holders such as Thomson SA and Sony Corp., is charging the fee for the right to use digital TV technology, mandatory in the US market by March 2007.
Xinhua News Agency:
- China’s exchange rate will play a “more positive role” in the country’s economic overhaul and in adjusting the trade imbalance, citing central bank governor Zhou Xiaochuan.
Late Buy/Sell Recommendations
- None of note
Night Trading
Asian indices are +.25% to +.75% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.04%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (DLP)/-.26
Upcoming Splits
- (LFC) 2.66-for-1
Economic Releases
10:00 am EST
- New Home Sales for November are estimated to rise to 1015K versus 1004K in October.
BOTTOM LINE: Asian indices are higher, boosted by technology and automaker shares in the region. I expect US equities to open mixed and to rise into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.
Tuesday Watch
Weekend Headlines
Bloomberg:
- US retail sales rose 23% on the weekend before Christmas as consumers swarmed stores for last-minute gift shopping. Dec. 23 was probably the second biggest shopping day of the year, with sales of about $8.72 billion, research firm ShopperTrak RCT said.
- US retail sales may rise 5% this holiday season, above the 4.6% average rated during the last 10 years, boosted by consumer who put off buying gifts and took advantage of this year’s extra shopping day before Christmas.
- The United Nations Security Council voted 15-0 to impose sanctions on Iran for its nuclear program for the first time, including a ban on acquisition of materials and technology that might be used to build an atomic bomb.
- The US dollar may strengthen on speculation reports this week will show the US housing market is stabilizing.
- Toyota Motor(TM) raised its production last month as demand for its small cars rose in North America.
- Sharp Corp., Japan’s largest maker of liquid-crystal displays and mobile phones, will double production of large-sized LCD screens in January, two months ahead of schedule, to meet demand for flat-panel televisions.
- US Treasuries fell for a third week, pushing yields on 10-year notes to the highest in more than a month, as reports showed strength in consumer confidence and housing construction.
- CBS Corp.(CBS) ignored warning signs that singer Janet Jackson might expose her breast during the 2004 Super Bowl half-time show, the FCC told an appeals court. The FCC, responding to a CBS appeal of its $550,000 regulatory fine, said the tv broadcaster should pay the penalty for airing indecent material at a time when children might be watching. “CBS was itself at fault because the network consciously and deliberately chose not to take reasonable precautions to prevent the broadcast of indecent material,” the FCC said.
- The yen fell after government reports on inflation and spending suggested the Bank of Japan will keep interest rates on hold at a policy meeting next month.
- Ethiopian forces attacked positions within 100 miles from Mogadishu, hours after Prime Minister Zenawi said he is being forced into war with Somalia, where Islamic militants have taken power.
- Crude oil is rising only .30 after Iran said it will defy United Nations sanctions and pursue nuclear research.
- Copper may fall by $1,000 a metric ton in the first quarter next year on concern slower economic growth in the US and falling imports by China may damp demand for the metal, according to the Great Wall Futures Co.
Wall Street Journal:
- Liberty Media(LINTA) may seek to acquire a phone company to make newly bought DirectTV more competitive with cable companies’ high-speed Internet and phone packages.
NY Times:
- Amtrak, the US passenger railroad, may see its number of riders increase by 50% within 10 years, but it needs billions of dollars in federal and state investment in other railroads.
- The US government awarded $388 million to Mississippi, Louisiana, Texas and Alabama to develop better, more comfortable temporary housing for those people displaced by natural disasters.
- A new documentary is urging rappers and music executives to consider the effect that the often negative messages on violence, sexism and homophobia in hip-hop songs has on young fans. The film, “Hip Hop: Beyond Beats and Rhymes,” was made by Byron Hurt, a former Northeastern University football player who counseled male athletes on the treatment of woman, and will be aired on PBS in February.
- The prices of pelts, including beaver, mink and muskrat, have as much as tripled as annual sales of fur garments rise.
- US hospital employees who work for companies that do at least $5 million in Medicaid business annually will have to learn to detect fraud and report it to the government.
Washington Post:
- The bald eagle will be removed from the endangered species list by February, with the support of mainstream environmental groups. The eagle population, under protection from the Endangered Species Act, has rebounded 15-fold to more than 7,000 nesting pairs since dropping to 417 nesting pairs in 1963, citing the US Fish and Wildlife Service.
- The FDA will probably recommend this week that stores be allowed to sell products from cloned animals.
San Diego-Union Tribune:
- The number of cruise passengers departing from San Diego has almost tripled since 2000 as cruise prices drop and more customers seek vacations to destinations such as Mexico and Hawaii.
Seattle Times:
- Marijuana valued at $1.03 billion is grown annually in Washington, making it the state’s second largest cash crop next to apples.
San Jose Mercury News:
- The number of jobs in California’s Silicon Valley grew by the most in more than five years as technology firms hired workers while the housing –construction declines were less than in other parts of the state.
AP:
- Ford Motor(F) plans to invest $1 billion in six automotive plants in southeastern Michigan, including the Dearborn Truck and Wayne Assembly, in exchange for $151 million in tax incentives..
- The FBI failed to fully investigate whether Oklahoma City bombers Timothy McVeigh and Terry Nichols had help from foreign sources, citing a yet-to-be released report from the House International Relations Committee.
LA Times:
- Walt Disney(DIS), which sold more than 300 Disney Stores in North America to Children’s Place Retail Stores in 2004, will earn a profit from a licensing agreement as the stores’ sales rise.
- The US Environmental Protection Agency last week approved amendments adopted by California three years ago that allows carmakers to produce vehicles powered by hydrogen fuel cells.
Financial Times:
- Chapman Capital LLC, a Los Angeles-based hedge fund, is seeking a private investigator to monitor the private lives of company executives, citing a job advertisement on a NY web site.
Sunday Times:
- Tesco Plc, Britain’s biggest retailer, will sell electronics from Apple Computer(AAPL) such as the iPod music player. Tesco will initially target 12 stores for its so-called “Apple Zones,” displaying products like the Apple Mac computer.
El Pais:
- Google(GOOG) CEO Schmidt said that a project to sell advertising for US newspapers will work.
Shanghai Securities News:
- China National Petroleum is aiming for a 23% increase in natural gas output in 2007.
Weekend Recommendations
Barron's:
- Made positive comments on (TXT), (SSP), (ITT) and (BTU).
Night Trading
Asian indices are -.25% to +1.0% on average.
S&P 500 indicated n/a.
NASDAQ 100 indicated n/a.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/Estimate
- None of note
Upcoming Splits
- None of note
Economic Releases
- None of note
Bloomberg:
- US retail sales rose 23% on the weekend before Christmas as consumers swarmed stores for last-minute gift shopping. Dec. 23 was probably the second biggest shopping day of the year, with sales of about $8.72 billion, research firm ShopperTrak RCT said.
- US retail sales may rise 5% this holiday season, above the 4.6% average rated during the last 10 years, boosted by consumer who put off buying gifts and took advantage of this year’s extra shopping day before Christmas.
- The United Nations Security Council voted 15-0 to impose sanctions on Iran for its nuclear program for the first time, including a ban on acquisition of materials and technology that might be used to build an atomic bomb.
- The US dollar may strengthen on speculation reports this week will show the US housing market is stabilizing.
- Toyota Motor(TM) raised its production last month as demand for its small cars rose in North America.
- Sharp Corp., Japan’s largest maker of liquid-crystal displays and mobile phones, will double production of large-sized LCD screens in January, two months ahead of schedule, to meet demand for flat-panel televisions.
- US Treasuries fell for a third week, pushing yields on 10-year notes to the highest in more than a month, as reports showed strength in consumer confidence and housing construction.
- CBS Corp.(CBS) ignored warning signs that singer Janet Jackson might expose her breast during the 2004 Super Bowl half-time show, the FCC told an appeals court. The FCC, responding to a CBS appeal of its $550,000 regulatory fine, said the tv broadcaster should pay the penalty for airing indecent material at a time when children might be watching. “CBS was itself at fault because the network consciously and deliberately chose not to take reasonable precautions to prevent the broadcast of indecent material,” the FCC said.
- The yen fell after government reports on inflation and spending suggested the Bank of Japan will keep interest rates on hold at a policy meeting next month.
- Ethiopian forces attacked positions within 100 miles from Mogadishu, hours after Prime Minister Zenawi said he is being forced into war with Somalia, where Islamic militants have taken power.
- Crude oil is rising only .30 after Iran said it will defy United Nations sanctions and pursue nuclear research.
- Copper may fall by $1,000 a metric ton in the first quarter next year on concern slower economic growth in the US and falling imports by China may damp demand for the metal, according to the Great Wall Futures Co.
Wall Street Journal:
- Liberty Media(LINTA) may seek to acquire a phone company to make newly bought DirectTV more competitive with cable companies’ high-speed Internet and phone packages.
NY Times:
- Amtrak, the US passenger railroad, may see its number of riders increase by 50% within 10 years, but it needs billions of dollars in federal and state investment in other railroads.
- The US government awarded $388 million to Mississippi, Louisiana, Texas and Alabama to develop better, more comfortable temporary housing for those people displaced by natural disasters.
- A new documentary is urging rappers and music executives to consider the effect that the often negative messages on violence, sexism and homophobia in hip-hop songs has on young fans. The film, “Hip Hop: Beyond Beats and Rhymes,” was made by Byron Hurt, a former Northeastern University football player who counseled male athletes on the treatment of woman, and will be aired on PBS in February.
- The prices of pelts, including beaver, mink and muskrat, have as much as tripled as annual sales of fur garments rise.
- US hospital employees who work for companies that do at least $5 million in Medicaid business annually will have to learn to detect fraud and report it to the government.
Washington Post:
- The bald eagle will be removed from the endangered species list by February, with the support of mainstream environmental groups. The eagle population, under protection from the Endangered Species Act, has rebounded 15-fold to more than 7,000 nesting pairs since dropping to 417 nesting pairs in 1963, citing the US Fish and Wildlife Service.
- The FDA will probably recommend this week that stores be allowed to sell products from cloned animals.
San Diego-Union Tribune:
- The number of cruise passengers departing from San Diego has almost tripled since 2000 as cruise prices drop and more customers seek vacations to destinations such as Mexico and Hawaii.
Seattle Times:
- Marijuana valued at $1.03 billion is grown annually in Washington, making it the state’s second largest cash crop next to apples.
San Jose Mercury News:
- The number of jobs in California’s Silicon Valley grew by the most in more than five years as technology firms hired workers while the housing –construction declines were less than in other parts of the state.
AP:
- Ford Motor(F) plans to invest $1 billion in six automotive plants in southeastern Michigan, including the Dearborn Truck and Wayne Assembly, in exchange for $151 million in tax incentives..
- The FBI failed to fully investigate whether Oklahoma City bombers Timothy McVeigh and Terry Nichols had help from foreign sources, citing a yet-to-be released report from the House International Relations Committee.
LA Times:
- Walt Disney(DIS), which sold more than 300 Disney Stores in North America to Children’s Place Retail Stores in 2004, will earn a profit from a licensing agreement as the stores’ sales rise.
- The US Environmental Protection Agency last week approved amendments adopted by California three years ago that allows carmakers to produce vehicles powered by hydrogen fuel cells.
Financial Times:
- Chapman Capital LLC, a Los Angeles-based hedge fund, is seeking a private investigator to monitor the private lives of company executives, citing a job advertisement on a NY web site.
Sunday Times:
- Tesco Plc, Britain’s biggest retailer, will sell electronics from Apple Computer(AAPL) such as the iPod music player. Tesco will initially target 12 stores for its so-called “Apple Zones,” displaying products like the Apple Mac computer.
El Pais:
- Google(GOOG) CEO Schmidt said that a project to sell advertising for US newspapers will work.
Shanghai Securities News:
- China National Petroleum is aiming for a 23% increase in natural gas output in 2007.
Weekend Recommendations
Barron's:
- Made positive comments on (TXT), (SSP), (ITT) and (BTU).
Night Trading
Asian indices are -.25% to +1.0% on average.
S&P 500 indicated n/a.
NASDAQ 100 indicated n/a.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/Estimate
- None of note
Upcoming Splits
- None of note
Economic Releases
- None of note
BOTTOM LINE: Asian Indices are mostly higher, boosted by automaker and technology shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the week.
Sunday, December 24, 2006
Friday, December 22, 2006
Thursday, December 21, 2006
Friday Watch
Late-Night Headlines
Bloomberg:
- Edison International’s Southern California Edison unit agreed to buy output from a facility planned by Australia’s Allco Finance Group Ltd. in the largest wind-power contract by a US utility.
- Micron Technology(MU) said first-quarter profit tripled, boosted by higher prices.
- Trading in options to buy shares of Kimberly-Clark(KMB) rose 24-fold, the most in more than six years, on speculation the company may be bought.
- Copper futures in Shanghai plunged the maximum daily limit to a six-month low on concern slower economic growth in the US and China, the world’s two biggest copper consumers, may reduce demand for the industrial metal.
- Research In Motion(RIMM) said third-quarter profit rose 46% on demand for BlackBerry e-mail devices and market share gains against rival Palm Inc.(PALM).
- Cia. Vale do Rio Doce, the world’s biggest iron-ore producer, and rivals may fail to secure a sixth straight increase in prices for the key steelmaking ingredient in 2008 as output from new mines boosts global supply.
Xinhua News Agency:
- Tianjin Qingyuan Electric Vehicle Co. is building China’s largest electric car plant in northern Tianjin, aiming to expand overseas sales. The factory, to be completed by the end of 2007, will produce vehicles powered by batteries, hybrid power and fuel cells.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (PSYS), raised target to $49.
Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.15%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (WAG)/.41
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Personal Income for November is estimated to rise .4% versus a .4% gain in October.
- Personal Spending for November is estimated to rise .6% versus a .2% gain in October.
- The PCE Deflator for November is estimated to rise .1% versus a .2% gain in October.
- Durable Goods Orders for November are estimated to rise 1.3% versus an -8.3% decline in October.
- Durables Ex Transports for November are estimated to rise 1.0% versus an -1.7% decline in October.
10:00 am EST
- The Final Univ. of Mich. Consumer Confidence reading for December is estimated to remain at 90.2 versus a prior estimate of 90.2.
Bloomberg:
- Edison International’s Southern California Edison unit agreed to buy output from a facility planned by Australia’s Allco Finance Group Ltd. in the largest wind-power contract by a US utility.
- Micron Technology(MU) said first-quarter profit tripled, boosted by higher prices.
- Trading in options to buy shares of Kimberly-Clark(KMB) rose 24-fold, the most in more than six years, on speculation the company may be bought.
- Copper futures in Shanghai plunged the maximum daily limit to a six-month low on concern slower economic growth in the US and China, the world’s two biggest copper consumers, may reduce demand for the industrial metal.
- Research In Motion(RIMM) said third-quarter profit rose 46% on demand for BlackBerry e-mail devices and market share gains against rival Palm Inc.(PALM).
- Cia. Vale do Rio Doce, the world’s biggest iron-ore producer, and rivals may fail to secure a sixth straight increase in prices for the key steelmaking ingredient in 2008 as output from new mines boosts global supply.
Xinhua News Agency:
- Tianjin Qingyuan Electric Vehicle Co. is building China’s largest electric car plant in northern Tianjin, aiming to expand overseas sales. The factory, to be completed by the end of 2007, will produce vehicles powered by batteries, hybrid power and fuel cells.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (PSYS), raised target to $49.
Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.15%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (WAG)/.41
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Personal Income for November is estimated to rise .4% versus a .4% gain in October.
- Personal Spending for November is estimated to rise .6% versus a .2% gain in October.
- The PCE Deflator for November is estimated to rise .1% versus a .2% gain in October.
- Durable Goods Orders for November are estimated to rise 1.3% versus an -8.3% decline in October.
- Durables Ex Transports for November are estimated to rise 1.0% versus an -1.7% decline in October.
10:00 am EST
- The Final Univ. of Mich. Consumer Confidence reading for December is estimated to remain at 90.2 versus a prior estimate of 90.2.
BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity shares in the region. I expect US equities to open modestly lower and to rise into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.
Wednesday, December 20, 2006
Thursday Watch
Late-Night Headlines
Bloomberg:
- Huntington Bancshares, Ohio’s fourth-largest bank, agreed to acquire in-state rival Sky Financial Group for about $3.6 billion in stock and cash.
- Japan’s export growth unexpectedly accelerated in November, easing concern that expansion of the world’s second-largest economy is faltering.
- Bank of Thailand Governor Tarisa Watanagase defended measures to control the appreciation of the baht that wiped $23 billion from the value of Thai stocks, and said the rules will be lifted once “volatility” eases.
- The Thai baht tumbled by the most in more than seven years as international investors sold shares on waning confidence in the country’s monetary policy after the government partially reversed some currency controls.
- Crude oil is falling as warmer-than-normal weather cuts demand for heating fuel and near-record speculation by investment funds subsides.
- Copper futures in Shanghai fell to a five-week low after international copper prices slumped on concern slower global growth may reduce demand for the metal used in buildings, cars and appliances.
- Imports of crude oil by Japan, the world’s largest consumer of oil after the US and China, fell for a seventh month in November, according to the ministry of finance. The country brought in 11% less oil last month than a year ago, the ministry said.
Financial Times:
- Global mergers and acquisitions in 2006 reached $3.9 trillion, citing data provider Datalogic.
Business Standard:
- Reliance Life Sciences, owned by India’s Reliance Group, may buy a US-based biotechnology company for $1 billion.
Haaretz:
- The Palestinian group Islamic Jihad fired seven Qassam rockets at southern Israel after two of its fighters were killed in a gun battle with the army.
Securities Times:
- The yuan rising “too fast” isn’t good and China needs to be able to control its foreign-exchange reform and keep it independent, citing a central bank researcher. The rapid gain in the Thai baht and its impact on the stock market showed how quickly currency appreciation can become a problem, he said.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (FDX), target $132.
- Rated (LAMR) Buy, target $74.
- Reiterated Buy on (PAYX), raised target to $49.
Morgan Stanley:
- Rated (CYTC) Overweight, target $35.
Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated +.04%.
NASDAQ 100 indicated +.10%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (AGE)/.91
- (AM)/.35
- (CCL)/.47
- (CMC)/.74
- (CAG)/.33
- (GIS)/1.03
- (MU)/.20
- (RHAT)/.12
- (RECN)/.27
- (RAD)/-.01
- (SHFL)/.18
- (SLR)/.05
- (SMSC)/.41
- (WOR)/.39
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Final 3Q GDP is estimated to rise 2.2% versus a prior estimate of 2.2%.
- Final 3Q GDP Price Index is estimated to rise 1.8% versus a prior estimate of 1.8%.
- Final 3Q Personal Consumption is estimated to rise 2.9% versus a prior estimate of 2.9%.
- Final 3Q Core PCE is estimated to rise 2.2% versus a prior estimate of 2.2%.
- Initial Jobless Claims for last week are estimated to rise to 315K versus 304K the prior week.
- Continuing Claims are estimated to fall to 2475K versus 2477K prior.
10:00 am EST
- Leading Indicators for November are estimated to rise .1% versus a .2% gain in October.
12:00 pm EST
- Philly Fed for December is estimated to fall to 4.0 versus 5.1 in November.
Bloomberg:
- Huntington Bancshares, Ohio’s fourth-largest bank, agreed to acquire in-state rival Sky Financial Group for about $3.6 billion in stock and cash.
- Japan’s export growth unexpectedly accelerated in November, easing concern that expansion of the world’s second-largest economy is faltering.
- Bank of Thailand Governor Tarisa Watanagase defended measures to control the appreciation of the baht that wiped $23 billion from the value of Thai stocks, and said the rules will be lifted once “volatility” eases.
- The Thai baht tumbled by the most in more than seven years as international investors sold shares on waning confidence in the country’s monetary policy after the government partially reversed some currency controls.
- Crude oil is falling as warmer-than-normal weather cuts demand for heating fuel and near-record speculation by investment funds subsides.
- Copper futures in Shanghai fell to a five-week low after international copper prices slumped on concern slower global growth may reduce demand for the metal used in buildings, cars and appliances.
- Imports of crude oil by Japan, the world’s largest consumer of oil after the US and China, fell for a seventh month in November, according to the ministry of finance. The country brought in 11% less oil last month than a year ago, the ministry said.
Financial Times:
- Global mergers and acquisitions in 2006 reached $3.9 trillion, citing data provider Datalogic.
Business Standard:
- Reliance Life Sciences, owned by India’s Reliance Group, may buy a US-based biotechnology company for $1 billion.
Haaretz:
- The Palestinian group Islamic Jihad fired seven Qassam rockets at southern Israel after two of its fighters were killed in a gun battle with the army.
Securities Times:
- The yuan rising “too fast” isn’t good and China needs to be able to control its foreign-exchange reform and keep it independent, citing a central bank researcher. The rapid gain in the Thai baht and its impact on the stock market showed how quickly currency appreciation can become a problem, he said.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (FDX), target $132.
- Rated (LAMR) Buy, target $74.
- Reiterated Buy on (PAYX), raised target to $49.
Morgan Stanley:
- Rated (CYTC) Overweight, target $35.
Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated +.04%.
NASDAQ 100 indicated +.10%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (AGE)/.91
- (AM)/.35
- (CCL)/.47
- (CMC)/.74
- (CAG)/.33
- (GIS)/1.03
- (MU)/.20
- (RHAT)/.12
- (RECN)/.27
- (RAD)/-.01
- (SHFL)/.18
- (SLR)/.05
- (SMSC)/.41
- (WOR)/.39
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Final 3Q GDP is estimated to rise 2.2% versus a prior estimate of 2.2%.
- Final 3Q GDP Price Index is estimated to rise 1.8% versus a prior estimate of 1.8%.
- Final 3Q Personal Consumption is estimated to rise 2.9% versus a prior estimate of 2.9%.
- Final 3Q Core PCE is estimated to rise 2.2% versus a prior estimate of 2.2%.
- Initial Jobless Claims for last week are estimated to rise to 315K versus 304K the prior week.
- Continuing Claims are estimated to fall to 2475K versus 2477K prior.
10:00 am EST
- Leading Indicators for November are estimated to rise .1% versus a .2% gain in October.
12:00 pm EST
- Philly Fed for December is estimated to fall to 4.0 versus 5.1 in November.
BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity shares in the region. I expect US equities to open modestly lower and to rise into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.
***Alert***
Blogging will be light over the next few days due to a scheduling conflict. Sorry for the inconvenience.
Stocks Slightly Higher into Final Hour on Small-cap Strength
BOTTOM LINE: The Portfolio is about even into the final hour as gains in my Semi longs, Biotech longs and Commodity shorts offset losses in my Internet longs and Telecom longs. I have not traded today, thus leaving the Portfolio 75% net long. The tone of the market is slightly positive as the advance/decline line is modestly higher, most sectors are rising and volume is slightly above average. The latest commitment of traders report showed net commercial US dollar index longs surged to the highest since late 2004. Moreover, net large speculative traders have the largest net short position in the US dollar index since late 2004. The US dollar index made a significant bottom in late 2004 and rose 15.2% over the next 11 months. As well, a recent survey by Bloomberg of traders, investors and strategists showed only 9.1% US dollar bulls versus the euro. US dollar bulls were 7.4% around the significant bottom in 2004. I suspect a similar outcome is likely this time as global investor sentiment towards the US dollar is once again excessively pessimistic. This has negative implications for the prices of many commodities. I expect US stocks to trade mixed into the close from current levels as commodity stock weakness offsets gains elsewhere.
Today's Headlines
Bloomberg:
- Shareholders of NYSE Group(NYX) approved the $14.6 billion purchase of Euronext NV, paving the way for the creation of the first trans-Atlantic securities market.
- Sugarhouse Casino, a $550 million project headed by Chicago investor Neil Bluhm, and Foxwoods Casino Philadelphia, a $410 million project proposed by Connecticut’s Mashantucket Pequot tribe, were awarded slot licenses for Philadelphia, making it the largest US city with casino gambling.
- A US plan to screen everyone who visits a doctor for HIV may get derailed by laws in at least eight states that require strict confidentiality and consent.
- Chilean stocks, riding a global copper mania, have become more expensive than equities in neighboring Argentina and Brazil. A decline in the metal’s price may undermine the market in 2007.
- CarMax(KMX), the largest used-car dealer in the US, said third-quarter profit almost doubled and raised its full-year forecast for the second time in three months as customers bought more luxury cars and light trucks.
- Iraqi Vice President Tariq al-Hashemi strongly endorsed a temporary boost in US troop strength in Baghdad to control sectarian violence, one of several ideas being weighed by the Bush administration.
- FedEx(FDX) said second-quarter profit rose 8.5%, but failed to lift forward guidance, thus disappointing investors.
- Prime Minister Tony Blair, ending a six-day visit to the Middle East, said the world faces a “monumental struggle” against extremist groups seeking to undermine Western governments. He singled out Iran as the region’s biggest threat.
- Mahmoud Ahmadinejad’s opponents were poised to secure a majority on Tehran’s City Council, in the first political setback suffered by Iran’s president since he won the office in June 2005.
- Natural gas is falling to a two-month low in NY as mild weather decreased demand and near record speculation by investment funds.
- Copper tumbled to a six-month low in NY as rising inventories and slower global growth fueled concern that demand may lag behind mine output.
- Gold prices are falling in NY on speculation the value of the dollar will hold steady against the euro, eroding the precious metal’s appeal as an alternative investment.
Wall Street Journal:
- IAC/InterActiveCorp’s Ticketmaster plans to acquire a 25% stake in ILike.com in a bid by the two companies to use the Internet to promote interest in music and concerts.
- Equity Office Properties Trust received approaches from at least four different parties before the real estate company agreed to sell itself to a unit of private-equity firm Blackstone Group LP for $20 billion.
NY Times:
- Leon Black, founder of Apollo Group and a former lieutenant of Michael Milken, has catapulted into the higher echelons of private equity with $37 billion worth of deals this week.
- Paramus, New Jersey, which has more parking spots than people, generates $5 billion a year in retail sales, about as much as the gross domestic product of Cambodia, Nicaragua or the sultanate of Brunei.
NY Post:
- Illegal video downloads were carried out at six million US households in the third quarter compared with 1.2 million that obtained permission to download videos legally, citing a study by NPD Group Inc.
International Herald Tribune:
- French security forces have broken up three Islamic terrorist plots in the past 18 months, including planned attacks on the Paris metro and Orly airport, citing an interview with anti-terrorist judge Jean-Louis Bruguiere.
Interfax:
- Azerbaijan, the third-largest oil producer in the former Soviet Union, raised crude-oil production 46% in the first 11 months of the year.
- Shareholders of NYSE Group(NYX) approved the $14.6 billion purchase of Euronext NV, paving the way for the creation of the first trans-Atlantic securities market.
- Sugarhouse Casino, a $550 million project headed by Chicago investor Neil Bluhm, and Foxwoods Casino Philadelphia, a $410 million project proposed by Connecticut’s Mashantucket Pequot tribe, were awarded slot licenses for Philadelphia, making it the largest US city with casino gambling.
- A US plan to screen everyone who visits a doctor for HIV may get derailed by laws in at least eight states that require strict confidentiality and consent.
- Chilean stocks, riding a global copper mania, have become more expensive than equities in neighboring Argentina and Brazil. A decline in the metal’s price may undermine the market in 2007.
- CarMax(KMX), the largest used-car dealer in the US, said third-quarter profit almost doubled and raised its full-year forecast for the second time in three months as customers bought more luxury cars and light trucks.
- Iraqi Vice President Tariq al-Hashemi strongly endorsed a temporary boost in US troop strength in Baghdad to control sectarian violence, one of several ideas being weighed by the Bush administration.
- FedEx(FDX) said second-quarter profit rose 8.5%, but failed to lift forward guidance, thus disappointing investors.
- Prime Minister Tony Blair, ending a six-day visit to the Middle East, said the world faces a “monumental struggle” against extremist groups seeking to undermine Western governments. He singled out Iran as the region’s biggest threat.
- Mahmoud Ahmadinejad’s opponents were poised to secure a majority on Tehran’s City Council, in the first political setback suffered by Iran’s president since he won the office in June 2005.
- Natural gas is falling to a two-month low in NY as mild weather decreased demand and near record speculation by investment funds.
- Copper tumbled to a six-month low in NY as rising inventories and slower global growth fueled concern that demand may lag behind mine output.
- Gold prices are falling in NY on speculation the value of the dollar will hold steady against the euro, eroding the precious metal’s appeal as an alternative investment.
Wall Street Journal:
- IAC/InterActiveCorp’s Ticketmaster plans to acquire a 25% stake in ILike.com in a bid by the two companies to use the Internet to promote interest in music and concerts.
- Equity Office Properties Trust received approaches from at least four different parties before the real estate company agreed to sell itself to a unit of private-equity firm Blackstone Group LP for $20 billion.
NY Times:
- Leon Black, founder of Apollo Group and a former lieutenant of Michael Milken, has catapulted into the higher echelons of private equity with $37 billion worth of deals this week.
- Paramus, New Jersey, which has more parking spots than people, generates $5 billion a year in retail sales, about as much as the gross domestic product of Cambodia, Nicaragua or the sultanate of Brunei.
NY Post:
- Illegal video downloads were carried out at six million US households in the third quarter compared with 1.2 million that obtained permission to download videos legally, citing a study by NPD Group Inc.
International Herald Tribune:
- French security forces have broken up three Islamic terrorist plots in the past 18 months, including planned attacks on the Paris metro and Orly airport, citing an interview with anti-terrorist judge Jean-Louis Bruguiere.
Interfax:
- Azerbaijan, the third-largest oil producer in the former Soviet Union, raised crude-oil production 46% in the first 11 months of the year.
Tuesday, December 19, 2006
Wednesday Watch
Late-Night Headlines
Bloomberg:
- Wang Jian, executive vice secretary of the China Society of World Economy, said the country’s economic growth may slow to 8% next year, as the government’s moves to slow investments lead to excess supply. Wang was speaking today at a steel industry conference in Beijing.
- Codelco, the world’s biggest copper producer, reached wage agreements with two of its unions, averting a strike in Chile that threatened to halt output at its largest mine, a labor leader said.
- Goldman Sachs Group(GS), through its GS Power Holdings LLC unit, bought a stake in biodiesel producer Green Earth Fuels, whose majority investors include US buyout firm Carlyle Group.
- The November US semiconductor book-to-bill ratio rose to .97 from .94 in October.
- The use of cholesterol-lowering drugs called statins is associated with a reduced risk of advanced prostate cancer, according to a study to be published tomorrow.
- US Treasury Secretary Henry Paulson declined to brand China a currency manipulator, concluding that the nation is taking steps to make the yuan more flexible.
- Ericsson, the world’s biggest provider of telecom equipment, agreed to buy Redback Networks(RBAK) for $2.1 billion or $25/share.
- Australian Treasurer Costello has slashed the government’s forecast for economic growth in the 12 months to June 30 from 3.25% to 2.5%.
- The yen dropped to a record low against the euro on speculation the Bank of Japan will raise interest rates at a slower pace than the European Central Bank.
- Somalia’s Islamist militia said it is preparing for “full scale war” against the interim government. The militia seized control of the capital, Mogadishu, in June and has advanced across the Horn of Africa nation, imposing Islamic laws in areas it controls. The US government says the militia is run by al-Qaeda.
- The Thai baht led Asian currencies higher after the government scrapped penalties on overseas investors buying stocks, a day after imposing them.
Wall Street Journal:
- US hedge funds say they expect competition in attracting and keeping workers on board in 2007, citing an informal survey. Payouts to manager in 2007 will rise to 8% to 20% of profits, with average payouts rising 15%, up from 3% in 2006.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (GILD) and (UNH).
Morgan Stanley:
- Channel checks point to a strong pick-up in mall traffic and apparel sales. Following a relatively slow start to the holiday season, mall traffic levels have shown meaningful signs of improvement based on a number of recent channel checks. Moreover, online holiday sales are forecasted to be up 24% year-over-year. However, growth in online sales has been accelerating in recent days with sales up 33% on Dec. 14th and 38% on Dec. 15th. The National Retail Federation forecasts a 34% rise in gift cards, but based on anecdotal evidence we believe gift card sales could surpass this estimate. We continue to forecast total holiday sales growth of 4-5%.
Night Trading
Asian Indices are +.75% to +1.25% on average.
S&P 500 indicated +.10%.
NASDAQ 100 indicated +.17%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (COMS)/.00
- (ACN/.42
- (ATU)/.81
- (BBBY)/.52
- (KMX)/.25
- (FDO)/.36
- (FDX)/1.76
- (FINL)/-.08
- (MLHR)/.56
- (NKE)/1.12
- (PAYX)/.34
Upcoming Splits
- None of note
Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil drawdown of -2,000,000 barrels versus a -4,295,000 barrel decline the prior week. Gasoline supplies are expected to remain unch. versus a -174,000 barrel decline the prior week. Distillate inventories are estimated to fall by -600,000 barrels versus a -445,000 barrel decline the prior week. Refinery Utilization is expected to rise .5% versus a -1.36% decline the prior week.
Bloomberg:
- Wang Jian, executive vice secretary of the China Society of World Economy, said the country’s economic growth may slow to 8% next year, as the government’s moves to slow investments lead to excess supply. Wang was speaking today at a steel industry conference in Beijing.
- Codelco, the world’s biggest copper producer, reached wage agreements with two of its unions, averting a strike in Chile that threatened to halt output at its largest mine, a labor leader said.
- Goldman Sachs Group(GS), through its GS Power Holdings LLC unit, bought a stake in biodiesel producer Green Earth Fuels, whose majority investors include US buyout firm Carlyle Group.
- The November US semiconductor book-to-bill ratio rose to .97 from .94 in October.
- The use of cholesterol-lowering drugs called statins is associated with a reduced risk of advanced prostate cancer, according to a study to be published tomorrow.
- US Treasury Secretary Henry Paulson declined to brand China a currency manipulator, concluding that the nation is taking steps to make the yuan more flexible.
- Ericsson, the world’s biggest provider of telecom equipment, agreed to buy Redback Networks(RBAK) for $2.1 billion or $25/share.
- Australian Treasurer Costello has slashed the government’s forecast for economic growth in the 12 months to June 30 from 3.25% to 2.5%.
- The yen dropped to a record low against the euro on speculation the Bank of Japan will raise interest rates at a slower pace than the European Central Bank.
- Somalia’s Islamist militia said it is preparing for “full scale war” against the interim government. The militia seized control of the capital, Mogadishu, in June and has advanced across the Horn of Africa nation, imposing Islamic laws in areas it controls. The US government says the militia is run by al-Qaeda.
- The Thai baht led Asian currencies higher after the government scrapped penalties on overseas investors buying stocks, a day after imposing them.
Wall Street Journal:
- US hedge funds say they expect competition in attracting and keeping workers on board in 2007, citing an informal survey. Payouts to manager in 2007 will rise to 8% to 20% of profits, with average payouts rising 15%, up from 3% in 2006.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (GILD) and (UNH).
Morgan Stanley:
- Channel checks point to a strong pick-up in mall traffic and apparel sales. Following a relatively slow start to the holiday season, mall traffic levels have shown meaningful signs of improvement based on a number of recent channel checks. Moreover, online holiday sales are forecasted to be up 24% year-over-year. However, growth in online sales has been accelerating in recent days with sales up 33% on Dec. 14th and 38% on Dec. 15th. The National Retail Federation forecasts a 34% rise in gift cards, but based on anecdotal evidence we believe gift card sales could surpass this estimate. We continue to forecast total holiday sales growth of 4-5%.
Night Trading
Asian Indices are +.75% to +1.25% on average.
S&P 500 indicated +.10%.
NASDAQ 100 indicated +.17%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
- (COMS)/.00
- (ACN/.42
- (ATU)/.81
- (BBBY)/.52
- (KMX)/.25
- (FDO)/.36
- (FDX)/1.76
- (FINL)/-.08
- (MLHR)/.56
- (NKE)/1.12
- (PAYX)/.34
Upcoming Splits
- None of note
Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil drawdown of -2,000,000 barrels versus a -4,295,000 barrel decline the prior week. Gasoline supplies are expected to remain unch. versus a -174,000 barrel decline the prior week. Distillate inventories are estimated to fall by -600,000 barrels versus a -445,000 barrel decline the prior week. Refinery Utilization is expected to rise .5% versus a -1.36% decline the prior week.
BOTTOM LINE: Asian indices are higher, boosted by automaker and technology shares in the region. I expect US equities to open mixed and to rise into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the day.
Subscribe to:
Posts (Atom)