S&P 500 1,110.06 +.59%
NASDAQ 1,869.87 +.54%
Leading Sectors
Iron/Steel +4.10%
Airlines +3.33%
Commodity +2.78%
Lagging Sectors
Networking -.40%
Semis -.87%
Homebuilders -1.49%
Other
Crude Oil 49.88 -.04%
Natural Gas 6.45 +1.56%
Gold 414.00 -.05%
Base Metals 116.26 -.75%
U.S. Dollar 88.11 -.20%
10-Yr. T-note Yield 4.00% +.38%
VIX 13.83 -5.40%
Put/Call .90 -7.22%
NYSE Arms .89 -44.38%
After-hours Movers
IACI +3.85% on ORBZ news.
ORBZ +27.59% on reports it may be purchased by Cendant for about $1.2 billion.
PCLN +11.61% on ORBZ news.
Recommendations
Goldman Sachs reiterated Outperform on JNPR, AYE and MET.
After-hours News
U.S. stocks rose today, led by surging commodity-related shares. After the close, China Minmetals has put in place the financing needed for a planned $5 billion takeover of Canada's biggest mining company, Noranda Inc., Reuters reported. Medicare, the U.S. medical-cost reimbursement program for the elderly, will increase the number of heart conditions that qualify for treatment with implantable cardiac defibrillators, CNBC said. Caterpillar raised its 2004 sales forecast and said revenue next year will increase by about 10% from this year as demand for its machines and engines grows, Bloomberg said. Preparations for Afghanistan's presidential election on Oct. 9 are "on track," a United Nations official said.
BOTTOM LINE: The Portfolio finished unchanged today as my rising steel and internet longs offset my declining homebuilding and security longs. I covered a few technology shorts and added some new Chinese ADR longs in the afternoon, leaving the Portfolio 100% net long. One of my new longs is ACH and I am using a stop-loss of $60.45 on this position. The tone of the market improved quite a bit in the afternoon, despite rising energy prices, as volume picked-up and the advance/decline line finished at its highs for the day. However, measures of investor anxiety fell again and are approaching very complacent levels. U.S. stocks should drift modestly higher through week's end on better economic data, short-covering, the Presidential debate and end-of-the quarter window-dressing. Tomorrow's reaction to the energy inventory data will also help determine the market's short-term direction.
Tuesday, September 28, 2004
Mid-day Update
S&P 500 1,106.87 +.30%
NASDAQ 1,861.67 +.10%
Leading Sectors
Iron/Steel +2.93%
Airlines +2.79%
Commodity +2.56%
Lagging Sectors
Networking -1.46%
Homebuilders -1.46%
Semis -1.58%
Other
Crude Oil 49.80 +.52%
Natural Gas 5.51 +4.71%
Gold 413.40 +.66%
Base Metals 116.26 -.75%
U.S. Dollar 88.18 -.12%
10-Yr. T-note Yield 4.02 +.72%
VIX 14.23 -2.67%
Put/Call .90 -7.22%
NYSE Arms 1.12 -30.0%
Market Movers
AGIX +57.6% after saying its experimental drug for clogged arteries significantly reduced the amount of fatty plaque in blood vessels.
JNPR -5.1% on Friedman Billings downgrade to Market Perform.
NABI +16.2% after announcing positive test results for its antismoking vaccine.
GGC +7.9% after saying full-year sales would be better than estimates.
CNC +11.7% after agreeing to buy two health plans for about $93 million to gain patients in Kansas and Missouri.
GOOG +4.1% after multiple Buy ratings by underwriters.
STTX +10.7% after substantially boosting 4Q and 04 outlook.
IMCL +5.46% after Friedman, Billings upgrade to Outperform.
TZOO -13.8% on profit-taking.
DJO -13.2% after lowering 3Q/4Q guidance.
SNA -11.2% after lowering 3Q/04 outlook and Robert Baird downgrade to Underperform.
Economic Data
Consumer Confidence for September was 96.8 versus estimates of 99.5.
Recommendations
GOOG rated Outperform at CSFB, target $145. LWSN raised to Overweight at JP Morgan. GOOG rated Outperform at Thomas Weisel. GOOG rated Overweight at JP Morgan. UTEK raised to Buy at Merrill Lynch, target $22. GOOG rated Overweight at Morgan Stanley. Goldman Sachs reiterated Outperform on RIG, DO, KSS, GDT, Goldman reiterated Underperform on PBG. Goldman reiterated Attractive view of Oil Service sector, favorites are RIG, DO, SLB, BHI and SII. Citi SmithBarney says to Buy DOW and LYO. Citi reiterated Buy on PRE, target $69. Citi reiterated Buy on EMC, target $13.50. Citi reiterated Buy on SMTC, target $24. Citi reiterated Sell on ISIL, target $14. Citi reiterated Buy on AFC, target $36. Citi reiterated Buy on WR, target $22.50. Citi reiterated Buy on NPSP, target $25.
Mid-day News
U.S. stocks are modestly higher mid-day as a weaker consumer confidence report is being more than offset by strength in commodity-related stocks. Saudi Arabia will raise oil production to 11 million barrels a day, the AP reported. Fannie Mae's need to restate earnings will be decided by the SEC, Reuters reported. A top al-Qaeda leader was seen in July meeting in Honduras with leaders of a Salvadoran criminal gang that has roots in the U.S., including a presence in Washington, D.C., the Washington Times reported. Major League Baseball may disclose that Washington, D.C. will be the new home of the Montreal Expos on Thursday, the AP reported. The San Francisco 49ers professional football team sold the naming right to Candlestick Park to Monster Cable Products for about $6 million over four years, the San Francisco Chronicle reported. Amazon.com and Microsoft filed lawsuits to fight "spoofing" and "phishing," or the use of forged e-mail that purports to come from Amazon.com, Hotmail.com and other domains, Bloomberg reported. Bonds of Allstate and other home and auto insurers are holding steady after Hurricane Jeanne became the fourth storm in seven weeks to hit Florida and generate as much as $26 billion of damage claims, Bloomberg said. SpaceShipOne, a spacecraft financed by Microsoft co-founder Paul Allen, will travel more than 62 miles above the California desert tomorrow in its first official attempt to win a $10 million competition to encourage space tourism, Bloomberg reported. Cisco Systems will sell 180,000 phones that transmit phone calls over the Internet to Bank of America, Bloomberg reported. The value of derivatives traded outside exchanges more than doubled to $1.2 trillion a day in the three years through April led by dollar-denominated interest-rate contracts, the Bank for International Settlements said. Google, whose shares are up 39% since its IPO, may rise further as it boosts advertising revenue and international sales, CSFB and JP Morgan said in research reports. Foreign-exchange trading surged to a record daily average of $1.9 trillion this year as hedge funds and other money managers increases bets on currencies, Bloomberg said.
BOTTOM LINE: The Portfolio is slightly lower mid-day as declines in my security and homebuilding longs are more than offsetting my declining semi and software shorts. I added a few alternative energy, wireless and internet longs this morning, leaving the Portfolio 50% net long. One of my new longs is PLUG and I am using a $5.90 stop-loss on this position. End-of-the quarter window-dressing, better economic data, the Presidential debate and short-covering should push stocks modestly higher over the next few days.
NASDAQ 1,861.67 +.10%
Leading Sectors
Iron/Steel +2.93%
Airlines +2.79%
Commodity +2.56%
Lagging Sectors
Networking -1.46%
Homebuilders -1.46%
Semis -1.58%
Other
Crude Oil 49.80 +.52%
Natural Gas 5.51 +4.71%
Gold 413.40 +.66%
Base Metals 116.26 -.75%
U.S. Dollar 88.18 -.12%
10-Yr. T-note Yield 4.02 +.72%
VIX 14.23 -2.67%
Put/Call .90 -7.22%
NYSE Arms 1.12 -30.0%
Market Movers
AGIX +57.6% after saying its experimental drug for clogged arteries significantly reduced the amount of fatty plaque in blood vessels.
JNPR -5.1% on Friedman Billings downgrade to Market Perform.
NABI +16.2% after announcing positive test results for its antismoking vaccine.
GGC +7.9% after saying full-year sales would be better than estimates.
CNC +11.7% after agreeing to buy two health plans for about $93 million to gain patients in Kansas and Missouri.
GOOG +4.1% after multiple Buy ratings by underwriters.
STTX +10.7% after substantially boosting 4Q and 04 outlook.
IMCL +5.46% after Friedman, Billings upgrade to Outperform.
TZOO -13.8% on profit-taking.
DJO -13.2% after lowering 3Q/4Q guidance.
SNA -11.2% after lowering 3Q/04 outlook and Robert Baird downgrade to Underperform.
Economic Data
Consumer Confidence for September was 96.8 versus estimates of 99.5.
Recommendations
GOOG rated Outperform at CSFB, target $145. LWSN raised to Overweight at JP Morgan. GOOG rated Outperform at Thomas Weisel. GOOG rated Overweight at JP Morgan. UTEK raised to Buy at Merrill Lynch, target $22. GOOG rated Overweight at Morgan Stanley. Goldman Sachs reiterated Outperform on RIG, DO, KSS, GDT, Goldman reiterated Underperform on PBG. Goldman reiterated Attractive view of Oil Service sector, favorites are RIG, DO, SLB, BHI and SII. Citi SmithBarney says to Buy DOW and LYO. Citi reiterated Buy on PRE, target $69. Citi reiterated Buy on EMC, target $13.50. Citi reiterated Buy on SMTC, target $24. Citi reiterated Sell on ISIL, target $14. Citi reiterated Buy on AFC, target $36. Citi reiterated Buy on WR, target $22.50. Citi reiterated Buy on NPSP, target $25.
Mid-day News
U.S. stocks are modestly higher mid-day as a weaker consumer confidence report is being more than offset by strength in commodity-related stocks. Saudi Arabia will raise oil production to 11 million barrels a day, the AP reported. Fannie Mae's need to restate earnings will be decided by the SEC, Reuters reported. A top al-Qaeda leader was seen in July meeting in Honduras with leaders of a Salvadoran criminal gang that has roots in the U.S., including a presence in Washington, D.C., the Washington Times reported. Major League Baseball may disclose that Washington, D.C. will be the new home of the Montreal Expos on Thursday, the AP reported. The San Francisco 49ers professional football team sold the naming right to Candlestick Park to Monster Cable Products for about $6 million over four years, the San Francisco Chronicle reported. Amazon.com and Microsoft filed lawsuits to fight "spoofing" and "phishing," or the use of forged e-mail that purports to come from Amazon.com, Hotmail.com and other domains, Bloomberg reported. Bonds of Allstate and other home and auto insurers are holding steady after Hurricane Jeanne became the fourth storm in seven weeks to hit Florida and generate as much as $26 billion of damage claims, Bloomberg said. SpaceShipOne, a spacecraft financed by Microsoft co-founder Paul Allen, will travel more than 62 miles above the California desert tomorrow in its first official attempt to win a $10 million competition to encourage space tourism, Bloomberg reported. Cisco Systems will sell 180,000 phones that transmit phone calls over the Internet to Bank of America, Bloomberg reported. The value of derivatives traded outside exchanges more than doubled to $1.2 trillion a day in the three years through April led by dollar-denominated interest-rate contracts, the Bank for International Settlements said. Google, whose shares are up 39% since its IPO, may rise further as it boosts advertising revenue and international sales, CSFB and JP Morgan said in research reports. Foreign-exchange trading surged to a record daily average of $1.9 trillion this year as hedge funds and other money managers increases bets on currencies, Bloomberg said.
BOTTOM LINE: The Portfolio is slightly lower mid-day as declines in my security and homebuilding longs are more than offsetting my declining semi and software shorts. I added a few alternative energy, wireless and internet longs this morning, leaving the Portfolio 50% net long. One of my new longs is PLUG and I am using a $5.90 stop-loss on this position. End-of-the quarter window-dressing, better economic data, the Presidential debate and short-covering should push stocks modestly higher over the next few days.
Tuesday Watch
Earnings of Note
Company/Estimate
EMMS/.21
SLR/.04
Splits
None of note.
Economic Data
Consumer Confidence for September estimated at 99.5 versus 98.2 in August.
Recommendations
Goldman Sachs said to Buy AIG, ALL, ENH and RE on any weakness. Goldman reiterated Outperform on DVN and Underperform on QGENF.
Late-Night News
Asian indices are mostly lower on continuing worries that high energy prices will hurt exporters in the region. It may take "18 months to two years" to boost earnings at Coca-Cola, the Financial Times reported, citing Chairman and CEO Isdell. North Korea has "weaponized" the enriched uranium from 8,000 spent nuclear fuel rods, the AP reported. AT&T agreed to a doubling of the interest premium on its bank credit line after the telephone company's bond rating was lowered to non-investment grade, Bloomberg reported. China may award an $8 billion order for four nuclear reactors to an overseas supplier such as Areva SA, Westinghouse Electric or Siemens AG as part of the world's biggest nuclear power construction program, Bloomberg said. Pfizer appealed China's revocation of its Viagra patent in a case that may test the nation's commitment to stronger protection for intellectual property rights, Bloomberg reported. Crude oil is rising above $50/bbl. in NY on concern rebel attacks in Nigeria may reduce supply from Africa's biggest oil producer at a time when U.S. inventories are close to a 29-year low, Bloomberg said. America Coming Together, a 527 political group backed by billionaire hedge fund manager George Soros, is paying 1,500 people $8-$12 an hour to go door-to-door in 17 battleground states to register voters, urging them to vote for Senator Kerry, Bloomberg Reported. The group has raised $80 million and is the best-funded get-out-the-vote effort in Democratic Party history, Bloomberg said.
Late-Night Trading
Asian Indices are -.75% to unch. on average.
S&P 500 indicated -.02%.
NASDAQ 100 indicated -.04%
BOTTOM LINE: I expect U.S. equities to open modestly lower in the morning on continuing worries over high oil prices and profit-taking. The Portfolio is 25% net short heading into tomorrow.
Company/Estimate
EMMS/.21
SLR/.04
Splits
None of note.
Economic Data
Consumer Confidence for September estimated at 99.5 versus 98.2 in August.
Recommendations
Goldman Sachs said to Buy AIG, ALL, ENH and RE on any weakness. Goldman reiterated Outperform on DVN and Underperform on QGENF.
Late-Night News
Asian indices are mostly lower on continuing worries that high energy prices will hurt exporters in the region. It may take "18 months to two years" to boost earnings at Coca-Cola, the Financial Times reported, citing Chairman and CEO Isdell. North Korea has "weaponized" the enriched uranium from 8,000 spent nuclear fuel rods, the AP reported. AT&T agreed to a doubling of the interest premium on its bank credit line after the telephone company's bond rating was lowered to non-investment grade, Bloomberg reported. China may award an $8 billion order for four nuclear reactors to an overseas supplier such as Areva SA, Westinghouse Electric or Siemens AG as part of the world's biggest nuclear power construction program, Bloomberg said. Pfizer appealed China's revocation of its Viagra patent in a case that may test the nation's commitment to stronger protection for intellectual property rights, Bloomberg reported. Crude oil is rising above $50/bbl. in NY on concern rebel attacks in Nigeria may reduce supply from Africa's biggest oil producer at a time when U.S. inventories are close to a 29-year low, Bloomberg said. America Coming Together, a 527 political group backed by billionaire hedge fund manager George Soros, is paying 1,500 people $8-$12 an hour to go door-to-door in 17 battleground states to register voters, urging them to vote for Senator Kerry, Bloomberg Reported. The group has raised $80 million and is the best-funded get-out-the-vote effort in Democratic Party history, Bloomberg said.
Late-Night Trading
Asian Indices are -.75% to unch. on average.
S&P 500 indicated -.02%.
NASDAQ 100 indicated -.04%
BOTTOM LINE: I expect U.S. equities to open modestly lower in the morning on continuing worries over high oil prices and profit-taking. The Portfolio is 25% net short heading into tomorrow.
Monday, September 27, 2004
Monday Close
S&P 500 1,103.52 -.59%
NASDAQ 1,859.88 -1.04%
Leading Sectors
Broadcasting +1.03%
Homebuilders +.91%
Utilities +.31%
Lagging Sectors
Biotech -1.85%
Networking -2.31%
Airlines -4.01%
Other
Crude Oil 49.92 +.62%
Natural Gas 5.30 +.72%
Gold 410.40 -.07%
Base Metals 117.14 +.98%
U.S. Dollar 88.29 -.12%
10-Yr. T-note Yield 3.98% -.95%
VIX 14.62 +2.38%
Put/Call .97 +4.30%
NYSE Arms 1.60 +52.38%
After-hours Movers
AGIX +64.0% after saying its experimental drug for clogged arteries significantly reduced the amount of fatty plaque in blood vessels.
NSTK +4.7% on continued optimism over its nasal spray for obesity.
MCHX +8.3% after announcing agreements with two of the Internet's leading shopping services through its TrafficLeader subsidiary.
HGSI -5.4% after announcing that it intends to offer $200 million aggregate principal amount of convertible subordinated notes.
MCIP -5.1% after saying Leucadia National has sold its 5% stake for $20 million pretax profit.
Recommendations
Goldman Sachs reiterated Outperform on HOT, FD, HD, WAG, AGN, CAT and PPL.
After-hours News
U.S. stocks finished lower today on rising commodity prices and profit-taking. After the close, Apollo Management is the leading bidder for News Corp.'s Hughes Network Systems unit after offering $300 million, Dow Jones reported. Iraq and the International Monetary Fund likely will reach an agreement this week or next on a program aimed at rebuilding Iraq's economy, Goldman Sachs International Vice Chairman Hormats told CNBC. American Airlines dropped a $10 per round trip fare increase on most U.S. and U.S.-Canada flights after competitors declined to match the change on all routes, Bloomberg reported. Nextel Communications said it purchased 6 million of its own shares, and some shares of Nextel Partners, from Motorola, Bloomberg said. Orange-juice prices in NY surged the most in more than three years to a 15-month high on supply concerns after Hurricane Jeanne hit Florida, Bloomberg reported.
BOTTOM LINE: The Portfolio finished slightly lower today as declines in my security longs offset gains in my homebuilding longs. I exited a few security-related longs in the afternoon as they hit stop-losses, thus leaving the Portfolio 25% net short. Volume was light today and the advance/decline line was poor. On the positive side, measures of investor anxiety are rising and interest rates continue to fall. I still expect homebuilders to reach all-time highs in the fourth quarter.
NASDAQ 1,859.88 -1.04%
Leading Sectors
Broadcasting +1.03%
Homebuilders +.91%
Utilities +.31%
Lagging Sectors
Biotech -1.85%
Networking -2.31%
Airlines -4.01%
Other
Crude Oil 49.92 +.62%
Natural Gas 5.30 +.72%
Gold 410.40 -.07%
Base Metals 117.14 +.98%
U.S. Dollar 88.29 -.12%
10-Yr. T-note Yield 3.98% -.95%
VIX 14.62 +2.38%
Put/Call .97 +4.30%
NYSE Arms 1.60 +52.38%
After-hours Movers
AGIX +64.0% after saying its experimental drug for clogged arteries significantly reduced the amount of fatty plaque in blood vessels.
NSTK +4.7% on continued optimism over its nasal spray for obesity.
MCHX +8.3% after announcing agreements with two of the Internet's leading shopping services through its TrafficLeader subsidiary.
HGSI -5.4% after announcing that it intends to offer $200 million aggregate principal amount of convertible subordinated notes.
MCIP -5.1% after saying Leucadia National has sold its 5% stake for $20 million pretax profit.
Recommendations
Goldman Sachs reiterated Outperform on HOT, FD, HD, WAG, AGN, CAT and PPL.
After-hours News
U.S. stocks finished lower today on rising commodity prices and profit-taking. After the close, Apollo Management is the leading bidder for News Corp.'s Hughes Network Systems unit after offering $300 million, Dow Jones reported. Iraq and the International Monetary Fund likely will reach an agreement this week or next on a program aimed at rebuilding Iraq's economy, Goldman Sachs International Vice Chairman Hormats told CNBC. American Airlines dropped a $10 per round trip fare increase on most U.S. and U.S.-Canada flights after competitors declined to match the change on all routes, Bloomberg reported. Nextel Communications said it purchased 6 million of its own shares, and some shares of Nextel Partners, from Motorola, Bloomberg said. Orange-juice prices in NY surged the most in more than three years to a 15-month high on supply concerns after Hurricane Jeanne hit Florida, Bloomberg reported.
BOTTOM LINE: The Portfolio finished slightly lower today as declines in my security longs offset gains in my homebuilding longs. I exited a few security-related longs in the afternoon as they hit stop-losses, thus leaving the Portfolio 25% net short. Volume was light today and the advance/decline line was poor. On the positive side, measures of investor anxiety are rising and interest rates continue to fall. I still expect homebuilders to reach all-time highs in the fourth quarter.
Mid-day Update
S&P 500 1,107.10 -.27%
NASDAQ 1,868.72 -.57%
Leading Sectors
Homebuilders +1.89%
Broadcasting +.38%
Drugs +.30%
Lagging Sectors
I-Banks -1.29%
Networking -1.31%
Airlines -3.45%
Other
Crude Oil 49.30 +.86%
Natural Gas 5.23 -2.91%
Gold 411.10 +.34%
Base Metals 117.02 +.88%
U.S. Dollar 88.21 -.21%
10-Yr. T-note Yield 3.99% -.76%
VIX 14.62 +2.38%
Put/Call .72 -22.58%
NYSE Arms 1.17 +11.43%
Market Movers
CX -7.5% after saying it agreed to buy RMC Group Plc for $4.15 billion to double revenue and expand in concrete markets in Europe and the U.S.
TOM -20.1% after saying U.S. authorities are investigating commissions the company paid to an overseas-purchasing unit.
VSEC +38.6% after saying it received a cost-plus-fixed-fee contract from the U.S. Navy valued as much as $1 billion.
NSTK +33.7% after announcing a global alliance with Merck(MRK) to develop an experimental nasal spray treatment for obesity.
PER +11.4% after boosting 3Q estimates.
CNCT after saying it had commenced the Phase III clinical trial program for Desilux, a low-potency topical steroid.
GMAI -14.7% on negative Barron's article.
Economic Data
New Home Sales for August were 1184K versus estimates of 1155K and 1082K in July.
Recommendations
Goldman Sachs reiterated Outperform on RE, ALL, ENH, AGN, FSL, HOT, KO, BSX, DNA, AMGN, STLD, FS, IGT, HD, GDT, MDT, MRVL and PFE. Goldman reiterated Underperform on AMCC. Citi SmithBarney reiterated Buy on MMM, target $95. Citi reiterated Buy on VIAB, target $50. Citi reiterated Buy on WMT, target $65. Citi reiterated Buy on HAL, target $44. Citi reiterated Sell on PGN, target $38.50. Citi reiterated Buy on UNM, target $20. Citi reiterated Buy on FNM, target $81. ISG raised to Outperform on CSFB. VISG rated Buy at UBS. WMT upgraded to Buy at Bank of America, target $60. JBLU, FRNT and AAI cut to Underweight at JP Morgan. FDO raised to Buy at Bank of America, target $33.50. IMOS raised to Outperform at Thomas Weisel, target $10. PTEN cut to Underweight at Morgan Stanley. TOM downgraded to Underweight, target $8.
Mid-day News
U.S. stocks are falling modestly mid-day on profit-taking and continuing fears over higher energy prices. IBM will invest $250 million over the next five years and employ1,000 people in a new business unit supporting products and services related to sensor networks, the NY Times reported. PalmSource will announce tomorrow its first operating system for so-called smart phones, the International Herald Tribune reported. Bank of America may close or merge as many as 38 mutual funds as part of its acquisition of FleetBoston Financial, the Boston Herald reported. Starbucks will raise beverage prices 11 cents on average, the Wall Street Journal reported. JP Morgan agreed to buy hedge fund company Highbridge Capital, Bloomberg reported. Anglo American Platinum, Impala Platinum and Northam Platinum may face strikes over pay at South African mines, crippling 60% of the world's platinum production and boosting prices of the metal, Bloomberg said. Walgreen said fourth-quarter profit rose 18%, helped by sales of prescription drugs, Bloomberg reported. Fannie Mae agreed to correct its bookkeeping policies to meet generally accepted accounting principles, Bloomberg said. A series of small tremors culminating in more than 10 larger earthquakes near Mount St. Helens may be a precursor to explosions, landslides and the release of ash clouds, the U.S. Geological Survey said. U.S. new home sales surged 9.4% in August, propelled by the lowest mortgage rates in four months, Bloomberg reported. Comcast is working with Time Warner to explore a potential transaction regarding bankrupt cable-tv operator Adelphia Communications, Bloomberg reported. Jeanne, the fourth hurricane to hit Florida in two months, weakened as it moved into Georgia, leaving behind a trail of destruction and at least 7 deaths, Bloomberg said. Crude oil is rising amid concern rebel attacks in Nigeria will reduce production and U.S. refiners will struggle to replenish supplies disrupted by Hurricane Ivan, Bloomberg reported.
BOTTOM LINE: The Portfolio is slightly lower mid-day as my declining security longs are more than offsetting my rising homebuilding longs. I have not traded today and the Portfolio is still market neutral. The tone of the market is negative today and the CRB is spiking up, mostly as a result of the hurricanes. I expect U.S. stocks to traded mixed into the afternoon.
NASDAQ 1,868.72 -.57%
Leading Sectors
Homebuilders +1.89%
Broadcasting +.38%
Drugs +.30%
Lagging Sectors
I-Banks -1.29%
Networking -1.31%
Airlines -3.45%
Other
Crude Oil 49.30 +.86%
Natural Gas 5.23 -2.91%
Gold 411.10 +.34%
Base Metals 117.02 +.88%
U.S. Dollar 88.21 -.21%
10-Yr. T-note Yield 3.99% -.76%
VIX 14.62 +2.38%
Put/Call .72 -22.58%
NYSE Arms 1.17 +11.43%
Market Movers
CX -7.5% after saying it agreed to buy RMC Group Plc for $4.15 billion to double revenue and expand in concrete markets in Europe and the U.S.
TOM -20.1% after saying U.S. authorities are investigating commissions the company paid to an overseas-purchasing unit.
VSEC +38.6% after saying it received a cost-plus-fixed-fee contract from the U.S. Navy valued as much as $1 billion.
NSTK +33.7% after announcing a global alliance with Merck(MRK) to develop an experimental nasal spray treatment for obesity.
PER +11.4% after boosting 3Q estimates.
CNCT after saying it had commenced the Phase III clinical trial program for Desilux, a low-potency topical steroid.
GMAI -14.7% on negative Barron's article.
Economic Data
New Home Sales for August were 1184K versus estimates of 1155K and 1082K in July.
Recommendations
Goldman Sachs reiterated Outperform on RE, ALL, ENH, AGN, FSL, HOT, KO, BSX, DNA, AMGN, STLD, FS, IGT, HD, GDT, MDT, MRVL and PFE. Goldman reiterated Underperform on AMCC. Citi SmithBarney reiterated Buy on MMM, target $95. Citi reiterated Buy on VIAB, target $50. Citi reiterated Buy on WMT, target $65. Citi reiterated Buy on HAL, target $44. Citi reiterated Sell on PGN, target $38.50. Citi reiterated Buy on UNM, target $20. Citi reiterated Buy on FNM, target $81. ISG raised to Outperform on CSFB. VISG rated Buy at UBS. WMT upgraded to Buy at Bank of America, target $60. JBLU, FRNT and AAI cut to Underweight at JP Morgan. FDO raised to Buy at Bank of America, target $33.50. IMOS raised to Outperform at Thomas Weisel, target $10. PTEN cut to Underweight at Morgan Stanley. TOM downgraded to Underweight, target $8.
Mid-day News
U.S. stocks are falling modestly mid-day on profit-taking and continuing fears over higher energy prices. IBM will invest $250 million over the next five years and employ1,000 people in a new business unit supporting products and services related to sensor networks, the NY Times reported. PalmSource will announce tomorrow its first operating system for so-called smart phones, the International Herald Tribune reported. Bank of America may close or merge as many as 38 mutual funds as part of its acquisition of FleetBoston Financial, the Boston Herald reported. Starbucks will raise beverage prices 11 cents on average, the Wall Street Journal reported. JP Morgan agreed to buy hedge fund company Highbridge Capital, Bloomberg reported. Anglo American Platinum, Impala Platinum and Northam Platinum may face strikes over pay at South African mines, crippling 60% of the world's platinum production and boosting prices of the metal, Bloomberg said. Walgreen said fourth-quarter profit rose 18%, helped by sales of prescription drugs, Bloomberg reported. Fannie Mae agreed to correct its bookkeeping policies to meet generally accepted accounting principles, Bloomberg said. A series of small tremors culminating in more than 10 larger earthquakes near Mount St. Helens may be a precursor to explosions, landslides and the release of ash clouds, the U.S. Geological Survey said. U.S. new home sales surged 9.4% in August, propelled by the lowest mortgage rates in four months, Bloomberg reported. Comcast is working with Time Warner to explore a potential transaction regarding bankrupt cable-tv operator Adelphia Communications, Bloomberg reported. Jeanne, the fourth hurricane to hit Florida in two months, weakened as it moved into Georgia, leaving behind a trail of destruction and at least 7 deaths, Bloomberg said. Crude oil is rising amid concern rebel attacks in Nigeria will reduce production and U.S. refiners will struggle to replenish supplies disrupted by Hurricane Ivan, Bloomberg reported.
BOTTOM LINE: The Portfolio is slightly lower mid-day as my declining security longs are more than offsetting my rising homebuilding longs. I have not traded today and the Portfolio is still market neutral. The tone of the market is negative today and the CRB is spiking up, mostly as a result of the hurricanes. I expect U.S. stocks to traded mixed into the afternoon.
Monday Watch
Earnings of Note
Company/Estimate
WAG/.31
Splits
AMWD 2-for-1
LM 3-for-2
Economic Data
New Home Sales for August estimated at 1155K versus 1134K in July.
Weekend Recommendations
Louis Rukeyser's Wall Street had guests that were positive on EK, INTC, DIA, PFE, BK and CMCSA. Wall St. Week w/Fortune had guests that were positive on CMCSA, NXTL, EBAY and EK. Bulls and Bears had guests that were positive on ERES, BAC, SLM, LDG, JBHT, CCL, AH, CL and mixed on KMRT, ORCL. Forbes on Fox had guests that were positive on INGR, QSTR, MSFT, WIT and MSO. Cashin' In had guests that were positive on FLIR, MMC, mixed on ISSX, KKD, ESPD, EDP and negative on MSO. Barron's had positive comments on BBI, F, TM, HMC, DCX and negative comments on VLKAY and GMAI. Goldman Sachs reiterated Outperform on EBAY. Goldman reiterated Attractive view on Gold stocks.
Weekend News
China may let its insurance companies buy stocks directly as early as next month, the 21st Century Business Herald said. Tesco Plc, Britain's biggest retailer, is testing RFID tags that will replace the bar code on products from bread to stereos, the Financial Times said. KarstadtQuelle AG, the largest German department store operator, plans to end its joint venture with Starbucks, Frankfurter Allgemeine Sonntagszeitung said. Iraq's Prime Minister Allawi and Secretary of State Colin Powell said they expected all Iraqis would participate in the election planned for January, the Washington Post reported. Semiconductor Manufacturing International has started making 12-inch wafers at its newest plant in Beijing, Xinhua news said. The world economy is at its best in five years, said IMF Managing Director Rodrigo Rato in an interview with El Pais. Senator Kerry, who supported extending a U.S. assault-weapons ban that expired two weeks ago, said that he owns a Chinese assault rifle, the NY Times reported. Viacom CEO Redstone said he will wait on a report by a panel investigating Dan Rather's use of questionable documents before deciding on the CBS News anchorman's future, Time magazine reported. Johnson & Johnson's may enter the hearing aid market and expand its over-the-counter drugs business in an effort to boost sales, the Financial Times said. France and Germany won't increase military aid to Iraq even if Senator Kerry wins the U.S. election, the Financial Times reported, citing French and German officials. Texas Instruments and Xilinx have cut chip orders at United Microelectronics after paring forecasts for their quarterly sales, the Commercial Times reported. Hewlett-Packard will stop making desktop computers based on Intel's Itanium chip, the Wall Street Journal reported. Asian traders said any declines in Fannie Mae debt, after regulators told the company to amend account ting procedures, are a buying opportunity, the Asian Wall Street Journal reported. U.S. oil inventories should make a quick recovery to normal levels after Hurricane Ivan disrupted supply to the U.S. Gulf of Mexico over the last two weeks, Qatar's oil minister said. Hurricane Jeanne, which slammed into Florida's Atlantic coast overnight, may cost insurers $6 billion to $14 billion, rivaling Hurricane Charley as the most expensive storm of the season, Bloomberg reported. Inco, the world's second-biggest nickel producer, and Falconbridge may spend $3.5 billion for the metal from Chinese stainless steel makers soars, Bloomberg said. The U.S. Army may reduce the length of time soldiers are required to spend in combat zones in Iraq and Afghanistan, the NY Times reported. Fannie Mae may have to sell assets or turn to investors to raise cash to meet its regulatory capital standards, the Wall Street Journal said.
Late-Night Trading
Asian indices are mixed, -.75% to +.25% on average.
S&P 500 indicated +.04%.
NASDAQ indicated +.04%
BOTTOM LINE: I expect U.S. stocks to open modestly lower in the morning on higher energy prices and greater-than-expected damage from Hurricane Jeanne. The Portfolio is market neutral heading into the week.
Company/Estimate
WAG/.31
Splits
AMWD 2-for-1
LM 3-for-2
Economic Data
New Home Sales for August estimated at 1155K versus 1134K in July.
Weekend Recommendations
Louis Rukeyser's Wall Street had guests that were positive on EK, INTC, DIA, PFE, BK and CMCSA. Wall St. Week w/Fortune had guests that were positive on CMCSA, NXTL, EBAY and EK. Bulls and Bears had guests that were positive on ERES, BAC, SLM, LDG, JBHT, CCL, AH, CL and mixed on KMRT, ORCL. Forbes on Fox had guests that were positive on INGR, QSTR, MSFT, WIT and MSO. Cashin' In had guests that were positive on FLIR, MMC, mixed on ISSX, KKD, ESPD, EDP and negative on MSO. Barron's had positive comments on BBI, F, TM, HMC, DCX and negative comments on VLKAY and GMAI. Goldman Sachs reiterated Outperform on EBAY. Goldman reiterated Attractive view on Gold stocks.
Weekend News
China may let its insurance companies buy stocks directly as early as next month, the 21st Century Business Herald said. Tesco Plc, Britain's biggest retailer, is testing RFID tags that will replace the bar code on products from bread to stereos, the Financial Times said. KarstadtQuelle AG, the largest German department store operator, plans to end its joint venture with Starbucks, Frankfurter Allgemeine Sonntagszeitung said. Iraq's Prime Minister Allawi and Secretary of State Colin Powell said they expected all Iraqis would participate in the election planned for January, the Washington Post reported. Semiconductor Manufacturing International has started making 12-inch wafers at its newest plant in Beijing, Xinhua news said. The world economy is at its best in five years, said IMF Managing Director Rodrigo Rato in an interview with El Pais. Senator Kerry, who supported extending a U.S. assault-weapons ban that expired two weeks ago, said that he owns a Chinese assault rifle, the NY Times reported. Viacom CEO Redstone said he will wait on a report by a panel investigating Dan Rather's use of questionable documents before deciding on the CBS News anchorman's future, Time magazine reported. Johnson & Johnson's may enter the hearing aid market and expand its over-the-counter drugs business in an effort to boost sales, the Financial Times said. France and Germany won't increase military aid to Iraq even if Senator Kerry wins the U.S. election, the Financial Times reported, citing French and German officials. Texas Instruments and Xilinx have cut chip orders at United Microelectronics after paring forecasts for their quarterly sales, the Commercial Times reported. Hewlett-Packard will stop making desktop computers based on Intel's Itanium chip, the Wall Street Journal reported. Asian traders said any declines in Fannie Mae debt, after regulators told the company to amend account ting procedures, are a buying opportunity, the Asian Wall Street Journal reported. U.S. oil inventories should make a quick recovery to normal levels after Hurricane Ivan disrupted supply to the U.S. Gulf of Mexico over the last two weeks, Qatar's oil minister said. Hurricane Jeanne, which slammed into Florida's Atlantic coast overnight, may cost insurers $6 billion to $14 billion, rivaling Hurricane Charley as the most expensive storm of the season, Bloomberg reported. Inco, the world's second-biggest nickel producer, and Falconbridge may spend $3.5 billion for the metal from Chinese stainless steel makers soars, Bloomberg said. The U.S. Army may reduce the length of time soldiers are required to spend in combat zones in Iraq and Afghanistan, the NY Times reported. Fannie Mae may have to sell assets or turn to investors to raise cash to meet its regulatory capital standards, the Wall Street Journal said.
Late-Night Trading
Asian indices are mixed, -.75% to +.25% on average.
S&P 500 indicated +.04%.
NASDAQ indicated +.04%
BOTTOM LINE: I expect U.S. stocks to open modestly lower in the morning on higher energy prices and greater-than-expected damage from Hurricane Jeanne. The Portfolio is market neutral heading into the week.
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