Bloomberg:
- The US dollar will rise this year and next after three years of losses against the euro and the yen, a JP Morgan survey of corporate customers shows.
- Growth in demand for oil tankers will slow in 2005 for a second straight year as near-record prices curb oil consumption.
- Rising energy prices and higher interest rates will take a larger bite out of consumer spending and cause the US economy to slow later this year, a Bloomberg News survey of economists found.
- China will use 380,000 metric tons of steel, or .1% of its output last year, to build stadiums and gymnasiums for the 2008 Olympic Games in Beijing, the China Iron and Steel Association said.
- Crude oil is falling for a fifth day in NY, the longest decline since August, on signs that US inventories will be sufficient to meet increased demand by refiners making gasoline.
- ShopKo Stores, a discounter with 360 stores, agreed to be acquired by a private equity firm for $715.2 million, the second buyout of a retail company in two months.
Wall Street Journal:
- Oil prices are unlikely to stay at their present high level, according to Lee Raymond, Exxon Mobil Corp.’s chief executive officer.
- Transactions between Delphi Corp. and BBK Ltd. are being investigated by the SEC as part of an inquiry into Delphi’s accounting.
- The private investors who own Warner Music Group stand to make $329.4 million in cash after an IPO next month.
- A bill tightening supervision of Fannie Mae and Freddie Mac may pass this year after the administration said it will be flexible over restrictions on the two biggest buyers of US home mortgages.
- The FDA has been asked by medical and environmental groups to curtail use of antibiotics in animal feed because of possible dangers to human health.
- A bill tightening supervision of Fannie Mae and Freddie Mac may pass this year after the administration said it will be flexible over restrictions on the two biggest buyers of US home mortgages.
NY Times:
- Documents for an agreement between AIG International Group and a unit of Berkshire Hathaway were altered two months after the accord was reached.
TradeWinds:
- The global container shipping fleet’s carrying capacity is set to grow by 60% through 2008 and may create an oversupply of shipping space, citing shipbrokers.
Les Echos:
- STMicroelectronics NV, Europe’s largest semiconductor maker, will be ready to deliver the first chips for high-definition television decoders using the MPEG-4 standard in September.
Friday, April 08, 2005
Morning Buy/Sell Recommendations
Goldman Sachs:
- Downgraded Life Insurance group to Cautious.
- Downgraded PFG to Underperform.
- Reiterated Outperform on AVP.
Smith Barney:
- Reiterated Buy on RSG, target $39.
- Reiterated Buy on FFIV, target $65.
- Reiterated Buy on RDWR, target $32.
- Reiterated Buy on EXTR, target $11.
- Reiterated Buy on FDRY, target $14.
- Reiterated Buy on NTGR, target $20.
- Reiterated Buy on PKTR, target $22.
- Reiterated Buy on JNPR, target $36.
- Reiterated Buy on ELX, target $23.50.
- Reiterated Buy on RSG, target $39.
- Rated RRD Buy, target $36.
- Rated AMTD Buy, target $13.25.
- Reiterated Buy on CHE, target $93.
- Reiterated Buy on FCS, target $19.
- Reiterated Buy on SSI, target $70.
Morgan Stanley:
- Cut State Street to Underweight.
JP Morgan:
- Raised GOL, STZ to Overweight.
- Downgraded MESA to Underweight.
- Downgraded SKYW to Underweight.
- Downgraded XJT to Underweight.
- Reiterated Overweight on DG, target $28.
Merrill Lynch:
- Raised ARBX to Buy.
CIBC:
- Raised MGA to Sector Outperform.
- Cut X to Sector Underperform.
Prudential:
- Reiterated Overweight on BWA, target $57.
Raymond James:
- Raised LUFK to Strong Buy, target $60.
Piper Jaffray:
- Reiterated Outperform on DELL, target $48.
Deutsche Bank:
- Downgraded GM to Sell, target $24.
Thomas Weisel:
- Reiterated Outperform on CHS, target $33.
- Reiterated Outperform on CACH, target $18.
- Downgraded Life Insurance group to Cautious.
- Downgraded PFG to Underperform.
- Reiterated Outperform on AVP.
Smith Barney:
- Reiterated Buy on RSG, target $39.
- Reiterated Buy on FFIV, target $65.
- Reiterated Buy on RDWR, target $32.
- Reiterated Buy on EXTR, target $11.
- Reiterated Buy on FDRY, target $14.
- Reiterated Buy on NTGR, target $20.
- Reiterated Buy on PKTR, target $22.
- Reiterated Buy on JNPR, target $36.
- Reiterated Buy on ELX, target $23.50.
- Reiterated Buy on RSG, target $39.
- Rated RRD Buy, target $36.
- Rated AMTD Buy, target $13.25.
- Reiterated Buy on CHE, target $93.
- Reiterated Buy on FCS, target $19.
- Reiterated Buy on SSI, target $70.
Morgan Stanley:
- Cut State Street to Underweight.
JP Morgan:
- Raised GOL, STZ to Overweight.
- Downgraded MESA to Underweight.
- Downgraded SKYW to Underweight.
- Downgraded XJT to Underweight.
- Reiterated Overweight on DG, target $28.
Merrill Lynch:
- Raised ARBX to Buy.
CIBC:
- Raised MGA to Sector Outperform.
- Cut X to Sector Underperform.
Prudential:
- Reiterated Overweight on BWA, target $57.
Raymond James:
- Raised LUFK to Strong Buy, target $60.
Piper Jaffray:
- Reiterated Outperform on DELL, target $48.
Deutsche Bank:
- Downgraded GM to Sell, target $24.
Thomas Weisel:
- Reiterated Outperform on CHS, target $33.
- Reiterated Outperform on CACH, target $18.
Friday Watch
Late-Night Headlines
Bloomberg:
- William Poole, president of the Federal Bank of St. Louis, said central bankers will need to be more "vigorous" in raising interest rates when inflation pressures begin appearing in labor costs.
- Crude oil futures in New York will probably fall next week as increasing production by members of OPEC boosts US inventories.
- Bank of America said revenue from its debt, treasury and trading operations in Asia may rise as much as 15% this year as it makes more fees selling corporate loans and bonds.
Wall Street Journal:
- Time Warner and Comcast agreed to buy Adelphia Communications for about $17.6 billion in cash and stock.
Financial Times:
- German companies are decreasing their investments in Russia on doubts that the country's government will follow through with market reforms.
- Qwest Communications is close to arranging a $2 billion equity infusion in its effort to buy MCI Inc.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on DELL.
Business Week:
- Shares of Barrier Therapeutics(BTRX), a maker of dermatological treatments, are expected to rise as the company awaits approval from the FDA.
Night Trading
Asian Indices are +.25% to +.50% on average.
S&P 500 indicated -.04%.
NASDAQ 100 indicated +.03%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Analyst Actions
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
CKR/.10
Splits
None of note
Economic Releases
None of note
Bloomberg:
- William Poole, president of the Federal Bank of St. Louis, said central bankers will need to be more "vigorous" in raising interest rates when inflation pressures begin appearing in labor costs.
- Crude oil futures in New York will probably fall next week as increasing production by members of OPEC boosts US inventories.
- Bank of America said revenue from its debt, treasury and trading operations in Asia may rise as much as 15% this year as it makes more fees selling corporate loans and bonds.
Wall Street Journal:
- Time Warner and Comcast agreed to buy Adelphia Communications for about $17.6 billion in cash and stock.
Financial Times:
- German companies are decreasing their investments in Russia on doubts that the country's government will follow through with market reforms.
- Qwest Communications is close to arranging a $2 billion equity infusion in its effort to buy MCI Inc.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on DELL.
Business Week:
- Shares of Barrier Therapeutics(BTRX), a maker of dermatological treatments, are expected to rise as the company awaits approval from the FDA.
Night Trading
Asian Indices are +.25% to +.50% on average.
S&P 500 indicated -.04%.
NASDAQ 100 indicated +.03%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Analyst Actions
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
CKR/.10
Splits
None of note
Economic Releases
None of note
BOTTOM LINE: Asian indices are higher, led gains in exporters on another decline in energy prices. I expect US equities to open modestly higher on another decline in commodity prices and strength in the US dollar. The Portfolio is 50% net long heading into tomorrow.
Thursday, April 07, 2005
Thursday Close
Indices
S&P 500 1,191.14 +.60%
DJIA 10,546.32 +.58%
NASDAQ 2,018.79 +.98%
Russell 2000 619.76 +.58%
DJ Wilshire 5000 11,739.03 +.58%
S&P Barra Growth 574.94 +.72%
S&P Barra Value 611.78 +.47%
Morgan Stanley Consumer 587.47 +.98%
Morgan Stanley Cyclical 751.67 +.80%
Morgan Stanley Technology 458.34 +1.02%
Transports 3,719.00 +.14%
Utilities 365.40 +.84%
Put/Call .69 -29.59%
NYSE Arms .76 -32.24%
Volatility(VIX) -6.24%
ISE Sentiment 135.00 -8.78%
US Dollar 84.87 +.22%
CRB 306.28 -.58%
Futures Spot Prices
Crude Oil 53.92 -.35%
Unleaded Gasoline 156.34 -.29%
Natural Gas 7.33 -.50%
Heating Oil 152.20 -.41%
Gold 427.70 -.16%
Base Metals 129.69 +.47%
Copper 149.95 -.46%
10-year US Treasury Yield 4.48% +1.28%
Leading Sectors
Gaming +2.44%
Semis +1.97%
Airlines +1.85%
Lagging Sectors
Restaurants -.58%
Energy -.58%
Oil Service -1.16%
After-hours Movers
STZ +4.6% after beating 4Q estimates and reiterating 1Q guidance.
ELX +5.3% after boosting 3Q forecast.
BCSI -15.4% after saying the SEC is conducting a formal investigation of the company.
USFC -4.4% after lowering 1Q estimates substantially.
ARBA -8.1% after lowering 2Q estimates.
BORL -9.6% after lowering 1Q and 2Q forecasts.
LAVA -17.1% after cutting 4Q and 06 forecasts substantially.
Evening Review
Detailed Market Summary
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
Futures Recap
S&P 500 Gallery View
Timely Economic Charts
PM Market Call
Real-time/After-hours Stock Quote
In Play
Afternoon Recommendations
Goldman Sachs:
- Reiterated Outperform on PFE and Underperform on DRI.
Business Week:
- Tootsie Roll Industries(TR) might be valued at $35-$37 a share in a possible buyout, citing LJR Great Lakes Review analyst Elliott Schlang.
- Doral Financial Corp., Puerto Rico’s largest mortgage lender, may see its shares rise to $49 in a year as Puerto Rico’s housing shortage will keep mortgage demand strong.
Afternoon/Evening Headlines
Bloomberg:
- Growth in US consumer installment credit slowed in February on waning demand for auto and other personal loans.
- Moody’s Investors Service said it put Pfizer’s Aaa long-term debt ratings on review for possible downgrade after today’s suspension of the Bextra painkiller.
- Marshall Carter, former chief executive officer of State Street, succeeded John Reed as chairman of the NYSE, 18 months after the world’s biggest stock market ousted Richard Grasso.
- Crude oil in NY fell for a fifth day amid speculation rising US refinery output will boost gasoline supplies for the peak summer motoring season.
- AmerisourceBergen Corp. said one of its units received a subpoena April 6 from Democratic NY Attorney General Spitzer’s office.
Financial Times:
- Morgan Stanley CEO Purcell said the firm’s board is “moving on” after resisting pressure from retired executives for his ouster.
- US imports from China rose 37% in January and February, while exports to the Asian country fell 10%.
Reuters:
- Morgan Stanley CEO Purcell, under pressure from retired executives calling for his ouster, denied speculation the firm may be bought by HSBC Holdings Plc.
Business Week:
- IBM CEO Palmisano projects the company will generate as much as $50 billion in revenue in 10 years from business consulting and outsourcing.
S&P 500 1,191.14 +.60%
DJIA 10,546.32 +.58%
NASDAQ 2,018.79 +.98%
Russell 2000 619.76 +.58%
DJ Wilshire 5000 11,739.03 +.58%
S&P Barra Growth 574.94 +.72%
S&P Barra Value 611.78 +.47%
Morgan Stanley Consumer 587.47 +.98%
Morgan Stanley Cyclical 751.67 +.80%
Morgan Stanley Technology 458.34 +1.02%
Transports 3,719.00 +.14%
Utilities 365.40 +.84%
Put/Call .69 -29.59%
NYSE Arms .76 -32.24%
Volatility(VIX) -6.24%
ISE Sentiment 135.00 -8.78%
US Dollar 84.87 +.22%
CRB 306.28 -.58%
Futures Spot Prices
Crude Oil 53.92 -.35%
Unleaded Gasoline 156.34 -.29%
Natural Gas 7.33 -.50%
Heating Oil 152.20 -.41%
Gold 427.70 -.16%
Base Metals 129.69 +.47%
Copper 149.95 -.46%
10-year US Treasury Yield 4.48% +1.28%
Leading Sectors
Gaming +2.44%
Semis +1.97%
Airlines +1.85%
Lagging Sectors
Restaurants -.58%
Energy -.58%
Oil Service -1.16%
After-hours Movers
STZ +4.6% after beating 4Q estimates and reiterating 1Q guidance.
ELX +5.3% after boosting 3Q forecast.
BCSI -15.4% after saying the SEC is conducting a formal investigation of the company.
USFC -4.4% after lowering 1Q estimates substantially.
ARBA -8.1% after lowering 2Q estimates.
BORL -9.6% after lowering 1Q and 2Q forecasts.
LAVA -17.1% after cutting 4Q and 06 forecasts substantially.
Evening Review
Detailed Market Summary
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
Futures Recap
S&P 500 Gallery View
Timely Economic Charts
PM Market Call
Real-time/After-hours Stock Quote
In Play
Afternoon Recommendations
Goldman Sachs:
- Reiterated Outperform on PFE and Underperform on DRI.
Business Week:
- Tootsie Roll Industries(TR) might be valued at $35-$37 a share in a possible buyout, citing LJR Great Lakes Review analyst Elliott Schlang.
- Doral Financial Corp., Puerto Rico’s largest mortgage lender, may see its shares rise to $49 in a year as Puerto Rico’s housing shortage will keep mortgage demand strong.
Afternoon/Evening Headlines
Bloomberg:
- Growth in US consumer installment credit slowed in February on waning demand for auto and other personal loans.
- Moody’s Investors Service said it put Pfizer’s Aaa long-term debt ratings on review for possible downgrade after today’s suspension of the Bextra painkiller.
- Marshall Carter, former chief executive officer of State Street, succeeded John Reed as chairman of the NYSE, 18 months after the world’s biggest stock market ousted Richard Grasso.
- Crude oil in NY fell for a fifth day amid speculation rising US refinery output will boost gasoline supplies for the peak summer motoring season.
- AmerisourceBergen Corp. said one of its units received a subpoena April 6 from Democratic NY Attorney General Spitzer’s office.
Financial Times:
- Morgan Stanley CEO Purcell said the firm’s board is “moving on” after resisting pressure from retired executives for his ouster.
- US imports from China rose 37% in January and February, while exports to the Asian country fell 10%.
Reuters:
- Morgan Stanley CEO Purcell, under pressure from retired executives calling for his ouster, denied speculation the firm may be bought by HSBC Holdings Plc.
Business Week:
- IBM CEO Palmisano projects the company will generate as much as $50 billion in revenue in 10 years from business consulting and outsourcing.
BOTTOM LINE: US stocks finished higher today on optimism over falling energy prices. The Portfolio finished higher on gains in my Internet, Computer and Gaming longs. I added a few new longs in the afternoon, thus leaving the Portfolio 50% net long. One of my new longs is QCOM and I am using a stop-loss of $34.75 on this position. The tone of the market strengthened into the afternoon as the advance/decline finished near its daily highs, almost every sector rose and volume was light. Energy-related stocks underperformed into the afternoon, while Tech and Gaming shares outperformed and measures of investor anxiety were mostly lower. Overall, today’s market action was positive, considering the rise in long-term interest rates, negative news from PFE/WMT/SBUX and Fed comments. I am not ruling out the possibility that stocks have seen there lows for the year. However, I would have liked to see heavier volume and a better advance/decline line. I expect stocks will test recent lows over the coming weeks on growth jitters.
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