Bloomberg:
- North Korea promised to strive to rid the Korean peninsula of nuclear weapons as six-nation talks aimed at dismantling the Stalinist nation’s atomic arms program began in Beijing today.
- The US Congress is set to pass a $10 billion energy bill after House and Senate negotiators approved a compromise version today.
- The US Senate Finance Committee approved legislation that would require companies to fully fund their defined-benefit pension plans and gives airlines 14 years to pay off their obligations.
Wall Street Journal:
- Wal-Mart Stores wants to open 42 stores in China by the end of 2006, nearly doubling its current total in the country.
- The NYC Police Dept. will today start a program to direct intelligence information to and from businesses to help counter possible terrorist attacks.
- Teva Pharmaceutical Industries’ agreement to buy Ivax is an acknowledgement that competition in the generic drugs business is likely to get sharper.
NY Times:
- Plans to build a Chicago skyscraper that would be 115 stories and about 2,000 feet tall, making it the tallest in the US.
- Some of New York’s biggest Democratic donors are backing Republican Mayor Michael Bloomberg’s re-election campaign.
- Crime in NYC’s subways has declined 22.6%, and public reports of suspicious packages have increased 36% since the July 7 terrorist attacks in London’s transit system.
- President Bush persuaded as many as six more Republican House lawmakers to support the Central American Free Trade Agreement with promises of protection for textile companies.
NY Post:
- XM Satellite Radio and Samsung Electronics are expected to announce a partnership today to make the first portable player for both MP3’s and satellite radio.
LA Times:
- US Senator Hillary Clinton has been named by the Democratic Leadership Council to lead a project to define the party’s agenda for the 2006 and 2008 elections.
Tuesday, July 26, 2005
Consumer Confidence Slips From 3-year High
- Consumer Confidence for July fell to 103.2 versus estimates of 106.3 and a reading of 106.2 in June.
BOTTOM LINE: American were a little less optimistic about the current economy and the future for the next 6 months after energy prices rose near highs. Terrorism fears likely impacted sentiment, as well. However the number of consumers expecting more jobs to become available in the future rose to 15.8%, the highest since January. As well, the number of consumers who say they will buy a car in the next 6 months rose to 7.2% from 6.6%. I expect confidence to make new cycle highs over the coming months.
Tuesday Watch
Late-Night Headlines
Bloomberg:
- China's government said it may restrict its textile exports to the US, similar to caps it put on exports of the products to the European Union last month to help resolve trade friction with the US.
- Confidence about the prospects of the global economy has declined 10%, citing a survey of international company executives by management consulting firm McKinsey.
- The yen weakened against the dollar for a third day in Asia on speculation China will delay any further revaluation of the yuan, restricting the benefit to the competitiveness of Japanese exports.
- Australian Prime Minister John Howard met his nation's troops and Iraqi Prime Minister Ibrahim al-Jaafari in an unannounced seven-hour visit to Iraq.
AP:
- Jane Fonda, the actress who in 1972 posed on a North Vietnamese anti-aircraft gun, plans in March to launch a bus tour across the US to call for an end to US military operations in Iraq.
Financial Times:
- The European Commission will propose that banks register personal details of anyone making money transfers into or out of the European Union as part of an effort to stop funding for terrorism.
Guardian:
- Revenue from sales of computer games to be played on cell phones will increase to $11 billion by 2010, compared with $2.6 billion this year, citing a report by Informa Telecoms & Media.
London-based Times:
- UK Prime Minister Tony Blair's popularity has increased in the wake of the terrorist attacks in London, citing a Populus survey commissioned by the newspaper.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on RE and BLS.
- Reiterated Underperform on ASH, AVB and CR.
Night Trading
Asian Indices are -.25% to +.25% on average.
S&P 500 indicated -.01%.
NASDAQ 100 indicated +.12%.
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
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
ADP/.44
AFL/.64
AMZN/.10
BIIB/.36
BJS/.60
CTX/1.69
CME/2.38
GLW/.18
ERTS/-.24
IMCL/.33
INSP/.38
LXK/1.06
LMT/.83
MHS/.58
HOT/.65
TDW/.46
VLO/2.95
VZ/.64
Upcoming Splits
None of note
Economic Releases
- Consumer Confidence for July is estimated to rise to 106.3 versus 105.8 in June.
Bloomberg:
- China's government said it may restrict its textile exports to the US, similar to caps it put on exports of the products to the European Union last month to help resolve trade friction with the US.
- Confidence about the prospects of the global economy has declined 10%, citing a survey of international company executives by management consulting firm McKinsey.
- The yen weakened against the dollar for a third day in Asia on speculation China will delay any further revaluation of the yuan, restricting the benefit to the competitiveness of Japanese exports.
- Australian Prime Minister John Howard met his nation's troops and Iraqi Prime Minister Ibrahim al-Jaafari in an unannounced seven-hour visit to Iraq.
AP:
- Jane Fonda, the actress who in 1972 posed on a North Vietnamese anti-aircraft gun, plans in March to launch a bus tour across the US to call for an end to US military operations in Iraq.
Financial Times:
- The European Commission will propose that banks register personal details of anyone making money transfers into or out of the European Union as part of an effort to stop funding for terrorism.
Guardian:
- Revenue from sales of computer games to be played on cell phones will increase to $11 billion by 2010, compared with $2.6 billion this year, citing a report by Informa Telecoms & Media.
London-based Times:
- UK Prime Minister Tony Blair's popularity has increased in the wake of the terrorist attacks in London, citing a Populus survey commissioned by the newspaper.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on RE and BLS.
- Reiterated Underperform on ASH, AVB and CR.
Night Trading
Asian Indices are -.25% to +.25% on average.
S&P 500 indicated -.01%.
NASDAQ 100 indicated +.12%.
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
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
ADP/.44
AFL/.64
AMZN/.10
BIIB/.36
BJS/.60
CTX/1.69
CME/2.38
GLW/.18
ERTS/-.24
IMCL/.33
INSP/.38
LXK/1.06
LMT/.83
MHS/.58
HOT/.65
TDW/.46
VLO/2.95
VZ/.64
Upcoming Splits
None of note
Economic Releases
- Consumer Confidence for July is estimated to rise to 106.3 versus 105.8 in June.
BOTTOM LINE: Asian indices are mostly lower on worries over earnings in the region. I expect US equities to open modestly higher, spurred by tech shares. The Portfolio is 75% net long heading into the day.
Monday, July 25, 2005
Stocks Finish Lower on Energy and Rate Worries
Indices
S&P 500 1,229.03 -.38%
DJIA 10,596.48 -.51%
NASDAQ 2,166.74 -.60%
Russell 2000 670.99 -1.0%
DJ Wilshire 5000 12,258.72 -.42%
S&P Barra Growth 589.72 -.38%
S&P Barra Value 634.92 -.37%
Morgan Stanley Consumer 584.39 -.37%
Morgan Stanley Cyclical 756.85 -.21%
Morgan Stanley Technology 496.22 -.51%
Transports 3,732.08 -1.27%
Utilities 391.99 -.24%
Put/Call .79 -1.25%
NYSE Arms 1.19 +17.29%
Volatility(VIX) 11.10 +5.51%
ISE Sentiment 169.00 +5.63%
US Dollar 89.57 -.08%
CRB 305.29 +.34%
Futures Spot Prices
Crude Oil 57.59.05 +.68%
Unleaded Gasoline 169.93 -1.66%
Natural Gas 7.33 -.66%
Heating Oil 160.90 +1.71%
Gold 425.70 +.16%
Base Metals 124.47 +.13%
Copper 161.30 +.59%
10-year US Treasury Yield 4.24 +.61%
Leading Sectors
Oil Service +.98%
Energy +.86%
Broadcasting +.47%
Lagging Sectors
Biotech -1.41%
Steel -2.12%
Homebuilders -2.56%
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
Goldman Sachs:
- Reiterated Outperform on EBAY.
Banc of America:
- Downgraded LM to Sell.
Afternoon/Evening Headlines
Bloomberg:
- US Federal research dollars to colleges and universities rose by 13.1% and hit their highest levels since 1985, according to the latest National Science Foundation statistics released last week.
- The Chicago Merc has overtaken Deutsche Boerse as the world’s most valuable financial market following a surge in the US exchange’s shares.
- The SEC is considering civil action against Fidelity Investments for violating rules on accepting gifts from brokers.
- Brazil’s currency had its biggest slide since October 2002 and stocks and bonds tumbled on concern President Luiz Inacio Lula da Silva may be drawn into an investigation of alleged government corruption.
- President Bush may consider bypassing the Senate by appointing John Bolton as UN ambassador on a temporary basis if Democrats continue to hold up a vote on his nomination.
Financial Times:
- Pakistan has destroyed al-Qaeda’s command and control system in the country and captured 700 fighters, citing President Pervez Musharraf.
S&P 500 1,229.03 -.38%
DJIA 10,596.48 -.51%
NASDAQ 2,166.74 -.60%
Russell 2000 670.99 -1.0%
DJ Wilshire 5000 12,258.72 -.42%
S&P Barra Growth 589.72 -.38%
S&P Barra Value 634.92 -.37%
Morgan Stanley Consumer 584.39 -.37%
Morgan Stanley Cyclical 756.85 -.21%
Morgan Stanley Technology 496.22 -.51%
Transports 3,732.08 -1.27%
Utilities 391.99 -.24%
Put/Call .79 -1.25%
NYSE Arms 1.19 +17.29%
Volatility(VIX) 11.10 +5.51%
ISE Sentiment 169.00 +5.63%
US Dollar 89.57 -.08%
CRB 305.29 +.34%
Futures Spot Prices
Crude Oil 57.59.05 +.68%
Unleaded Gasoline 169.93 -1.66%
Natural Gas 7.33 -.66%
Heating Oil 160.90 +1.71%
Gold 425.70 +.16%
Base Metals 124.47 +.13%
Copper 161.30 +.59%
10-year US Treasury Yield 4.24 +.61%
Leading Sectors
Oil Service +.98%
Energy +.86%
Broadcasting +.47%
Lagging Sectors
Biotech -1.41%
Steel -2.12%
Homebuilders -2.56%
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
Goldman Sachs:
- Reiterated Outperform on EBAY.
Banc of America:
- Downgraded LM to Sell.
Afternoon/Evening Headlines
Bloomberg:
- US Federal research dollars to colleges and universities rose by 13.1% and hit their highest levels since 1985, according to the latest National Science Foundation statistics released last week.
- The Chicago Merc has overtaken Deutsche Boerse as the world’s most valuable financial market following a surge in the US exchange’s shares.
- The SEC is considering civil action against Fidelity Investments for violating rules on accepting gifts from brokers.
- Brazil’s currency had its biggest slide since October 2002 and stocks and bonds tumbled on concern President Luiz Inacio Lula da Silva may be drawn into an investigation of alleged government corruption.
- President Bush may consider bypassing the Senate by appointing John Bolton as UN ambassador on a temporary basis if Democrats continue to hold up a vote on his nomination.
Financial Times:
- Pakistan has destroyed al-Qaeda’s command and control system in the country and captured 700 fighters, citing President Pervez Musharraf.
BOTTOM LINE: The Portfolio finished slightly lower today on losses in my Internet, Biotech and Homebuilding longs. I exited my QQQQ long in the afternoon and took profits in a couple of other longs, thus leaving the Portfolio 75% net long. The tone of the market was negative today as the advance/decline line finished lower, most sectors fell and volume was light. Measures of investor anxiety were mixed into the close. Overall, today’s market action was neutral slightly negative. Stocks are responding well to earnings reports after-hours. I expect consumer confidence to modestly exceed expectations tomorrow which could also boost shares.
Stocks Consolidating Recent Gains Mid-day
Indices
S&P 500 1,234.11 +.03%
DJIA 10,645.87 -.06%
NASDAQ 2,175.20 -.21%
Russell 2000 676.39 -.21%
DJ Wilshire 5000 12,312.16 +.01%
S&P Barra Growth 591.85 -.02%
S&P Barra Value 637.95 +.10%
Morgan Stanley Consumer 585.89 -.11%
Morgan Stanley Cyclical 760.58 +.28%
Morgan Stanley Technology 498.30 -.09%
Transports 3,765.39 -.39%
Utilities 394.62 +.44%
Put/Call .69 -13.75%
NYSE Arms .92 -8.98%
Volatility(VIX) 10.97 +4.28%
ISE Sentiment 162.00 +1.25%
US Dollar 89.61 -.03%
CRB 304.91 +.22%
Futures Spot Prices
Crude Oil 58.80 +.17%
Unleaded Gasoline 171.00 -1.04%
Natural Gas 7.25 -1.81%
Heating Oil 160.10 +1.27%
Gold 425.80 +.19
Base Metals 124.92 +.15%
Copper 161.70 +.84%
10-year US Treasury Yield 4.24% +.61%
Leading Sectors
Energy +1.54%
Oil Service +1.48%
Telecom +.51%
Lagging Sectors
Biotech -.98%
Homebuilders -.99%
Steel -1.27%
S&P 500 1,234.11 +.03%
DJIA 10,645.87 -.06%
NASDAQ 2,175.20 -.21%
Russell 2000 676.39 -.21%
DJ Wilshire 5000 12,312.16 +.01%
S&P Barra Growth 591.85 -.02%
S&P Barra Value 637.95 +.10%
Morgan Stanley Consumer 585.89 -.11%
Morgan Stanley Cyclical 760.58 +.28%
Morgan Stanley Technology 498.30 -.09%
Transports 3,765.39 -.39%
Utilities 394.62 +.44%
Put/Call .69 -13.75%
NYSE Arms .92 -8.98%
Volatility(VIX) 10.97 +4.28%
ISE Sentiment 162.00 +1.25%
US Dollar 89.61 -.03%
CRB 304.91 +.22%
Futures Spot Prices
Crude Oil 58.80 +.17%
Unleaded Gasoline 171.00 -1.04%
Natural Gas 7.25 -1.81%
Heating Oil 160.10 +1.27%
Gold 425.80 +.19
Base Metals 124.92 +.15%
Copper 161.70 +.84%
10-year US Treasury Yield 4.24% +.61%
Leading Sectors
Energy +1.54%
Oil Service +1.48%
Telecom +.51%
Lagging Sectors
Biotech -.98%
Homebuilders -.99%
Steel -1.27%
BOTTOM LINE: The Portfolio is unchanged mid-day as gains in my Software and Medical longs are offsetting losses in my Biotechnology longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is slightly negative as the advance/decline line is modestly lower, most sectors are lower and volume is below average. Measures of investor anxiety are mostly lower. Today’s overall market action is neutral considering recent gains and the rise in energy prices and long-term rates from morning lows. In a recent Merrill Lynch survey, energy was the favorite industry among 273 global money managers. Portfolio managers who were "overweight," or held stakes above their benchmarks, outnumbered those "underweight" by 37 percentage points. The energy industry topped health care for the top ranking among all 11 industry groups. I expect stocks to trade mixed into the afternoon as stocks consolidate recent gains.
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