Bloomberg:
- US homebuilder shares are rising again, led by Standard Pacific(SPF), DR Horton(DHI) and Ryland Group(RYL), the largest seller of new homes for first-time buyers, as a 10-month low in mortgage rates sparked hopes of a housing rebound. The Housing Index(HGX) is up 27% in less than five months.
- There’s no housing slump in Manhattan, according to a survey from the Real Estate Board of NY. The median price of an apartment in Manhattan, the most expensive urban real estate market in the US, rose 6% in the third quarter to $767,000. Median prices for East Side condos soared 45% to $1.35 million. First-time buyers seeking a toe-hold in the surging NY market pushed the median price in northern Manhattan neighborhoods to $558,000, a 60% spike, the board said.
- Yahoo!(YHOO) CEO Terry Semel promoted CFO Decker to a new job overseeing advertising sales as part of a broader shake-up designed to catch up to competitors such as Google(GOOG).
- The dollar rose for a second day against the euro after a report showed US companies in November added the most workers since June.
- German factory orders unexpectedly dropped for a second month in October, led by a slump in domestic demand for cars and trucks.
- Factory production in the UK unexpectedly dell the most in a year in October, crimped by a stronger currency.
- Crude oil prices in NY may tumble to $40 a barrel next year as demand for biofuel made from crops spurs investors to switch from energy to agricultural commodities, said Tetsu Emori, chief commodities strategist at Japan’s Mitsui Bussan Futures Ltd.
- Gold is falling another $7/oz. in NY as the dollar’s recent gains reduce demand for the metal.
- Starbucks(SBUX) confirmed its forecast for earnings per share of 87 cents to 89 cents in fiscal 2007 and said it expects to operate nearly 15,000 cafes by next October.
- Copper is falling in NY the most in three weeks on reduced speculation by investment funds amid surging inventories.
Wall Street Journal:
- Financier Carl Icahn is dropping his $4.6 billion bid for Reckson Assoc. Realty(RA) after the target approved another offer.
- Comcast Corp.’s(CMCSA) founders, the Roberts family, will donate $15 million to a cancer-treatment center being developed by the Univ. of Pennsylvania Health System.
- Wheeling-Pittsburgh Corp.(WPSC), a West Virginia steelmaker, said it’s reviewing stock sales by three executives shortly before the company said its results would fall short of expectations.
USA Today:
- US Airways CEO Parker said he will stop pursuing Delta Air if Delta’s management doesn’t support the merger.
NY Times:
- Worldwide volumes of spam e-mail messages have doubled from last year and now accounts for 90% of all e-mails sent, citing spam-filterer Ironport Systems.
- The US has offered a package of economic and energy assistance to North Korea if that country will give up its nuclear weapons and related technology.
Fort Worth Star-Telegram:
- A US Transportation Security Administration test program lets guests at the Grand Hyatt hotel at Dallas-Fort Worth International Airport go through security without a boarding pass.
Tehran Times:
- Iran has started substituting euros for dollars in its crude oil trading.
Dagens Naeringsliv:
- A Miami-based business man is in talks with the Jackson Memorial Hospital about buying human fat from liposuction operations for use in biodiesel production.
Wednesday, December 06, 2006
Tuesday, December 05, 2006
Wednesday Watch
Late-Night Headlines
Bloomberg:
- The US dollar will recover against the euro next year as the world’s biggest economy will prove resilient, said Joe Prendergast at CSFB.
- Users of mobile phones, whose antennae send radio waves into the human brain, are no more likely to get cancer than people who don’t use mobile phones, according to a study in the Journal of the National Cancer Institute.
- The five permanent members of the UN Security Council narrowed their differences over imposing sanctions on Iran and will now ask their UN ambassadors to hammer out a resolution, the French Foreign Ministry said.
- Yahoo!(YHOO) CEO Terry Semel will reorganize the company into three groups to stem a slide in the stock price and win back users and advertisers lost to Google(GOOG).
- Australia’s economy grew .3% in the third quarter, its slowest pace in three years, as business spending and farm output dropped.
- China wants to get half of its energy needs from “new and alternative” sources by 2050, a Chinese official said, as the nation seeks to diversify from a reliance on coal and crude.
Wall Street Journal:
- The conditions that have spurred this year’s historic surge in mergers and acquisitions will likely continue into next year, citing Piero Novelli, UBS AG’s co-head of global M&A.
Financial Times:
- OAO Rosneft, Russia’s largest oil company, will invest $20 billion to become one of the world’s largest oil firms by the end of the decade, citing CEO Bogdanchikov.
AFP:
- Traces of radioactive Polonium-210 were found at London soccer team Arsenal’s stadium during a probe into the death of Russian ex-spy Alexander Litvinenko. An unidentified agency spokeswoman was quoted as saying “minute quantities” of the substance that were “barely detectable” were uncovered at Emirates Stadium and that there was no risk to public health.
China Daily:
- Chinese corn prices are surging as production of grain-based fuels including ethanol increases, citing analysts.
Night Trading
Asian Indices are -.75% to +.50% on average.
S&P 500 indicated -.02%.
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)
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
- (JW/A)/.47
- (KFY)/.31
- (NCS)/1.34
- (OSI)/.32
- (NX)/1.05
- (VTS)/.47
Upcoming Splits
- None of note
Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil build of 500,000 barrels versus a 360,000 barrel drawdown the prior week. Gasoline supplies are expected to rise 956,000 barrels versus a 589,000 barrel decline the prior week. Distillate supplies are estimated to fall 850,000 barrels versus a 1,002,000 barrel decline the prior week. Finally, Refinery Utilization is expected to rise .9% versus a .99% increase the prior week.
Bloomberg:
- The US dollar will recover against the euro next year as the world’s biggest economy will prove resilient, said Joe Prendergast at CSFB.
- Users of mobile phones, whose antennae send radio waves into the human brain, are no more likely to get cancer than people who don’t use mobile phones, according to a study in the Journal of the National Cancer Institute.
- The five permanent members of the UN Security Council narrowed their differences over imposing sanctions on Iran and will now ask their UN ambassadors to hammer out a resolution, the French Foreign Ministry said.
- Yahoo!(YHOO) CEO Terry Semel will reorganize the company into three groups to stem a slide in the stock price and win back users and advertisers lost to Google(GOOG).
- Australia’s economy grew .3% in the third quarter, its slowest pace in three years, as business spending and farm output dropped.
- China wants to get half of its energy needs from “new and alternative” sources by 2050, a Chinese official said, as the nation seeks to diversify from a reliance on coal and crude.
Wall Street Journal:
- The conditions that have spurred this year’s historic surge in mergers and acquisitions will likely continue into next year, citing Piero Novelli, UBS AG’s co-head of global M&A.
Financial Times:
- OAO Rosneft, Russia’s largest oil company, will invest $20 billion to become one of the world’s largest oil firms by the end of the decade, citing CEO Bogdanchikov.
AFP:
- Traces of radioactive Polonium-210 were found at London soccer team Arsenal’s stadium during a probe into the death of Russian ex-spy Alexander Litvinenko. An unidentified agency spokeswoman was quoted as saying “minute quantities” of the substance that were “barely detectable” were uncovered at Emirates Stadium and that there was no risk to public health.
China Daily:
- Chinese corn prices are surging as production of grain-based fuels including ethanol increases, citing analysts.
Night Trading
Asian Indices are -.75% to +.50% on average.
S&P 500 indicated -.02%.
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)
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
- (JW/A)/.47
- (KFY)/.31
- (NCS)/1.34
- (OSI)/.32
- (NX)/1.05
- (VTS)/.47
Upcoming Splits
- None of note
Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil build of 500,000 barrels versus a 360,000 barrel drawdown the prior week. Gasoline supplies are expected to rise 956,000 barrels versus a 589,000 barrel decline the prior week. Distillate supplies are estimated to fall 850,000 barrels versus a 1,002,000 barrel decline the prior week. Finally, Refinery Utilization is expected to rise .9% versus a .99% increase the prior week.
BOTTOM LINE: Asian indices are mostly higher, boosted by commodity shares in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 100% net long heading into the day.
Stocks Finish Slightly Higher on Positive Economic Data
Indices
S&P 500 1,414.76 +.40%
DJIA 12,331.60 +.39%
NASDAQ 2,452.38 +.16%
Russell 2000 797.42 +.20%
Wilshire 5000 14,223.79 +.37%
S&P Barra Growth 655.80 +.33%
S&P Barra Value 756.87 +.47%
Morgan Stanley Consumer 686.67 +.77%
Morgan Stanley Cyclical 892.51 +.51%
Morgan Stanley Technology 577.48 +.25%
Transports 4,791.93 +.97%
Utilities 462.19 +.31%
Put/Call .75 -12.79%
NYSE Arms .90 -15.67%
Volatility(VIX) 11.27 +.36%
ISE Sentiment 154.0 +12.41%
US Dollar 82.51 +.10%
CRB 316.43 +.33%
Futures Spot Prices
Crude Oil 62.54 +.16%
Reformulated Gasoline 164.55 -1.06%
Natural Gas 7.70 -1.33%
Heating Oil 180.03 -.48%
Gold 648.90 -.31%
Base Metals 249.38 +1.42%
Copper 324.60 +2.20%
10-year US Treasury Yield 4.44% +.39%
Leading Sectors
Homebuilders +2.0%
Papers +1.61%
Restaurants +.98%
Lagging Sectors
Oil Tankers -.72%
HMOs -.94%
Gold & Silver -1.25%
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
Oppenheimer:
- Rated (LQDT) Buy, target $21.
- Rated (SPPI) Buy, target $10.
- Rated (GSIC) Buy, target $21.
Afternoon/Evening Headlines
Bloomberg:
- William Polk Carey, chairman of the WP Carey real estate investment banking firm, donated $50 million to Johns Hopkins University to establish a separate business school at the university founded by on of his distant ancestors.
- House Democratic leader Nancy Pelosi rejected a call by some lawmakers in her party to withhold funds for military operations in Iraq in order to end the war.
- Venezuelan President Hugo Chavez said he will push for a constitutional amendment next year that would allow him to hold office indefinitely as a first step toward making Venezuela a socialist nation.
- OPEC oil output fell 1.9% in November or half of the cartel’s pledged cuts at an October meeting.
Australian Financial Review:
- BHP Billiton(BHP) is close to agreeing on a 10.5% cut in annual contract prices for hard coking coal used in steelmaking, citing McCloskey’s Coal Report.
S&P 500 1,414.76 +.40%
DJIA 12,331.60 +.39%
NASDAQ 2,452.38 +.16%
Russell 2000 797.42 +.20%
Wilshire 5000 14,223.79 +.37%
S&P Barra Growth 655.80 +.33%
S&P Barra Value 756.87 +.47%
Morgan Stanley Consumer 686.67 +.77%
Morgan Stanley Cyclical 892.51 +.51%
Morgan Stanley Technology 577.48 +.25%
Transports 4,791.93 +.97%
Utilities 462.19 +.31%
Put/Call .75 -12.79%
NYSE Arms .90 -15.67%
Volatility(VIX) 11.27 +.36%
ISE Sentiment 154.0 +12.41%
US Dollar 82.51 +.10%
CRB 316.43 +.33%
Futures Spot Prices
Crude Oil 62.54 +.16%
Reformulated Gasoline 164.55 -1.06%
Natural Gas 7.70 -1.33%
Heating Oil 180.03 -.48%
Gold 648.90 -.31%
Base Metals 249.38 +1.42%
Copper 324.60 +2.20%
10-year US Treasury Yield 4.44% +.39%
Leading Sectors
Homebuilders +2.0%
Papers +1.61%
Restaurants +.98%
Lagging Sectors
Oil Tankers -.72%
HMOs -.94%
Gold & Silver -1.25%
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
Oppenheimer:
- Rated (LQDT) Buy, target $21.
- Rated (SPPI) Buy, target $10.
- Rated (GSIC) Buy, target $21.
Afternoon/Evening Headlines
Bloomberg:
- William Polk Carey, chairman of the WP Carey real estate investment banking firm, donated $50 million to Johns Hopkins University to establish a separate business school at the university founded by on of his distant ancestors.
- House Democratic leader Nancy Pelosi rejected a call by some lawmakers in her party to withhold funds for military operations in Iraq in order to end the war.
- Venezuelan President Hugo Chavez said he will push for a constitutional amendment next year that would allow him to hold office indefinitely as a first step toward making Venezuela a socialist nation.
- OPEC oil output fell 1.9% in November or half of the cartel’s pledged cuts at an October meeting.
Australian Financial Review:
- BHP Billiton(BHP) is close to agreeing on a 10.5% cut in annual contract prices for hard coking coal used in steelmaking, citing McCloskey’s Coal Report.
BOTTOM LINE: The Portfolio finished higher today on gains in my Internet longs, Semi longs and Retail longs. I did not trade in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was slightly positive today as the advance/decline line finished slightly higher, sector performance was mostly positive and volume was above average. Measures of investor anxiety were mostly lower into the close. Today's overall market action was mildly bullish. Homebuilders were standout performers today, rising another 2%. The Housing Index (HGX) is now 25% above July lows. With the many US stock market bears expecting a major decline and even the bulls anticipating a January pullback, large funds are likely paring long exposure further right now.
I suspect more healthy upwardly biased consolidating action like today is likely in the near term before another push higher into year-end.
Stocks Modestly Higher into Final Hour on Positive Economic Data
BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Semi longs, Retail longs and Internet longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is higher, most sectors are rising and volume is above average. The Bloomberg Crude Oil percentage of Bulls came in at 72.5% in the most recent survey. Crude Bears were 17.5%. This survey comprises 40 analysts, traders and brokers and is done weekly by Bloomberg. Bullish sentiment toward oil has only been higher one other time, October 2004, right before oil plunged from 27% from $55 per barrel to $40 per barrel. Right now, oil bulls are in a state of denial as record inflows into commodity funds keep the speculative mania alive. Almost every day, I read of new demand destroying alternative energy projects coming online and new finds around the world. Demand for oil has barely risen globally over the last three years during a global economic boom. I continue to believe oil will head substantially lower from current levels over the intermediate term as the mania subsides and the fundamentals reassert themselves. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, positive economic data and portfolio manager performance anxiety.
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