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Friday, November 09, 2007
Links of Interest
Thursday, November 08, 2007
Friday's Watch
Late-Night Headlines
Bloomberg:
- BHP Billiton(BHP) may need to offer cash for Rio Tinto Group(RTP) after its smaller rival rejected the largest ever takeover bid.
- Merck(MRK) may pay about $5 billion to settle claims it hid the health risks of its withdrawn Vioxx painkiller, three lawyers with direct knowledge of the accord said.
- China called on Iran to “positively respond” to international concerns it may be using its nuclear program to develop an atomic weapon.
- Nikon Corp., the world’s second-biggest maker of cameras aimed at professionals, climbed the most in almost five years after the company raised its full-year profit forecast and dividend.
-
- Julius Baer Holding,
Wall Street Journal:
- Chrysler LLC plans to offer rebates and incentives next month to reduce its inventory.
CNNMoney.com:
- If it feels like more and more Americans have extra money to spend, that's because they do. The percentage of
- Wall Street braces for higher tax rates. If lawmakers let capital gains and dividend rates move higher, selling pressure could pick up and buyers could get stingy. The leading Democratic candidates for president have said they’d favor higher investment taxes on upper-income taxpayers – and Wall Streeters don’t like it.
- Marvel recalling plush ‘Curious George’ dolls. About 175,000 plush dolls are being recalled for excessive levels of lead after the company re-tested its entire product line.
- Prince Alwaleed: Why Chuck had to go.
IBD:
- Intel(INTC) Unveils Its ‘Penryn’ Chip Lineup.
Reuters:
- Economy faces risks, not recession: Bernanke.
Telegraph:
- Citigroup Inc.(C) is being urged by some analysts and shareholders to beak off and sell its brokerage, investment banking and retail operations, citing analysts.
Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (CELG), target $78.
- Reiterated Buy on (URBN), target $30.
Night Trading
Asian Indices are -.50% to +1.0% on average.
S&P 500 futures +.29%.
NASDAQ 100 futures +.40%.
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Earnings of Note
Company/EPS Estimate
- (KDE)/-.15
- (CLWR)/-.75
- (DRS)/.95
- (FNM)/.85
- (GG)/.15
- (JASO)/2.63
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- The Trade Deficit for September is estimated to widen to -$58.5 billion versus -$57.6 billion in August.
- The Import Price Index for October is estimated to rise 1.2% versus a 1.0% gain in September.
10:00 am EST
-
Other Potential Market Movers
- The (HNT) Investor Conference, (CTIC) analyst day, (GAS) Analyst Presentation and (FNM) Conference Call could also impact trading today.
Stocks Finish Mostly Lower on Weakness in the Tech Sector
Indices
S&P 500 1,474.77 -.06%
DJIA 13,266.29 -.25%
NASDAQ 2,696.00 -1.92%
Russell 2000 780.90 +.64%
Wilshire 5000 14,855.40 +.01%
Russell 1000 Growth 613.28 -.73%
Russell 1000 Value 803.80 +.76%
Morgan Stanley Consumer 735.22 +.73%
Morgan Stanley Cyclical 1,017.98 +.26%
Morgan Stanley Technology 634.48 -3.57%
Transports 4,696.73 +.72%
Utilities 526.89 +1.99%
MSCI Emerging Markets 157.79 -.13%
Sentiment/Internals
Total Put/Call 1.24 +15.89%
NYSE Arms .86 -46.61%
Volatility(VIX) 26.16 -1.25%
ISE Sentiment 119.0 +10.19%
Futures Spot Prices
Crude Oil $95.60 -.80%
Reformulated Gasoline 243.65 -.17%
Natural Gas 7.73 +1.43%
Heating Oil 260.15 -.61%
Gold 833.90 +.05%
Base Metals 241.32 -1.77%
Copper 321.75 -1.27%
Economy
10-year US Treasury Yield 4.28% -4 basis points
US Dollar 75.43 +.03%
CRB Index 353.85 -.16%
Leading Sectors
Alternative Energy +2.5%
Utilities +1.99%
HMOs +1.65%
Lagging Sectors
Networking -3.19%
Computer Hardware -3.59%
Internet -4.66%
Evening Review
Market Performance Summary
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In Play
Afternoon Recommendations
- None of note
Afternoon/Evening Headlines
Bloomberg:
- Most US stocks rose after a final-hour rally in banks from their lowest level in two years overcame a sell-off in technology shares led by Cisco Systems(CSCO).
- Qualcomm Inc. said profit rose 84% after selling more chips. The shares fell 7.4% after a forecast missed analysts’ estimates.
- pricelin.com’s(PCLN) gross travel bookings for the 3rd quarter rose 54% to $1.39 billion. The shares jumped 9% in after-hours trading.
Stocks Lower into Final Hour, Weighed Down by Tech
BOTTOM LINE: The Portfolio is lower into the final hour on losses in my Software longs, Internet longs and Computer longs. I added to my (IWM)/(QQQQ) hedges on the slightly higher open this morning and then covered some of them and some of my (EEM) short this afternoon, thus leaving the Portfolio 75% net long. The overall tone of the market is negative today as the advance/decline line is lower, most sectors are falling and volume is heavy. Investor anxiety is above-average. I am seeing some positive developments. Banks are now 1% higher, and the Broker/Dealer Index is about even. Market leaders are cutting losses. The NYSE reported recently that short interest on the exchange rose another 2.4% the last two weeks of October. Here are the 25 stocks with the largest percentage increases in their short interest relative to their float over that time period:
1. XJT +13.3%
2. RDN +9.2%
3. PFB +9.0%
4. VMW +9.05
5. CMG +8.7%
6. HAR +7.8%
7. SPF +7.7%
8. SCA +6.8%
9. HCR +5.7%
10. IMB +5.4%
11. ABK +5.2%
12. WCI +5.0%
13. MTG +4.9%
14. NDN +4.8%
15. CFC +4.7%
16. HOS +4.6%
17. DSL +4.5%
18. UA +4.5%
19. ETH +3.9%
20. MIR +3.9%
21. MGI +3.8%
22. USG +3.7%
23.
24. FED +3.5%
25. CEC +3.5%
Today's Headlines
Bloomberg:
- Kenneth Brusda, president of North Star Asset Management, said he expects “headline news” on writedowns from losses related to subprime mortgages will be “over in the next couple of quarters.”
- Copper is falling to an 11-week low as rising supplies and the prospect of slower economic growth raised speculation that demand will slump.
- The US dollar will keep its status as the “world currency” for 15 to 20 years, said Stephen Roach, chairman of Morgan Stanley Asia Ltd.
- Petroleo Brasileiro SA(PBR), Brazil’s state-controlled oil company, said its Tupi field may contain as much as 8 billion barrels of oil and natural gas, an amount that could boost the country’s reserves by 62%.
- US Treasury notes rose to the highest since 2005 as Federal Reserve Chairman Ben S. Bernanke told Congress he expects the
NY Times:
- India’s Solution for Oil Prices: Ban Speculation by Banning Trading. There are “no supply constraints right now, and demand has not escalated out of control,” Mr. Srinivasan said. Rather, trading on Nymex, is contributing “enormously” to high prices, he said. If crude were eliminated from the commodities traded on Nymex, Mr. Srinivasan predicted, the world would “see a drastic reduction in the price.” Mr. Srinivasan’s idea is based on the widely held belief that investors are artificially driving up oil prices. Hedge funds, banks and pension funds have poured capital into oil trading in recent years, betting that demand will increases. Analysts say these bets have become self-fulfilling prophecies, helping to push prices higher.
- US troops have driven al-Qaeda in Iraq out of every Baghdad neighborhood, according to Major General Joseph Fil, the US commander in the city.
- The Democratic chairman of the House Ways and Means Committee has proposed legislation that would effectively halt some current tax break audits of people who get a tax break for living and operating a business in the United States Virgin Islands.
NY Post:
- AQR Capital Management LLC, a hedge-fund company with about $38 billion in assets, pulled a planned IPO after several investors withdrew their funds.
Financial Times:
- BP Plc(BP) CEO Tony Hayward may increase capital expenditures, because BP’s recent polity of being conservative in spending on alternative and other higher-cost fuel sources makes less sense if oil prices stay high.
Job Market Still Healthy
- Initial Jobless Claims for this week fell to 317K versus estimates of 325K and 330K the prior week.
- Continuing Claims fell to 2579K versus estimates of 2560K and 2583K prior.