Friday, March 13, 2009

Links of Note

Posted by Gary .....at 11:25 AM

Bull Radar

Posted by Gary .....at 11:17 AM

Style Outperformer:
Large-cap Value (+.65%)

Sector Outperformers:
Airlines (+3.23%), Gaming (+2.46%) and HMOs (+1.89%)

Stocks Rising on Unusual Volume:
HOLX, MRK, AMAG, MMSI, SGP, HDB, APU, QSFT, DVN, HIBB, BEAT, EHTH, CTRP, MYRG, FWLT, AIRM, BECN, NVEC, NTES, NICE, HMSY, NVLS, VPRT, VOLC, FEIC, HOLX, SASR, ENER, CALM, TOD, NC and PLL

Stocks With Unusual Call Option Activity:
1) HUM 2) VRTX 3) ISIL 4) CAH 5) CVTX

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Links of Interest

Posted by Gary .....at 9:18 AM
Market Snapshot Commentary
Market Performance Summary
Style Performance
Sector Performance
WSJ Data Center
Top 20 Biz Stories
IBD Breaking News
Movers & Shakers
Upgrades/Downgrades
In Play
NYSE Unusual Volume
NASDAQ Unusual Volume
Hot Spots
Option Dragon
NASDAQ 100 Heatmap
Chart Toppers
Real-Time Intraday Quote/Chart
HFR Global Hedge Fund Indices
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Thursday, March 12, 2009

Friday Watch

Posted by Gary .....at 4:26 PM

Late-Night Headlines
Bloomberg:

- Billionaire Warren Buffett’s Berkshire Hathaway Inc.(BRK/A) had its top-level AAA credit rating cut by Fitch Ratings, which cited concern about the potential for losses on the insurer’s equity and derivatives holdings. Buffett’s role as chief investment officer also puts the company at risk if he becomes unable to do the job, Fitch said in a statement. Fitch cut the so-called issuer default rating on Berkshire to AA+, and senior unsecured debt to AA. The insurance and reinsurance units kept their AAA status, with a negative outlook for all entities, Fitch said.

- Treasuries fell, snapping a two-day gain, as China’s Premier Wen Jiabao said he’s concerned about the safety of its investment in U.S. government debt. Ten-year note yields rose three basis points to 2.88 percent as of 12:21 p.m. in Tokyo, according to BGCantor Market Data.


Wall Street Journal:

- To win Senate approval, David Ogden’s nomination for deputy attorney general is having to overcome concerns about pornography -– not the usual political disputes over torture, terrorism policy, or past legal writings. Republicans say Ogden has generated thousands of calls from constituents -– far more than Attorney General Eric Holder who was approved in relatively quick fashion in January. Much of the opposition apparently is coming at the urging of conservative groups that object to Ogden’s previous legal work on First Amendment issues, representing producers of adult entertainment.

- Wal-Mart Stores Inc. (WMT) feels certain that Congress will not pass the pro-union bill introduced this week, a Wal-Mart executive said Thursday. "In the end, we are confident that Congress will get it right and it will be defeated," Wal-Mart Treasurer Charles Holley said at a Bank of America/Merrill Lynch consumer conference Thursday.

- Citigroup Inc.(C) is preparing to nominate four financial experts, including two former bank chief executives, to be directors as part of the overhaul of the New York company's board, according to people familiar with the matter. The likely recruits include Jerry Grundhofer, former chief executive of U.S. Bancorp; Michael O'Neill, former CEO of Bank of Hawaii Corp.; and William S. Thompson, former co-head of bond-giant Pimco, these people said. Citigroup also is likely to add at least one more director with a risk-management background, likely a finance professor.

- The Obama administration is considering lifting a ban on regular diplomatic contacts with Iran and looking at ways to develop a direct line of communication to Supreme Leader Ali Khamenei, said officials briefed on the deliberations. American and European officials say Mr. Khamenei is the only Iranian leader who can make the ultimate decision to suspend or freeze Iran's nuclear program. "The key issue is now to find a channel to Khamenei," said a senior Western diplomat briefed on the Obama administration's policy review in recent days. "If the supreme leader moves, he's going to do it in a very prudent and incremental way." The discussions are part of a larger Iran-policy review that the Obama administration is aiming to complete this month, according to U.S. officials.

- With their core business in shambles, some venture capitalists are changing their stripes, styling themselves as investors in distressed assets and public companies. Since last year's market meltdown, venture-capital firms such as Venrock and Sanderling Ventures have ramped up their investments in public firms, typically through private stock placements known as "registered directs" and "private investments in public equities," or PIPEs.


Washington Post:

- Scientists have developed a polyurethane coating that heals its own scratches when exposed to sunlight, offering the promise of scratch-free cars and other products, researchers said on Thursday. "We developed a polymeric material that is able to repair itself by exposure to the sun," said Marek Urban of the University of Southern Mississippi in Hattiesburg, whose study appears in the journal Science.

- H. Rodgin Cohen, chairman of the New York law firm Sullivan & Cromwell, has withdrawn his name from consideration for deputy Treasury secretary, becoming the fourth pick for a prominent Treasury Department post to pull out in recent weeks. A prominent attorney who has advised many of the top Wall Street firms, Cohen dropped out after the White House found an issue during his vetting process, two sources familiar with the matter said. The sources declined to identify the reason.

- The U.S. Navy has dispatched a guided-missile destroyer to the South China Sea after Chinese ships allegedly harassed an American ship operating there last weekend, a Pentagon official said yesterday. The USS Chung-Hoon, armed with torpedoes and missiles, is stationed in protection of the USNS Impeccable, an ocean surveillance ship. On Sunday, five Chinese vessels surrounded the Impeccable, which is unarmed. The Chinese ships approached to within 25 feet and blocked the Impeccable's path with pieces of wood, the official said. "Chung-Hoon is there, in the area, keeping an eye on Impeccable, which continues lawful military operations," said the official, who spoke on the condition of anonymity because of the sensitivity of the matter.

Dallas Morning News:

- Gov. Rick Perry, joining a handful of his fellow Southern Republican leaders, said Thursday that he was rejecting $556 million in federal stimulus money for unemployed Texans because it had too many strings attached. He said the federal provisions would require unprecedented changes in state rules on who is eligible for unemployment payments. He also argued that the funds – which Democrats say would update benefits so that more women, elderly and student workers could qualify – would place additional burdens on businesses, leaving them to pay the added costs when the federal money ran out. Instead, businesses should be able to use the money to create jobs, Perry said.

AP:

- An aide to President Barack Obama is on leave from his White House job after the FBI raided his old District of Columbia government office Thursday, arresting a city employee and a technology consultant on corruption charges, a White House official said. The charges were lodged against the two men at a federal court hearing as the FBI finished searching the city's technology office, which was led until recently by Obama's new computer chief, Vivek Kundra. Kundra is on leave from his White House job until further details of the case become known, according to a White House official speaking on condition of anonymity because the official did not want to publicly discuss personnel matters.

- Jon Stewart hammered Jim Cramer and his network, CNBC, in their anticipated face-off on "The Daily Show," repeatedly chastising the "Mad Money" host for putting entertainment above journalism. "I understand that you want to make finance entertaining, but it's not a ... game," Stewart told Cramer, adding in an expletive during the show's Thursday taping. The episode was scheduled to air at 11 p.m. EDT on Comedy Central. It was perhaps the hardest lashing Stewart has given to a TV commentator since 2004 when he called Tucker Carlson and his then co-host Paul Begala "partisan hacks" on CNN's "Crossfire," the since canceled political commentary program.


Reuters:

- Citigroup Inc Chairman Richard Parsons said on Thursday that the bank does not need any more capital injections from the government and expressed confidence that Citi would remain in private hands. Asked in an interview with Reuters whether Citigroup needed additional government capital injections, Parsons said: "No, I think actually, particularly with the latest conversion... Citi is actually one of the better capitalized banks in the world."


Financial Times:
- The European Central Bank has already embarked, in effect, on emergency “quantitative easing” to boost the eurozone economy but stands ready to do more if deflation risks emerge, according to Christian Noyer, governor of the Banque de France. Hugely expanded ECB operations to pump extra liquidity into the banking system, renewed last week, had taken the central bank into “non-standard monetary policy”, Mr Noyer said in an interview with the Financial Times. “It is a way of doing quantitative easing, certainly.” When it came to the ECB’s own response, Mr Noyer “would not rule anything out”. Where credit markets were not working a “central bank may consider that at a certain point it is appropriate to intervene directly”, he said. That left open the option of the ECB, for instance, buying corporate debt outright. But the French central banker saw signs the functioning of the banking system was improving. “Market and lending [interest] rates are continuing to move nicely downwards. The process has been fuelled by the 275 basis points cut that the ECB has decided. The process is not finished. We need some time for all that to feed through into the economy.” Mr Noyer did not rule out further cuts in the ECB’s main interest rate, currently 1.5 per cent, the lowest ever. But he noted that very short-term market interest rates were tending towards the “deposit facility” rate that the ECB pays on sums parked with it overnight, currently 0.5 per cent. “As a consequence, the rates effectively paid by borrowers are much closer to the situation in the US or UK than most people would imagine.”

- Japan on Thursday threw its weight behind US efforts to ensure next month’s G20 summit focuses on the need for immediate co-ordinated action to support the world economy rather than long-term efforts to improve financial sector regulation. In an interview with the Financial Times that highlighted the growing rift in the G20 ahead of Friday’s pre-summit meeting of finance ministers, Kaoru Yosano, Japan’s finance minister, said he understood the European-led push to focus on tightening financial regulation. But he suggested such issues appeared cosmetic compared to more pressing economic problems. “We all agree [on the need for better financial regulation], but I personally feel: are these actions necessary at a time of crisis? What we ask at this moment is to save the life of the world economy. Not to comment about its beard,” said Mr Yosano, who is also Japan’s minister for economic and fiscal policy. His comments come amid a lively transatlantic debate about what the G20’s priorities should be at its April 2 summit and the degree to which individual countries should commit to aggressive stimulus action. Tim Geithner, US Treasury secretary, on Wednesday called for the world’s biggest industrialised countries to commit to spending 2 per cent of their gross domestic product this year and next to stimulate the global economy. European leaders, however, argue they have done their part and the debate should move forward. At a meeting with Angela Merkel, the German chancellor, President Nicolas Sarkozy of France said Europe had “already invested a lot for the recovery”. Christian Noyer, governor of the Banque de France, told the FT that the US needed to fix its own financial system rather than pressing other countries to come up with fresh plans.

The Economic Times:

- The real estate market in India is trapped in a vicious cycle of plunging prices. With the bottom nowhere in sight, potential buyers do not want to try and catch a falling knife, says Pranay Vakil, chairman, Knight Frank India, a property consultancy firm. “They are expecting a further cut in prices, while developers themselves have been dropping prices, anticipating an increase in sales volumes.” Rajneesh Chhabra, a property broker based in south Delhi, says asking rates are down 30% from their peak, but it’s still almost impossible to find a buyer.


Nikkei English News:

- Japan’s government may maintain its assessment of the economy in March after five months of downgrades.


Late Buy/Sell Recommendations
- None of note


Night Trading
Asian Indices are +.75% to +3.50% on average.
S&P 500 futures -.12%.
NASDAQ 100 futures -.09%.


Morning Preview
US AM Market Call
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Pre-market Commentary
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Top 25 Stories
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Today in IBD
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Bond Ticker
Economic Preview/Calendar
Earnings Calendar

Conference Calendar

Who’s Speaking?
Upgrades/Downgrades
Rasmussen Business/Economy Polling

Earnings of Note
Company/EPS Estimate
- None of note


Economic Releases

8:30 am EST

- The Trade Balance for January is estimated at -$38.0B versus -$39.9B in December.

- The Import Price Index for February is estimated to fall .7% versus a 1.1% decline in January.


10:00 am EST

- The Preliminary Univ. of Mich. Consumer Confidence reading for March is estimated at 55.0 versus 56.3 in February.


Upcoming Splits
- None of note


Other Potential Market Movers
- Larry Summers speaking could also impact trading today.


BOTTOM LINE: Asian indices are sharply higher, boosted by financial and technology stocks 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.
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Stocks Finish Sharply Higher, Boosted by Financial, Technology, Healthcare, Homebuilding, REIT, Construction and Medical Shares

Posted by Gary .....at 4:02 PM
Evening Review
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GuruFocus.com
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Stocks Soaring into Final Hour on Less Financial Sector Pessimism, Less Extreme Economic Fear, Short-Covering, Buyout Speculation

Posted by Gary .....at 3:13 PM
BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Technology longs, Education longs, Medical longs, Biotech longs and Retail longs. I added to my (ILMN) and (GILD) longs and took profits in another long today, thus leaving the Portfolio 100% net long. The tone of the market is very positive as the advance/decline line is substantially higher, almost every sector is rising and volume is about average. Investor anxiety is about average. Today’s overall market action is very bullish. The VIX is falling 6.37% and is very high at 40.83. The ISE Sentiment Index is below average at 129.0 and the total put/call is below average at .74. Finally, the NYSE Arms has been running around average most of the day, hitting 1.35 at its intraday peak, and is currently .73. The Euro Financial Sector Credit Default Swap Index is rising 1.05% today to 192.66 basis points. This index is down from its record March 10th high of 208.75. The North American Investment Grade Credit Default Swap Index is rising 2.24% to 244.55 basis points. This index is still below its Dec. 5th record high of 285.99. The TED spread is rising .84% to 112 basis points. The TED spread is now down 351 basis points since its all-time high of 463 basis points on October 10th. The 2-year swap spread is plunging 9.69% to 65.25 basis points. The Libor-OIS spread is falling .84% to 106.0 basis points. The 10-year TIPS spread, a good gauge of inflation expectations, is rising 10 basis points to 1.0%, which is down 164 basis points since July 7th. The 10-year TIPS spread bottomed at .65% in October 1998 during the Asian financial crisis and at 1.24% in October 2001 during the technology bubble-bursting meltdown. The 3-month T-Bill is yielding .20%, which is down 2 basis points today. The methodical grind higher today is much healthier than a gap and then flat-line. Breadth is very good. The action in financials remains a huge positive. Much of this rally is predicated on the assumption that mark-to-market will at the very least be relaxed and possibly even temporarily suspended. As well, talk of bringing back the uptick rule is a large psychological positive for investors. The AAII % Bulls rose to 27.64% this week, while the % Bears fell to 54.47%. Overall, investors remain overwhelmingly bearish. However, I would still like to see a few other technical indicators, such as the total put/call, display more investor angst. The 10-year T-note is trading as if it is about to break out again. Large specs are the most net short the 10-year since August of last year and much talk of a bond bubble still persists. We have had a large rally in stocks and some better economic data, yet the 10-year is firm. Asian equities should see sharp gains tonight. Nikkei futures indicate an +300 open in Japan and DAX futures indicate an +32 open in Germany tomorrow. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, declining credit market angst, bargain-hunting, buyout optimism, better investor psychology, less extreme economic fear and diminishing financial sector pessimism.
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