Wednesday, December 14, 2005
***Alert***
I will be unable to post the Wednesday Close due to a scheduling conflict. I plan to finish the day 75% net long. I will post the Thursday Watch later this evening.
Stocks Higher Mid-day on Falling Energy Prices and Lower Long-term Rates
Indices
S&P 500 1,273.64 +.49%
DJIA 10,888.56 +.60%
NASDAQ 2,265.03 unch.
Russell 2000 690.85 +.26%
DJ Wilshire 5000 12,741.43 +.45%
S&P Barra Growth 643.87 N/A
S&P Barra Value 660.59 +.50%
Morgan Stanley Consumer 599.46 +.54%
Morgan Stanley Cyclical 788.13 +.33%
Morgan Stanley Technology 536.97 +.11%
Transports 4,114.89 +.66%
Utilities 416.16 +.81%
Put/Call .67 +6.35%
NYSE Arms .74 +3.36%
Volatility(VIX) 10.43 -6.12%
ISE Sentiment 231.00 +36.69%
US Dollar 89.81%
CRB 331.44 -1.25%
Futures Spot Prices
Crude Oil 60.85 -.85%
Unleaded Gasoline 164.30 -.18%
Natural Gas 14.69 -4.47%
Heating Oil 184.50 +.46%
Gold 509.60 -2.77%
Base Metals 150.55 -1.85%
Copper 196.60 -2.99%
10-year US Treasury Yield 4.44% -1.70%
Leading Sectors
Homebuilders +2.05%
Airlines +1.64%
Retail +1.25%
Lagging Sectors
Hospitals -.78%
Oil Tankers -.87%
Gold & Silver -2.32%
S&P 500 1,273.64 +.49%
DJIA 10,888.56 +.60%
NASDAQ 2,265.03 unch.
Russell 2000 690.85 +.26%
DJ Wilshire 5000 12,741.43 +.45%
S&P Barra Growth 643.87 N/A
S&P Barra Value 660.59 +.50%
Morgan Stanley Consumer 599.46 +.54%
Morgan Stanley Cyclical 788.13 +.33%
Morgan Stanley Technology 536.97 +.11%
Transports 4,114.89 +.66%
Utilities 416.16 +.81%
Put/Call .67 +6.35%
NYSE Arms .74 +3.36%
Volatility(VIX) 10.43 -6.12%
ISE Sentiment 231.00 +36.69%
US Dollar 89.81%
CRB 331.44 -1.25%
Futures Spot Prices
Crude Oil 60.85 -.85%
Unleaded Gasoline 164.30 -.18%
Natural Gas 14.69 -4.47%
Heating Oil 184.50 +.46%
Gold 509.60 -2.77%
Base Metals 150.55 -1.85%
Copper 196.60 -2.99%
10-year US Treasury Yield 4.44% -1.70%
Leading Sectors
Homebuilders +2.05%
Airlines +1.64%
Retail +1.25%
Lagging Sectors
Hospitals -.78%
Oil Tankers -.87%
Gold & Silver -2.32%
BOTTOM LINE: The Portfolio is slightly lower mid-day on losses in my Medical longs and Computer longs. I added to my IWM and QQQQ shorts and then covered some, thus leaving the Portfolio 75% net long. The tone of the market is slightly positive as the advance/decline line is about even, most sectors are higher and volume is about average. Measures of investor anxiety are mixed. Overall, today’s market action is slightly negative considering the decline in long-term rates and energy prices. The S&P Supercomposite Restaurants Index is 2% higher over the last two days. It is at 316.09, very close to its all-time high of 317.34. This is more evidence that the consumer isn't weakening to any significant extent. I expect US stocks to trade mixed-to-higher into the close on short-covering.
Today's Headlines
Bloomberg:
- ConocoPhillips Chairman Jim Mulva, who said a month ago that acquisitions are “not that attractive,” is paying twice as much for Burlington Resources’ reserves as his peers did in two of the year’s biggest takeovers.
- Kohlberg Kravis Roberts will begin raising a global investment fund next month that may reach $10 billion.
- European donations of food to famine-struck countries dropped by more than 50% over the past decade, the top US aid official said.
- General Dynamics agreed to buy Anteon International for about $2 billion to increase sales of system integration services to defense and intelligence agencies.
- US Treasuries are rising, pushing the 10-year note yield to the lowest this month, on speculation that tame inflation will cause the Fed to pause or stop raising interest rates.
- The US dollar is falling by the most since March 2000 against the yen after Japanese business confidence rose to the highest in a year.
Wall Street Journal:
- Walt Disney will make its first film production in China, a Chinese-language joint-venture project called “The Secret of the Magic Gourd.”
- More than 850 US mutual funds cut the management fees they charge investors last year, up from 239 in 2003, and this year the number will be about 700.
- The Chicago Merc plans to match or top General Atlantic’s $135 million offer for a 10% stake in the NYMEX as early as this week.
NY Times:
- FPL Group is in advanced discussions to buy Constellation Energy Group for more than $11 billion.
- Voter turnout in Tikrit for Iraq’s parliamentary election tomorrow is expected to be high and reflects the change in Sunni attitude toward the political process.
- Three casinos are set to reopen by New Year’s Eve in Biloxi, Mississippi, where nine of 10 floating casinos were destroyed by Hurricane Katrina.
- Tribune’s LA Times will stop publishing its national edition next week as the company cuts jobs.
- JPMorgan, Citigroup and Consolidated Edison are among companies in NY preparing for a possible transit strike.
- Most of the Chinese public remains unaware that police in their country killed as many as 20 people last week while suppressing a demonstration.
USA Today:
- More Americans feel it was not a mistake to liberate Iraq by a 50%-48% margin.
Finanz und Wirtschaft:
- Starbucks expects to operate at least 30,000 stores in the coming years as it expands in China and studies new markets like India, Brazil and Russia, its CEO said.
AFP:
- Iranian President Mahmoud Ahmadinejad said the Holocaust is a myth and Israel should move as far away as Alaska.
- ConocoPhillips Chairman Jim Mulva, who said a month ago that acquisitions are “not that attractive,” is paying twice as much for Burlington Resources’ reserves as his peers did in two of the year’s biggest takeovers.
- Kohlberg Kravis Roberts will begin raising a global investment fund next month that may reach $10 billion.
- European donations of food to famine-struck countries dropped by more than 50% over the past decade, the top US aid official said.
- General Dynamics agreed to buy Anteon International for about $2 billion to increase sales of system integration services to defense and intelligence agencies.
- US Treasuries are rising, pushing the 10-year note yield to the lowest this month, on speculation that tame inflation will cause the Fed to pause or stop raising interest rates.
- The US dollar is falling by the most since March 2000 against the yen after Japanese business confidence rose to the highest in a year.
Wall Street Journal:
- Walt Disney will make its first film production in China, a Chinese-language joint-venture project called “The Secret of the Magic Gourd.”
- More than 850 US mutual funds cut the management fees they charge investors last year, up from 239 in 2003, and this year the number will be about 700.
- The Chicago Merc plans to match or top General Atlantic’s $135 million offer for a 10% stake in the NYMEX as early as this week.
NY Times:
- FPL Group is in advanced discussions to buy Constellation Energy Group for more than $11 billion.
- Voter turnout in Tikrit for Iraq’s parliamentary election tomorrow is expected to be high and reflects the change in Sunni attitude toward the political process.
- Three casinos are set to reopen by New Year’s Eve in Biloxi, Mississippi, where nine of 10 floating casinos were destroyed by Hurricane Katrina.
- Tribune’s LA Times will stop publishing its national edition next week as the company cuts jobs.
- JPMorgan, Citigroup and Consolidated Edison are among companies in NY preparing for a possible transit strike.
- Most of the Chinese public remains unaware that police in their country killed as many as 20 people last week while suppressing a demonstration.
USA Today:
- More Americans feel it was not a mistake to liberate Iraq by a 50%-48% margin.
Finanz und Wirtschaft:
- Starbucks expects to operate at least 30,000 stores in the coming years as it expands in China and studies new markets like India, Brazil and Russia, its CEO said.
AFP:
- Iranian President Mahmoud Ahmadinejad said the Holocaust is a myth and Israel should move as far away as Alaska.
Trade Deficit Widens, Import Prices Fall, Oil Supplies Rise
- The Trade Deficit for October widened to -$68.9 billion versus -$66.0 billion in September.
- The Import Price Index for November fell 1.7% versus estimates of a .5% decline and a .3% rise in October.
- The EIA reported crude inventories rose 892,000 barrels vs. estimates of a 1.5 million barrel drawdown. Gasoline inventories rose 1.76 million barrels vs. estimates of a 1.0 million barrel increase. Distillate supplies fell 88,000 barrels vs. estimates of a 600,000 barrel build. Refinery utilization fell 1.0% vs. estimates of a 0.5% increase.
- The Import Price Index for November fell 1.7% versus estimates of a .5% decline and a .3% rise in October.
- The EIA reported crude inventories rose 892,000 barrels vs. estimates of a 1.5 million barrel drawdown. Gasoline inventories rose 1.76 million barrels vs. estimates of a 1.0 million barrel increase. Distillate supplies fell 88,000 barrels vs. estimates of a 600,000 barrel build. Refinery utilization fell 1.0% vs. estimates of a 0.5% increase.
BOTTOM LINE: The US trade deficit unexpectedly widened in October, as imports of crude oil, automobiles and televisions increased, Bloomberg reported. Imports rose 2.7% and exports rose 1.7% during the month. I continue to believe the trade deficit will only improve marginally over the intermediate-term as US economic growth continues to exceed that of most other major global economies, offsetting other factors.
Prices of goods imported into the US fell more than expected in November, reflecting cheaper oil, natural gas and building materials. I expect import prices to rise in the near-term before anther push lower next quarter.
Oil is slightly lower on the EIA report. Crude supplies are still well above-average levels for this time of the year. The drawdown in distillate supplies is likely the result of switching from natural gas.
Tuesday, December 13, 2005
Wednesday Watch
Late-Night Headlines
Bloomberg:
- Iraqi’s first election of a permanent government since the ousting of dictator Saddam Hussein may reduce the power of the governing Shiite Muslim coalition.
- Boeing beat larger rival Airbus SAS to win an order worth as much as $15.5 billion for 115 airplanes from Qantas Airways Ltd., Australia’s largest carrier.
Financial Times:
- US airlines may recruit 2,500 new pilots next year after an increase in the number of low-cost carriers, regional airlines and business planes, citing Kit Darby, a pilot consultant at Atlanta-based Air Inc.
CNBC:
- Morgan Stanley will pay “huge” bonuses even amid earnings that have fallen 25% this year, Crain’s NY Business reporter Aaron Elstein said.
Business Week:
- Legal music downloads are slowing down this quarter in spite of brisk sales of Apple Computer’s iPod portable music player, citing data from Nielsen SoundScan. Music downloads may pick up after Christmas because sales of iTunes gift cards are “off the charts,” the magazine said.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on GE.
- Reiterated Underperform on GXP, SIE and ELNK.
Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated -.07%.
NASDAQ 100 indicated -.15%.
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
NDN/.06
FRE/1.02
MERQE/.32
NAV/3.06
WGO/.42
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- The Trade Deficit for October is estimated to shrink to -$62.8 billion from -$66.1 billion in September.
- The Import Price Index for November is estimated to fall .5% versus a .3% decline in October.
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude drawdown of 1.5 million barrels. Gasoline inventories are estimated to rise 1.0 million barrels and distillate supplies are expected to rise 800,000 barrels. Finally, refinery utilization is expected to rise 0.45%.
Bloomberg:
- Iraqi’s first election of a permanent government since the ousting of dictator Saddam Hussein may reduce the power of the governing Shiite Muslim coalition.
- Boeing beat larger rival Airbus SAS to win an order worth as much as $15.5 billion for 115 airplanes from Qantas Airways Ltd., Australia’s largest carrier.
Financial Times:
- US airlines may recruit 2,500 new pilots next year after an increase in the number of low-cost carriers, regional airlines and business planes, citing Kit Darby, a pilot consultant at Atlanta-based Air Inc.
CNBC:
- Morgan Stanley will pay “huge” bonuses even amid earnings that have fallen 25% this year, Crain’s NY Business reporter Aaron Elstein said.
Business Week:
- Legal music downloads are slowing down this quarter in spite of brisk sales of Apple Computer’s iPod portable music player, citing data from Nielsen SoundScan. Music downloads may pick up after Christmas because sales of iTunes gift cards are “off the charts,” the magazine said.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on GE.
- Reiterated Underperform on GXP, SIE and ELNK.
Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated -.07%.
NASDAQ 100 indicated -.15%.
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
NDN/.06
FRE/1.02
MERQE/.32
NAV/3.06
WGO/.42
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- The Trade Deficit for October is estimated to shrink to -$62.8 billion from -$66.1 billion in September.
- The Import Price Index for November is estimated to fall .5% versus a .3% decline in October.
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude drawdown of 1.5 million barrels. Gasoline inventories are estimated to rise 1.0 million barrels and distillate supplies are expected to rise 800,000 barrels. Finally, refinery utilization is expected to rise 0.45%.
BOTTOM LINE: Asian indices are mostly lower after a Japanese manufacturing survey failed to meet expectations. I expect US equities to open lower and to rally modestly into the afternoon, finishing mixed-to-lower. The Portfolio is 75% net long heading into the day.
Stocks Finish Higher on Weak Breadth
Indices
S&P 500 1,267.43 +.56%
DJIA 10,823.72 +.52%
NASDAQ 2,265.00 +.18%
Russell 2000 689.03 -.07%
DJ Wilshire 5000 12,684.52 +.44%
S&P Barra Growth 605.72 +.43%
S&P Barra Value 657.33 +.68%
Morgan Stanley Consumer 596.23 +.80%
Morgan Stanley Cyclical 785.52 +.65%
Morgan Stanley Technology 536.34 +.12%
Transports 4,088.03 -.07%
Utilities 412.84 +1.24%
Put/Call .63 -8.70%
NYSE Arms .72 -11.56%
Volatility(VIX) 11.11 -3.14%
ISE Sentiment 174.00 -15.94%
US Dollar 90.53 +.23%
CRB 335.62 +.58%
Futures Spot Prices
Crude Oil 61.23 -.24%
Unleaded Gasoline 164.00 -.36%
Natural Gas 15.25 -.80%
Heating Oil 183.16 -.27%
Gold 521.70 -.44%
Base Metals 153.38 +1.06%
Copper 202.20 -.22%
10-year US Treasury Yield 4.51% -.61%
Leading Sectors
Restaurants +1.74%
Drugs +1.68%
Homebuilders +1.38%
Lagging Sectors
Oil Tankers -1.41%
Gaming -1.51%
Oil Service -1.54%
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 PFE.
Afternoon/Evening Headlines
Bloomberg:
- Futures traders pared bets the Federal Reserve will boost its benchmark interest rate to 4.75% by April after the central bank raised rates a 13th straight time and signaled it’s moving closer to the end of the increases.
- Iraqis residing in the US began casting absentee ballots today at eight polling places across the country for Iraq’s parliamentary elections.
CNBC:
- Delphi Corp. CEO Steve Miller said the bankrupt auto-parts maker will likely come to a labor agreement with the UAW in the first quarter of next year.
- A judge granted a preliminary injunction today against a potential strike by NYC transit workers.
S&P 500 1,267.43 +.56%
DJIA 10,823.72 +.52%
NASDAQ 2,265.00 +.18%
Russell 2000 689.03 -.07%
DJ Wilshire 5000 12,684.52 +.44%
S&P Barra Growth 605.72 +.43%
S&P Barra Value 657.33 +.68%
Morgan Stanley Consumer 596.23 +.80%
Morgan Stanley Cyclical 785.52 +.65%
Morgan Stanley Technology 536.34 +.12%
Transports 4,088.03 -.07%
Utilities 412.84 +1.24%
Put/Call .63 -8.70%
NYSE Arms .72 -11.56%
Volatility(VIX) 11.11 -3.14%
ISE Sentiment 174.00 -15.94%
US Dollar 90.53 +.23%
CRB 335.62 +.58%
Futures Spot Prices
Crude Oil 61.23 -.24%
Unleaded Gasoline 164.00 -.36%
Natural Gas 15.25 -.80%
Heating Oil 183.16 -.27%
Gold 521.70 -.44%
Base Metals 153.38 +1.06%
Copper 202.20 -.22%
10-year US Treasury Yield 4.51% -.61%
Leading Sectors
Restaurants +1.74%
Drugs +1.68%
Homebuilders +1.38%
Lagging Sectors
Oil Tankers -1.41%
Gaming -1.51%
Oil Service -1.54%
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 PFE.
Afternoon/Evening Headlines
Bloomberg:
- Futures traders pared bets the Federal Reserve will boost its benchmark interest rate to 4.75% by April after the central bank raised rates a 13th straight time and signaled it’s moving closer to the end of the increases.
- Iraqis residing in the US began casting absentee ballots today at eight polling places across the country for Iraq’s parliamentary elections.
CNBC:
- Delphi Corp. CEO Steve Miller said the bankrupt auto-parts maker will likely come to a labor agreement with the UAW in the first quarter of next year.
- A judge granted a preliminary injunction today against a potential strike by NYC transit workers.
BOTTOM LINE: The Portfolio finished lower today on losses in my Medical longs and Retail longs. I added to my VLO short and added IWM and QQQQ shorts in the afternoon, thus leaving the Portfolio 75% net long. The tone of the market was mixed today as the advance/decline line finished slightly lower, sector performance was mostly positive and volume was above average. Measures of investor anxiety were mostly lower into the close. I still expect stocks to finish the year strongly with the S&P 500 returning around 10%. However, in the near term, it appears more consolidation is necessary.
Stocks Higher Mid-day on Fed "Pause" Hopes
Indices
S&P 500 1,271.67 +.92%
DJIA 10,871.43 +.95%
NASDAQ 2,271.69 +.48%
Russell 2000 692.25 +.39%
DJ Wilshire 5000 12,723.49 +.75%
S&P Barra Growth 607.62 +.74%
S&P Barra Value 659.26 +.97%
Morgan Stanley Consumer 597.22 +.96%
Morgan Stanley Cyclical 787.65 +.92%
Morgan Stanley Technology 537.72 +.38%
Transports 4,095.84 +.12%
Utilities 412.73 +1.22%
Put/Call .59 -14.49%
NYSE Arms .59 -27.06%
Volatility(VIX) 10.92 -4.80%
ISE Sentiment 181.00 -12.56%
US Dollar 90.27 -.06%
CRB 335.58 +.56%
Futures Spot Prices
Crude Oil 61.50 +.33%
Unleaded Gasoline 164.90 +.13%
Natural Gas 15.36 +3.63%
Heating Oil 183.25 +3.39%
Gold 524.80 -1.26%
Base Metals 153.38 +1.06%
Copper 202.00 +1.71%
10-year US Treasury Yield 4.52% -.39%
Leading Sectors
Restaurants +1.88%
Drugs +1.59%
Homebuilders +1.31%
Lagging Sectors
Airlines -1.09%
Oil Tankers -1.16%
Gaming -1.20%
S&P 500 1,271.67 +.92%
DJIA 10,871.43 +.95%
NASDAQ 2,271.69 +.48%
Russell 2000 692.25 +.39%
DJ Wilshire 5000 12,723.49 +.75%
S&P Barra Growth 607.62 +.74%
S&P Barra Value 659.26 +.97%
Morgan Stanley Consumer 597.22 +.96%
Morgan Stanley Cyclical 787.65 +.92%
Morgan Stanley Technology 537.72 +.38%
Transports 4,095.84 +.12%
Utilities 412.73 +1.22%
Put/Call .59 -14.49%
NYSE Arms .59 -27.06%
Volatility(VIX) 10.92 -4.80%
ISE Sentiment 181.00 -12.56%
US Dollar 90.27 -.06%
CRB 335.58 +.56%
Futures Spot Prices
Crude Oil 61.50 +.33%
Unleaded Gasoline 164.90 +.13%
Natural Gas 15.36 +3.63%
Heating Oil 183.25 +3.39%
Gold 524.80 -1.26%
Base Metals 153.38 +1.06%
Copper 202.00 +1.71%
10-year US Treasury Yield 4.52% -.39%
Leading Sectors
Restaurants +1.88%
Drugs +1.59%
Homebuilders +1.31%
Lagging Sectors
Airlines -1.09%
Oil Tankers -1.16%
Gaming -1.20%
BOTTOM LINE: The Portfolio is lower mid-day on losses in my Medical longs, Retail longs and Medical Information System longs. I added to my ELOS long this morning and added to an existing short, thus leaving the Portfolio 100% net long. The tone of the market is slightly positive as the advance/decline line is about even, most sectors are higher and volume is above average. Measures of investor anxiety are mostly lower. Overall, today’s market action is slightly negative considering the Fed removed the word “accommodative” from their description of the current level of rates. The Johnson Redbook same-store sales index rose 3.3% year-over-year last week vs. a 3.3% rise the prior week. This week's gain is up from a 1.5% increase in late April, and it's the 32nd week in a row that the index has risen 3% or more. I continue to believe retail will outperform through year-end. The Morgan Stanley Retail Index (MVRX) has returned 13% since late October versus a 7% gain for the S&P 500. I expect US stocks to trade mixed into the close as higher energy prices offsets optimism the Fed is closer to a “pause.”
Today's Headlines
Bloomberg:
- US Senate Majority Leader Bill Frist said Congress will likely extend tax cuts for dividends and capital gains before adjourning for the year.
- US Treasuries rose after the Fed raised its interest-rate target for the 13th straight time and indicated that it may be about done raising borrowing costs.
Wall Street Journal:
- US companies’ plans to hire workers look relatively robust, continuing a two-year trend, citing a quarterly survey that Manpower Inc. may release today.
- Mark Cuban, the owner of the Dallas Mavericks basketball team, is investing in Brondell, a San Francisco start-up company that wants to make heated toilet seats that use warm water to clean their users, citing Cuban.
NY Times:
- Nelson Peltz, who owns a 5.5% stake in Wendy’s International, plans to propose an overhaul of the third-largest fast-food company and may start a proxy fight.
Star-Ledger of Newark:
- A New Jersey state Senate committee yesterday passed stem-cell research legislation that would seek voter approval for $350 million in state funding.
Financial News:
- Blackstone Group LP has collected $12 billion for its latest buyout fund and plans to raise a further $1 billion before closing it next year.
Chronicle of Higher Education:
- Spending for online education at universities in the US may rise to as much as $10.4 billion in 2007 from an estimated $6.8 billion this year.
- US Senate Majority Leader Bill Frist said Congress will likely extend tax cuts for dividends and capital gains before adjourning for the year.
- US Treasuries rose after the Fed raised its interest-rate target for the 13th straight time and indicated that it may be about done raising borrowing costs.
Wall Street Journal:
- US companies’ plans to hire workers look relatively robust, continuing a two-year trend, citing a quarterly survey that Manpower Inc. may release today.
- Mark Cuban, the owner of the Dallas Mavericks basketball team, is investing in Brondell, a San Francisco start-up company that wants to make heated toilet seats that use warm water to clean their users, citing Cuban.
NY Times:
- Nelson Peltz, who owns a 5.5% stake in Wendy’s International, plans to propose an overhaul of the third-largest fast-food company and may start a proxy fight.
Star-Ledger of Newark:
- A New Jersey state Senate committee yesterday passed stem-cell research legislation that would seek voter approval for $350 million in state funding.
Financial News:
- Blackstone Group LP has collected $12 billion for its latest buyout fund and plans to raise a further $1 billion before closing it next year.
Chronicle of Higher Education:
- Spending for online education at universities in the US may rise to as much as $10.4 billion in 2007 from an estimated $6.8 billion this year.
Retail Sales Remain Healthy, Inventories Low
- Advance Retail Sales for November rose .3% versus estimates of a .4% gain and an upwardly revised .3% increase in October.
- Retail Sales Less Autos for November fell .3% versus estimates of a .1% decline and a .8% increase in October.
- Business Inventories for October rose .3% versus estimates of a .5% increase and a .5% gain in September.
- Retail Sales Less Autos for November fell .3% versus estimates of a .1% decline and a .8% increase in October.
- Business Inventories for October rose .3% versus estimates of a .5% increase and a .5% gain in September.
BOTTOM LINE: US retail sales rose less than forecast last month as consumers pocketed some of their savings from lower gasoline prices instead of spending the cash, Bloomberg reported. Gas station receipts fell 5.9% in November, the biggest drop since 2003 after average gas prices fell to $2.30/gallon from $2.77/gallon in October. Moreover, last month was the ninth warmest November in US history, depressing sales of winter clothing. The Morgan Stanley Retail Index has risen 13% since late October versus a 7% gain for the S&P 500. I continue to believe retail will outperform through year-end.
US business sales rose .8% in October, more than double the increase in inventories and reinforcing forecasts that companies will increase production in coming months, Bloomberg said. I continue to believe inventory rebuilding will add to US economic growth over the intermediate-term as executive confidence rises further.
Monday, December 12, 2005
Tuesday Watch
Late-Night Headlines
Bloomberg:
- ConocoPhillips(COP), agreed to buy Burlington Resources(BR) for $35.6 billion in cash and stock.
- California Governor Schwarzenegger refused to stop tomorrow’s execution of Stanley Williams, co-founder of the Crips gang in LA and convicted murderer who won the support of celebrities. Schwarzenegger said William’s refusal to apologize for the murders, his unwillingness to help police dissect the structures of street gangs, as well as a plan he had to blow up a jail transportation bus and escape during his trial, raised doubt about his redemption.
- Microsoft sod 39% of its new Xbox game console in the first two days its was available in Japan, according to market researcher Enterbrain Inc.
Financial Times:
- Kuwait may allow international oil companies access to its oilfields by the end of 2006 to meet its oil production targets.
AP:
- Osama bin Laden may no longer be directing operations of his al-Qaeda terrorist organization, citing remarks made by Ryan Crocker, the US ambassador to Pakistan.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on AMP, CRL, DNA and EBAY.
Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated unch.
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
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
ADCT/.17
BBY/.30
EASI/.56
LEH/2.64
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Advance Retail Sales for November are estimated to rise .4% versus a .1% decline in October.
- Retail Sales Less Autos for November are estimated to fall .1% versus a .9% increase in October.
10:00 am EST
- Business Inventories for October are estimated to rise .5% versus a .5% increase in September.
2:15 pm EST
- The FOMC is expected to raise the benchmark interest rate 25 basis points to 4.25%.
Bloomberg:
- ConocoPhillips(COP), agreed to buy Burlington Resources(BR) for $35.6 billion in cash and stock.
- California Governor Schwarzenegger refused to stop tomorrow’s execution of Stanley Williams, co-founder of the Crips gang in LA and convicted murderer who won the support of celebrities. Schwarzenegger said William’s refusal to apologize for the murders, his unwillingness to help police dissect the structures of street gangs, as well as a plan he had to blow up a jail transportation bus and escape during his trial, raised doubt about his redemption.
- Microsoft sod 39% of its new Xbox game console in the first two days its was available in Japan, according to market researcher Enterbrain Inc.
Financial Times:
- Kuwait may allow international oil companies access to its oilfields by the end of 2006 to meet its oil production targets.
AP:
- Osama bin Laden may no longer be directing operations of his al-Qaeda terrorist organization, citing remarks made by Ryan Crocker, the US ambassador to Pakistan.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on AMP, CRL, DNA and EBAY.
Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated unch.
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
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
ADCT/.17
BBY/.30
EASI/.56
LEH/2.64
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- Advance Retail Sales for November are estimated to rise .4% versus a .1% decline in October.
- Retail Sales Less Autos for November are estimated to fall .1% versus a .9% increase in October.
10:00 am EST
- Business Inventories for October are estimated to rise .5% versus a .5% increase in September.
2:15 pm EST
- The FOMC is expected to raise the benchmark interest rate 25 basis points to 4.25%.
BOTTOM LINE: Asian indices are mostly lower on rising apprehension ahead of the US Fed announcement. I expect US equities to open mixed and to rally modestly into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.
Stocks Finish Mixed Ahead of Fed Announcement
Indices
S&P 500 1,260.43 +.08%
DJIA 10,767.77 -.10%
NASDAQ 2,260.95 +.19%
Russell 2000 689.54 +.11%
DJ Wilshire 5000 12,628.53 +.10%
S&P Barra Growth 603.15 +.17%
S&P Barra Value 652.92 unch.
Morgan Stanley Consumer 591.52 +.13%
Morgan Stanley Cyclical 780.46 -.03%
Morgan Stanley Technology 535.68 +.59%
Transports 4,090.70 -.28%
Utilities 407.78 -.50%
Put/Call .69 -13.75%
NYSE Arms .81 -20.38%
Volatility(VIX) 11.47 -1.88%
ISE Sentiment 207.00 +5.61%
US Dollar 90.31 -1.03%
CRB 333.70 +1.80%
Futures Spot Prices
Crude Oil 61.41 +.18%
Unleaded Gasoline 165.25 +.35%
Natural Gas 15.04 +1.37%
Heating Oil 177.65 +.23%
Gold 531.00 -.09%
Base Metals 151.76 -1.53%
Copper 199.00 +.20%
10-year US Treasury Yield 4.54% +.57%
Leading Sectors
Energy +1.22%
Oil Service +1.12%
Broadcasting +1.10%
Lagging Sectors
Utilities -.50%
Restaurants -.58%
Insurance -.64%
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 CL and RDEN.
- Reiterated Underperform on MARSA.
Afternoon/Evening Headlines
Bloomberg:
- GM’s debt rating, already non-investment grade, was cut two levels by S&P because of concern that losses at the automaker’s North American operations will be difficult to end.
- Diebold said CEO Walden O’Dell resigned and will be replaced by President Thomas Swidarski.
- Crude oil rose to a five-week high as falling temperatures in the US spurred demand for heating oil.
CNBC:
- US Steel may sell its oil pipe business for $2.5 billion, Mergermarket consulting editor Josh Kosman said.
S&P 500 1,260.43 +.08%
DJIA 10,767.77 -.10%
NASDAQ 2,260.95 +.19%
Russell 2000 689.54 +.11%
DJ Wilshire 5000 12,628.53 +.10%
S&P Barra Growth 603.15 +.17%
S&P Barra Value 652.92 unch.
Morgan Stanley Consumer 591.52 +.13%
Morgan Stanley Cyclical 780.46 -.03%
Morgan Stanley Technology 535.68 +.59%
Transports 4,090.70 -.28%
Utilities 407.78 -.50%
Put/Call .69 -13.75%
NYSE Arms .81 -20.38%
Volatility(VIX) 11.47 -1.88%
ISE Sentiment 207.00 +5.61%
US Dollar 90.31 -1.03%
CRB 333.70 +1.80%
Futures Spot Prices
Crude Oil 61.41 +.18%
Unleaded Gasoline 165.25 +.35%
Natural Gas 15.04 +1.37%
Heating Oil 177.65 +.23%
Gold 531.00 -.09%
Base Metals 151.76 -1.53%
Copper 199.00 +.20%
10-year US Treasury Yield 4.54% +.57%
Leading Sectors
Energy +1.22%
Oil Service +1.12%
Broadcasting +1.10%
Lagging Sectors
Utilities -.50%
Restaurants -.58%
Insurance -.64%
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 CL and RDEN.
- Reiterated Underperform on MARSA.
Afternoon/Evening Headlines
Bloomberg:
- GM’s debt rating, already non-investment grade, was cut two levels by S&P because of concern that losses at the automaker’s North American operations will be difficult to end.
- Diebold said CEO Walden O’Dell resigned and will be replaced by President Thomas Swidarski.
- Crude oil rose to a five-week high as falling temperatures in the US spurred demand for heating oil.
CNBC:
- US Steel may sell its oil pipe business for $2.5 billion, Mergermarket consulting editor Josh Kosman said.
BOTTOM LINE: The Portfolio finished higher today on gains in my Internet longs, Medical longs and Semi longs. I did not trade in the afternoon, thus leaving the Portfolio 100% net long. The tone of the market was mixed today as the advance/decline line finished slightly lower, sector performance was mixed and volume was above average. Measures of investor anxiety were lower into the close. Intuitive Surgical (ISRG) broke out of a two-week trading range today, making another all-time high on above-average volume. This stock remains one of my largest long positions. I expect it to continue to outperform over the intermediate term.
Stocks Modestly Lower Mid-day on Rising Energy Prices and Apprehension Ahead of Fed Meeting
Indices
S&P 500 1,256.87 -.20%
DJIA 10,743.68 -.32%
NASDAQ 2,256.83 +.01%
Russell 2000 687.99 -.12%
DJ Wilshire 5000 12,593.73 -.18%
S&P Barra Growth 602.06 -.01%
S&P Barra Value 650.73 -.34%
Morgan Stanley Consumer 590.06 -.12%
Morgan Stanley Cyclical 778.47 -.28%
Morgan Stanley Technology 535.01 +.47%
Transports 4,062.55 -.97%
Utilities 407.35 -.60%
Put/Call .69 -13.75%
NYSE Arms .99 -3.59%
Volatility(VIX) 11.65 -.34%
ISE Sentiment 198.00 +1.02
US Dollar 90.27 -1.07%
CRB 331.92 +1.27%
Futures Spot Prices
Crude Oil 60.40 +1.70%
Unleaded Gasoline 162.70 +1.38%
Natural Gas 14.83 +3.62%
Heating Oil 175.50 +1.34%
Gold 531.50 +.25%
Base Metals 151.76 -1.53%
Copper 198.60 -2.17%
10-year US Treasury Yield 4.55% +.74%
Leading Sectors
Broadcasting +.97%
Energy +.73%
Gaming +.46%
Lagging Sectors
Telecom -.66%
Banks -.72%
HMOs -1.13%
S&P 500 1,256.87 -.20%
DJIA 10,743.68 -.32%
NASDAQ 2,256.83 +.01%
Russell 2000 687.99 -.12%
DJ Wilshire 5000 12,593.73 -.18%
S&P Barra Growth 602.06 -.01%
S&P Barra Value 650.73 -.34%
Morgan Stanley Consumer 590.06 -.12%
Morgan Stanley Cyclical 778.47 -.28%
Morgan Stanley Technology 535.01 +.47%
Transports 4,062.55 -.97%
Utilities 407.35 -.60%
Put/Call .69 -13.75%
NYSE Arms .99 -3.59%
Volatility(VIX) 11.65 -.34%
ISE Sentiment 198.00 +1.02
US Dollar 90.27 -1.07%
CRB 331.92 +1.27%
Futures Spot Prices
Crude Oil 60.40 +1.70%
Unleaded Gasoline 162.70 +1.38%
Natural Gas 14.83 +3.62%
Heating Oil 175.50 +1.34%
Gold 531.50 +.25%
Base Metals 151.76 -1.53%
Copper 198.60 -2.17%
10-year US Treasury Yield 4.55% +.74%
Leading Sectors
Broadcasting +.97%
Energy +.73%
Gaming +.46%
Lagging Sectors
Telecom -.66%
Banks -.72%
HMOs -1.13%
BOTTOM LINE: The Portfolio is slightly higher mid-day on gains in my Medical longs, Internet longs and Semi longs. I added RGLD short this morning and added to a few existing longs, thus leaving the Portfolio 100% net long. The tone of the market is negative as the advance/decline line is higher, most sectors are lower and volume is about average. Measures of investor anxiety are lower. Overall, today’s market action is slightly negative considering overnight gains in Asia and higher energy prices. The Energy sector saw the greatest insider selling in the S&P 500 for the week ending Dec. 9. Total insider sales for the group were $79,691,434 last week. Total insider purchases were $0. This is the largest amount of insider selling in Energy I have seen in quite some time. I expect US stocks to trade mixed-to-higher into the close on short-covering.
Today's Headlines
Bloomberg:
- OPEC may end an offer to tap 2 million barrels a day of spare output capacity because there isn’t sufficient demand, the group’s President Sheikh Ahmad Fahd al-Sabah said.
- Coca-Cola and PepsiCo are headed for their first annual decline in US soft-drink sales in at least four decades as health-conscious consumers switch to bottled water, sports drinks and juices.
- US strategists, who correctly called the stock market’s performance this year, are getting more bullish for 2006.
- Ford Motor may save more than $1 billion annually on US health care under an agreement reached with the UAW, analysts said.
- Merck suffered a setback when a judge declared a mistrial in the third case involving its Vioxx painkiller, after a jury said they’d deadlocked on whether the drug caused a Florida man’s death.
- Time Warner and Comcast are among six cable companies that plan to offer a separate tier of family-friendly programs, an industry group said.
- The dollar is falling the most in more than two months against the euro on speculation the Fed may say tomorrow that interest rates are no longer stimulating the US economy.
Wall Street Journal:
- Alteria Group’s Philip Morris USA will make its first drug-delivery product by partnering with Pennsylvania-based Discovery Labs Inc. to create new ways of delivering medicine to premature babies with breathing problems.
- Tommy Hilfiger has three possible offers.
- News Corp.’s HarperCollins Publishers said it will produce digital copies of its books and then make them available to search services offered by companies such as Google, Microsoft and Amazon.com.
- The avian flu virus in China is stable at present, not mutating toward a form readily transmissible among humans, according to Shu Yuelong, the head of China’s national influenza laboratory.
NY Post:
- Consumer Reports will begin offering product ratings, pricing information and store availability through wireless phones.
NY Times:
- Three private-equity firms and Dunkin Donuts are near an agreement for the sale of the donut chain for about $2 billion.
- Samsung Electronics and Toshiba are spending billions on new factories and more engineers as competition intensifies to develop more powerful NAND flash memory chips.
- The MSNBC cable news network will spend almost $1 million on its most concentrated Internet advertising blitz to date, promoting three of its prime-time shows on hundreds of Web sites and Web logs.
USA Today:
- Iraqi Vice President Adel Abdul Mahdi said he envisions the nation having three semi-independent regions that handle internal security and have more control over funding.
Boston Globe:
- Corporate spending on computer servers, networking and storage equipment, and software may rise 11% next year to $546.9 billion, citing Moody’s Economy.com research firm.
Chronicle of Higher Education:
- The Ford Foundation gave 26 schools including Yale University, Trinity University and Northwestern University grants of $100,000 for projects that promote academic freedom, religious tolerance and environments in which difficult subjects can be discussed openly.
AFP:
- Iraqis working in hospitals, the military and those in prisons started voting today before full elections for a parliament that will restore sovereignty to the country.
- OPEC may end an offer to tap 2 million barrels a day of spare output capacity because there isn’t sufficient demand, the group’s President Sheikh Ahmad Fahd al-Sabah said.
- Coca-Cola and PepsiCo are headed for their first annual decline in US soft-drink sales in at least four decades as health-conscious consumers switch to bottled water, sports drinks and juices.
- US strategists, who correctly called the stock market’s performance this year, are getting more bullish for 2006.
- Ford Motor may save more than $1 billion annually on US health care under an agreement reached with the UAW, analysts said.
- Merck suffered a setback when a judge declared a mistrial in the third case involving its Vioxx painkiller, after a jury said they’d deadlocked on whether the drug caused a Florida man’s death.
- Time Warner and Comcast are among six cable companies that plan to offer a separate tier of family-friendly programs, an industry group said.
- The dollar is falling the most in more than two months against the euro on speculation the Fed may say tomorrow that interest rates are no longer stimulating the US economy.
Wall Street Journal:
- Alteria Group’s Philip Morris USA will make its first drug-delivery product by partnering with Pennsylvania-based Discovery Labs Inc. to create new ways of delivering medicine to premature babies with breathing problems.
- Tommy Hilfiger has three possible offers.
- News Corp.’s HarperCollins Publishers said it will produce digital copies of its books and then make them available to search services offered by companies such as Google, Microsoft and Amazon.com.
- The avian flu virus in China is stable at present, not mutating toward a form readily transmissible among humans, according to Shu Yuelong, the head of China’s national influenza laboratory.
NY Post:
- Consumer Reports will begin offering product ratings, pricing information and store availability through wireless phones.
NY Times:
- Three private-equity firms and Dunkin Donuts are near an agreement for the sale of the donut chain for about $2 billion.
- Samsung Electronics and Toshiba are spending billions on new factories and more engineers as competition intensifies to develop more powerful NAND flash memory chips.
- The MSNBC cable news network will spend almost $1 million on its most concentrated Internet advertising blitz to date, promoting three of its prime-time shows on hundreds of Web sites and Web logs.
USA Today:
- Iraqi Vice President Adel Abdul Mahdi said he envisions the nation having three semi-independent regions that handle internal security and have more control over funding.
Boston Globe:
- Corporate spending on computer servers, networking and storage equipment, and software may rise 11% next year to $546.9 billion, citing Moody’s Economy.com research firm.
Chronicle of Higher Education:
- The Ford Foundation gave 26 schools including Yale University, Trinity University and Northwestern University grants of $100,000 for projects that promote academic freedom, religious tolerance and environments in which difficult subjects can be discussed openly.
AFP:
- Iraqis working in hospitals, the military and those in prisons started voting today before full elections for a parliament that will restore sovereignty to the country.
Sunday, December 11, 2005
Monday Watch
Weekend Headlines
Bloomberg:
- Two-thirds of US company executives surveyed said they intend to increase capital spending over the next 12 months, according to Baruch College’s Zicklin School of Business. The average increase is expected to be 9%.
- Microsoft released its Xbox 360 game console in Japan today, about three months ahead of Sony’s PlayStation 3.
- Wal-Mart Stores said December same-store sales at its US stores are rising within its forecast.
- Saudi Arabia joined other members from OPEC in saying the group should maintain current production to meet demand during the Northern Hemisphere winter.
- The Fed may say monetary policy is no longer stimulating the economy after it raises interest rates for the 13th time, according to more than half of Wall Street’s biggest bond trading firms.
- Viacom’s Paramount Pictures agreed to buy DreamWorks SKG for $1.6 billion in cash and debt, wresting the movie studio away from NBC Universal and securing the talents of Steven Spielberg.
- Walt Disney’s “The Chronicles of Narnia: The Lion, the Witch and the Wardrobe” opened as the No. 1 film in the US and Canadian theaters with an estimated $67.1 million in ticket sales, the second-best December debut ever.
- Louisiana is among three US states interested in being the site of a joint venture refinery with Kuwait.
Wall Street Journal:
- Delphi Corp. CEO Miller said he’s putting together a new contract proposal for UAW at the No. 1 US auto-parts maker.
- ConocoPhilliops is in advanced discussions to acquire Burlington Resources, an oil and gas producer, for more than $30 billion.
Barron’s:
- US stocks will rise 5% to 25% next year as the economy expands, corporate profits mount and the Fed ends its string of short-term rate increases, Wall Street strategists said.
NY Times:
- Senator Joe Lieberman, a Democrat from Connecticut, has angered many Democratic activists and alienated some from his party in Congress over his support for the US liberation of Iraq.
- US courts have become less cooperative with prosecutors seeking the right to gain cellular-phone tracking information from wireless companies without showing “probable cause.”
- California’s $3 billion stem-cell institute, beset by lawsuits, criticism and bureaucracy since its formation more than a year ago, has yet to spend a single dollar on research.
- The campaigning for candidates and parties in Iraq’s parliamentary elections next week has been sophisticated with text messages being sent to cell phones, and chaotic with gunfire and murders.
- FEMA will extend its deadline for paying for hotel rooms for most survivors of Hurricane Katrina.
- Sirius Satellite Radio and XM Satellite Radio Holdings are about to leap forward, as Howard Stern joins Sirius and both companies introduce portable receivers.
- About 6,000 subway and bus workers voted yesterday to authorize the union to strike if an agreement isn’t reached with New York’s Metropolitan Transportation Authority on a new contract by Dec. 15.
NY Post:
- The board of Albertson’s, the second-biggest US supermarket chain, is meeting this weekend to evaluate final bids from a number of investment firms.
Washington Post:
- Clerics from Iraq’s majority Shiite and minority Sunni sects of Islam are using their pulpits in the country’s mosques to urge voters to back their respective blocs in the Dec. 15 parliamentary elections.
- American Online co-founder Steve Case wrote that parent company Time Warner should be split into four independent companies.
Financial Times:
- Richard Branson, the UK billionaire who owns a majority stake in Virgin Mobile Holdings Plc, may have to accept a lower price for his stake to push through a takeover offer from NTL Inc.
Canadian Press:
- Canada plans to allow government departments to cancel contracts with US companies if they pass data about Canadian citizens to US anti-terrorism investigators.
Iran Daily:
- Iran has started construction work on a 360-megawatt nuclear power plant in Khuzestan province, citing the head of Iran’s Atomic Energy Organization.
Korea Economic Daily:
- Hynix Semiconductor of South Korea plans to increase production of NAND flash memory to 40% of total output next year from 30% now on rising demand from consumer electronics makers.
Weekend Recommendations
Barron's:
- Had positive comments on WMT.
Goldman Sachs:
- Reiterated Outperform on CRL and PKG.
Night Trading
Asian indices are unch. to +1.25% on average.
S&P 500 indicated +.28%.
NASDAQ 100 indicated +.29%.
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/Estimate
JJZ/.10
TDS/.29
USM/.37
Upcoming Splits
GOL 2-for-1
JOYG 3-for-2
RES 3-for-2
Economic Releases
10:00 am EST
- The Monthly Budget Deficit for November is estimated to widen to -$80.0 billion versus -$57.9 billion in October.
Bloomberg:
- Two-thirds of US company executives surveyed said they intend to increase capital spending over the next 12 months, according to Baruch College’s Zicklin School of Business. The average increase is expected to be 9%.
- Microsoft released its Xbox 360 game console in Japan today, about three months ahead of Sony’s PlayStation 3.
- Wal-Mart Stores said December same-store sales at its US stores are rising within its forecast.
- Saudi Arabia joined other members from OPEC in saying the group should maintain current production to meet demand during the Northern Hemisphere winter.
- The Fed may say monetary policy is no longer stimulating the economy after it raises interest rates for the 13th time, according to more than half of Wall Street’s biggest bond trading firms.
- Viacom’s Paramount Pictures agreed to buy DreamWorks SKG for $1.6 billion in cash and debt, wresting the movie studio away from NBC Universal and securing the talents of Steven Spielberg.
- Walt Disney’s “The Chronicles of Narnia: The Lion, the Witch and the Wardrobe” opened as the No. 1 film in the US and Canadian theaters with an estimated $67.1 million in ticket sales, the second-best December debut ever.
- Louisiana is among three US states interested in being the site of a joint venture refinery with Kuwait.
Wall Street Journal:
- Delphi Corp. CEO Miller said he’s putting together a new contract proposal for UAW at the No. 1 US auto-parts maker.
- ConocoPhilliops is in advanced discussions to acquire Burlington Resources, an oil and gas producer, for more than $30 billion.
Barron’s:
- US stocks will rise 5% to 25% next year as the economy expands, corporate profits mount and the Fed ends its string of short-term rate increases, Wall Street strategists said.
NY Times:
- Senator Joe Lieberman, a Democrat from Connecticut, has angered many Democratic activists and alienated some from his party in Congress over his support for the US liberation of Iraq.
- US courts have become less cooperative with prosecutors seeking the right to gain cellular-phone tracking information from wireless companies without showing “probable cause.”
- California’s $3 billion stem-cell institute, beset by lawsuits, criticism and bureaucracy since its formation more than a year ago, has yet to spend a single dollar on research.
- The campaigning for candidates and parties in Iraq’s parliamentary elections next week has been sophisticated with text messages being sent to cell phones, and chaotic with gunfire and murders.
- FEMA will extend its deadline for paying for hotel rooms for most survivors of Hurricane Katrina.
- Sirius Satellite Radio and XM Satellite Radio Holdings are about to leap forward, as Howard Stern joins Sirius and both companies introduce portable receivers.
- About 6,000 subway and bus workers voted yesterday to authorize the union to strike if an agreement isn’t reached with New York’s Metropolitan Transportation Authority on a new contract by Dec. 15.
NY Post:
- The board of Albertson’s, the second-biggest US supermarket chain, is meeting this weekend to evaluate final bids from a number of investment firms.
Washington Post:
- Clerics from Iraq’s majority Shiite and minority Sunni sects of Islam are using their pulpits in the country’s mosques to urge voters to back their respective blocs in the Dec. 15 parliamentary elections.
- American Online co-founder Steve Case wrote that parent company Time Warner should be split into four independent companies.
Financial Times:
- Richard Branson, the UK billionaire who owns a majority stake in Virgin Mobile Holdings Plc, may have to accept a lower price for his stake to push through a takeover offer from NTL Inc.
Canadian Press:
- Canada plans to allow government departments to cancel contracts with US companies if they pass data about Canadian citizens to US anti-terrorism investigators.
Iran Daily:
- Iran has started construction work on a 360-megawatt nuclear power plant in Khuzestan province, citing the head of Iran’s Atomic Energy Organization.
Korea Economic Daily:
- Hynix Semiconductor of South Korea plans to increase production of NAND flash memory to 40% of total output next year from 30% now on rising demand from consumer electronics makers.
Weekend Recommendations
Barron's:
- Had positive comments on WMT.
Goldman Sachs:
- Reiterated Outperform on CRL and PKG.
Night Trading
Asian indices are unch. to +1.25% on average.
S&P 500 indicated +.28%.
NASDAQ 100 indicated +.29%.
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/Estimate
JJZ/.10
TDS/.29
USM/.37
Upcoming Splits
GOL 2-for-1
JOYG 3-for-2
RES 3-for-2
Economic Releases
10:00 am EST
- The Monthly Budget Deficit for November is estimated to widen to -$80.0 billion versus -$57.9 billion in October.
BOTTOM LINE: Asian Indices are higher, led by exporting shares in the region after oil fell below $60/bbl. and US consumer confidence exceeded estimates last Fri. I expect US stocks to open modestly higher and build on gains throughout the day. The Portfolio is 100% net long heading into the week.
Weekly Outlook
There are a number of important economic reports and some significant corporate earnings reports scheduled for release this week.
Economic reports for the week include:
Mon. - Monthly Budget Statement
Tues. - Advance Retail Sales, Business Inventories, FOMC Rate Decision
Wed. - Trade Balance, Import Price Index
Thur. - Initial Jobless Claims, Consumer Price Index, Empire Manufacturing, Net Foreign Security Purchases, Industrial Production, Philly Fed
Fri. - Current Account Balance
A few of the more noteworthy companies that release quarterly earnings this week are:
Mon. - Jacuzzi Brands(JJZ), Telephone & Data Systems(TDS), US Cellular(USM)
Tues. - ADC Telecom(ADCT), CKE Restaurants(CKR), Cooper Companies(COO), Engineered Support(EASI), Lehman Brothers(LEH), Martek Biosciences(MATK)
Wed. - Freddie Mac(FRE), Mercury Interactive(MERQE)
Thur. - Apollo Group(APOL), Bear Stearns(BSC), Best Buy(BBY), Darden Restaurants(DRI), Goldman Sachs(GS), Herman Miller(MLHR), KB Home(KBH), Lennar Corp.(LEN), Oracle Corp.(ORCL), Pier 1 Imports(PIR), Rite Aid(RAD)
Fri. - Carnival Corp.(CCL), Cintas Corp.(CTAS), Family Dollar(FDO), GTECH Holdings(GTK), Quiksilver Inc.(ZQK), Steelcase(SCS), Take-Two Interactive(TTWO)
Other events that have market-moving potential this week include:
Mon. - UBS Server Technologies Conference
Tue. - None of note
Wed. - None of note
Thur. - RBC Silver Conference
Fri. - RBC Silver Conference
Economic reports for the week include:
Mon. - Monthly Budget Statement
Tues. - Advance Retail Sales, Business Inventories, FOMC Rate Decision
Wed. - Trade Balance, Import Price Index
Thur. - Initial Jobless Claims, Consumer Price Index, Empire Manufacturing, Net Foreign Security Purchases, Industrial Production, Philly Fed
Fri. - Current Account Balance
A few of the more noteworthy companies that release quarterly earnings this week are:
Mon. - Jacuzzi Brands(JJZ), Telephone & Data Systems(TDS), US Cellular(USM)
Tues. - ADC Telecom(ADCT), CKE Restaurants(CKR), Cooper Companies(COO), Engineered Support(EASI), Lehman Brothers(LEH), Martek Biosciences(MATK)
Wed. - Freddie Mac(FRE), Mercury Interactive(MERQE)
Thur. - Apollo Group(APOL), Bear Stearns(BSC), Best Buy(BBY), Darden Restaurants(DRI), Goldman Sachs(GS), Herman Miller(MLHR), KB Home(KBH), Lennar Corp.(LEN), Oracle Corp.(ORCL), Pier 1 Imports(PIR), Rite Aid(RAD)
Fri. - Carnival Corp.(CCL), Cintas Corp.(CTAS), Family Dollar(FDO), GTECH Holdings(GTK), Quiksilver Inc.(ZQK), Steelcase(SCS), Take-Two Interactive(TTWO)
Other events that have market-moving potential this week include:
Mon. - UBS Server Technologies Conference
Tue. - None of note
Wed. - None of note
Thur. - RBC Silver Conference
Fri. - RBC Silver Conference
BOTTOM LINE: I expect US stocks to finish the week higher on increasing demand for US assets, less hawkish Fed comments, short-covering, moderating inflation fears and increasing inflows. My trading indicators are still giving bullish signals and the Portfolio is 100% net long heading into the week.
Saturday, December 10, 2005
Market Week in Review
S&P 500 1,265.08 -.45%*
Click here for the Weekly Wrap by Briefing.com.
Click here for the Weekly Wrap by Briefing.com.
BOTTOM LINE: Overall, last week's market performance was just slightly negative considering recent gains, the rise in natural gas prices and disappointing comments from Toll Brothers(TOL) and Intel(INTC). The advance/decline line fell, sector performance was mixed and volume was above average on the week. Measures of investor anxiety were mostly lower. However, the AAII % Bulls fell again to 49.47%, slightly above average levels, which is a positive. The average 30-year mortgage rate rose for the first time in three weeks to 6.32%. This is 111 basis points above all-time lows set in June 2003. I continue to believe mortgage rates will head modestly lower over the intermediate-term as measures of inflation decelerate and economic growth slows to average rates. The benchmark 10-year T-note yield rose 1 basis point on the week as unit labor costs(the largest component of inflation) fell more-than-expected in 3Q, offsetting strong economic data.
Small-caps and cyclicals continued to outperform on increasing optimism over the unrelenting strength of the economy, falling only slightly on the week. Gold rose again on continuing international diversification into the precious metal. I still believe the rise in gold is not a result of increasing inflation fears as evidenced by the decline in unit labor costs this week. Unleaded Gas futures were basically unchanged and are 45% below September highs even as refinery utilization still remains below normal as a result of the hurricanes. Natural gas supplies decreased less-than-expected this week and are now 6.9% above the 5-year average for this time of year even as 29% of daily Gulf of Mexico production remains shut-in. I believe a significant top in natural gas occurred last week or will so shortly. Prices for many commodities are now being driven by fear and record capital inflows into commodity funds, rather than fundamentals. I still expect global energy demand destruction and a significant increase in supplies into 2006 to push energy prices substantially lower over the intermediate-term. The S&P 500 is still within striking distance of my mid-year prediction of a double-digit annual gain, but time is running out. The index is currently up 5.75% for the year.
US economic growth has now exceeded 3% for 10 straight quarters, the best streak since March 1986. Moreover, corporate profit growth has reached double-digit rates for 14 quarters in a row, the best run since at least 1936. I want to reiterated the point that quite possibly there has never before in US history been a greater disconnect between economic perception and reality. This disconnect is fueled by the record number of market participants that perceive that they benefit, both politically and financially, from the demise of the US economy. This, in turn, leads to an overwhelmingly negative spin on almost any positive event. Irrational pessimism is pervasive as a recent poll by American Research Group found 43% of Americans believe the US economy is in a recession. The common definition of a recession is 2 consecutive quarters of economic contraction. As this pessimism lifts and optimism comes to the fore, price/earnings multiples for US stocks should expand, thus leading to significant price appreciation over the intermediate-term.
Friday, December 09, 2005
Weekly Scoreboard*
Indices
S&P 500 1,265.08 -.45%
DJIA 10,877.51 -.91%
NASDAQ 2,256.73 -.73%
Russell 2000 688.77 -.26%
DJ Wilshire 5000 12,615.39 -.40%
S&P Equity Long/Short Index 1,099.76 +1.31%
S&P Barra Growth 602.11 -.64%
S&P Barra Value 652.91 -.27%
Morgan Stanley Consumer 590.77 -.69%
Morgan Stanley Cyclical 780.68 -.08%
Morgan Stanley Technology 532.54 -.84%
Transports 4,102.34 -.87%
Utilities 409.82 +1.68%
S&P 500 Cum A/D Line 8,222.00 -5.0%
Bloomberg Crude Oil % Bulls 52.0 +22.09%
Put/Call .80 -5.88%
NYSE Arms 1.02 -17.07%
Volatility(VIX) 11.69 +6.18%
ISE Sentiment 196.00 +26.45%
AAII % Bulls 49.47 -5.72%
US Dollar 91.30 -.70%
CRB 327.81 +1.37%
Futures Spot Prices
Crude Oil 59.39 +.15%
Unleaded Gasoline 160.49 +.06%
Natural Gas 14.31 +2.82%
Heating Oil 173.18 -2.16%
Gold 529.50 +3.20%
Base Metals 154.13 +3.25%
Copper 202.90 +1.05%
10-year US Treasury Yield 4.52% +.22%
Average 30-year Mortgage Rate 6.32% +.96%
Leading Sectors
Gold & Silver +5.77%
Oil Service +2.86%
Disk Drives +2.17%
Lagging Sectors
Computer Services +1.93%
Homebuilders -2.12%
Oil Tankers -2.76%
One-Week High-Volume Gainers
One-Week High-Volume Losers
*5-Day % Change
S&P 500 1,265.08 -.45%
DJIA 10,877.51 -.91%
NASDAQ 2,256.73 -.73%
Russell 2000 688.77 -.26%
DJ Wilshire 5000 12,615.39 -.40%
S&P Equity Long/Short Index 1,099.76 +1.31%
S&P Barra Growth 602.11 -.64%
S&P Barra Value 652.91 -.27%
Morgan Stanley Consumer 590.77 -.69%
Morgan Stanley Cyclical 780.68 -.08%
Morgan Stanley Technology 532.54 -.84%
Transports 4,102.34 -.87%
Utilities 409.82 +1.68%
S&P 500 Cum A/D Line 8,222.00 -5.0%
Bloomberg Crude Oil % Bulls 52.0 +22.09%
Put/Call .80 -5.88%
NYSE Arms 1.02 -17.07%
Volatility(VIX) 11.69 +6.18%
ISE Sentiment 196.00 +26.45%
AAII % Bulls 49.47 -5.72%
US Dollar 91.30 -.70%
CRB 327.81 +1.37%
Futures Spot Prices
Crude Oil 59.39 +.15%
Unleaded Gasoline 160.49 +.06%
Natural Gas 14.31 +2.82%
Heating Oil 173.18 -2.16%
Gold 529.50 +3.20%
Base Metals 154.13 +3.25%
Copper 202.90 +1.05%
10-year US Treasury Yield 4.52% +.22%
Average 30-year Mortgage Rate 6.32% +.96%
Leading Sectors
Gold & Silver +5.77%
Oil Service +2.86%
Disk Drives +2.17%
Lagging Sectors
Computer Services +1.93%
Homebuilders -2.12%
Oil Tankers -2.76%
One-Week High-Volume Gainers
One-Week High-Volume Losers
*5-Day % Change
Stocks Higher Mid-day as Energy Prices Reverse Lower and Consumer Sentiment Improves
Indices
S&P 500 1,262.24 +.51%
DJIA 10,797.55 +.39%
NASDAQ 2,257.97 +.52%
Russell 2000 689.08 +.56%
DJ Wilshire 5000 12,640.89 +.49%
S&P Barra Growth 603.17 +.34%
S&P Barra Value 654.92 +.70%
Morgan Stanley Consumer 592.04 +.41%
Morgan Stanley Cyclical 782.78 +.68%
Morgan Stanley Technology 533.33 +.85%
Transports 4,109.82 +.68%
Utilities 410.57 +.98%
Put/Call .81 -18.18%
NYSE Arms 1.05 -9.53%
Volatility(VIX) 11.59 -5.08%
ISE Sentiment 197.00 unch.
US Dollar 91.23 -.03%
CRB 327.39 -.92%
Futures Spot Prices
Crude Oil 59.20 -2.41%
Unleaded Gasoline 160.70 -1.08%
Natural Gas 14.34 -4.30%
Heating Oil 172.20 -3.43%
Gold 529.10 +1.22%
Base Metals 154.13 +.77%
Copper 203.00 unch.
10-year US Treasury Yield 4.53% +1.45%
Leading Sectors
Semis +1.71%
HMOs +1.54%
Banks +1.45%
Lagging Sectors
Gold & Silver -1.21%
Airlines -1.30%
Energy -1.37%
S&P 500 1,262.24 +.51%
DJIA 10,797.55 +.39%
NASDAQ 2,257.97 +.52%
Russell 2000 689.08 +.56%
DJ Wilshire 5000 12,640.89 +.49%
S&P Barra Growth 603.17 +.34%
S&P Barra Value 654.92 +.70%
Morgan Stanley Consumer 592.04 +.41%
Morgan Stanley Cyclical 782.78 +.68%
Morgan Stanley Technology 533.33 +.85%
Transports 4,109.82 +.68%
Utilities 410.57 +.98%
Put/Call .81 -18.18%
NYSE Arms 1.05 -9.53%
Volatility(VIX) 11.59 -5.08%
ISE Sentiment 197.00 unch.
US Dollar 91.23 -.03%
CRB 327.39 -.92%
Futures Spot Prices
Crude Oil 59.20 -2.41%
Unleaded Gasoline 160.70 -1.08%
Natural Gas 14.34 -4.30%
Heating Oil 172.20 -3.43%
Gold 529.10 +1.22%
Base Metals 154.13 +.77%
Copper 203.00 unch.
10-year US Treasury Yield 4.53% +1.45%
Leading Sectors
Semis +1.71%
HMOs +1.54%
Banks +1.45%
Lagging Sectors
Gold & Silver -1.21%
Airlines -1.30%
Energy -1.37%
BOTTOM LINE: The Portfolio is higher mid-day on gains in my Medical longs, Internet longs, Semi longs, Energy-related shorts and Retail longs. I have not traded this 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 higher and volume is about average. Measures of investor anxiety are mostly lower. Overall, today’s market action is positive considering the bounce in long-term rates and declines in energy-related stocks. The ECRI Weekly Leading Index rose to 135.70 this week from 135.50 the prior week. This is still near cycle highs of 135.80 and up from 132.00 during the last week of May. This gauge of future economic activity is forecasting healthy U.S. growth. I expect US stocks to trade mixed-to-higher into the close on falling energy prices and rising optimism.
Today's Headlines
Bloomberg:
- Merck, turning to its public health roots, plans to introduce the first cervical cancer vaccine in an attempt to revive its sales.
- French industrial production fell by the most in more than six years in October as output of cars dropped, suggesting Europe’s third-largest economy may be faltering yet again.
- Intel’s sales forecast disappointed investors and signaled the world’s biggest chipmaker may be losing market share to AMD.
- Goldman Sachs, Morgan Stanley, Lehman Brothers Holdings and Bear Stearns may report combined fourth-quarter earnings of $4 billion, capping a record year fueled by trading and advising on takeovers.
- Eli Lilly, maker of the top-selling schizophrenia drug Zyprexa, forecast that 2006 earnings per share will rise 63% on expanding sales of its newest products.
- US Treasuries are falling after an industry report showed consumer confidence rose in December more than forecast, capping its biggest two-month gain since 2003.
- Crude oil is falling on signs supplies will be adequate to meet demand for winter as the first cold snap of the season moves through the northern US.
Wall Street Journal:
- The NYSE set a minimum price of almost $50,000 for the right to continue trading on its floor after the exchange concludes its acquisition of electronic-trading company Archipelago Holdings.
- Three Puerto Rican lenders, Doral Financial, R&G Financial, and First BanCorp may soon issue financial restatements, following scrutiny by the SEC.
- Anheuser-Busch has started a campaign to promote the health benefits of drinking beer.
- Virgin Atlantic founder Richard Branson and New Mexico plan to build a $200 million “spaceport” in the desert to prepare for commercial space travel.
- Viacom’s Paramount Pictures unit is preparing to bid for DreamWorks SKG, using mostly money put up by outside investors.
- US oil and drug companies may collide over House and Senate negotiations on the Republican party’s proposed $45 billion deficit-reduction bill.
- Deckers Outdoor, maker of Teva sandals and Ugg boots, will sell more different Ugg models in the hope of turning last year’s footwear fad into a permanent brand.
AP:
- Verizon Communications’ Verizon Wireless said that it has won two lawsuits against telemarketers who made unsolicited sales calls to its customers.
NY Times:
- Alltel has agreed to spin off its fixed-line unit and merge it with Valor Communications in a transaction worth $9.1 billion as it tries to focus on its cellular phone business.
Washington Post:
- French Prime Minister Dominique de Villepin says the timetable for withdrawal of international forces from Iraq should be determined by conditions in the country in order to avoid chaos.
Globe and Mail:
- Research In Motion can avoid losing access to the US market for its BlackBerry e-mail device with a single payment.
Interfax:
- Russia’s government today condemned Iranian President Mahmoud Ahmadinejad’s comments that Europe should host a state of Israel on its soil because of the genocide committed against Jews by the Nazis.
Boersen-Zeitung:
- JPMorgan Chase may make further acquisitions to strengthen its US retail business, citing an interview with the chief economist at JPMorgan.
- Merck, turning to its public health roots, plans to introduce the first cervical cancer vaccine in an attempt to revive its sales.
- French industrial production fell by the most in more than six years in October as output of cars dropped, suggesting Europe’s third-largest economy may be faltering yet again.
- Intel’s sales forecast disappointed investors and signaled the world’s biggest chipmaker may be losing market share to AMD.
- Goldman Sachs, Morgan Stanley, Lehman Brothers Holdings and Bear Stearns may report combined fourth-quarter earnings of $4 billion, capping a record year fueled by trading and advising on takeovers.
- Eli Lilly, maker of the top-selling schizophrenia drug Zyprexa, forecast that 2006 earnings per share will rise 63% on expanding sales of its newest products.
- US Treasuries are falling after an industry report showed consumer confidence rose in December more than forecast, capping its biggest two-month gain since 2003.
- Crude oil is falling on signs supplies will be adequate to meet demand for winter as the first cold snap of the season moves through the northern US.
Wall Street Journal:
- The NYSE set a minimum price of almost $50,000 for the right to continue trading on its floor after the exchange concludes its acquisition of electronic-trading company Archipelago Holdings.
- Three Puerto Rican lenders, Doral Financial, R&G Financial, and First BanCorp may soon issue financial restatements, following scrutiny by the SEC.
- Anheuser-Busch has started a campaign to promote the health benefits of drinking beer.
- Virgin Atlantic founder Richard Branson and New Mexico plan to build a $200 million “spaceport” in the desert to prepare for commercial space travel.
- Viacom’s Paramount Pictures unit is preparing to bid for DreamWorks SKG, using mostly money put up by outside investors.
- US oil and drug companies may collide over House and Senate negotiations on the Republican party’s proposed $45 billion deficit-reduction bill.
- Deckers Outdoor, maker of Teva sandals and Ugg boots, will sell more different Ugg models in the hope of turning last year’s footwear fad into a permanent brand.
AP:
- Verizon Communications’ Verizon Wireless said that it has won two lawsuits against telemarketers who made unsolicited sales calls to its customers.
NY Times:
- Alltel has agreed to spin off its fixed-line unit and merge it with Valor Communications in a transaction worth $9.1 billion as it tries to focus on its cellular phone business.
Washington Post:
- French Prime Minister Dominique de Villepin says the timetable for withdrawal of international forces from Iraq should be determined by conditions in the country in order to avoid chaos.
Globe and Mail:
- Research In Motion can avoid losing access to the US market for its BlackBerry e-mail device with a single payment.
Interfax:
- Russia’s government today condemned Iranian President Mahmoud Ahmadinejad’s comments that Europe should host a state of Israel on its soil because of the genocide committed against Jews by the Nazis.
Boersen-Zeitung:
- JPMorgan Chase may make further acquisitions to strengthen its US retail business, citing an interview with the chief economist at JPMorgan.
Consumer Confidence Improves Again, Wholesale Inventory-to-Sales Ratio at Historic Low
- Preliminary Univ. of Mich. Consumer Confidence for December rose to 88.7 versus estimates of 85.0 and a reading of 81.6 in November.
- Wholesale Inventories for October rose .2% versus estimates of a .5% gain and a .6% increase in September.
- Wholesale Inventories for October rose .2% versus estimates of a .5% gain and a .6% increase in September.
BOTTOM LINE: US consumers grew more confident for a second month in December as lower gasoline prices left households with more money to spend during the holiday season. The avg. price gas fell to $2.19 last week from $3.12 right after the hurricanes hit. Moreover, hiring has rebounded back close to pre-hurricane levels and US economic growth has risen 3% or more for 10 straight quarters, the best streak since 1986. The current conditions component of the index, which is a gauge of whether or not consumers feel it is a good time to purchase big-ticket items, rose to 106.6 from 100.2 the prior month. I expect confidence to continue to improve as irrational pessimism lifts, energy prices fall and the US economy remains strong.
Sales at US wholesalers rose 1.2% in October, exceeding a gain in inventories that suggests increased production in coming months as companies try to meet demand, Bloomberg said. The inventory-to-sales ration fell to a historic low of 1.13 months versus a reading of 1.15 months in September. As companies continue to gain confidence in US economic resiliency, inventory rebuilding should help boost economic growth going forward.
Friday Watch
Late-Night Headlines
Bloomberg:
- Japan’s economy grew 1.0% in the third quarter, a slower pace than originally estimated, partly after the previous quarter’s figure was revised higher.
- OPEC, led by Saudi Arabia, is preparing to keep output close to a 25-year high as oil trades near $60 a barrel and demand peaks during the Northern Hemisphere winter.
- A NY appeals court ruled that marriage is a union between a man and a woman under the state’s Domestic Relations Law, overturning a judge’s decision in February that found the statute unconstitutional.
Financial Times:
- European investment in research and development is falling further behind the US and Japan, citing research by the European Commission and Eurostat.
Economic Daily:
- Google may choose Taiwan to base its mainframe system for its Asian markets.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on QCOM, DHR, CVS, DNA, CMX, MDT and MMM.
- Reiterated Underperform on CMOS.
Smith Barney:
- Reiterated Buy on GOOG, target $490.
Business Week:
- Shares of Expeditors International(EXPD) of Washington, a Seattle freight forwarder and customs broker, show strong momentum, rising from $50 in May to $71 on Dec. 7.
- Sonus Pharmaceuticals(SNUS) may be worth $12 a share in a year, Mark Lappe of Efficacy Capital said.
Night Trading
Asian Indices are +.25% to +1.0% on average.
S&P 500 indicated +.04%.
NASDAQ 100 indicated unch.
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
LGND/-.16
MATK/.10
Upcoming Splits
CDIS 2-for-1
TXU 2-for-1
Economic Releases
9:45 am EST
- Preliminary Univ. of Mich. Consumer Confidence for December is estimated to rise to 85.0 versus a reading of 81.6 in November.
10:00 am EST
- Wholesale Inventories for October are estimated to rise .5% versus a .6% increase in September.
Bloomberg:
- Japan’s economy grew 1.0% in the third quarter, a slower pace than originally estimated, partly after the previous quarter’s figure was revised higher.
- OPEC, led by Saudi Arabia, is preparing to keep output close to a 25-year high as oil trades near $60 a barrel and demand peaks during the Northern Hemisphere winter.
- A NY appeals court ruled that marriage is a union between a man and a woman under the state’s Domestic Relations Law, overturning a judge’s decision in February that found the statute unconstitutional.
Financial Times:
- European investment in research and development is falling further behind the US and Japan, citing research by the European Commission and Eurostat.
Economic Daily:
- Google may choose Taiwan to base its mainframe system for its Asian markets.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on QCOM, DHR, CVS, DNA, CMX, MDT and MMM.
- Reiterated Underperform on CMOS.
Smith Barney:
- Reiterated Buy on GOOG, target $490.
Business Week:
- Shares of Expeditors International(EXPD) of Washington, a Seattle freight forwarder and customs broker, show strong momentum, rising from $50 in May to $71 on Dec. 7.
- Sonus Pharmaceuticals(SNUS) may be worth $12 a share in a year, Mark Lappe of Efficacy Capital said.
Night Trading
Asian Indices are +.25% to +1.0% on average.
S&P 500 indicated +.04%.
NASDAQ 100 indicated unch.
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
LGND/-.16
MATK/.10
Upcoming Splits
CDIS 2-for-1
TXU 2-for-1
Economic Releases
9:45 am EST
- Preliminary Univ. of Mich. Consumer Confidence for December is estimated to rise to 85.0 versus a reading of 81.6 in November.
10:00 am EST
- Wholesale Inventories for October are estimated to rise .5% versus a .6% increase in September.
BOTTOM LINE: Asian indices are higher, boosted by Financial shares in the region. I expect US equities to open mixed and to rally modestly into the afternoon, finishing mixed-to-higher. The Portfolio is 100% net long heading into the day.
Thursday, December 08, 2005
Stocks Finish Modestly Lower on Late-day Rebound
Indices
S&P 500 1,255.84 -.12%
DJIA 10,755.12 -.52%
NASDAQ 2,246.46 -.25%
Russell 2000 685.22 +.32%
DJ Wilshire 5000 12,579.40 -.01%
S&P Barra Growth 601.10 -.22%
S&P Barra Value 650.39 -.03%
Morgan Stanley Consumer 589.61 -.30%
Morgan Stanley Cyclical 777.47 -.14%
Morgan Stanley Technology 528.86 -.59%
Transports 4,082.59 -.69%
Utilities 406.58 +1.37%
Put/Call .99 +26.92%
NYSE Arms 1.16 +11.74%
Volatility(VIX) 12.21 +.25%
ISE Sentiment 196.00 +.51%
US Dollar 91.26 -.69%
CRB 330.44 +1.78%
Futures Spot Prices
Crude Oil 61.03 +.61%
Unleaded Gasoline 164.30 +1.01%
Natural Gas 15.42 +2.88%
Heating Oil 180.50 +1.22%
Gold 524.10 +.27%
Base Metals 152.95 +.04%
Copper 202.65 -.17%
10-year US Treasury Yield 4.46% -1.05%
Leading Sectors
Oil Service +3.44%
Energy +1.81%
Gold & Silver +1.80%
Lagging Sectors
Restaurants -1.16%
Steel -1.20%
Semis -1.71%
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 PFE and WON.
- Upgraded MEH to Outperform.
Afternoon/Evening Headlines
Bloomberg:
- The US House passed a $56.6 billion budget measure that extends past 2008 a 15% tax rate on dividends and most capital gains.
- Intel said fourth-quarter sales will rise to a record $10.4 billion to $10.6 billion, within previous forecasts, as consumers buy laptops for holiday gifts.
- Commuters driving into Manhattan will be required to carry at least three passengers during certain hours and taxis will have to pick up multiple riders under New York City’s plan for handling a possible transit strike.
- Crude oil rose a second day and natural gas reached a record as cold weather in the northern US bolsters heating-fuel demand.
- Electronic Arts will buy Jamdat Mobile for $680 million to expand its share of the $1 billion market for cell-phone games.
Financial Times:
- BP Plc, Europe’s largest oil company, has been referred for “criminal action” in the US in connection with an explosion at its Texas City refinery.
AP:
- US life expectancy has reached 77.6 years, a record high, citing a National Center for Health Statistics report.
Chronicle of Higher Education:
- US universities awarded 3.4% more doctorates in 2004, the biggest one-year increase in 12 years.
- Former presidents Bill Clinton and George H.W. Bush said a relief fund they organized raised $90 million in education grants, and $30 million will go to colleges and universities that were devastated by Hurricane Katrina.
S&P 500 1,255.84 -.12%
DJIA 10,755.12 -.52%
NASDAQ 2,246.46 -.25%
Russell 2000 685.22 +.32%
DJ Wilshire 5000 12,579.40 -.01%
S&P Barra Growth 601.10 -.22%
S&P Barra Value 650.39 -.03%
Morgan Stanley Consumer 589.61 -.30%
Morgan Stanley Cyclical 777.47 -.14%
Morgan Stanley Technology 528.86 -.59%
Transports 4,082.59 -.69%
Utilities 406.58 +1.37%
Put/Call .99 +26.92%
NYSE Arms 1.16 +11.74%
Volatility(VIX) 12.21 +.25%
ISE Sentiment 196.00 +.51%
US Dollar 91.26 -.69%
CRB 330.44 +1.78%
Futures Spot Prices
Crude Oil 61.03 +.61%
Unleaded Gasoline 164.30 +1.01%
Natural Gas 15.42 +2.88%
Heating Oil 180.50 +1.22%
Gold 524.10 +.27%
Base Metals 152.95 +.04%
Copper 202.65 -.17%
10-year US Treasury Yield 4.46% -1.05%
Leading Sectors
Oil Service +3.44%
Energy +1.81%
Gold & Silver +1.80%
Lagging Sectors
Restaurants -1.16%
Steel -1.20%
Semis -1.71%
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 PFE and WON.
- Upgraded MEH to Outperform.
Afternoon/Evening Headlines
Bloomberg:
- The US House passed a $56.6 billion budget measure that extends past 2008 a 15% tax rate on dividends and most capital gains.
- Intel said fourth-quarter sales will rise to a record $10.4 billion to $10.6 billion, within previous forecasts, as consumers buy laptops for holiday gifts.
- Commuters driving into Manhattan will be required to carry at least three passengers during certain hours and taxis will have to pick up multiple riders under New York City’s plan for handling a possible transit strike.
- Crude oil rose a second day and natural gas reached a record as cold weather in the northern US bolsters heating-fuel demand.
- Electronic Arts will buy Jamdat Mobile for $680 million to expand its share of the $1 billion market for cell-phone games.
Financial Times:
- BP Plc, Europe’s largest oil company, has been referred for “criminal action” in the US in connection with an explosion at its Texas City refinery.
AP:
- US life expectancy has reached 77.6 years, a record high, citing a National Center for Health Statistics report.
Chronicle of Higher Education:
- US universities awarded 3.4% more doctorates in 2004, the biggest one-year increase in 12 years.
- Former presidents Bill Clinton and George H.W. Bush said a relief fund they organized raised $90 million in education grants, and $30 million will go to colleges and universities that were devastated by Hurricane Katrina.
BOTTOM LINE: The Portfolio finished slightly higher today on gains in my Internet longs, Retail longs and Semi longs. I did not trade in the afternoon, thus leaving the Portfolio 100% net long. The tone of the market was neutral today as the advance/decline line finished about unchanged, sector performance was mixed and volume was above average. Measures of investor anxiety were mostly higher into the close. Overall, the bears get the win today, but they can't feel very good about the underlying action. The Russell 2000 closed higher, the S&P 500 was barely down, the A/D line was almost unchanged, Google (GOOG) traded 6 points higher and the homebuilders/retailers were both higher. This comes on a day when natural gas exceeded $15. If natural gas is in a final blow-off move higher, which I suspect, some more temporary weakness in equities is possible. However, I still expect any near-term weakness to be shallow and short-lived.
***Alert***
Due to a scheduling conflict I am unable to post the Mid-day Scoreboard. I am back to 100% net long and expect stocks to trade mixed-to-higher from current levels into the close.
Today's Headlines
Bloomberg:
- Japan’s government extended the deployment of its troops in Iraq for one year, Transport Minister Kitagawa said.
- Donald Trump is planning to build a $1 billion seaside resort complex in Israel, Yediot Aharonat said, citing Israel’s consul-general in Miami.
- Bill Gross, who manages the world’s biggest bond fun, told CNBC that the Fed will drop the word “accommodation” from its statement next week when it raises its benchmark interest rate.
- Crude oil is rising and natural gas surged to a record as cold weather in the northern US bolsters heating-fuel demand and refiners try to increase production.
- The US dollar is falling the most in eight days against the yen and the euro after Japanese and European policy makers suggested they will raise borrowing costs.
- US Treasuries are rising amid optimism that the Fed may stop raising interest rates early next year.
- Qualcomm raised its forecast after a surge in holiday sales of phones that surf the Internet and download music.
- Chevron plans to increase capital spending next year by 35% to $14.8 billion to boost production.
Wall Street Journal:
- Cisco Systems is seeking to benefit by supplying equipment that moves video from the Internet to the home, citing CEO Chambers.
- US physicians are taking part in a growing debate over whether the increased use of feeding tubes for elderly patients and the terminally ill should be curtailed.
- Merrill Lynch intends to remove its name from mutual funds and other money-management items offered to small US investors, to encourage rival brokers to start selling the products.
- New satellite-radio receivers that mimic Apple Computer iPods in their ability to store and organize hundreds of songs may threaten the music industry’s attempts to protect copyrights and royalties.
- The US Congress and the Bush administration should make cutting or eliminating the 15% maximum tax on savings their top priority among changes to the tax code, Martin Feldstein wrote. Feldstein, chairman of the Council of Economic Advisors under President Reagan, said taxing income from savings is unfair because it charges people twice if they postpone spending.
USA Today:
- More African Americans in the US are participating in a migration toward southern states as they retire, spurred by increasing wealth and rising home ownership.
NY Times:
- Anthony D. Romero, the executive director of the ACLU, has been accused of ignoring the group’s principles such as dissent and free speech, as he increased fund raising efforts. An “unusual” number of board members have resigned since Romero took over 4 days before 9/11.
Guardian:
- Harold Pinter, the winner of the 2005 Nobel Prize for literature, devoted the bulk of his Nobel lecture to a denunciation of the United State’s role in the world for the past 50 years.
- Japan’s government extended the deployment of its troops in Iraq for one year, Transport Minister Kitagawa said.
- Donald Trump is planning to build a $1 billion seaside resort complex in Israel, Yediot Aharonat said, citing Israel’s consul-general in Miami.
- Bill Gross, who manages the world’s biggest bond fun, told CNBC that the Fed will drop the word “accommodation” from its statement next week when it raises its benchmark interest rate.
- Crude oil is rising and natural gas surged to a record as cold weather in the northern US bolsters heating-fuel demand and refiners try to increase production.
- The US dollar is falling the most in eight days against the yen and the euro after Japanese and European policy makers suggested they will raise borrowing costs.
- US Treasuries are rising amid optimism that the Fed may stop raising interest rates early next year.
- Qualcomm raised its forecast after a surge in holiday sales of phones that surf the Internet and download music.
- Chevron plans to increase capital spending next year by 35% to $14.8 billion to boost production.
Wall Street Journal:
- Cisco Systems is seeking to benefit by supplying equipment that moves video from the Internet to the home, citing CEO Chambers.
- US physicians are taking part in a growing debate over whether the increased use of feeding tubes for elderly patients and the terminally ill should be curtailed.
- Merrill Lynch intends to remove its name from mutual funds and other money-management items offered to small US investors, to encourage rival brokers to start selling the products.
- New satellite-radio receivers that mimic Apple Computer iPods in their ability to store and organize hundreds of songs may threaten the music industry’s attempts to protect copyrights and royalties.
- The US Congress and the Bush administration should make cutting or eliminating the 15% maximum tax on savings their top priority among changes to the tax code, Martin Feldstein wrote. Feldstein, chairman of the Council of Economic Advisors under President Reagan, said taxing income from savings is unfair because it charges people twice if they postpone spending.
USA Today:
- More African Americans in the US are participating in a migration toward southern states as they retire, spurred by increasing wealth and rising home ownership.
NY Times:
- Anthony D. Romero, the executive director of the ACLU, has been accused of ignoring the group’s principles such as dissent and free speech, as he increased fund raising efforts. An “unusual” number of board members have resigned since Romero took over 4 days before 9/11.
Guardian:
- Harold Pinter, the winner of the 2005 Nobel Prize for literature, devoted the bulk of his Nobel lecture to a denunciation of the United State’s role in the world for the past 50 years.
Initial Jobless Claims Rise Modestly
- Initial Jobless Claims for last week rose to 327K versus estimates of 318K and 321K the prior week.
- Continuing Claims fell to 2603K versus estimates of 2745K and 2740K prior.
- Continuing Claims fell to 2603K versus estimates of 2745K and 2740K prior.
BOTTOM LINE: The number of Americans filing first-time claims for unemployment benefits unexpectedly rose last week as delayed filing from the Thanksgiving week inflated the tally, Bloomberg said. The total number of people collecting benefits dropped by the most in almost a year. The four-week moving average of jobless claims fell to 322,500 from 322,750. The unemployment rate among those able to receive benefits, which follows the US unemployment rate, fell to 2.0% from 2.1%. I continue to believe the labor market will remain healthy, but fail to tighten to the extent as to boost unit labor costs, the largest component of inflation, substantially.
Thursday Watch
Late-Night Headlines
Bloomberg:
- Sony Corp. had its debt rating cut one level to A2 by Moody’s Inventors Service.
Chicago Tribune:
- Chicago’s city council today approved an ordinance that will ban smoking in all public places in the city, including restaurants, bars and sports venues, within three years.
Reuters:
- Worldwide DVD movie sales are probably nearing their peak as customer interest in downloads and video-on-demand rises.
Kyodo News:
- Japan’s government will today announce a one-year extension of the deployment of its troops in Iraq.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on KO.
- Reiterated Underperform on TXN.
Smith Barney:
- Upgraded PLAY to Buy, target $36.
Night Trading
Asian Indices are -1.25% to -.25% on average.
S&P 500 indicated -.21%.
NASDAQ 100 indicated -.26%.
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
CIEN/-.03
COST/.45
FLE/.00
CMOS/-.02
ESL/.56
NSM/.28
TOL/.65
Upcoming Splits
CDIS 2-for-1
TXU 2-for-1
Economic Releases
8:30 am EST
- Initial Jobless Claims for last week are estimated to fall to 318K versus 320K the prior week.
- Continuing Claims are estimated to fall to 2745K versus 2767K prior.
Bloomberg:
- Sony Corp. had its debt rating cut one level to A2 by Moody’s Inventors Service.
Chicago Tribune:
- Chicago’s city council today approved an ordinance that will ban smoking in all public places in the city, including restaurants, bars and sports venues, within three years.
Reuters:
- Worldwide DVD movie sales are probably nearing their peak as customer interest in downloads and video-on-demand rises.
Kyodo News:
- Japan’s government will today announce a one-year extension of the deployment of its troops in Iraq.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on KO.
- Reiterated Underperform on TXN.
Smith Barney:
- Upgraded PLAY to Buy, target $36.
Night Trading
Asian Indices are -1.25% to -.25% on average.
S&P 500 indicated -.21%.
NASDAQ 100 indicated -.26%.
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
CIEN/-.03
COST/.45
FLE/.00
CMOS/-.02
ESL/.56
NSM/.28
TOL/.65
Upcoming Splits
CDIS 2-for-1
TXU 2-for-1
Economic Releases
8:30 am EST
- Initial Jobless Claims for last week are estimated to fall to 318K versus 320K the prior week.
- Continuing Claims are estimated to fall to 2745K versus 2767K prior.
BOTTOM LINE: Asian indices are lower, dragged down by Financial shares in the region. I expect US equities to open lower and to rally modestly into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.
Wednesday, December 07, 2005
Stocks Close Modestly Lower After Late-day Rally
Indices
S&P 500 1,257.37 -.50%
DJIA 10,810.91 -.42%
NASDAQ 2,252.01 -.39%
Russell 2000 683.01 -.66%
DJ Wilshire 5000 12,581.10 -.50%
S&P Barra Growth 602.42 -.41%
S&P Barra Value 650.57 -.59%
Morgan Stanley Consumer 591.36 -.30%
Morgan Stanley Cyclical 778.57 -.73%
Morgan Stanley Technology 532.00 -.35%
Transports 4,110.25 -.44%
Utilities 401.09 -.74%
Put/Call .78 unch.
NYSE Arms 1.03 +26.08%
Volatility(VIX) 12.18 +5.73%
ISE Sentiment 195.00 +4.28%
US Dollar 91.89 +.49%
CRB 324.66 +.11%
Futures Spot Prices
Crude Oil 59.08 -.22%
Unleaded Gasoline 156.53 -.15%
Natural Gas 13.78 +.58%
Heating Oil 173.40 -.15%
Gold 518.70 +.17%
Base Metals 152.89 +1.18%
Copper 202.80 -.17%
10-year US Treasury Yield 4.51% +.70%
Leading Sectors
Gold & Silver +1.91%
Airlines .43%
Retail +.21%
Lagging Sectors
Semis -1.19%
HMOs -1.55%
Homebuilders -2.33%
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 NUE and FRNT.
- Reiterated Underperform on CR.
Afternoon/Evening Headlines
Bloomberg:
- Gold prices in NY rose to a 24-year high, climbing for the seventh time in eight sessions, as international fund managers seek to diversify from currencies, stocks and bonds.
- Gannett, the largest US newspaper company, predicted lackluster growth in advertising revenue next year, in line with other publishers.
- Resolution of the Israeli-Palestinian conflict has dropped to seventh place from second among concerns cited by Arabs in six countries, as domestic economic and social issues gain attention, according to a survey released today by the Arab American Institute.
- The US House of Representatives passed a measure that would spare 15 million households from a $30 billion alternative minimum tax increase next year.
- Guidant, which has an agreement to be acquired by Johnson & Johnson, said it is ready to negotiate with Boston Scientific on an unsolicited proposal to buy Guidant for $25 billion.
- Borrowing by US consumers unexpectedly fell in October as credit card debt and new car loans declined.
- A US air marshal fired at a passenger in a jetway outside American Airlines Flight 924 in Miami, after the passenger said a carry-on bag held a bomb.
- Texas Instruments said profit this quarter will be at the high end of its forecast on higher holiday demand.
Automotive News:
- GM has asked Jerome York, a representative of billionaire investor Kirk Kerkorian, to join the company’s board.
RPP:
- Peru and the US reached an agreement for a free-trade accord after 18 months of negotiations.
S&P 500 1,257.37 -.50%
DJIA 10,810.91 -.42%
NASDAQ 2,252.01 -.39%
Russell 2000 683.01 -.66%
DJ Wilshire 5000 12,581.10 -.50%
S&P Barra Growth 602.42 -.41%
S&P Barra Value 650.57 -.59%
Morgan Stanley Consumer 591.36 -.30%
Morgan Stanley Cyclical 778.57 -.73%
Morgan Stanley Technology 532.00 -.35%
Transports 4,110.25 -.44%
Utilities 401.09 -.74%
Put/Call .78 unch.
NYSE Arms 1.03 +26.08%
Volatility(VIX) 12.18 +5.73%
ISE Sentiment 195.00 +4.28%
US Dollar 91.89 +.49%
CRB 324.66 +.11%
Futures Spot Prices
Crude Oil 59.08 -.22%
Unleaded Gasoline 156.53 -.15%
Natural Gas 13.78 +.58%
Heating Oil 173.40 -.15%
Gold 518.70 +.17%
Base Metals 152.89 +1.18%
Copper 202.80 -.17%
10-year US Treasury Yield 4.51% +.70%
Leading Sectors
Gold & Silver +1.91%
Airlines .43%
Retail +.21%
Lagging Sectors
Semis -1.19%
HMOs -1.55%
Homebuilders -2.33%
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 NUE and FRNT.
- Reiterated Underperform on CR.
Afternoon/Evening Headlines
Bloomberg:
- Gold prices in NY rose to a 24-year high, climbing for the seventh time in eight sessions, as international fund managers seek to diversify from currencies, stocks and bonds.
- Gannett, the largest US newspaper company, predicted lackluster growth in advertising revenue next year, in line with other publishers.
- Resolution of the Israeli-Palestinian conflict has dropped to seventh place from second among concerns cited by Arabs in six countries, as domestic economic and social issues gain attention, according to a survey released today by the Arab American Institute.
- The US House of Representatives passed a measure that would spare 15 million households from a $30 billion alternative minimum tax increase next year.
- Guidant, which has an agreement to be acquired by Johnson & Johnson, said it is ready to negotiate with Boston Scientific on an unsolicited proposal to buy Guidant for $25 billion.
- Borrowing by US consumers unexpectedly fell in October as credit card debt and new car loans declined.
- A US air marshal fired at a passenger in a jetway outside American Airlines Flight 924 in Miami, after the passenger said a carry-on bag held a bomb.
- Texas Instruments said profit this quarter will be at the high end of its forecast on higher holiday demand.
Automotive News:
- GM has asked Jerome York, a representative of billionaire investor Kirk Kerkorian, to join the company’s board.
RPP:
- Peru and the US reached an agreement for a free-trade accord after 18 months of negotiations.
BOTTOM LINE: The Portfolio finished unchanged today as gains in my Airline longs, Medical longs and Retail longs offset losses in my Semi longs and Internet longs. I did not trade in the afternoon, 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 about average. Measures of investor anxiety were mostly higher into the close. Overall, today's action was disappointing for the bulls. The major averages and breadth are finishing lower despite the fall in oil. Jitters over the housing market, increased terrorism fears and a bounce in long-term rates were the culprits. On the positive side, the bears were unable to gain substantial traction. Moreover, the retail index is actually positive on the day. It appears as though more choppy action is necessary before another push higher. I sense a lack of conviction in the bearish community as their main arguments become harder and harder to make.
Subscribe to:
Posts (Atom)