S&P 500 1,121.30 +.69%
NASDAQ 1,858.56 +.76%
Leading Sectors
Homebuilders +3.45%
I-Banks +2.69%
Disk Drives +2.38%
Lagging Sectors
Restaurants -.45%
Oil Service -1.10%
Semis -1.14%
Other
Crude Oil 43.17 -.32%
Natural Gas 4.87 +1.77%
Gold 400.10 +.18%
Base Metals 106.80 +1.07%
U.S. Dollar 89.23 -.37%
10-Yr. T-note Yield 4.24% -1.23%
VIX 14.07 +1.15%
Put/Call .85 -16.67%
NYSE Arms .95 -5.0%
After-hours Movers
MYL +4.27% after saying billionaire Carl Icahn holds a 6.8% stake and plans to oppose the company's purchase of King Pharmaceuticals.
CYMI +4.79% on bargain-hunting after reiterated 3Q outlook.
MAMA +10.65% after announcing a 600,000 share buyback.
MCK -7.32% after lowering 1st half outlook and maintaining full-year guidance.
TLAB +14.04% after reducing its takeover offer for AFCI to $1.5 billion.
Recommendations
Goldman Sachs reiterated Outperform on EMC, DIS, UST, FSL, STZ and KO.
After-hours News
U.S. stocks rose today, pushing the S&P 500 to a two-month high, as falling oil prices, declining interest rates and pro-business political rhetoric boosted investor optimism. After the close, Costco Wholesale Corp. plans to open its first Australian store next year, the Australian Financial Review reported. Amvescap Plc's U.S. mutual-fund units, Invesco Funds Group and AIM Investments, reached a $450 million settlement with federal and state complaints of improper trading, Bloomberg said. Neiman Marcus Group said 4th quarter earnings almost tripled as shoppers bought more designer dresses and handbags, Bloomberg said. Coach, the largest U.S. seller of luxury-leather goods, said 1Q earning will beat analyst expectations, Bloomberg said. Prudential Financial's Ed Yardeni, one of the most bullish strategists on Wall Street, left the firm to join Oak Associates, a money manager that overseas more than $8 billion. Republican Senator McCain and Democratic Senator Lieberman introduced a bill to implement the findings of the panel that investigated the 9/11 terrorist attacks, including the appointment of a national intelligence director, Bloomberg reported. Tyco International said it repurchased $350 million of convertible bonds and will take a charge of about $167 million in the fiscal fourth quarter for the purchase as it works to reduce net debt to $10 billion, Bloomberg reported.
BOTTOM LINE: The Portfolio finished substantially higher today as my gaming, internet, telecom equipment and homebuilding longs rose. I took profits in a few of my retail and restaurant longs and added a few technology longs in the afternoon, thus leaving the Portfolio 125% net long. One of my new longs is OSTK and I am using a $31 stop-loss on this position. The overall tone of the market was pretty good today as afternoon profit-taking proved fleeting, most sectors rose, volume improved and small-caps outperformed. Greenspan's upcoming comments should further boost investor optimism for accelerating U.S. economic growth.
Tuesday, September 07, 2004
Mid-day Update
S&P 500 1,122.34 +.78%
NASDAQ 1,863.61 +1.04%
Leading Sectors
Disk Drives +2.89%
Homebuilders +2.71%
I-Banks +2.28%
Lagging Sectors
Energy -.37%
Restaurants -.45%
Oil Service -1.05%
Other
Crude Oil 42.93 -2.41%
Natural Gas 4.75 +1.60%
Gold 401.00 -.37%
Base Metals 106.80 +1.07%
U.S. Dollar 89.35 -.23%
10-Yr. T-note Yield 4.26% -.77%
VIX 14.24 +2.37%
Put/Call .90 -11.76%
NYSE Arms 1.04 +4.0%
Market Movers
NFLX +16.6% after Newsweek reported that it entered an agreement with TiVo to let customers download movies into TiVo's digital video recorders.
RIMM +4.47% after announcing plans to enable BlackBerry Connect on Symbian OS-based devices, such as the Nokia 9500 Communicator.
TZOO +14.2% on short-squeeze.
FLE +11.9% after beating 1Q earnings estimates but missing its sales forecast.
CEPH +4.6% after saying it received a subpoena from U.S. prosecutors in Philadelphia for documents relating to sales and marketing practices from 1998 to the present.
PXD -4.6% after lowering its 3Q production forecast after hurricanes Charley and Earl forced worker evacuations and the company shut output at a Gulf of Mexico field.
HOV +7.7% after beating 3Q forecast and raising 05 outlook.
*Homebuilders up across the board on HOV report and falling interest rates.
Economic Data
None of note.
Recommendations
Goldman Sachs reiterated Underperform on PYX, LVLT, VRSN and T. Goldman reiterated Outperform on AIG, ASN, FD, IGT, FS, HOT, FDC, CZN, UST and ALL. Citi SmithBarney reiterated Buy on GE, target $38. OSG raised to Overweight at JP Morgan. GMR raised to Overweight at JP Morgan. SNIC rated Overweight at JP Morgan. ATRS raised to raised to Outperform at CSFB, target $30. CSCO raised to Sector Outperform at CIBC, target $25.
Mid-day News
U.S. stocks are higher mid-day on optimism over falling energy prices, declining interest rates and pro-business political rhetoric. The U.S. Navy is proposing cuts in its shipbuilding program that may hurt the industry, as the Pentagon considers shifting the military's focus from preparing for large-scale warfare to building resources for guerrilla warfare, long-term peacekeeping and counter-terrorism efforts, the Washington Post reported. Denver billionaire Philip Anschutz hired Frederick Anderson and Ryan McKibben to help study potential acquisitions among U.S. weekly or daily newspapers, the Denver Post reported. Disney's ABC broadcast network is experimenting with "ABC News Now," a 24-hour news broadcast available on the Internet, mobile phones and digital tv, the AP reported. Several pharmaceutical companies are participating in a $3 million pilot project to test a system for tracking and identifying prescription drug battles using radio frequency identification devices, the Boston Herald reported. Frank Quattrone, who earned $120 million at the height of the stock market bubble as Credit Suisse First Boston's top investment banker for technology companies, may receive 21 months in prison, Bloomberg reported. Hurricane Ivan, the fifth Atlantic hurricane this year, was racing west toward Trinidad, Tobago and other Caribbean islands on a track that's expected to take it past Cuba to the edge of the Gulf of Mexico by the weekend, Bloomberg reported. More than 2.5 million Floridians are still without power as of 9am local time as a result of Hurricane Frances, according to Florida's Emergency Management Department. Crude oil futures in New York are falling after Hurricane Frances missed U.S. offshore production facilities in the Gulf of Mexico, Bloomberg reported.
BOTTOM LINE: The Portfolio is substantially higher mid-day as my security, gaming, telecom equipment and internet longs are rising. I have not traded and the Portfolio is 125% net long. The overall tone of the market is good today. Interest rates are falling, oil and gasoline prices are declining, the CRB is dropping and the VIX/Arms are rising, which are all positives for stocks. While the CRB briefly broke below its 200-day moving average a couple of times over the last few months, it appears headed for a more substantial technical breakdown. This would be a very positive development with respect to future inflation readings. Commodity prices have been the main source of exaggerated inflation fears. I expect U.S. stocks to rise modestly into the close.
NASDAQ 1,863.61 +1.04%
Leading Sectors
Disk Drives +2.89%
Homebuilders +2.71%
I-Banks +2.28%
Lagging Sectors
Energy -.37%
Restaurants -.45%
Oil Service -1.05%
Other
Crude Oil 42.93 -2.41%
Natural Gas 4.75 +1.60%
Gold 401.00 -.37%
Base Metals 106.80 +1.07%
U.S. Dollar 89.35 -.23%
10-Yr. T-note Yield 4.26% -.77%
VIX 14.24 +2.37%
Put/Call .90 -11.76%
NYSE Arms 1.04 +4.0%
Market Movers
NFLX +16.6% after Newsweek reported that it entered an agreement with TiVo to let customers download movies into TiVo's digital video recorders.
RIMM +4.47% after announcing plans to enable BlackBerry Connect on Symbian OS-based devices, such as the Nokia 9500 Communicator.
TZOO +14.2% on short-squeeze.
FLE +11.9% after beating 1Q earnings estimates but missing its sales forecast.
CEPH +4.6% after saying it received a subpoena from U.S. prosecutors in Philadelphia for documents relating to sales and marketing practices from 1998 to the present.
PXD -4.6% after lowering its 3Q production forecast after hurricanes Charley and Earl forced worker evacuations and the company shut output at a Gulf of Mexico field.
HOV +7.7% after beating 3Q forecast and raising 05 outlook.
*Homebuilders up across the board on HOV report and falling interest rates.
Economic Data
None of note.
Recommendations
Goldman Sachs reiterated Underperform on PYX, LVLT, VRSN and T. Goldman reiterated Outperform on AIG, ASN, FD, IGT, FS, HOT, FDC, CZN, UST and ALL. Citi SmithBarney reiterated Buy on GE, target $38. OSG raised to Overweight at JP Morgan. GMR raised to Overweight at JP Morgan. SNIC rated Overweight at JP Morgan. ATRS raised to raised to Outperform at CSFB, target $30. CSCO raised to Sector Outperform at CIBC, target $25.
Mid-day News
U.S. stocks are higher mid-day on optimism over falling energy prices, declining interest rates and pro-business political rhetoric. The U.S. Navy is proposing cuts in its shipbuilding program that may hurt the industry, as the Pentagon considers shifting the military's focus from preparing for large-scale warfare to building resources for guerrilla warfare, long-term peacekeeping and counter-terrorism efforts, the Washington Post reported. Denver billionaire Philip Anschutz hired Frederick Anderson and Ryan McKibben to help study potential acquisitions among U.S. weekly or daily newspapers, the Denver Post reported. Disney's ABC broadcast network is experimenting with "ABC News Now," a 24-hour news broadcast available on the Internet, mobile phones and digital tv, the AP reported. Several pharmaceutical companies are participating in a $3 million pilot project to test a system for tracking and identifying prescription drug battles using radio frequency identification devices, the Boston Herald reported. Frank Quattrone, who earned $120 million at the height of the stock market bubble as Credit Suisse First Boston's top investment banker for technology companies, may receive 21 months in prison, Bloomberg reported. Hurricane Ivan, the fifth Atlantic hurricane this year, was racing west toward Trinidad, Tobago and other Caribbean islands on a track that's expected to take it past Cuba to the edge of the Gulf of Mexico by the weekend, Bloomberg reported. More than 2.5 million Floridians are still without power as of 9am local time as a result of Hurricane Frances, according to Florida's Emergency Management Department. Crude oil futures in New York are falling after Hurricane Frances missed U.S. offshore production facilities in the Gulf of Mexico, Bloomberg reported.
BOTTOM LINE: The Portfolio is substantially higher mid-day as my security, gaming, telecom equipment and internet longs are rising. I have not traded and the Portfolio is 125% net long. The overall tone of the market is good today. Interest rates are falling, oil and gasoline prices are declining, the CRB is dropping and the VIX/Arms are rising, which are all positives for stocks. While the CRB briefly broke below its 200-day moving average a couple of times over the last few months, it appears headed for a more substantial technical breakdown. This would be a very positive development with respect to future inflation readings. Commodity prices have been the main source of exaggerated inflation fears. I expect U.S. stocks to rise modestly into the close.
Monday, September 06, 2004
Tuesday Watch
Earnings of Note
Company/Estimate
CEN/.19
UTIW/.44
NMG/B/.36
HOV/1.35
Splits
RIO 3-for-1
TCB 2-for-1
GILD 2-for-1
Economic Data
None of note.
Weekend Recommendations
Louis Rukeyser's Wall Street had guests that were positive on HAL, NE, MSFT, RIG, GS, LXK, DNR, MNT, ISCA, YDNT and DRCT. Wall St. Week w/Fortune had guests that were positive on EDMC, BAC, PFE and WAT. Barron's had positive columns on IGT, VSEA, SMMX, LF, IMAX and negative columns on CAKE and CDN. Goldman Sachs reiterated Outperform on UDR, EBAY, SYMC, MERQ and ASN. Goldman reiterated Underperform on PBG. Byte and Switch has a positive article on Storage Networking.
Weekend News
Bank of China, the country's second-biggest lender, may choose Citibank and JP Morgan Chase as its strategic investors ahead of an IPO to overseas investors, the 21st Century Business Herald reported. OPEC is pumping at near capacity and providing oil that exceeds oil market demand, the Qatari Oil Minister told al-Hayat. Izzat Ibrahim al-Duri, Iraq's second in command under former President Saddam Hussein, was captured by Iraqi defense officials, al-Arabiya reported. Netflix and TiVo plan to announce an agreement where customers can download Netflix movies onto TiVo recorders, Newsweek reported. China's annual demand for gold may triple after the country deregulates its market of the precious metal, China Daily said. Saddam Hussein and other leaders of his ousted regime will face trial within a matter of weeks, the AP said. The online gambling industry is growing rapidly, fueled by the popularity of televised poker tournaments, the Washington Post reported. 9 in 10 American workers find their job at least somewhat satisfying, according to an AP survey. U.S. tv networks such as CBS and NBC are working to increase product-placement advertising in shows to counter falling ratings and new technology that allows viewers to skip commercials, the NY Times reported. U.S. companies are ranked first in a global survey of corporate governance standards, beating Canada and the U.K. for the first time, the Financial Times reported. Afghanistan's presidential election campaign begins today in preparation for voting Oct. 9 when 17 candidates will challenge President Karzai in the country's first nationwide election, the BBC reported. President Bush leads Senator Kerry by 11 percentage points, receiving a 13 point bounce, according to a poll conducted after the Republican National Convention, Newsweek reported. Tradesports.com is now showing a 61% chance of Bush's re-election versus 49% during the Democratic Convention. Russian President Putin vowed to strengthen his security forces to combat terrorism, as the number of dead from the school siege increased to at least 323, almost half of them children, Bloomberg reported. Capital spending in Japan rose 10.7% from a year earlier, prompting economists to raise their estimates for growth in the world's second-largest economy, Bloomberg reported. Former President Clinton, in a 90-minute telephone call from his hospital bed, gave Senator Kerry advice on how to revive his campaign, the NY Times reported. Wal-Mart said September sales are rising 2% to 4% as consumers bought more food, health and beauty products last week, Bloomberg said. Former President Clinton is recovering after undergoing successful heart bypass surgery at a NY hospital, Bloomberg reported. Crude oil futures are falling in New York after tropical storm Frances passed east of the main U.S. oil and natural gas-producing region in the Gulf of Mexico, Bloomberg said. Intel President Otellini today will outline plans for computer chips due next year that simultaneously run tasks such as burning CDs and playing video games as he seeks to allay concerns about product delays, Bloomberg said. Allstate, Ace and other insurers face $3 billion to $6 billion in losses from Hurricane Frances, a fraction of earlier estimates, after the storm weakened as it crossed Florida, storm modelers said.
Late-Night Trading
Asian indices are mixed, -.50% to +.50% on average.
S&P 500 indicated +.28%.
NASDAQ indicated +.18%.
BOTTOM LINE: I expect U.S. stocks to open higher in the morning on diminishing domestic terrorism fears, falling energy prices, pro-business political rhetoric and short-covering. The Portfolio is 125% net long heading into tomorrow.
Company/Estimate
CEN/.19
UTIW/.44
NMG/B/.36
HOV/1.35
Splits
RIO 3-for-1
TCB 2-for-1
GILD 2-for-1
Economic Data
None of note.
Weekend Recommendations
Louis Rukeyser's Wall Street had guests that were positive on HAL, NE, MSFT, RIG, GS, LXK, DNR, MNT, ISCA, YDNT and DRCT. Wall St. Week w/Fortune had guests that were positive on EDMC, BAC, PFE and WAT. Barron's had positive columns on IGT, VSEA, SMMX, LF, IMAX and negative columns on CAKE and CDN. Goldman Sachs reiterated Outperform on UDR, EBAY, SYMC, MERQ and ASN. Goldman reiterated Underperform on PBG. Byte and Switch has a positive article on Storage Networking.
Weekend News
Bank of China, the country's second-biggest lender, may choose Citibank and JP Morgan Chase as its strategic investors ahead of an IPO to overseas investors, the 21st Century Business Herald reported. OPEC is pumping at near capacity and providing oil that exceeds oil market demand, the Qatari Oil Minister told al-Hayat. Izzat Ibrahim al-Duri, Iraq's second in command under former President Saddam Hussein, was captured by Iraqi defense officials, al-Arabiya reported. Netflix and TiVo plan to announce an agreement where customers can download Netflix movies onto TiVo recorders, Newsweek reported. China's annual demand for gold may triple after the country deregulates its market of the precious metal, China Daily said. Saddam Hussein and other leaders of his ousted regime will face trial within a matter of weeks, the AP said. The online gambling industry is growing rapidly, fueled by the popularity of televised poker tournaments, the Washington Post reported. 9 in 10 American workers find their job at least somewhat satisfying, according to an AP survey. U.S. tv networks such as CBS and NBC are working to increase product-placement advertising in shows to counter falling ratings and new technology that allows viewers to skip commercials, the NY Times reported. U.S. companies are ranked first in a global survey of corporate governance standards, beating Canada and the U.K. for the first time, the Financial Times reported. Afghanistan's presidential election campaign begins today in preparation for voting Oct. 9 when 17 candidates will challenge President Karzai in the country's first nationwide election, the BBC reported. President Bush leads Senator Kerry by 11 percentage points, receiving a 13 point bounce, according to a poll conducted after the Republican National Convention, Newsweek reported. Tradesports.com is now showing a 61% chance of Bush's re-election versus 49% during the Democratic Convention. Russian President Putin vowed to strengthen his security forces to combat terrorism, as the number of dead from the school siege increased to at least 323, almost half of them children, Bloomberg reported. Capital spending in Japan rose 10.7% from a year earlier, prompting economists to raise their estimates for growth in the world's second-largest economy, Bloomberg reported. Former President Clinton, in a 90-minute telephone call from his hospital bed, gave Senator Kerry advice on how to revive his campaign, the NY Times reported. Wal-Mart said September sales are rising 2% to 4% as consumers bought more food, health and beauty products last week, Bloomberg said. Former President Clinton is recovering after undergoing successful heart bypass surgery at a NY hospital, Bloomberg reported. Crude oil futures are falling in New York after tropical storm Frances passed east of the main U.S. oil and natural gas-producing region in the Gulf of Mexico, Bloomberg said. Intel President Otellini today will outline plans for computer chips due next year that simultaneously run tasks such as burning CDs and playing video games as he seeks to allay concerns about product delays, Bloomberg said. Allstate, Ace and other insurers face $3 billion to $6 billion in losses from Hurricane Frances, a fraction of earlier estimates, after the storm weakened as it crossed Florida, storm modelers said.
Late-Night Trading
Asian indices are mixed, -.50% to +.50% on average.
S&P 500 indicated +.28%.
NASDAQ indicated +.18%.
BOTTOM LINE: I expect U.S. stocks to open higher in the morning on diminishing domestic terrorism fears, falling energy prices, pro-business political rhetoric and short-covering. The Portfolio is 125% net long heading into tomorrow.
Chart of the Week
Rydex Cash Flow Ratio
Bottom Line: The above chart illustrates one measure of investor sentiment that is currently at levels normally preceding substantial rallies.
Bottom Line: The above chart illustrates one measure of investor sentiment that is currently at levels normally preceding substantial rallies.
Weekly Outlook
There are a few important economic reports and some significant corporate earnings reports scheduled for release this week. Economic reports include Consumer Credit, Import Price Index, Initial Jobless Claims, Continuing Claims, Wholesale Inventories, Producer Price Index and Trade Balance. The Producer Price Index has market-moving potential.
Neiman Marcus Group(NMG/A), Comverse Technology(CMVT), CBRL Group(CBRL), National Semiconductor(NSM), Quiksilver(ZQK), Take-Two Interactive(TTWO) and Hovnanian(HOV) are some of the more important companies that release quarterly earnings this week. There are also a number of other events that have market-moving potential. The Lehman Brothers Energy Conference, Citi SmithBarney Tech Conference, Greenspan's testimony on the economy to the House Budget Panel, Prudential Consumer Conference, Thomas Weisel Healthcare Conference, CSFB Software Conference, Goldman Sachs Retail Conference, August Chain Store Comp Sales, Fed's Yellen speech, Fed's McTeer speech and the Raymond James Small Cap Investor's Forum could also impact trading this week.
Bottom Line: I expect U.S. stocks to finish the week higher on heavier volume as traders and investors return from vacation and boost shares on optimism over diminishing terrorism fears, pro-business political rhetoric, falling energy prices and economic data showing stabilizing sustainable growth. More nimble investors should begin building long positions over the next couple of weeks in semi/semi-equip. stocks as I believe these companies will outperform substantially during the fourth quarter. My short-term trading indicators are still giving Buy signals and the Portfolio is 125% net long heading into the week.
Neiman Marcus Group(NMG/A), Comverse Technology(CMVT), CBRL Group(CBRL), National Semiconductor(NSM), Quiksilver(ZQK), Take-Two Interactive(TTWO) and Hovnanian(HOV) are some of the more important companies that release quarterly earnings this week. There are also a number of other events that have market-moving potential. The Lehman Brothers Energy Conference, Citi SmithBarney Tech Conference, Greenspan's testimony on the economy to the House Budget Panel, Prudential Consumer Conference, Thomas Weisel Healthcare Conference, CSFB Software Conference, Goldman Sachs Retail Conference, August Chain Store Comp Sales, Fed's Yellen speech, Fed's McTeer speech and the Raymond James Small Cap Investor's Forum could also impact trading this week.
Bottom Line: I expect U.S. stocks to finish the week higher on heavier volume as traders and investors return from vacation and boost shares on optimism over diminishing terrorism fears, pro-business political rhetoric, falling energy prices and economic data showing stabilizing sustainable growth. More nimble investors should begin building long positions over the next couple of weeks in semi/semi-equip. stocks as I believe these companies will outperform substantially during the fourth quarter. My short-term trading indicators are still giving Buy signals and the Portfolio is 125% net long heading into the week.
Sunday, September 05, 2004
Market Week in Review
S&P 500 1,113.63 +.53%
Click here for the Weekly Wrap by Briefing.com.
Bottom Line: Overall, last week's market action was mixed. The S&P 500 gained for a fourth consecutive week, its longest winning streak since January, helping the benchmark erase its loss for the year. Most sectors registered gains outside of technology. Volume was 27% below this year's average as many investors and traders were on vacation. The semiconductor index, now down 36.2% from its January highs, made a new low for the year as Intel's gross margins and earnings guidance disappointed. Crude oil prices reversed on Thursday and Natural Gas prices continue to plunge. Base Metal prices are also on the verge of a technical breakdown. Notwithstanding the drops in some of the underlying commodities, commodity-related stocks led the market. Measures of investor anxiety were mixed last week, however most remained at relatively low levels. One measure of investor sentiment that stands out on the bullish side is the Rydex Cash Flow Ratio which is at levels that normally precede sharp rallies.
Click here for the Weekly Wrap by Briefing.com.
Bottom Line: Overall, last week's market action was mixed. The S&P 500 gained for a fourth consecutive week, its longest winning streak since January, helping the benchmark erase its loss for the year. Most sectors registered gains outside of technology. Volume was 27% below this year's average as many investors and traders were on vacation. The semiconductor index, now down 36.2% from its January highs, made a new low for the year as Intel's gross margins and earnings guidance disappointed. Crude oil prices reversed on Thursday and Natural Gas prices continue to plunge. Base Metal prices are also on the verge of a technical breakdown. Notwithstanding the drops in some of the underlying commodities, commodity-related stocks led the market. Measures of investor anxiety were mixed last week, however most remained at relatively low levels. One measure of investor sentiment that stands out on the bullish side is the Rydex Cash Flow Ratio which is at levels that normally precede sharp rallies.
Subscribe to:
Posts (Atom)