Mar 10, 2010

Daily Markets - Financial News And Opinions

Daily Markets - Financial News And Opinions

The Enforcement Tax

Posted: 10 Mar 2010 06:16 PM PST

It’s no secret that municipal finances are imploding under the weight of falling income, sales, and property tax revenues. Unfortunately, with no real sign of a rebound in hiring or housing prices, and with consumers saving more and spending less, there is little hope of a sudden reversal of fortunes, at least in the short-term.
So, what’s a cash-strapped municipality to do?
Why, step up collections of the enforcement tax, of course.
In Virginia Hands Out 6996 Traffic Tickets In One Weekend In … [visit site to read more]


What’s Happening Now In The Markets?

Posted: 10 Mar 2010 05:01 PM PST

Wall Street CEOs and long-only mutual fund managers may have to “tap dance through mine fields” as part of their job description - but that doesn’t mean you do.

Chuck Prince, the deposed CEO of Citigroup (NYSE:C), has a quote that will haunt him for the rest of his life.

In the summer of 2007, the subprime mortgage crisis had not yet blown up. The warning signs were there, and plenty of observers were alarmed… but Wall Street was still fat, happy, and oh so complacent.

In July of that … [visit site to read more]

China Stands Firm On Forex Policy Despite Increasing Pressure

Posted: 10 Mar 2010 04:01 PM PST

China’s rigid stance to not appreciate its currency continues to cause problems with “hot money” and foreign trade relations.

A report from Yi Gang, China’s director of the State Administration of Foreign Exchange (SAFE), today (Tuesday) shrugged off calls for currency appreciation. Yi said China’s foreign-exchange reserves - which are the largest in the world at $2.4 trillion - are safe and stable, and the country will strengthen its supervision of speculative cash inflows.

Speculation … [visit site to read more]

Brazil Launches Salvo Of Trade Sanctions Against US

Posted: 10 Mar 2010 03:05 PM PST

According to the head of economic affairs at Brazil's foreign ministry, Carlos Marcio Cozendey, the plan is "to distribute the retaliation broadly in order to maximise pressure."
The "retaliation" he refers to includes trade sections on 100 US goods, ranging from cars to milk powder. The tariffs are in response to cotton producer subsidies the US has kept in place despite a 2008 WTO ruling that found the practice discriminatory.
From the BBC News:
"The World Trade Organization … [visit site to read more]

Unlocking The Jobs Dilemma

Posted: 10 Mar 2010 03:01 PM PST

Productive, private-sector jobs - the lifeblood of a sound economy - are under assault by politicians in the United States and Western Europe, who have unwittingly taken a number of steps that make future job losses a foregone conclusion.

In the 1980s, as a Member of the UK Parliament and elected Chairman of the Conservative Small Business Committee, I led discussions on the issue of job creation. At that point, the British labor market was dealing with technological advances that threatened … [visit site to read more]

Ron Paul: Not Long Before The Gov’t Is “Borrowing Us Further Into Oblivion”

Posted: 10 Mar 2010 03:00 PM PST

Dr. Ron Paul (R-TX) isn't one to let his opinion go unheard… especially as Congress continues approving massive amounts of debt-financed spending.
From his recent Texas Straight Talk:
"Last week, the House approved another increase in the national debt ceiling. This means the government can borrow $1.9 trillion more to stay afloat and avoid default. It has been little more than a year since the last debt limit increase, and graphs showing the debt limit over time show a steep, almost … [visit site to read more]

CBO Budget Projections And The Horrors Of Inflation

Posted: 10 Mar 2010 03:00 PM PST

The pills that I thought were tranquilizers turned out to be vitamins, and although I am on the verge of some kind of mental breakdown because of the mix-up, I feel great!
Turning to the old tried and true, I soon learned that I had started too late, and I was not nearly drunk enough to have properly anesthetized my nerves when I chanced to read Agora Financial's 5- Minute Forecast report that "The CBO's latest numbers reveal that President Obama's proposed fiscal 2011 budget would add … [visit site to read more]

New Client For Allscripts

Posted: 10 Mar 2010 02:30 PM PST

Allscripts-Misys Healthcare Solutions, Inc. (NASDAQ:MDRX) recently entered into an agreement with a new client, Huntington Memorial Hospital, whereby the latter will offer the branded version of Allscripts’ e-prescribing solution under the name HuntingtonRx to its nearly 1,000 affiliated physicians. Financial terms of the agreement have not been disclosed.
Allscripts’ e-prescribing solution is an Electronic Health Record (EHR) software that automates the process of writing prescriptions. EHR system … [visit site to read more]

Investing In India: News And Forecasts For The Long Haul

Posted: 10 Mar 2010 02:15 PM PST

The private sector ruined itself in the bubble of '03-'07. Now, it's the public sector's turn. All over the developed world – with a few exceptions – the feds are adding debt at an alarming rate.
The US has already passed "the point of no return," says a report from Casey Research. Ken Rogoff and Carmen Reinhart put that point where external debt passes 73% of GDP or 239% of exports. IMF data, says the Casey team, shows the US has already gone too far on both scores, with … [visit site to read more]

Traffic Declines For OMAB

Posted: 10 Mar 2010 02:15 PM PST

Mexican airport operator Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (NASDAQ:OMAB) reported a 12.5% decrease in passenger traffic at its 13 airports in February 2010, compared to February 2009. Domestic and international traffic declined 13.4% and 8.7%, respectively.
Domestic traffic grew at three airports: Chihuahua, Culiacan and San Luis Potosi. Traffic at the Chihuahua and Culiacan airports benefited from increases on the routes to Guadalajara. Traffic in San Luis Potosi increased … [visit site to read more]

Play Rising Energy Prices With These Oil And Gas ETFs

Posted: 10 Mar 2010 02:01 PM PST

Uh-oh…you’ve probably noticed that gas prices are once again creeping higher, just in time for the driving season. As a motorist, it might have you cringing; but as an exchange traded fund (ETF) investor, it might have you looking for an opening.

Gas has already crept up 5 cents a gallon, and it could go as high as $3 a gallon if those in the know are correct. Oil prices have also increased, to $82 on optimism about the economy, new tensions in oil-producing Nigeria and reports that China … [visit site to read more]

Jacobs Wins $9.9 M Contract

Posted: 10 Mar 2010 02:00 PM PST

Jacobs Engineering Group Inc. (NYSE:JEC) received a contract from the Air Force Research Laboratory’s Airbase Technologies Division to research and develop technologies for deployed airbase infrastructure, force protection and homeland defense operations. The potential value of the 3-year contract is estimated at $9.9 million.
Jacobs will provide technical expertise to execute a comprehensive research and development program that includes the design, development and testing of new protective … [visit site to read more]

Morgan Keegan Faces Charges (revised)

Posted: 10 Mar 2010 01:54 PM PST

Morgan Keegan, a securities brokerage unit of Regions Financial Corp. (NYSE:RF), has been slapped with charges amounting to $3.6 million in relation with two arbitration cases that were filed against it by two bond investors. These investors, who had invested in the company's proprietary RMK bonds, suffered losses due to overexposure in risky mortgage-related securities.
The investors allege that they had been given false information about the true nature of the RMK funds. Despite the fact the … [visit site to read more]

Deciphering The VIX Index And The Rally In Overconfidence

Posted: 10 Mar 2010 01:51 PM PST

Hip hip, hooray! Hip hip, hooray!
Our little big bull market celebrated its one-year anniversary yesterday, albeit in tentative style. The Dow managed to eke out an 11-point gain, while the broader S&P 500 fared only slightly better. Investors, it appears, are awaiting the next catalyst to keep the momentum going. But are they running out of excuses to buy?
It is difficult to know precisely what is going on inside the collective brain of the marketplace, but one indicator gives us a hint. … [visit site to read more]

Video: NYSE Closing Bell Market Monitor: C, AIG

Posted: 10 Mar 2010 01:49 PM PST

The latest in news, commentary, and information on what’s moving the US equities markets. Watch this broadcast LIVE at 4:00 pm EST daily @ “http://www.nyx.com/marketmonitor” … [visit site to read more]

Dell: Downward Estimate Revisions

Posted: 10 Mar 2010 01:47 PM PST

Earnings estimates for the computing major Dell Inc. (NASDAQ:DELL) have taken a nosedive despite the company's reporting decent fourth quarter 2010 numbers.
Dell reported fourth quarter 2010 EPS of 28 cents, which exceeded the Zacks Consensus Estimate of 27 cents. However, EPS was down 3.0% from the year-ago quarter. The full-year 2010 earnings of $1.05 also declined, dropping 27.0% from the year-ago quarter.
Revenue for the fourth quarter was $14.9 billion, up 11.0% from $13.4 billion reported in … [visit site to read more]

Video: Ford Introduces India To The “Figo”

Posted: 10 Mar 2010 01:46 PM PST

The Ford Motor Company officially launched the “Figo” vehicle thisTuesday in India. It marks Ford’s first ever made-for-India compact car. … [visit site to read more]

Video: Crude Rises On Hurricane Season Concerns

Posted: 10 Mar 2010 01:39 PM PST

Front month crude prices were on the upside this session on concerns over the severity of the upcoming hurricane season … [visit site to read more]

Ferrellgas Partners Profits Strong

Posted: 10 Mar 2010 01:30 PM PST

Ferrellgas Partners L.P. (NYSE:FGP) posted in-line results for the fiscal second quarter of 2010, primarily driven by higher propane sales volumes and lower costs. The partnership reported adjusted earnings of $1.10 per unit for the quarter, meeting the Zacks Consensus Estimate and last year's earnings of $1.10.
Revenue in the quarter improved 9% to $777.9 million due to increased retail and wholesale propane volumes. Ferrellgas sold 353.7 million gallons of propane during the quarter, up 13% … [visit site to read more]

TiVo Beats On Higher Revenues

Posted: 10 Mar 2010 01:14 PM PST

TiVo Inc. (NASDAQ:TIVO) reported a net loss of 9 cents per share for the fourth quarter of fiscal 2010, 3 cents above the Zacks Consensus Estimate of a loss of 12 cents per share but fell from the prior-year quarter. The company had reported a loss of 4 cents per share in the fourth quarter of 2009.
Although revenue growth was encouraging in the quarter driven by higher hardware sales, growing costs and reduced subscriber additions led to lower profitability. TiVo is not immune to the current … [visit site to read more]

Water Stocks: A Few Of My Favorite Things, Part I

Posted: 10 Mar 2010 01:03 PM PST

Water – I've been urging my subscribers to invest in water stocks for several years…and Hyflux is one of my favorites. Hyflux (HYFXF: OTC Bulletin Board) operates in China, Southeast Asia, India, the Middle East and North Africa. It is involved in a variety of water projects, from desalination to recycling. It was among the first stocks ever recommended in my investment service, Mayer's Special Situations, when I launched the "Blue Gold Portfolio" back in the summer of 2006. Since I … [visit site to read more]

Why Germany Is The “Must-Invest” Economy

Posted: 10 Mar 2010 01:01 PM PST

If you’re a U.S. investor, you can’t be happy about the prospects for your portfolio. After all, you’re mostly trapped in an economy with a gigantic and dangerous financial-services sector, a central bank that can’t stop itself from printing money and a government that overspends wildly.

But there is an answer: You should consider allocating some of that “at-risk” capital to a country that has none of those problems - Germany.

Germany has a banking system, of course, but that banking … [visit site to read more]

Micromet Raises Funds

Posted: 10 Mar 2010 12:55 PM PST

Recently, Micromet (NASDAQ:MITI) announced a 10 million share offering of common stock. In Aug 2009, Micromet received net proceeds of about $75 million from a common stock issuance.

We believe with the advancement of clinical trials, the company's R&D costs are expected to increase further, hence the need to raise funds. Due to the funds raised during the third quarter, Micromet exited 2009 with $113.4 million in cash and cash equivalents, up from $46 million at the end of Dec … [visit site to read more]

New Leader In Animal Health

Posted: 10 Mar 2010 12:40 PM PST

Sanofi-Aventis (NYSE:SNY) and Merck (NYSE:MRK) have decided to combine their Animal Health businesses – Merial and Intervet/Schering-Plough to create a global leader in this segment. The joint venture, equally owned by the two companies is awaiting approval from certain regulatory authorities. The transaction is expected to be completed by the end of 2010 or early 2011.

In July 2009, Merck sold its 50% interest in Merial to its partner Sanofi-Aventis for $4 billion. In addition, Sanofi had an … [visit site to read more]

Brown-Forman Reports Strong Sales

Posted: 10 Mar 2010 12:20 PM PST

Brown-Forman Corp. (BF.A), one of the leading producers and distributors of premium alcoholic beverages in the world, posted fiscal 2010 third-quarter earnings of $107.9 million or $0.73 per share, compared to $123.4 million or $0.81 in the year-ago quarter. The quarterly earnings surpassed the Zacks Consensus Estimate by two cents.

During the quarter, net sales increased 10% to $861.7 million compared to $784.1 million in the year-ago period. The increase was primarily due to strong sales of … [visit site to read more]

Private Sector De-leveraging: A Rally In A Bull Costume

Posted: 10 Mar 2010 12:18 PM PST

Yesterday marked the one-year anniversary of the rally. The Dow rose a piddly 11 points. Gold sold off $1.
This rally has gone on for so long most people think it is not a rally at all, but a new bull market. Worldwide, it has taken equities up some 73%…making it one of the greatest rallies ever.
What are we to think? Are we alone in thinking it's still a trap? What happened to the problems that led to the crisis of '07-'09?
If you don't think about it too much you might think … [visit site to read more]

Video: 03/10 FX Options Report

Posted: 10 Mar 2010 12:16 PM PST

The USD and EUR advanced vs. the JPY, as risk appetite rose in mid-week trade. … [visit site to read more]

Forex Trading: EURUSD Holds Trendline Support At 1.3645

Posted: 10 Mar 2010 12:11 PM PST

ETFs For Increasing Energy Appetite

Posted: 10 Mar 2010 12:01 PM PST

As the global population continues to expand and purchasing power in developing nations increases, the world’s appetite for energy is likely to amplify painting an opportunity for investors.

According to the Energy Information Administration (EIA), average consumption of crude oil is expected to increase to 1.5 million barrels per day, up nearly 300,000 barrels per day from its previous forecast of 1.2 million barrels per day.  This uptick in demand is primarily being driven by expected … [visit site to read more]

FCN Lowered To Underperform

Posted: 10 Mar 2010 11:50 AM PST

We are downgrading our recommendation on FTI Consulting Inc. (NYSE:FCN) to Underperform from Neutral as a dramatic deceleration is expected in Corporate Finance and Restructuring through the remainder of 2010.

The company's fourth quarter earnings of 71 cents per share came in only a couple of cents short of the Zacks Consensus Estimate due to disciplined expense management and fewer share count. However, any significant growth was restricted by declining revenues from Technology and Strategic … [visit site to read more]

What Every Investor Should Know About Commodity ETF Investing

Posted: 10 Mar 2010 11:26 AM PST

It's difficult to put a finger on the exact cause of the recent surge in popularity of commodity investing. More than likely, the boom is attributable to a number of different factors. Correlation between international equity markets (and even between stocks and bonds) has surged in recent years, increasing both the importance and difficulty of adding non-correlated assets to investor portfolios. Given the relatively weak correlation with other asset classes, commodities have found a home in … [visit site to read more]

3 Chances With Pimavanserin

Posted: 10 Mar 2010 11:16 AM PST

Biovail (NYSE:BVF) and Acadia Pharmaceuticals (NASDAQ:ACAD) are moving forward with a 3-pronged strategy for pimavanserin. Acadia plans a phase III trial in Parkinson's disease psychosis (PDP) and a phase II feasibility study in Alzheimer's disease psychosis (ADP). Biovail plans a phase III trial with pimavanserin as an adjunctive therapy for schizophrenia. All three programs should be up and running by the third quarter 2010.
Management has made a number of changes to the planned third phase III … [visit site to read more]

Forget About The British Pound!

Posted: 10 Mar 2010 11:01 AM PST

Last week, the BoE decided to leave rates unchanged at 0.5% and to forestall expanding on its GBP 200bn asset-purchase program, which was widely anticipated by the whole of economists in the Bloomberg consensus. It was hard to see any reason for the BoE to change the outlook for monetary policy in the short term, having decided to pause the program in February.

The latest economic data confirmed that the wait-and-see stance recently adopted by the BoE is appropriate. Over the last … [visit site to read more]

Morgan Keegan Faces Charges

Posted: 10 Mar 2010 10:55 AM PST

Morgan Keegan, a securities brokerage unit of Regions Financial Corp. (NYSE:RF), has been slapped with charges amounting to $3.6 billion in relation with two arbitration cases that were filed against it by two bond investors. These investors, who had invested in the company's proprietary RMK bonds, suffered losses due to overexposure in risky mortgage-related securities.
The investors allege that they had been given false information about the true nature of the RMK funds. Despite the fact the … [visit site to read more]

Video: Market Movers: AIG, C, GR, CVX, JCG, NFLX

Posted: 10 Mar 2010 10:51 AM PST

The latest news and information on U.S. stocks that are moving the market. … [visit site to read more]

Hasbro Sells Notes

Posted: 10 Mar 2010 10:35 AM PST

Earlier the week, Hasbro, Inc. (NYSE:HAS) announced an offering of $500 million of the 6.35% notes due 2040. Interest on the notes will be paid twice each year on March 15 and September 15. The notes will mature on March 15, 2040.
The notes will be senior unsecured obligations of the company and will be at par with all other senior unsecured debt in right of payment. There is no sinking fund for the notes. The notes will be issued only in a registered form in denominations of $2,000 and integral … [visit site to read more]

Broadcom Completes Teknovus Acquisition

Posted: 10 Mar 2010 10:25 AM PST

Broadcom Corporation (NASDAQ:BRCM) announced that it has completed the acquisition of Teknovus, a leading supplier of Ethernet Passive Optical Network (EPON) chipsets and software. EPON is a technology providing broadband service at up to 10 Gigabits per second over fiber optic cables. EPON represents approximately 94% of the FTTx (e.g. Fiber-to-the-Home) connections in the Asia Pacific region and is expected to grow at 33% through 2014.
 
Broadcom paid approximately $123 million for the … [visit site to read more]

P&G Recalls Pringles Chips

Posted: 10 Mar 2010 10:15 AM PST

Recently, The Procter & Gamble Company (NYSE:PG) voluntarily recalled two flavors of Pringles Chips in response to the recommendation from the Food & Drug Administration (FDA) to protect consumers from potential salmonella exposure. The flavors were Pringles Restaurant Cravers Cheeseburger potato crisps and Pringles Family Faves Taco Night potato crisps. However, the company confirmed that there have been no reports of salmonella-related illness in relation to these products.
P&G also … [visit site to read more]

PG Recalls Pringles Chips

Posted: 10 Mar 2010 10:15 AM PST

Recently, The Procter & Gamble Company (NYSE:PG) voluntarily recalled two flavors of Pringles Chips in response to the recommendation from the Food & Drug Administration (FDA) to protect consumers from potential salmonella exposure. The flavors were Pringles Restaurant Cravers Cheeseburger potato crisps and Pringles Family Faves Taco Night potato crisps. However, the company confirmed that there have been no reports of salmonella-related illness in relation to these products.
PG also … [visit site to read more]

Onglyza In Post-Marketing Study

Posted: 10 Mar 2010 10:10 AM PST

Recently, Bristol-Myers Squibb (NYSE:BMY) announced that it has commenced a phase IV (post marketing) study for its type II diabetes drug Onglyza (saxagliptin). Bristol-Myers entered into collaboration with AstraZeneca plc (NYSE:AZN) in Jan 2007 to research, develop and commercialize select candidates for type II diabetes. 

The post marketing study was partly designed to fulfill the requirement of the U.S. Food and Drug Administration (FDA) in addition to finding out the potential benefit of … [visit site to read more]

Google Steps Closer To The Cloud

Posted: 10 Mar 2010 10:10 AM PST

Mountain View, California-based Google Inc. (NASDAQ:GOOG), which is slated to introduce its cloud-based Chrome operating system later this year, took another step towards achieving this goal. The company has announced an online marketplace where software developers will be able to offer their products.
The software to be sold at the store will be closely tied to Google's own cloud computing services, essentially enhancing Google's current lineup and encouraging consumers to adopt the Google … [visit site to read more]

British Pound Plunge: Would Another Forex Market “Black Wednesday” Happen Again?

Posted: 10 Mar 2010 10:01 AM PST

Outside of the earthquake rescue efforts in Chile and the Greek-rescue efforts in Brussels, the big news in the world economy last week occurred in currencies.

As you can see in the chart below, the plummeting British pound sterling has dropped even more than the beleaguered euro in the past month and a half, while the good old U.S. dollar has been as good as gold. (That last bit was a bit of currency irony; the dollar has actually been much better than gold, which has flat-lined in the … [visit site to read more]

Video: Yen Falters On Rise In Chinese Exports

Posted: 10 Mar 2010 10:01 AM PST

The Japanese yen took a dive this session following data showing Chinese exports nearly tripled last month. … [visit site to read more]

Five Facts About HOLDRS Every ETF Investor Must Know

Posted: 10 Mar 2010 10:00 AM PST

For the most part, ETFs are pretty similar regardless of which issuer is behind the fund. But as many investors know, there's one notable exception to this rule. The HOLDRS products from Merrill Lynch are similar to traditional ETFs in many ways, but also feature some nuances that make them very different in others. HOLDRS stands for Holding Company Depository Receipts, and are securities that represent an investor's ownership in the common stock or ADRs of specified companies in a … [visit site to read more]

Japan’s Growing Attachment To China Over The US

Posted: 10 Mar 2010 10:00 AM PST

Day after day, China's heavyweight status becomes more pronounced. We've discussed it before, due to its economy, which is in the process of overtaking Japan's second place in size and its growing influence in Latin America. Today, we take a look at its strengthening influence in Asia… and Japan in particular.
According to the Financial Times:
"Last year, the Japanese economy shrank by more than 5 per cent. And the high hopes that surrounded the reformist government of Yukio … [visit site to read more]

Illinois Judge Blocks FTR-VZ Deal

Posted: 10 Mar 2010 09:55 AM PST

Frontier Communications' (NYSE:FTR) impending acquisition of the rural fixed-line business of Verizon (NYSE:VZ) suffered a major blow as an Administrative Law Judge in Illinois has issued an order to block the transaction in the state. The concerned judge has proposed to the state regulator "Illinois Commerce Commission” not to approve the deal. 

The move puts the asset sale in Illinois under significant uncertainty. However, a final decision of the state regulator is expected in April … [visit site to read more]

EQT Corp. Raises Guidance

Posted: 10 Mar 2010 09:40 AM PST

To accelerate development of its Marcellus and Huron/Berea plays' properties, EQT Corporation (NYSE:EQT) has announced 12.5 million shares of its common stock offering.
 
Early last week, the company announced its intention to buy approximately 58,000 net acres in the Marcellus Shale from a group of private operators and landowners in a stock and cash deal. 

Management is confident about the company's capability to profitably develop these assets as EQT already has extensive … [visit site to read more]

ATS Medical Downgraded

Posted: 10 Mar 2010 09:25 AM PST

We recently downgraded ATS Medical, Inc. (NASDAQ:ATSI) to 'Underperform' with a target price of $2.30 based on a P/S of 2.0x our fiscal 2010 revenue estimate of $82 million.
 
ATS Medical recently reported fourth quarter and fiscal 2009 results. For the fourth quarter, loss per share was 5 cents, higher than the Zacks Consensus Estimate of loss of 1 cent and the year-ago loss of 2 cents. For fiscal 2009, loss per share was 9 cents, compared to the Zacks Consensus Estimate and the year-ago … [visit site to read more]

Forex Trading: EURUSD Falling Back Toward 1.3613 Support As Gold Spoils The Party

Posted: 10 Mar 2010 09:22 AM PST

The EURUSD is falling back down toward support at the 1.3613 level (100 and 200 hour MA level) as the sharp fall in the Gold price has market participants reversing their positions (Low reached 1.3621). The market has bounced higher as the converged moving averages, do remain a key support level. They also give traders a level to lean against with  stop orders on a break below it. On the topside now, the 1.3654 level comes back as  resistance as the market … [visit site to read more]

Analyst Interviews: Steel Industry Stock Review

Posted: 09 Mar 2010 09:00 PM PST

The steel industry is rather concentrated in structure, with a few producers accounting for the lion's share of sales. With companies engaged in the extraction of iron ore and coke coal for the processing of iron and steel, this industry includes metal ore exploration and mining services, iron and steel foundries for smelting, rolling, forging, spinning, recycling, stamping, polishing and plating of iron and steel products such as pipes, tubes, wires, springs, rolls and bars.
ArcelorMittal … [visit site to read more]
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