Mar 17, 2010

Daily Markets - Financial News And Opinions

Daily Markets - Financial News And Opinions

The Economy Is Not Always The Stock Market Driver

Posted: 17 Mar 2010 12:01 PM PDT

In the long run, economic development and - especially - corporate earnings are the main drivers of stock market performance. But this relationship is very loose. It becomes tight only if your time horizon is measured in decades.

Shorter term, economic development and corporate earnings are often relatively inconsequential for the stock market. Why? Economic changes are superimposed by changes in the fundamental valuation of the stock market. That means investors’ perceptions and their … [visit site to read more]


Starwood Invests In IT

Posted: 17 Mar 2010 11:50 AM PDT

Starwood Hotels & Resorts Worldwide Inc. (NYSE:HOT) yesterday announced that it has awarded an approximately $200 million contract to IT vendor Accenture (NYSE:ACN).
 
Under the contract that will span a number of years, Accenture will provide a range of IT services including application outsourcing and infrastructure outsourcing. Accenture will develop, maintain and run applications for the hotel company, as well as manage servers, data centers and end-user computers.
 
This long term … [visit site to read more]

Jacobs Inks New Deal

Posted: 17 Mar 2010 11:34 AM PDT

Jacobs Engineering Group Inc. (NYSE:JEC) signed a four-year contract with Transport Scotland, the national transport agency of Scotland, to provide engineering consultancy services.
 
Transport Scotland oversees the operation and improvement of the trunk road and railway networks in Scotland. As part of the four-year framework, Jacobs will provide engineering services ranging from feasibility studies and environmental appraisals through to the procurement and supervision of the construction … [visit site to read more]

AAR Profit Down By Half

Posted: 17 Mar 2010 11:16 AM PDT

AAR Corp. (NYSE:AIR) reported discouraging results for the third quarter of fiscal 2010. During the quarter, sales were $309.6 million, down from $338.8 million in the third quarter of fiscal 2009.
 
Net income was $9.9 million or 26 cents, down to almost half of $17.2 million or 43 cents in the year-ago quarter. Reported EPS was below the Zacks Consensus Estimate of 35 cents.
 
Sales to defense and government customers were down 1% year over year, and represented 48% of total sales … [visit site to read more]

Earnings Scorecard: VeriFone

Posted: 17 Mar 2010 11:06 AM PDT

Following the release of better-than-expected first quarter results and an increase in guidance by VeriFone Holdings Inc. (NYSE:PAY), we recently upgraded our rating on the stock to Outperform from Neutral.
Based in San Jose, California, VeriFone designs, markets and services a transaction automation system that facilitates electronic payments between consumers, merchants and financial institutions.
Revenues of $223.4 million in the first quarter of fiscal 2010 were up 2.6% sequentially and up … [visit site to read more]

The Breakup Of The Euro And The Alcohol-Induced Debt Crisis

Posted: 17 Mar 2010 11:00 AM PDT

It is better to spend money like there's no tomorrow than to spend tonight like there's no money! – Irish toast.
So the Irish have their excuse for the lamentable state of their nation's economic affairs. They can blame it on the drink. But what say the Greeks…and the Portuguese…the Spaniards…Britons…Italians and, indeed, all the other nations signatory to the boneheaded European single currency experiment? To what barroom philosophy do they attribute their disastrous finances? … [visit site to read more]

Masimo Remains Neutral

Posted: 17 Mar 2010 10:59 AM PDT

We continue to maintain our 'Neutral' rating on Masimo Corp. (NASDAQ:MASI) with a target price of $28 based on a P/E of 28.0x our fiscal 2010 EPS estimate of $1. The company's fourth quarter fiscal 2009 results reflect a mixed trend.
Masimo reported fourth-quarter earnings per share of 23 cents, surpassing the Zacks Consensus Estimate of 22 cents. However, earnings was lower than the year-ago figure of 24 cents. For fiscal 2009, earnings per share was 88 cents, in line with the Zacks Consensus … [visit site to read more]

Cyclical Stock Bull vs. Secular Gold Bull

Posted: 17 Mar 2010 10:45 AM PDT

Since March of 2000, the stock market has been and continues to be in a secular bear market. Beginning in March of 2009, the stock market entered another cyclical bull market.

This means our current stock market is in a relatively short term bull rally within a much longer term secular bear market decline. A really big bear market rally, so to speak.

This cyclical bull will serve to separate the second phase of the secular bear from the third and potentially most damaging leg down in the … [visit site to read more]

LLY Expands Men’s Health Range

Posted: 17 Mar 2010 10:44 AM PDT

Eli Lilly and Co. (NYSE:LLY) recently entered into a deal with Australian company, Acrux, which should help strengthen Lilly's men's health portfolio. Lilly acquired exclusive worldwide rights to commercialize Axiron, which is currently being reviewed by the US Food and Drug Administration (FDA) for the treatment of testosterone deficiency (hypogonadism) in men. 

As per the terms of the deal, Lilly will make an upfront payment of $50 million and $3 million on the transfer of … [visit site to read more]

Forex Trading: USDCHF Moves Down Toward 200 Day MA At 1.0491

Posted: 17 Mar 2010 10:44 AM PDT

The USDCHF is moving back down toward the 200 day MA support at 1.0491.  A move below this level will likely pressure the USDCHF further.  However, the higher the CHF goes (versus EURCHF and USDCHF) the better the chance for intervention.  That intervention level would be the new tolerant level for the EURCHF.  The EURCHF has has been pressured today and is trading at the 1.4477 level, 150 pips below the old floor at … [visit site to read more]

2007 Redux?

Posted: 17 Mar 2010 10:43 AM PDT

The market value of the high yield FINRA-BLP Active U.S. Corporate Bond Index relative to its investment grade counterpart has now exceeded the level seen in May 2007, at the peak of the credit bubble.

If you ask me, it looks like risk-taking is back with a … [visit site to read more]

Forex Trading: USDCAD On The Way To Parity?

Posted: 17 Mar 2010 10:37 AM PDT

The 1.0100 level gave way and the price is down testing the next support at the 1.0074 level. This level the last time the price was this low, was a ceiling then floor. A move below this level has little in the way of support until the parity level.   Of course the market will target this and likely will find buyers against the level with stops on a move below. Fundamentally, with oil higher and growth numbers better, this benefits the CAD$ and that lowers the USDCAD.  … [visit site to read more]

Mylan Strengthens Portfolio

Posted: 17 Mar 2010 10:29 AM PDT

Mylan Inc. (NYSE:MYL) has entered into an agreement with Takeda Pharmaceutical for two type II diabetes drugs – Actoplus Met and Actos, which recorded 2009 sales of $459 million and $3.4 billion, respectively. 

Following the agreement, Mylan will be able to launch the generic versions of Actoplus Met on Dec 14, 2012 and Actos on Aug 17, 2012 or earlier under certain circumstances. The company expects to be eligible for 180 days of marketing exclusivity for both the drugs on … [visit site to read more]

Mutual Funds: Top 3 ING Funds

Posted: 17 Mar 2010 10:23 AM PDT

With approximately €343 billion of assets under management, ING is one of the world's leading asset management firms. The company has an investment presence in 33 countries across the Americas, Asia-Pacific, Europe and the Middle East. ING offers a wide range of global, international and domestic funds which are designed to meet the needs of specific investors. It serves institutional clients, including retirement plans, endowments and foundations, as well as individual investors through … [visit site to read more]

Gold Experiences Strong Rally On US Dollar Slump

Posted: 17 Mar 2010 10:17 AM PDT

Gold experienced a solid rally yesterday as the precious metal’s negative correlation with the Dollar kicked back into 1st gear.  The Cable, Aussie, and EUR/USD all experienced topside breakouts yesterday in the wake of the Fed’s decision to maintain its loose monetary policy stance for the foreseeable future.  Yesterday’s return to the risk trade certain benefitted gold as the precious jumped from $1100/oz and peaked just above $1130/oz and our new 3rd tier downtrend line.  Our 3rd … [visit site to read more]

MMC Acquires Thomas Rutherfoord

Posted: 17 Mar 2010 10:14 AM PDT

In an attempt to grow its insurance business nationally, Marsh & McLennan Agency LLC (MMA), a subsidiary of insurance broker Marsh & McLennan Companies Inc. (NYSE:MMC) announced the acquisition of Thomas Rutherfoord, Inc., one of the highly-regarded brokerage firms in the U.S. The terms of the transaction, however, remain undisclosed. 

With this acquisition, MMA will now contain annual revenue of $171 million to become the 13th largest insurance agency in the U.S. The deal is … [visit site to read more]

Forex Trading: GBPUSD Bounces More Than I Thought.

Posted: 17 Mar 2010 10:11 AM PDT

The GBPUSD has moved up more sharply then thought after correcting 61.8 of the days range.  The move is not normal, but that is par for the course given current trading environment.  Support should now be found against the 1.5351 and then 1.5332.  A break of 1.5380 starts to look for the 1.5421 … [visit site to read more]

Video: Central Bank Decisions Favor Higher-Yielding Currencies

Posted: 17 Mar 2010 10:01 AM PDT

Higher-yielding currencies continued to rise this session following central bank decisions to keep interest rates unchanged. … [visit site to read more]

Declining US Household Debt Signals The Beginning Of The End

Posted: 17 Mar 2010 10:00 AM PDT

Financial Times: US Household Debt Falls for First Time Since WWII
Yes, dear reader, we have been a voice howling in the wilderness. First the wilderness around the Café des Dames in Paris's 19th arrondissement…recently the wilderness of Bethesda, Maryland…and lately the wilderness near the Taj Mahal Hotel in old Bombay.
Reading the TIMES of India is a delight. We see that a politician has been given a colorful, over-the-table bribe…a garland made up of 50,000 thousand-rupee notes … [visit site to read more]

CIT Posts Loss On Higher Costs

Posted: 17 Mar 2010 09:59 AM PDT

On Tuesday, CIT Group Inc. (NYSE:CIT) reported a net income of $3.2 billion, including the reorganization benefit under the post-bankruptcy accounting known as Fresh Start Accounting (FSA). Excluding special accounting procedures and other items related to its reorganization, its quarterly pre-tax loss was $1 billion. Results reflected low finance revenue as well as high borrowing and credit costs, primarily in Corporate Finance segment of the company. 

CIT's commercial net charge-offs, … [visit site to read more]

Forex Trading: USDJPY Breaks Through The Support At The 90.34

Posted: 17 Mar 2010 09:45 AM PDT

The USDJPY fell below the 200 hour MA support and continued the fall until finding support against he 90.09/13 levels.  90.09 is the 100 day MA support. The 90.13 level is the  midpoint of the range from Feb 19th to the low on March 4th.  A break of this support area would be bearish and should lead to further momentum selling with 89.98 and then 89.66 the next targets. Resistance now at … [visit site to read more]

Thai ETF In Focus After ‘Red Shirt’ Protests

Posted: 17 Mar 2010 09:37 AM PDT

Ongoing protests in the capital of Thailand have left many investors wondering if the country will grind to a halt due to political turbulence caused by the Red Shirt movement. The Red Shirters are protesting what they believe is an illegitimate Abhisit government, which came to power via a December 2008 parliamentary vote after a controversial court ruling ousted former Thai leader Thaksin's allies. Another court decision last month confiscated close to two billion dollars from the former … [visit site to read more]
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