Mar 16, 2010

Daily Markets - Financial News And Opinions

Daily Markets - Financial News And Opinions

Gold: Bullish Bounce Off Long-Term Trendline

Posted: 16 Mar 2010 05:45 PM PDT

Price action on spot gold, a daily chart of which is shown, has made a swift and pronounced bounce off a long-term uptrend support line. This long-term trendline was falsely breached in early February, but has subsequently been respected since then. Most recently, price action descended back down to the trendline last week before making the pronounced bounce this week. On Tuesday (3/16/2010) in particular, price action on gold has made a strong bullish move, closely approaching resistance in … [visit site to read more]


Wait…What?

Posted: 16 Mar 2010 05:08 PM PDT

We interrupt the euphoria in the stock market to bring you this breaking news flash –

“Shipping Market Worst Since World War II, Fisher Says” (Bloomberg)

The world shipping market is mired in its biggest slump since World War II, said James Fisher & Sons Plc, a U.K. hauler of oil products.
"This is the worst shipping recession since the war," Chairman Tim Harris said today in a telephone interview. He spoke after the Barrow-in-Furness, England-based company reported little-changed … [visit site to read more]

What Happened To Focus On Jobs?

Posted: 16 Mar 2010 05:01 PM PDT

If America and Americans are not at work, then how can we truly expect any other initiatives and undertakings to gain a foothold? There is nothing that generates more personal and collective confidence than a job. In fact, I would go even further and state that a job not only generates personal confidence for individuals, but ultimately a job very often defines a person’s self-worth.

Then why is it that the topic of jobs is not the OVERWHELMING focus in Washington eight days a week? … [visit site to read more]

Cartoon: Finding Employment

Posted: 16 Mar 2010 04:01 PM PDT

Source: Ted Rall, GoComics.com, March 15, … [visit site to read more]

The Great Correction: Awaiting Bailouts That Will Never Come

Posted: 16 Mar 2010 04:00 PM PDT

We're going to rename our theory. This is more than a depression; it's more than a financial and economic phenomenon. It includes a shift of power…a return to normal after 4 centuries of aberration…and the failure of a whole line of Nobel Prizing-winning economic claptrap, including the Efficient Market Hypothesis and Modern Portfolio Theory. Let's call this phase "The Great Correction"…and wait for events to prove we're right.
In the meantime…we await clarification…
When … [visit site to read more]

Earnings Scorecard: Hormel

Posted: 16 Mar 2010 03:37 PM PDT

Last month, Hormel Foods Corporation (NYSE:HRL) reported encouraging results for the first quarter of fiscal 2010. During the quarter, net earnings were $111.2 million, up 37% from $81.4 million in the same quarter of fiscal 2009. EPS for the quarter was 82 cents, compared to 60 cents in the year-ago quarter. It exceeded the market expectation of 68 cents per share.
Thus, the company raised its full year EPS guidance range from $2.63 to $2.73 per share to $2.68 to $2.78.
Agreement
Based on the … [visit site to read more]

Pay Czar Caps GMAC Executives

Posted: 16 Mar 2010 03:19 PM PDT

Pay czar Kenneth Feinberg has put a cap on the compensation for top executives at auto finance company GMAC Inc. (NYSE:GJM), which continues to post losses without any likelihood of repaying the $16.3 billion of funds that it had received under the Troubled Asset Repurchase Program (TARP).
 
Michael Carpenter, a 62-year-old ex-Citigroup Inc. (NYSE:C) executive was appointed as the CEO of GMAC in November 2009. He had been on the board since May 2009. Carpenter will only receive compensation in … [visit site to read more]

Fiserv To Repurchase Shares

Posted: 16 Mar 2010 03:01 PM PDT

Fiserv, Inc. (NASDAQ:FISV) announced that its Board has authorized it to repurchase up to five million additional shares of its common stock — approximately 3% percent of its outstanding shares.
As of March 1, 2010, the company had approximately one million shares remaining in its previous repurchase authorization. Fiserv repurchased 1.1 million shares of its common stock in the last quarter and 4.1 million shares in 2009.
Under the new authorization, Fiserv may repurchase shares in the open market … [visit site to read more]

Hot Penny Stock: Sirium XM Radio

Posted: 16 Mar 2010 03:01 PM PDT

Sirius XM radio stock (NASDAQ:SIRI) has performed a spectacular run from from around 60 cent to $1.15 in the last month and reached a climax top on Feb 16th. Previous posts have tracked this stock move from 63 cents up. Subsequently, the stock selldown  to around 82 cents whereby it seems to have found temporary support as evident from the spinning top and high volume ( in the chart). These two weeks have been characterized by decreasing volume which is typical of stocks that comes down from … [visit site to read more]

Private Debt Decline: Good For US Bad For The Economy

Posted: 16 Mar 2010 03:00 PM PDT

I got a disturbing email from Bianco Research which showed a chart of "Private Credit Market Debt" which they say shows "Total credit market creation not including Treasury Debt, Municipal Debt and Agency Debt".
It is actually a horror that the level of private debt peaked last year at about $36 trillion, which is certainly a lot of money, especially since total GDP of the Whole Freaking Country (WFC) is only $14 trillion (and falling!).
In some kind of bizarre "good news/bad news" … [visit site to read more]

Earnings Scorecard: Costco

Posted: 16 Mar 2010 02:49 PM PDT

Costco Wholesale Corporation (NASDAQ:COST), one of the leading U.S. warehouse club operators, reported fiscal second-quarter 2010 earnings that missed the Zacks Consensus Estimate by a penny, though they were up significantly from the prior-year quarter.
Total revenue climbed 11.3% year-over-year, with comparable-store sales up 9%, reflecting a comparable sales growth of 5% at U.S. locations and 26% gain at the international divisions. Rising gasoline prices and a weaker U.S. dollar were helpful to … [visit site to read more]

Patriot Sells 1st Met Coal To Asia

Posted: 16 Mar 2010 02:48 PM PDT

Coal producer, Patriot Coal Corporation (NYSE:PCX) is all set to venture into the Asian coal markets with its first sale of $1.5 million tons of metallurgical coal to steel mills in the Pacific Rim.
The company said that the coal will be sourced primarily from its Panther and Winchester mines. The sale is arranged through a third party, Xcoal, which has an extensive presence in Asian markets. The company expects coal deliveries to begin in April 2010 through early 2011.
Furthermore, the company … [visit site to read more]

PRAA Buys 62% Stake In CCB

Posted: 16 Mar 2010 02:33 PM PDT

In an attempt to expand into the class action settlement recovery market, Portfolio Recovery Associates, Inc. (NASDAQ:PRAA) announced on Monday the acquisition of 62% stake in the Claims Compensation Bureau, LLC (CCB), a company that specializes in recovering funds and processing payments due under class action claims settlement for clients. Although the deal has been completed, the terms of the transaction remains undisclosed.
Though PRAA has acquired a 62% controlling interest in substantially all … [visit site to read more]

PepsiCo Raises Dividend

Posted: 16 Mar 2010 02:20 PM PDT

The Board of Directors of PepsiCo (NYSE:PEP) raised the annual dividend by 7% to $1.92 per share from $1.82 earlier. This is the 38th consecutive annual increase in dividend. The dividend is expected to be payable on June 30, 2010 to shareholders on record as of June 4, 2010.
The company's strong balance sheet and its ability to generate healthy cash flow allow it to increase shareholder value through higher dividends. Cash in fiscal 2009 totaled $3.9 billion. The improvement was driven by … [visit site to read more]

Daimler To Join Renault-Nissan

Posted: 16 Mar 2010 02:09 PM PDT

Germany's Daimler AG (NYSE:DAI) has entered into discussions with France's Renault SA to acquire mutual equity stakes that would add the former to the alliance, which already includes Japan's Nissan Motor Co. The stakes to be acquired are likely to amount to less than 10%.
In December last year, Daimler and Renault announced plans to jointly develop small cars. The talks about exchanging equity stakes are just a part of that announcement.
Daimler is now interested in enhancing the … [visit site to read more]

Video: Ford Unveils Its New Police Car, The Interceptor

Posted: 16 Mar 2010 02:05 PM PDT

After nearly three decades, the Ford Crown Victori police car is being phased out by the new Police Interceptor. … [visit site to read more]

The Investment U Conference: Take Your “Virtual” Seat On The Plane To San Diego

Posted: 16 Mar 2010 02:05 PM PDT

As I write, my Investment U colleagues are heading west.
Their destination: San Diego, California, for the annual Investment U Conference.
I must confess, I'm a little envious – although I'm not sure the Californians would allow pasty Brits like me to go anywhere near the beach anyway.
This year marks the twelfth Investment U Conference. And the theme couldn't be more crucial or timely: The Best Contrarian Investments for 2010…
With a mass of investing information available, knowing … [visit site to read more]

Financials Could Feel The Heat From Legislation Reform

Posted: 16 Mar 2010 02:01 PM PDT

Although the future of reform legislation remains unclear, a recent bill proposed by Senator Christopher Dodd could potentially hinder the financial sector and its exchange traded funds (ETFs).

This new proposed reform, which is expected to be forced onto the Senate Finance Committee as early as next week, aims to give the Federal Reserve extraordinary control and power over large financial institutions.   More specifically, it would give the Fed the power to break up any large … [visit site to read more]

Guns And Butter: Two Bull Markets Worth Watching

Posted: 16 Mar 2010 02:00 PM PDT

Stocks went precisely nowhere yesterday. In fact, for all of 2010 so far, the Dow and S&P 500 have done just about squat – a 2-3% gain, at best.
Traders will say they're all holding their breath for today's FOMC decision, which, as our pal Peter Cooper forecast last week, might include a surprise rate hike. But really…stocks are boring these days. So let's find a bull market somewhere else more traditionally boring.
Buy food, Chris Mayer told his Special Situations readers … [visit site to read more]

Video: NYSE Closing Bell Market Monitor: C, WMT, LTD

Posted: 16 Mar 2010 01:57 PM PDT

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]

Flowserve Wins $15M Order

Posted: 16 Mar 2010 01:55 PM PDT

Flowserve Corp. (NYSE:FLS) received an order worth more than $15 million from State Nuclear Power Engineering Company Ltd. (SNPEC) in China for ASME Section III safety-related globe and gate valves and Flowserve Limitorque actuators.
Flowserve said it will book the order in the first quarter of 2010.
The Flowserve valves and actuators will be utilized at the Westinghouse design AP1000(TM) Sanmen and Haiyang Unit 2 nuclear power plants located in Zhejiang and Shandong regions. The plants, … [visit site to read more]

Daily ETF Roundup: VXX Sinks, GDX Soars

Posted: 16 Mar 2010 01:52 PM PDT

Equity markets finished the day slightly ahead after the Fed decided to hold rates at record lows at its meeting earlier today. The Fed signaled improving conditions with regards to business spending but remained cautious regarding unemployment levels and consumer spending. "The Fed is holding out for clearer signs of improvements in the labor market," said Anthony Chan, chief economist at JP Morgan's Private Wealth Management. "Until then, the Fed feels it needs the insurance policy of … [visit site to read more]

Video: Crude Rises On Positve Fed Comments

Posted: 16 Mar 2010 01:40 PM PDT

Front month crude prices rose this session following optimistic remarks on the economy by the Federal Reserve. … [visit site to read more]

Fed Stays On Hold

Posted: 16 Mar 2010 01:39 PM PDT

As expected, the Federal Reserve left the federal funds rate unchanged at its meeting today. Below, we present statements from the current meeting along with statements from the late January meeting, with my commentary and interpretation (translation?) interspersed on a paragraph by paragraph basis.
“Information received since the Federal Open Market Committee met in January suggests that economic activity has continued to strengthen and that the labor market is stabilizing. Household spending … [visit site to read more]

Closed-End Funds Vs. ETFs: Are You Missing Out On “Secret” Profits From Emerging Markets?

Posted: 16 Mar 2010 01:39 PM PDT

Tuesday, March 16, 2010: Issue #1217
As I noted in my column last week, the explosion in popularity of ETFs and ultra ETFs has changed the way many investors gain broad diversification.
An ETF…

Gives you exposure to multiple assets through just one investment.
Contains a basket of stocks and trades in real-time on major exchanges, based on the value of the underlying assets in the basket.
Offers low management fees.

By contrast, closed-end funds…

Are actively managed. This means they … [visit site to read more]

CB&I Wins Peru Project

Posted: 16 Mar 2010 01:38 PM PDT

Chicago Bridge & Iron Co. (NYSE:CBI) has secured a deal to supply a cryogenic natural gas processing plant in Malvinas, Peru, as part of an expansion of the Camisea gas project. CB&I's deal, which is valued above US$45 million, is with Pluspetrol Peru Corporation S.A. as operator and contract administrator, on behalf of the licensees.
CB&I will be accountable for the engineering, procurement, modular fabrication and commissioning of a cryogenic unit designed to process up to 520 … [visit site to read more]

American Oriental Beats Marginally

Posted: 16 Mar 2010 01:22 PM PDT

American Oriental Bioengineering's (NYSE:AOB) fourth-quarter earnings per share (EPS) came in at 14 cents surpassing the Zacks Consensus Estimate of 12 cents and 10 cents reported in the year-ago period. For 2009, the company reported EPS of 53 cents, compared to last year's 61 cents.
The company derives revenue from two operating segments–Manufacturing and Distribution. During the quarter, Manufacturing accounted for more than 95% of the company's total revenue. The company generated $3.6 … [visit site to read more]

Canadian Natural Resources (NYSE:CNQ) – Management “Acts Like Owners” For Better Decisions

Posted: 16 Mar 2010 01:15 PM PDT

Calgary-based Canadian Natural Resources (NYSE:CNQ) is an independent crude oil and natural gas company with operations in Canada, the UK, and West Africa. It's recently reported nearly flat earnings, but relatively healthy revenue growth from the year prior period. In order to get a more in-depth analysis on its recent announcement, we turn to Chris Mayer, Agora Financial's research editor for the Capital & Crisis newsletter. He took a close look at the announcement and has the following … [visit site to read more]

MDR Subsidiary To Buy GE Unit

Posted: 16 Mar 2010 01:06 PM PDT

Babcock & Wilcox Power Generation Group – a subsidiary of energy-focused engineering and construction firm McDermott International Inc. (NYSE:MDR) – announced the purchase of an air and emissions unit from GE Energy, a division of General Electric Co. (NYSE:GE). No details were available on the financial terms of the transaction, which is expected to close following the satisfaction of customary closing conditions.
 
The GE Energy segment employs around 220 people in various locations … [visit site to read more]

I’m So Confused

Posted: 16 Mar 2010 01:06 PM PDT

OK, time for a bit of crowdsourcing on a familiar subject. According to Bloomberg BusinessWeek, the bottom is at hand in the property market:

“Housing Real-Estate Recovery Signaled as Fed Unwinds”

The U.S. housing market is poised to withstand the removal of government and Federal Reserve stimulus programs and rebound later in the year, contributing to annual economic growth for the first time since 2006.
Increases in jobs, credit and affordable homes will help offset the end of the Fed's … [visit site to read more]

Verizon Awaits “Nexus One”

Posted: 16 Mar 2010 12:50 PM PDT

Taiwanese handset giant HTC has reportedly begun shipping Google's (NASDAQ:GOOG) Nexus One (a.k.a "Google phone”) Android phone to US wireless kingpin Verizon (NYSE:VZ). According to the Chinese newspaper Economic Daily, the carrier is likely to begin offering the device in late March or April 2010. Moreover, HTC will also ship the phone to Vodafone (NYSE:VOD) in the near future. 

Manufactured by HTC, Nexus One is Google's own branded Android smartphone and is being marketed by the Internet … [visit site to read more]

Lazy Markets Lazy Psychology

Posted: 16 Mar 2010 12:45 PM PDT

There is literally almost nothing new to report in the way of developments since our last article - The S&P500 is still sitting just a hair above its January high, currently invalidating the terminal pattern that developed to start the initial move down.

This does increase the case for another bullish run in the short-to-mid-term, however the markets have stalled after long time-frame of consistent buying, making higher highs on waning technicals, including the Advance/Decline … [visit site to read more]

OGE Focuses On Smart Meters

Posted: 16 Mar 2010 12:35 PM PDT

OGE Energy Corporation (NYSE:OGE) filed an application with the Oklahoma Corporation Commission seeking approval to install smart meters across its Oklahoma service area. If approved, the proposal would increase the average customer’s electric bill by about $2 per month for the next three years. The hike has been partially subsidized by $130 million federal stimulus grant received by the company. 

OGE Energy plans to avoid addition of new fossil fuel generation units until fiscal 2020. The … [visit site to read more]

MGM Contractor Plans Liens

Posted: 16 Mar 2010 12:20 PM PDT

The primary general contractor of MGM Mirage's (NYSE:MGM) $8.5 billion CityCenter project on the Las Vegas Strip is planning to take legal action against its owners. 

MGM Mirage, which owns CityCenter in a joint venture with Dubai World, has disclosed in a regulatory filing with the Securities and Exchange Commission last Friday that the primary general contractor for the CityCenter project has sent a notice of its intent to file mechanics' liens on CityCenter for an alleged … [visit site to read more]

TIP: Silver Bullet Or Steel Trap?

Posted: 16 Mar 2010 12:06 PM PDT

Earlier this month, InvestmentNews released a list of the ten ETFs financial advisors researched the most in 2009. The list, which was based on information provided by Morningstar, included several traditional inflation hedges, such as the SPDR Gold Trust (GLD) and iShares COMEX Gold Trust (IAU), as well as the broad-based PowerShares DB Commodity Fund (DBC). And in the top spot was the Barclays TIPS Bond Fund (TIP), which invests in inflation-protected securities issued by the U.S. … [visit site to read more]

AES Corporation Sells Stake

Posted: 16 Mar 2010 12:05 PM PDT

AES Corporation (NYSE:AES) concluded its equity sale with a wholly-owned investment subsidiary of China Investment Corporation (CIC). The deal was first announced on Nov 6, 2009 and raises $1.58 billion in new capital for AES. CIC acquired 125.5 million shares of AES common stock for $12.60 each for a 15% stake in the company. 

China Investment's entry provides AES with a new source of capital to finance its pipeline of investment projects. Additionally, working with CIC will expand its … [visit site to read more]

Five Ultra Popular ETNs

Posted: 16 Mar 2010 12:00 PM PDT

Most of what's written about ETNs is cautionary in nature, focusing on the credit risk inherent in any debt security. And with good reason; the risks of ETN investing are very real. While most exchange-traded notes are issued by major financial institutions with lofty credit ratings, the last few years have taught investors that credit risk, however negligible, can never be written off completely. But ETNs also offer some potential advantages to investors. For one, they often offer exposure … [visit site to read more]

When Money Supplies Go Wild!

Posted: 16 Mar 2010 12:00 PM PDT

The US money supply is much bigger than the official numbers indicate…$1.25 trillion bigger, to be exact. If you care about the value of the dollars in your pocket, this information should matter greatly to you.
As the financial crisis has unfolded over the last two years, the Federal Reserve has been responding in a variety of unprecedented ways. Therefore, it is logical to assume that these never-before-used actions have altered long-established ways of measuring the US dollar money … [visit site to read more]

Forex Trading: GBPUSD Fills The Hourly Bar Gap From Feb 26th/March 1st

Posted: 16 Mar 2010 11:36 AM PDT

Remember the gap on the hourly chart from February 26th to March 1st between the 1.5239 and the high on Monday at 1.5203?  That gap was filled with the GBPUSD move up to the high for the day at the 1.5244 (PHEW).  The price now is looking to hold the support at the 1.5206. This was the high for the day prior to the move … [visit site to read more]
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