U.S. Markets:
Dow +9.36 (+0.07%)
Nasdaq +8.79 (+0.37%)
S&P 500 -1.27 (-0.09%)
News That Moved the Market
Cap Lifted For Home Loan Providers. The markets took off early in the session on news that the Office of Federal Housing Enterprise Oversight decided to remove Fannie Mae's (FNM, +1.1%) and Freddie Mac's (FRE, -0.5%) $1.5 trillion mortgage portfolio cap. The cap was created after the two companies found $11.3 billion in accounting errors in 2006. The lenders should now be better able to provide financing for the U.S.'s troubled housing market.
Earlier in the morning, Fannie Mae reported a greater than expected $3.6 billion loss and shares of the company hit a 12-year low, but news of the regulator's decision turned the stock around. Later in the day, the markets sold off, as investors pocketed profits. It seems many do not want to leave profits on the table when a bad piece of data or headline could erase any gains.
Bernanke Signals Further Rate Cuts. Fed Chairman Ben Bernanke spoke in front of the Senate Banking Committee Wednesday and provided some relief to investors. Despite rising inflation pressures, he indicated the Fed would continue easing rates as economic downside risks remained the key focus.
Economic Data Misses Estimates. The Commerce Department reported durable goods fell 5.3%, which was slightly worse than expected. Meanwhile, new homes sales came in at 588,000, missing the 600,000 expected and representing a 13-year low. Both pieces of data were not horrible, but showed signs of a deteriorating economy.
Quick Tics:
The EU slapped Microsoft (MSFT, -0.4%) with a record $1.35 billion anti-trust fine.
The U.S. dollar hit a record low against the euro ($1.5118/euro) after Bernanke signaled further rate cuts.
Gold futures hit an all-time high of $967.70/ounce.
Nortel Networks (NT, -13.3%) reported steeper losses, announced job cuts, and released a worse than expected growth forecast for 2008.
Tomorrow Notable Earnings:
Cablevision Systems Corp.(CVC) Before Open
Dell, Inc. (DELL) Before Open
Gap Inc. (GPS) After Close
Kohls Corporation (KSS) After Close
Sears Holdings Corp (SHLD) Before Open
Viacom (VIA) After Close
XM Satellite Radio (XMSR) Before Open
Economic Events:
8:30 AM: GDP
8:30 AM: Chain Deflator
8:30 AM: Initial Job Claims
Wednesday, February 27, 2008
My Daughter Says Buy Abercrombie & Fitch....
No kidding. ANF is the owner of the Hollister chain...and this is the hottest store for young teens.
The stock is up .75 to $81.75 today. Technically...the stock has alot of resistance at $84-85 level. We'll keep an eye on it and let you know if it breaks out.
The stock is up .75 to $81.75 today. Technically...the stock has alot of resistance at $84-85 level. We'll keep an eye on it and let you know if it breaks out.
Technical Alert: Sony Corp.(SNE)
We have been following Sony Corp., as the company has had alot of wins over the past month. The stock is higher again today on high volume, currently up .60 to $49.50. It has climbed out of a base, up 20%, in the last two weeks.
Next resistance is at $55-56 level.
Next resistance is at $55-56 level.
Technical Alert: Juniper (JNPR)
Juniper Networks is breaking higher out of one month base on higher volume.
The stock is up 1.25 to $28.75 today. The stock was looking strong in the low 30's back in December before the market sold off the first few weeks in January.
The stock is up 1.25 to $28.75 today. The stock was looking strong in the low 30's back in December before the market sold off the first few weeks in January.
Technical Alert: Research in Motion (RIMM)
Research in Motion is breaking higher out of a cup and handle formation on higher volume.
The stock is up 3.12 to $110.87. The next level of resistance on the stock is at $122.
The stock is up 3.12 to $110.87. The next level of resistance on the stock is at $122.
Upgrades this morning...
Stocks that have been Upgraded this Morning:
Healthways (HWAY) by Stifel Nicolaus
AXT Inc (AXTI) by Roth Capital
Medarex (MEDX) by BMO Capital Markets
SuperGen (SUPG) by Susquehanna Financial
Xilinx (XLNX) by UBS
Overseas Shipholding (OSG) by Bear Stearns
Tenet Healthcare (THC) by Jefferies & Co
Telefonica S.A. (TEF) by UBS
Healthways (HWAY) by Stifel Nicolaus
AXT Inc (AXTI) by Roth Capital
Medarex (MEDX) by BMO Capital Markets
SuperGen (SUPG) by Susquehanna Financial
Xilinx (XLNX) by UBS
Overseas Shipholding (OSG) by Bear Stearns
Tenet Healthcare (THC) by Jefferies & Co
Telefonica S.A. (TEF) by UBS
Downgrades this morning...
Here is a list of stocks that have been Downgraded this morning:
Autodesk (ADSK) by Needham & Co
Ceradyne (CRDN) by Morgan Joseph
Orthofix (OFIX) by Susquehanna Financial
NovaGold Resources (NG) by RBC Capital Mkts
K-Swiss (KSWS) by Susquehanna Financial
Solarfun Power (SOLF) by Banc of America Sec
JA Solar (JASO) by Banc of America Sec
Chesapeake Energy (CHK) by Citigroup
Quicksilver (KWK) by Citigroup
EOG Resources (EOG) by Citigroup
SW Energy (SWN) by Citigroup
Barrick Gold (ABX) by Credit Suisse
Ultra Petroleum (UPL) by JP Morgan
Autodesk (ADSK) by Needham & Co
Ceradyne (CRDN) by Morgan Joseph
Orthofix (OFIX) by Susquehanna Financial
NovaGold Resources (NG) by RBC Capital Mkts
K-Swiss (KSWS) by Susquehanna Financial
Solarfun Power (SOLF) by Banc of America Sec
JA Solar (JASO) by Banc of America Sec
Chesapeake Energy (CHK) by Citigroup
Quicksilver (KWK) by Citigroup
EOG Resources (EOG) by Citigroup
SW Energy (SWN) by Citigroup
Barrick Gold (ABX) by Credit Suisse
Ultra Petroleum (UPL) by JP Morgan
Costco Down as Goldman Cuts Rating on Co....
Shares of Costco Wholesale Corp. (COST) is down 2.4% to $64.86 after Goldman Sachs cut its rating on the warehouse retailer to neutral from buy.
In a note to clients, Goldman Sachs analyst Adrianne Shapira wrote that "with current relative valuation well above historic averages and limited remaining catalysts on the horizon, we view current risk/reward less compelling."
The stock appeared to be breaking out yesterday, but this downgrade should cause it to pull back. It has key support at $62.50.
In a note to clients, Goldman Sachs analyst Adrianne Shapira wrote that "with current relative valuation well above historic averages and limited remaining catalysts on the horizon, we view current risk/reward less compelling."
The stock appeared to be breaking out yesterday, but this downgrade should cause it to pull back. It has key support at $62.50.
Netflix Up After Boosting 1Q Outlook...
Shares of Netflix Inc. (NFLX) are up 6.9% to $31 before the opening bell Wednesday after the online DVD rental service boosted its first-quarter earnings outlook.
The Los Gatos, Calif., company said it now sees first-quarter earnings of 15 cents to 22 cents a share on revenue of $324 million to $328 million. The company had previously forecast first quarter earnings of 13 cents to 21 cents a share on revenue of $323 million to $328 million.
Analysts expect, on average, earnings of 20 cents a share on revenue of $325 million.
In addition, Netflix sees first-quarter ending subscribers of 8.16 million to 8.26 million, up from a prior view of 7.85 million to 8.05 million ending subscribers.
Not much of a raise, but...
The Los Gatos, Calif., company said it now sees first-quarter earnings of 15 cents to 22 cents a share on revenue of $324 million to $328 million. The company had previously forecast first quarter earnings of 13 cents to 21 cents a share on revenue of $323 million to $328 million.
Analysts expect, on average, earnings of 20 cents a share on revenue of $325 million.
In addition, Netflix sees first-quarter ending subscribers of 8.16 million to 8.26 million, up from a prior view of 7.85 million to 8.05 million ending subscribers.
Not much of a raise, but...
US January Durable Goods Orders Drop 5.3%..
Orders for durable goods fall 5.3% to $212.80 billion and a barometer of capital spending by businesses slumps, an indication the sluggish economy might be restraining companies. Economists expected a smaller 4% decrease in durable goods orders.
US Stock futures dropped on the news...
US Stock futures dropped on the news...
Bernanke Speaks to Congress this Morning...
Eyes will be trained on Washington D.C. on Wednesday as Bernanke begins his two days of Congressional testimony, starting at 10 a.m. Eastern.
Vice Chairman Donald Kohn on Tuesday said that, despite signs that inflation actually strengthened in January, the nation's weak economy and fragile financial markets remain a bigger threat than higher prices. Kohn's views are generally thought to be closely aligned with Bernanke's.
In the last six months, traders have been selling off the market EVERY time either Bernanke or Bush appear on TV. It is obvious neither guy has any respect on Wall Street. Stock futures are already down in anticipation...
Vice Chairman Donald Kohn on Tuesday said that, despite signs that inflation actually strengthened in January, the nation's weak economy and fragile financial markets remain a bigger threat than higher prices. Kohn's views are generally thought to be closely aligned with Bernanke's.
In the last six months, traders have been selling off the market EVERY time either Bernanke or Bush appear on TV. It is obvious neither guy has any respect on Wall Street. Stock futures are already down in anticipation...
J&J, Amgen Fall on New Study...
Anemia drugs Aranesp and Procrit sold by Amgen (AMGN) and Johnson & Johnson (JNJ) raise the risk of death among cancer patients by about 10%, a new study of previous trials found. Amgen played down the study, saying the risks are already in the drugs' labels.
The FDA will convene in March to decide whether to impose further restrictions on the drugs, commonly used to treat chemotherapy-induced anemia. Shares of Amgen and J&J were down 3.2% and 1.15% in Europe.
The FDA will convene in March to decide whether to impose further restrictions on the drugs, commonly used to treat chemotherapy-induced anemia. Shares of Amgen and J&J were down 3.2% and 1.15% in Europe.
Dollar Tumbles...
The U.S. dollar hit record lows against the euro after weak consumer confidence and surprise inflation raised the odds of further interest-rate cuts.
Consumer Confidence fell to 75 vs. 82 consensus, down from 87.3 -- its lowest in nearly 15 years. Both core (+0.4%) and headline (+1%) wholesale inflation surprised to the upside; 12-month PPI of 7.4% is at its highest in over 25 years.
Consumer Confidence fell to 75 vs. 82 consensus, down from 87.3 -- its lowest in nearly 15 years. Both core (+0.4%) and headline (+1%) wholesale inflation surprised to the upside; 12-month PPI of 7.4% is at its highest in over 25 years.
EU Hits Mocrosoft With $1.3B Fine...
The EU fined Microsoft (MSFT) a record $1.3 billion for overcharging developers for interoperability information needed to develop Windows-compatible software. Microsoft noted the fines related to past issues that have been resolved.
Microsoft has dropped licensee royalty demands from 2.98%-3.87% to 0.5-0.7% and later to a flat fee of $14,000 for interoperability info and a worldwide patent license for 0.4%. There was speculation a penalty could go as high as $2.2B.
Microsoft has dropped licensee royalty demands from 2.98%-3.87% to 0.5-0.7% and later to a flat fee of $14,000 for interoperability info and a worldwide patent license for 0.4%. There was speculation a penalty could go as high as $2.2B.
Toll Bros. Misses, But Sees Glimmers of Hope...
Number-one U.S. luxury homebuilder Toll Brothers (TOL) posted a $0.61/share loss, exceeding the -$0.44 expected by analysts. The loss included a $245M writedown, net of which Toll earned $0.35/share. Net contracts signed fell 50% to $375M; backlog fell 42% to $2.4B.
CEO Robert Toll was again critical of the media's relentless 'drumbeat' recession talk, which he said dampens consumers' moods and keeps them from buying. Toll said selling remains weak, but that it sees a few "glimmers of hope."
CEO Robert Toll was again critical of the media's relentless 'drumbeat' recession talk, which he said dampens consumers' moods and keeps them from buying. Toll said selling remains weak, but that it sees a few "glimmers of hope."
Earnings Due Today....
COMPANIES REPORTING EARNINGS
• Dollar Tree Stores Inc. (DLTR). Projected to post a Q4 profit of $1.02 a share, up 5.73% from $0.96 earned per share same time previous year.
• Dress Barn Inc. (DBRN). Estimated to report a Q2 profit of $0.06 a share, down 75% from the same quarter last year when the company earned $0.24.
• Limited Brands (LTD). Forecast to post Q4 earnings of $0.91 a share, a decrease of 15.37% from the same quarter last year when the company earned $1.08.
• McDermott International Inc. (MDR). Expected to report Q4 earnings of $0.65 a share, a change of 77.26% from the same quarter last year when the company earned $0.37.
• Noble Energy Inc. (NBL). Expected to report Q4 earnings of $1.63 a share, a change of 57.86% from the same quarter last year when the company earned $1.03.
• Owens Corning Inc. (OC). Likely to report a Q4 profit of $0.19 a share, against a loss of $0.16 earned the same quarter last year.
• Petrohawk Energy Corp. (HK). Likely to report a Q4 profit of $0.15 a share, a change of 143.33% from the same quarter last year when the company earned $0.06.
• Public Storage (PSA). Estimated to report a Q4 profit of $0.28 a share, compared to a loss of $0.48 same quarter last year.
• Salesforce.com (CRM). Expected to report Q4 earnings of $0.04 a share.
• Washington Post Co. (WPO) is expected to report Q4 earnings of $8.85 a share, a change of -3.80% from the same quarter last year when the company earned $9.20.
• Dollar Tree Stores Inc. (DLTR). Projected to post a Q4 profit of $1.02 a share, up 5.73% from $0.96 earned per share same time previous year.
• Dress Barn Inc. (DBRN). Estimated to report a Q2 profit of $0.06 a share, down 75% from the same quarter last year when the company earned $0.24.
• Limited Brands (LTD). Forecast to post Q4 earnings of $0.91 a share, a decrease of 15.37% from the same quarter last year when the company earned $1.08.
• McDermott International Inc. (MDR). Expected to report Q4 earnings of $0.65 a share, a change of 77.26% from the same quarter last year when the company earned $0.37.
• Noble Energy Inc. (NBL). Expected to report Q4 earnings of $1.63 a share, a change of 57.86% from the same quarter last year when the company earned $1.03.
• Owens Corning Inc. (OC). Likely to report a Q4 profit of $0.19 a share, against a loss of $0.16 earned the same quarter last year.
• Petrohawk Energy Corp. (HK). Likely to report a Q4 profit of $0.15 a share, a change of 143.33% from the same quarter last year when the company earned $0.06.
• Public Storage (PSA). Estimated to report a Q4 profit of $0.28 a share, compared to a loss of $0.48 same quarter last year.
• Salesforce.com (CRM). Expected to report Q4 earnings of $0.04 a share.
• Washington Post Co. (WPO) is expected to report Q4 earnings of $8.85 a share, a change of -3.80% from the same quarter last year when the company earned $9.20.
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