Market stages late rally to close higher....

Following the release of the Fed August 9 minutes, traders pushed stocks higher.  With 15 minutes left in the day the Dow was up 88 points, however program selling in the last 10 minutes brought us back toward even on the day.

Dow + 20 to 11559
Nas +14 to 2576
S&P +3 to 1212

Oil stocks rallied into the close and Gold, once again, moved higher in tandem with the broad market.  All in all not a bad day, but not exactly the breakout we were hoping for.

Market shruggs off Fed minutes...

 FOMC minutes from the Aug. 9 meeting show a split concerning the best tools for easing monetary policy. A few members felt that economic developments justified a more substantial move, but they were willing to accept the stronger forward guidance on the federal funds rate as a step in the direction of additional accommodation.

The markets sold off initially on the release, but are now resuming their uptrend...

Dow +19
Nas +11
S&P +1

Terra Nitrogen continues move higher....

We've been following the movement of Terra Nitrogen (TNH) over the past week.  Today the stock is up yet another 6.19 to 194.70.  The dividend is now 7.66% based on the current price.

Consumer confidence drops...

This morning we got news that confidence among consumers plunged to its lowest level since April 2009. The consumer confidence index dropped to a reading of 44.5 in August from 59.2 in July, according to the Conference Board. Economists had been looking for a reading of 52.

That's a big miss by the experts...however a few good weeks in the stock market can turn that confidence around very quickly.

RIMM Breaks out.....

We pointed out last week that it may be time to scoop up some Reseach in Motion shares.  The maker of Blackberry phones' shares rose thru the targeted $30 level yesterday and are getting a strong follow thru rally today.

Shares are currently up 1.50 to $32.22

After two hours.....

the market just turned positive after a negative open.  Look for more volatility as traders await Fed minutes to be released at 2 pm this afternoon.

Dow +3
Nas +5
S&P +1

Southwest Air shares weak on bad news concerning 717's...

Shares of Southwest Airlines (LUV -2.1%) suffer on a day many airline stocks (FAA +0.7%) are posting modest gains. An aviation blogger reports the firm's 88 717s picked up in the AirTran buyout are increasingly "unviable" in a high fuel cost environment, a statement reinforced by the carrier's decision to drop routes serviced exclusively by 717s.

LUV shares are down 0.20 to 8.48 this morning.

You gotta like Perrigo...

Generic product maker Perrigo (PRGO) is hitting new all-time highs this morning.  It is currently up 1.94 to 95.55.

 

Market holds up well.....

Twenty minutes into the day, the market is holding up despite premarket selling following Fed comments about potential QE3. 
Dow -25
Nas -5
S&P -5

Fed minutes from last weeks meeting will be released later today.  Look for a drastic reaction either way on that once it is released.  It is becoming clear that the market does not want to hear that the Fed is going to start a QE3 program.

FDIC objecting to Bank of America settlement...

Bank of America (BAC) is once again a stock to watch, as the FDIC objects to B of A's $8.5 billion mortgage settlement.  The agency is objecting as an investor rather than a regulator - it owns securities that would be covered by the settlement because it took over banks that failed during the financial crisis.

The FDIC says its objection is based on the fact that it doesn't have enough information to evaluate it.

This is probably positive for Green Mountain Coffee...

Starbucks Corp. (SBUX). The coffee chain said coffee packets under its brand for Green Mountain Coffee Roasters Inc's (GMCR) single-serve Keurig coffee machines will be sold in U.S. grocery and specialty retail stores from November, in time for the key holiday season. It also said it plans to grow its sales of "K-Cups" to $1 billion over time.

Meanwhile, check out the chart on Coffee prices...

HP contemplates splitting company...

Hewlett-Packard (HPQ). The technology company said on Monday it prefers to spin off its personal computers unit and is currently working on understanding the larger implications of separating the business from the company.

Premarket movers...

Premarket gainers:

LLNW +10%. AEZS +8%. PANL +6%. TGB +4%. DG +3%.

Losers:
 
NBG -9%. CEDC -7%. LVLT -4%. ASBC -4%. FRO -3%. DB -3%. FMS -3%. GSK -3%.

Futures sell off on Fed comments premarket....

Gold spikes higher as well.

Chicago Fed's Charles Evans says "strong accommodation" is needed for a "substantial period of time" due to a U.S. economy that seems to be moving "sideways." Evans tells CNBC this morning that more aggressive policy is needed; he is "somewhat nervous" about the recovery, and believes the labor market is in a state "consistent with recession."

This clinches it.  It is clear, the market does NOT want any more fiscal stimulus from the Fed.  It would be nice if they would just let everything play out.

DSW beats and raises...

DSW Inc's quarterly profit beat estimates as more customers showed up at its stores looking for discounts, and the shoe retailer raised its full-year outlook.   The Columbus, Ohio-based retailer now expects annual diluted earnings of $2.70-$2.85 for the full year. It had earlier forecast earnings in the range of $2.65-$2.80.

Excluding items related to DSW's merger with RVI which closed in the quarter, it earned 74 cents a share in the second quarter.  Sales at the company, which sells branded footwear for men and women at discounted rates, rose 14.7 percent to $476.3 million.

Analysts, on average, had expected the retailer to earn 63 cents a share on revenue of $459.4 million, according to Thomson Reuters I/B/E/S.

The stock is up $2 in premarket trading to $49.20.

New Idea of the Day....MAKO

MAKO Surgical (MAKO) designs and makes robotic systems (similar general idea as ISRG) that can avoid total knee replacements by use of a procedure called MAKOplasty. MAKOplasty is an alternative that resurfaces the damaged portions of the knee. MAKO sells the robotic system, called the Robotic Arm Interactive Orthopedic System, and then sells consumables which must be replaced for every procedure. Recovery times for MAKOplasty patients are drastically reduced over total knee replacement, leading to lower healthcare and rehabilitation costs, and improved quality of life.

About 581,000 knee replacements are performed each year in the US. Although there are no hard numbers for the percentage of these that would benefit from MAKOplasty, that does provide some scale to the potential market. The company has not yet had a profitable quarter, but revenues keep increasing at a high rate (up 80% and 81% in the past two quarters) and procedures performed are also increasing quickly (up 88% in the first half of 2011 to over 2,800).

MAKO fell down to $21 during the latest market selloff, but then has come storming back after releasing its earnings on August 9.  The stock rose 2.57 to a new closing high of 34.99 yesterday.  Here is the weekly chart:

Today is a key day....

After yesterday's rally we are sitting just above key levels.  The S&P closed at 1210 after breaking thru the previous high made on August 17.  What we would like to see today is follow thru move higher, on heavier volume.  This morning Futures are lower (down 6), but that is great.  A reversal of that with a further breakout would be very positive.