August 31, 2011
How to Make Weak Hands Strong
 A time-honored adage in the investing world says that when markets bottom out, money changes hands. The thinking goes along the lines that the weak hands panic and sell when the strong hands move in to buy and hold up the market. In this way money moves from weak hands to strong hands at market bottoms. When Volatility Declines, the Trend Turns Bullish As the market reaches its low in a downward trend, it does so with high volatility. Once the volatility begins to subside, market watchers are quick to point out that a change of trend may be underway. The change of trend may a great time to adopt a posture of being the strong hands. But to do so you have to find a way to acquire some market muscle. You need the psychological staying power to keep (more)…
Is the Risk Trade ON… or… OFF?
 In the stock market… risk is NEVER off… Below are some interesting and, in some cases, somewhat disturbing ‘factoids’: Every time the GDP has dropped more than 2% in one year, our country has gone into recession. As of Friday’s report, Q2 GDP was down 1.5% over the previous year. Garden-variety recessions see an average drop in the market of about 40%. Estimates are now that the likely upcoming recession (assumption of many) could push the market down by 30% or more from current levels. Unemployment is being woefully under-reported. When you include those who are working in temporary jobs to get by along with those who have given up looking for a job, the estimates are closer to 17%+. The European banking and sovereign debt crisis has all the appearances of spiraling out of control. Could a default of (more)…
Commerce Report and Goldman Sachs Bolster Metals
 Industrials and materials had been failing to take off while other sectors recovered over the past four days. That changed during Wednesday trading after the commerce department reported a rise in factory orders of over 2.4 percent for the month of July. This not only surpassed economist expectations but helped to buck the weight regarding the slowing global economy. Attention on the global economic slow-down has prompted speculation over a double dip and weighed on the Wall Street consciousness. Today’s announcement regarding factory orders or the rising demand on manufacturers, directly benefitted the basic materials sector as hope arose regarding a reversal of attitudes. Compounding the impact of the rise in factory orders was a bullish note issued by investment banking firm, Goldman Sachs (GS). Metals, especially those designated for commercial use, have been tanking during the past two months, (more)…
Equities Sector Coverage: Market Retakes Positive Territory For 2011
 Mortgage Applications tumbled 9.6% last week with for purchases near a fifteen year low. The demand for refinancings slumped 12.2%. According to ADP, the private sector added just 91,000 workers in August. The Chicago PMI came in at 56.5 in August down from 58.8 in July. The Dow Jones Industrial Average surged higher Thursday morning up more than 100 points to a morning high at 11,712.60 versus the 50-day and 200-day simple moving averages at 11,916 and 11,993. There was afternoon weakness into the red with a day’s low at 11,528.08. The NASDAQ jumped to 2611.58 in morning trading versus its 50-day and 200-day simple moving averages at 2656 and 2704. The NASDAQ weakened in afternoon trading to a day’s low in the red at 2557.74. Asian stocks traded higher on Wednesday again following the gains on Wall Street. The (more)…
Is It Possible to Have Both Safety and Returns?
 The volatility of late has led investors to invade everything from safe havens to food related stocks. Some have been taking risks on bargain bins, while others are looking toward investing in the Volatility Index. Any angle an investor chooses appears to have a definite upside and downside. Snapping up weak financial stocks can offer a major upside, while investing in gold or the franc is dangerous in that it holds the threat of a potential expiration date. Other safety options offer weak returns in exchange for stability. Ideally, an investor would be able to shield themselves largely from volatility without having to sacrifice returns. This win/win situation seems to undermine the very attitude it takes to play the market, but options like this do exist. A number of investment banks have observed this demand and begun to launch relatively (more)…
Equities Roundup: Stocks Rise On Stimulus Hopes Despite Weak Economic Data
 Wall Street is trading higher today as investors remain optimistic that the Federal Reserve is preparing for a new round of economic stimulus packages. According to Automatic Data Processing (ADP), the private sector added 91,000 jobs in August, led mainly by service companies and small-businesses. Economists, however, were expecting an increase of 100,000. The U.S. Department of Commerce indicated that factory orders rose 2.4 percent in July, beating economist projections of 2.0 percent. Stocks dipped slightly when it was announced that the U.S. Justice Department is seeking to block the AT&T (T) $39 billion acquisition of T-Mobile, which is owned by Deutsche Telekom AG (DTEGY). The deal would put immense pressure on competitors, from a price standpoint and stymie future product innovation for consumers. The deal had received staunch opposition from other telecoms like Sprint (S), but received support from (more)…
Technical Breakout Before Obama’s Speech Next Week
 Brooksie’s Daily Stock Market blog - an edge before the open Wednesday, August 31, 2011 9:21 am EDT DJIA: 11,559.95 S&P 500: 1212.92 There is a lot of anticipation built into this market as the Street awaits President Obama’s introduction of new programs to stimulate economic growth next week. That will be followed by a two-day meeting by the Federal Open Market Committee (FOMC) starting on September 20 which is expected to be economy friendly ! The S&P 500 is up 4.7% in three days as institutions continue to nibble away on stocks that are assumed to be cheap, assuming the nation is not headed for a recession. This morning, the ADP Employment Report for July indicated 91,000 jobs were added to the private sector, 58,000 by small business, 30,000 by medium size business, the remainder by big companies. While (more)…
China Stocks End Dismal August with A Rally
 China stocks ended a drama-filled August with a bang, and apparently the current rally could spill into September. However, this week’s upswing probably won’t move very far into next month and has only put a dent in August’s big losses. In the first three days of this week the Hang Seng Index jumped 4.9% to 20,535, and the index of Chinese company stocks soared 6.2% to 10,943. Still for the month the Hang Seng lost 8.5%, and Chinese companies sank 11.6%. This week’s rally still has some momentum, according to Ben Kwong, chief operating officer at KGI Asia. The focus is on companies announcing results. For example Chinese oil producer CNOOC (CEO) bounced higher the last couple days after announcing a big jump in interim profits. CNOOC and other Chinese resources companies stand to gain from a weakening U.S. dollar, (more)…
Convenience Drives WeedMaps App
 Convenience can be relied upon to help make decisions ranging from what restaurant to dine in to what mall to shop in. In a world where options become ever more plentiful, convenience is becoming more important than ever. Medicinal cannabis is no exception. More and more states have begun legalizing the medicinal use of marijuana. This, in turn, has prompted an increase in businesses looking to profit from the recession-proof medicinal cannabis model. The bevy of new locations increases competition among purveyors and makes it difficult for users to select the dispensary that’s right for them. That is why WeedMaps Media, a fully owned subsidiary of Internet marketing services company, General Cannabis Inc. (CANA) has announced the debut of their Android application. The application, which is exclusively for Amazon, provides locations for local dispensaries and doctors, links to videos and (more)…
August 30, 2011
Techs Follow Broader Market Slightly Higher
 A plunge in consumer spending led investors away from equities today as analysts questioned how American’s will spend alongside slower economic growth. The reports, accompanies by weaker job numbers had the market ending only narrowly higher. Tech mirrored the broader market, with major companies gaining only slightly for the day. Among the more notable gainers, was Nokia (NOK), which announced the release of its first Windows-based smartphone, expected for the fourth quarter. The smartphone, which is not yet on the market is the company’s biggest bet of the year. Nokia believes the release will help them regain market share lost to Apple’s iPhone. Until this year, Nokia was accountable for the majority of smart phones being shipped. Their hardware has not lost its popularity, but shares have been slipping as consumers have expressed a preference sleeker, more seamless iPhone. The (more)…
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