Why stocks are in for a rough ride this week
Stocks in for a rough ride this week

Longtime market bull Jeremy Siegel says investors could realize the market is behind the curve on interest rates.


Mega caps, junk bonds and emerging markets offer hedged play on economic recovery.

By TheStockAdvisors Jan 5, 2012 4:56PM
Image: Stock market Traders (© Comstock/Corbis)This post is one in a series in which over 50 newsletter advisors share their Top Picks for 2012.

By Jim Lowell, Fidelity Investor

If 2011 was a slim-pickings picnic, many are saying 2012 will be nothing more than the ants. Not me. I know the macro issues we’ll have to invest through: ongoing eurozone crisis, escalating U.S. class warfare rhetoric, another Arab Spring. But don't forget that 2011 also taught us that even though one major piece of the global economy was broken, our own economy was able to maintain growth, albeit slow.  

Shares are down and peripheral bond yields are up as spending cuts continue to undermine the continent’s economy.

By MoneyShow.com Jan 5, 2012 4:28PM

Image: Euro (© Corbis)By Igor Greenwald, MoneyShow.com

That didn’t take long. 

A couple of days into the new year, Spanish and Italian stocks are down 2% amid dimming risk appetite around the globe.

Big Italian lender UniCredit had to discount its equity 43% to raise €7.5 billion from skeptical investors. Denmark’s Vestas, the world’s top maker of wind turbines, fell even more after cutting its outlook for the second time in two months as European customers postponed orders.


Expect financials and materials to do well in 2012.

By Motley Fool Pick of the Day Jan 5, 2012 4:23PM

Image: Crystal ball (© Brand X Pictures/Jupiterimages)By Alex Dumortier


As a forecaster on The Good Judgment Project, I compete in estimating the probabilities of political and economic events for the Intelligence Advanced Research Projects Agency. One of the lessons I've (re)learned is that "it is exceedingly difficult to make predictions, particularly about the future," to quote physicist Niels Bohr.

That gives no pause to financiers, pundits, and experts of all stripes who are always willing, around this time, to offer their predictions for the following year. I won't be left out; here are mine.


The employment picture got a little brighter over the past month. Here are some stocks that could benefit most from continued gains.

By John Reese Jan 5, 2012 4:13PM

Image: Construction workers (© image100/Corbis)Throughout the second half of 2011, many (if not most) pundits and prognosticators waited for the European debt crisis to spread across the Atlantic Ocean and topple the U.S. economic recovery. But over the past several weeks, a funny thing happened on the way to another recession: The economy actually picked up, and the job market has made its most significant improvement in nearly a year.

The four-week average of new claims for unemployment has fallen to its lowest level since June 2008, according to Labor Department data. Continuing claims, meanwhile, have fallen to levels not seen since September 2008, when the Lehman Brothers collapse sparked the financial crisis.


New unemployment claims are down, which could mean an improved December jobs picture.

By Jim J. Jubak Jan 5, 2012 3:49PM
Image: Office workers (© ColorBlind Images/Blend Images/Corbis)

Thursday's report on weekly initial unemployment claims offered a promising setup for Friday's release of the December jobs number.

For the week that ended Dec. 31, the number of people filing new claims for unemployment dropped to 372,000. That was a significant decline from the 387,000 initial claims filed in the week ended Dec. 24. Economists surveyed by Briefing.com had expected the initial claim number to drop to 375,000.

Even the continuing claims for unemployment number dropped to a still-horrendous 3.595 million for the week from 3.617 million the week before.

Cash-rich electronics company shows strong growth in core businesses.

By TheStockAdvisors Jan 5, 2012 3:48PM
Image: Construction Workers Carrying Window (© Steve Hix/Somos Images/Corbis)This post is one in a series in which over 50 newsletter advisors share their Top Picks for 2012.

By Benj Gallander & Ben Stadelmann, Contra the Heard Investment Letter

We focus on buying deep value plays that are out-of-favor and that strategy has contributed to our 10-year annualized return of 19.6%. One of our favorites that is overdue for a recovery is Flextronics (FLEX). 
Tags: FLEX

High-yielding stocks like Pfizer and Southern Copper may seem boring, but dividends have a history of saving the day.

By Jim Cramer Jan 5, 2012 3:13PM

Image: Businessman offering money © Andrea Bricco/Brand X Pictures/Getty ImagesPeople always want to know what sectors are going to work in a new year. Makes sense, as a great deal of a stock's move does depend on its sector -- perhaps too much, because of what I've been calling the "ETF-ization" of stocks, where the group a company belongs to hangs together by an ETF instead of trading separately, even a little bit, on the merits.


That's why I think the sector that will perform the best, again, in 2012, is the dividend sector, the segment of companies that reward you, that pay you to wait, while the company gets its act together or just simply puts on more cream to the cake.


The presidential candidate likely did very well focusing on metal-mining companies in 2009 and 2010.

By Kim Peterson Jan 5, 2012 2:43PM
Image: Golden Nest Egg (© Chris Collins/Photographer)Republican presidential candidate Ron Paul's investments are, well, let's just call them unusual.

The Wall Street Journal describes his choices as weird and was immediately hammered by readers calling foul. I'll say this much for his picks: They're definitely unorthodox, but they've seemed to turn out well.

Paul didn't like bonds or well-known mainstream stocks in 2010. In fact, he actively bet against U.S. stocks with a small stake in the Prudent Bear Mutual Fund (BEARX). You can see Paul's investments on his Congressional disclosure statement (registration required) for 2010. 

As old hits such as CityVille lose popularity, gaming company looks to new ones to maintain user base.

By Trefis Jan 5, 2012 2:37PM
Image: Couple with laptop (© Corbis)Zynga (ZNGA), the world's largest social gaming company, had a rather disappointing public debut, shedding nearly 5% of its stock price on the first day of trading. It competes primarily with other social gaming companies like Electronic Arts (ERTS) and Playdom, which was recently acquired by Disney (DIS). We have a $10.20 price estimate for Zynga, which stands just above the offering price for its IPO. New games account for more than 40% of its Trefis price estimate.

Zynga has made some really popular games like CityVille and FarmVille, which had a user base of close to 100 million at their peak. However, social games can get old fast and user numbers can drop as quickly as they grow.


The soft drink giant is said to be mulling several moves to boost its earnings.

By Melly Alazraki Jan 5, 2012 2:02PM
PepsiCo (PEP) is considering cutting roughly 4,000 jobs, or about 1.3% of its 300,000 global payroll, in order to boost earnings, according to the New York Post.

The soft drink giant is also mulling ending its 401(k) match, the paper said. The Post's sources said that Pepsi believes it is more generous than its peers because it offers both a pension plan and a 401(k) match. The elimination of the 401(k) match could reportedly save the soft drink and snack food company $75 million. 

The company is trying to sell its publishing business and may give up on its e-reader, too. The move reeks of desperation and could mean the end of Barnes & Noble as we know it.

By InvestorPlace Jan 5, 2012 1:24PM
By Tom Taulli

Barnes & Noble (BKS) has put together a strong e-commerce platform and a popular e-reader, the Nook, that has allowed it to avoid the fate of many brick-and-mortar booksellers. Thanks to growth from its e-book division and the relative popularity of the low-cost Nook, B&N narrowed its losses and saw revenue jump 20% in fiscal 2011 over the previous year.

Too bad Barnes & Noble is now giving up on the Nook. Recent reports say the company will spin off production of the tablet.

That reeks of desperation and is likely the end of both the Nook reader and Barnes & Noble as we know it. 

When it comes to buying the index's highest-yielding dividend stocks, the real question may well be 'Why not?'

By The Fiscal Times Jan 5, 2012 1:24PM

Image:Man with dog © VStock LLC, Tanya Constantine, Tetra images, Getty ImagesBy Suzanne McGee, The Fiscal Times

Last year, the one popular investment strategy that paid off -- generating returns far higher than those offered by any market index as well as the majority of U.S. equity mutual funds -- was snapping up the so-called Dogs of the Dow.


Collectively, the 10 Dow components with the highest dividend yields on January 1, 2011 ended up delivering a gain of 12.2 percent -- or 17.2 percent once dividends were added to the mix -- leaving most other investment strategies in the dust.


Rendering company's stock is a lot more appetizing than its business.

By TheStockAdvisors Jan 5, 2012 1:17PM
Image: Sheep (© Fancy/Veer/Corbis)This post is one in a series in which over 50 newsletter advisors share their Top Picks for 2012

By John Reese, Validea

Darling International (DAR) is a 130-year-old company in the business of rendering -- that is, turning animal by-products into oils and proteins used by agricultural, leather, and oleo-chemical firms.  
Tags: DAR

Apple was initiated with a 'buy,' while Nokia was upgraded to 'outperform.'

By MSN Money Partner Jan 5, 2012 1:13PM
Information provided by Theflyonthewall.com

Thursday's noteworthy upgrades include:
  • Barclays (BCS) upgraded to Outperform from Sector Perform at RBC Capital
  • Pacific Sunwear (PSUN) upgraded to Buy from Neutral at Janney Capital
  • Nokia (NOK) upgraded to Outperform from Underperform at Credit Suisse
  • Take-Two (TTWO) upgraded to Buy from Neutral at MKM Partners
  • Anadarko (APC) upgraded to Strong Buy from Outperform at Raymond James

Low multiples and strong growth forecasts should lure buyers, but Amazon looks expensive.

By Jonathan Berr Jan 5, 2012 12:57PM
Image: Dollar sign on keyboard (© Corbis)Google (GOOG), whose name has become synonymous with online searching, and Apple (AAPL), which has revolutionized the music and publishing businesses, are trading at historically low multiples. Shares of Amazon.com (AMZN), the largest e-commerce company, meanwhile, appear to be expensive.

Shares of Google are valued at a price-to-earnings ratio of 22.78, close to their lows for the past five years. The stock, which is up 11% over the past 52 weeks, has a slightly higher multiple than the S&P 500, which Reuters estimates at 19.31. Investors have got mixed signals lately about the stock. 


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[BRIEFING.COM] S&P futures vs fair value: +0.70. Nasdaq futures vs fair value: -2.50. U.S. equity futures trade little changed amid upbeat action overseas. The S&P 500 futures hover within a point of fair value. The underperformance of U.S. futures relative to global equities reflects the wait-and-see approach ahead of today's policy directive from the Federal Open Market Committee. Yesterday, the market rallied after Wall Street Journal's Jon Hilsenrath indicated the FOMC plans to ... More


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