A stock market graph trending down © jmiks/Getty Images
Be wary of dire market forecasts

The most likely scenario is that the markets will begin to rise from here -- and that bounce is just beginning to take hold.

VIDEO ON MSN MONEY

Technical indicators show that a major top is not in place, but as fears mount and carnage continues, here are the critical risk factors.

By MoneyShow.com Jun 16, 2011 2:19PM
By Tom Aspray, MoneyShow.com

If we took a poll this morning, amid the backdrop of sharp declines in Asian markets and the riots in Greece, I suspect a clear majority would now say yes, the bull market is over. Tuesday’s sharp gains gave the bulls some hope, but it was short-lived, as stocks were hammered again on Wednesday.

Those looking at the recent fundamental data can certainly make a case for further economic weakness and the possibility of another recession. Early in my career, I came to the conclusion that investing or trading based on fundamental analysis did not work and that technical analysis will often give advance warning of fundamental developments.

The only thing that I see on the horizon that could cause another financial crisis is if Congress fails to raise the debt ceiling.

The average investor may not realize the important impact that psychology can have on the markets. I believe the initial vote against the rescue plan in October 2008 created a crisis in confidence, and by the time it passed later in the week, the damage was already done. Even a momentary loss of confidence in US debt could have lasting implications.

Though I was certainly not expecting such a deep market decline, it is important to realize that the Spyder Trust (SPY) has not yet retraced 38.2% of the rally from the June 2010 lows. Even in a healthy uptrend, corrections of 38%-50% are quite normal.

Let’s take a look at some of the other technical indicators and what they are currently telling us about the health of the stock market.
 

Industry analysts say a production increase could send shares flying as high as $100.

By TheStreet Staff Jun 16, 2011 1:17PM

By Ted Reed, TheStreet

 

Analysts are applauding Boeing's (BA) decision to increase 737 production and say that the aircraft maker's stock is poised for major upside.

 

Boeing said Wednesday that it will boost 737 production to 42 a month, up from the current pace of 31.5 a month. Boeing currently has a 737 order backlog of 2,101 and is sold out through 2015.

 

"Global demand for aircraft remains healthy and resilient given requirements to replace aging fleets, satisfy growth in emerging regions and add more fuel efficient aircraft to existing fleets," wrote Gleacher & Company analyst Peter Arment, in a report issued Thursday.

 

Supporters say giving companies a break on repatriating foreign profits would help the economy.

By Kim Peterson Jun 16, 2011 12:10PM
With an unemployment rate still above 9%, there is a growing call from corporations for a tax holiday on money parked overseas.

Companies have as much as $1 trillion in profits stored abroad. They want to bring that money to the United States but don't want to pay taxes at current corporate rates, which max out at 35%. Some politicians are pushing for a tax holiday similar to one granted in 2004, which allowed corporations to bring back money at a 5.25% rate, The Hill reports.

Even a former union chief supports the move. Check out the following interview with Andy Stern, who formerly led the Service Employees International Union, about why he supports a tax repatriation holiday.

Post continues below: 

The online music service already sees flagging interest from investors on its second day of trading.

By Kim Peterson Jun 16, 2011 11:44AM
Updated 4:05 p.m. ET

Well, that didn't take long. Shares of Pandora Media (P) closed today down 23% to $13.39, dashing any hopes that this would be the next soar-out-of-the-gate tech IPO.

Pandora opened Wednesday at $20, and some eager suckers -- oh, I mean investors -- pushed the price up to $26 before everyone sobered up. The online radio service has never made a profit and runs mostly on advertising money. There's plenty to be skeptical about here.

"On the bright side, maybe there's not so much of a tech-stock bubble after all," writes Mark Gongloff at The Wall Street Journal. Pandora was certainly no LinkedIn (LNKD), which doubled to $94 on its first day of trading but Thursday was at about $71.40.

Check out the following interview, which analyzes the state of the IPO market after Pandora.

Post continues below: 

Funds tracking producers can offer relief from economic headwinds while outperforming the physical metal during rallies.

By TheStreet Staff Jun 16, 2011 11:24AM

Image: Gold ingots (©Anthony Bradshaw/Photographer)By Don Dion, TheStreet

 

Thanks to exchange-traded funds, gaining access to gold has become simpler than ever. With products such as SPDR Gold Shares (GLD), iShares Gold Trust (IAU) and ETFS Physical Gold Shares (SGOL), investors can gain exposure to physical bullion.

 

However, there are other options gold-hungry investors may want to consider, including gold-miner-backed funds like the Market Vectors Gold Miners ETF (GDX) and Market Vectors Junior Gold Miners ETF (GDXJ). Unlike GLD and other physically backed products, GDX and GDXJ do not track a physical stockpile of the metal. Instead, they spread their assets across a wide collection of global gold producers.

 

Of the two funds, GDX stands out as the strongest and most stable option for conservative, long-term investors. Top holdings include Barrick Gold (ABX), Goldcorp (GG) and Newmont Mining (NEM).

 

Rising material costs, weak existing-home prices and a glut of distressed properties on the market are crushing builder confidence.

By TheStreet Staff Jun 16, 2011 10:58AM

Image: Home under construction (© Corbis)By Miriam Reimer, TheStreet

 

Homebuilder sentiment fell to an eight-month low in June as a perfect storm of weak existing-home prices, rising material costs, distressed property sales and sluggish consumer confidence brewed in the housing market.

 

"Builders are being squeezed by the continuing weakness in existing-home prices -- against which they must compete -- as well as rising material costs," said Bob Nielsen, a homebuilder from Reno, Nev., and the chairman of the National Association of Home Builders.

 

"In addition to the ongoing impacts of distressed property sales on home prices, appraisal values and consumer confidence, rising costs for materials such as roofing, copper, wallboard, vinyl siding and other components have made it extremely difficult to construct a new home and sell it at a price that covers the costs."

 

The economy has hit a soft patch, but corporate America is healthy.

By TheStreet Staff Jun 16, 2011 10:26AM

Image: Value stocks (© Photodisc/Getty Images)By Jake Lynch, TheStreet

 

After a one-day relief rally, stocks resumed their decline Wednesday.

 

Although Tuesday's consumer spending report beat expectations, it marked the first year-over-year monthly decline since June 2010 as higher gasoline and food prices weighed on Americans. Then, Wednesday, the New York Area General Economic Report dropped to negative 7.8, signaling contraction, as manufacturing slowed. Making matters worse, June's national survey of U.S. homebuilders fell to a nine-month low as demand outlook weakened.

 

A negative-data deluge is pushing stock prices to discounts. Although the pace of growth has weakened in recent weeks, corporate America remains healthy, and a soft patch may provide an attractive entry point for equity investors. It's difficult to buy when others are fleeing the market, but long-term investors should be on the lookout for bargains in both ETFs and equities.

 

Despite a 20% sell-off in 2011, the retail banking giant could be a breakout pick for aggressive investors.

By InvestorPlace Jun 16, 2011 9:31AM

By Jeff Reeves, Editor, InvestorPlace.com

   

jeff reeves investorplaceYes, my decision to buy Bank of America (BAC) on Dec. 31 at $13.34 has made me the subject of much ridicule among my colleagues. As the stock creeps down toward $10, more and more folks ask, "So, are you ready to sell now?"


My answer is firm: No way. Because my rule is that you should never make a sale unless you look at the stock in a vacuum and ask yourself, "If I didn't own stock, how would I feel? Would I think it's a buy or look elsewhere?"


And when I look at B of A, I still see reasons to buy. So much so that I'm seriously considering doubling down in my position. Here's why:

 

This time around, Greek riots don't pose as big a threat to US markets. But the same can't be said for European banks.

By Jim Cramer Jun 16, 2011 8:55AM

jim cramerthe streetThe last time I saw Greek protesters running down the streets and causing a big ruckus, the market plummeted almost 1,000 points. For the first 300 points, we thought it was all about Greece. It was only after we saw Procter & Gamble (PG) drop 30 points that we recognized that it was a revolt by the machines.

 

Still, I found it pretty uncomfortable, a little more than a year later, to see this same replay and recall that Greek protests were the proximate cause for an event that drove people out of this market like there was no tomorrow. Of course, there was a tomorrow, but a lot of people didn't stick around to see it.

 

It's worth debating for a moment, though, whether we are in better shape to handle the potential collapse of a country's treasury and its bonds than we were the last time Greece reached crisis mode.

 

The capital raising has run ahead of the income for Navios Maritime Partners.

By Jim J. Jubak Jun 15, 2011 5:22PM
Jim JubakNothing wrong with the yield on Navios Maritime Partners (NMM) -- 9.48% on a trailing-12-month dividend track record.

But how do you feel about the volatility of this master limited partnership as we head into the possibility of a slowing global economy? Dry bulk shippers are extremely sensitive to changes in global economic activity, since day rates for their ships and the number of days those ships are under contract vary with how much iron ore and coal and the like need to go from hither to yon.

The partnership units, which trade at $17.93 today, fell to $13.96 in last year’s summer slump. The low, during the global economic crisis, was $2.86 on Nov. 20, 2008.

That’s too much risk for me, even with the big dividend yield. And that’s why I dropped the stock from my Dividend Income portfolio on May 6, 2011. See my post for more on this.
 

The retail giant turns to small and midsized buildings in an effort to draw more US shoppers.

By Kim Peterson Jun 15, 2011 2:37PM
Wal-Mart (WMT) stores are about to get smaller. The new ones, anyway.

The company still runs the giant, sprawling supercenters that we're familiar with. But now it's opening more midsized stores under the Walmart Market name. They're about the size of an average supermarket.

Wal-Mart already has 185 such markets and wants to open 90 to 100 more by January. That total will ramp up to 300 by fiscal 2013, the company said.

And Wal-Mart is getting even smaller with Wal-Mart Express, its answer to the dollar stores that have been stealing its business. Wal-Mart Express stores get you in and out fast, with milk, eggs, a pharmacy, check-cashing services and gasoline pumps. 

Here are a few names that have disappointed some top fund managers.

By Motley Fool Pick of the Day Jun 15, 2011 1:24PM

By Matt Koppenheffer

 

"Managers don't go from geniuses to idiots overnight."


-- Russell Kinnel, director of mutual fund research at Morningstar

 

The quote above comes courtesy of a recent Bloomberg article that discussed the lackluster performance of mutual fund all-stars Bruce Berkowitz, Ken Heebner and Bill Miller so far this year.

 

We could actually read that quote a couple of different ways. The obvious read is that when a top-performing manager's performance dips, it doesn't mean that he's suddenly lost his touch. However, we could also take the view that when a stock picker's performance badly falters, perhaps he wasn't the genius that we originally assumed he was.

 

Of course Berkowitz, Heebner and Miller aren't just any trio of schmoes who had a few years of good returns. In fact, they have delivered outstanding performance over extended periods and provided good reason for us to believe that they have legitimate skill.

 

The stock looks to be in correction mode as institutional traders have lost interest. What's its future?

By Kim Peterson Jun 15, 2011 12:59PM
Starbucks (SBUX) went on an amazing run from August 2010 through the end of March, with shares rising more than 50%.

But we really haven't seen much from the stock in the past three months. Shares bounced between $35 and $37, and Wednesday they were slipping below $35.

So is it time to buy or sell? In the following video, we get arguments for both moves. Dan Fitzpatrick of TheStreet says the technicals show big institutions have lost interest in Starbucks, while Jim Cramer says the institutions will be back and the stock is worth buying. 

The sector's popularity has inspired funds that track farming.

By TheStreet Staff Jun 15, 2011 12:08PM

Image: Corn field (© Sean Way/Design Pics/Corbis)By Don Dion, TheStreet

 

As I explained earlier this week, commodities have become difficult to tame as the broad market works through this current rough patch. While attempting to target the wide resource spectrum as a whole may be tricky now, there are individual segments that are showing promising strength.

 

Agriculture, for instance, has stood out in recent weeks as crops such as corn and wheat have generated headlines. This scenario is boding well for equity-backed ETFs linked to farming.

 

The veteran Market Vectors Agribusiness ETF (MOO) has enjoyed a welcome jolt of activity as rising food prices drive investors toward farming-related companies like Mosaic (MOS), Deere (DE) and Monsanto (MON).

 

The stock was priced at $16 and has soared as high as $26. What are investors seeing here?

By Kim Peterson Jun 15, 2011 11:31AM
Updated 4:30 p.m. ET

Online music service Pandora Media (P) saw a nice jump in its initial public offering Wednesday. The company raised about $235 million, pricing shares at $16 each.

The stock opened at $20 surged to $26, but ended up closing the day at $17.42. At the $20 opening, the company was valued at more than $3 billion. Fairly outrageous, since Pandora has never made a profit, gets revenue mostly from advertising and faces enormous competition.

Check out this video discussion about Pandora's pros and cons and why the company can't achieve economies of scale.  

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