8 reasons the market isn't worse
8 reasons the market isn't worse

Stocks should be crushed by global turmoil, Jim Cramer says. Instead, they're doing fine.

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A good quarter is a good quarter. Don't hide it under a blanket of worry, and don't accentuate the negative.

By TheStreet.com Staff Wed 12:38 PM

Woman Singing for Fame and Fortune © Alberto Ruggieri/Illustration Works/CorbisDoes tone matter? Should we care about inflection and word choice on conference calls?


You bet we should. Here's why.


When Honeywell (HON) and Domino's (DPZ) reported their quarters Friday and today, both stocks flew higher on their better-than-expected numbers and good commentary. Both CEOs, Dave Cote and Pat Doyle, played it straight, giving the highlights and then telling their stories. In each case, the confidence they had about the future ran throughout the calls. Most important, they gave very little reason to sell because, alas, there weren't really any reasons to sell.


TheStreet.com logoBut go back a previous quarter. In each case both men spent an inordinate amount of time talking about the negatives -- or at least, as I would describe it, telling you things they might be worried about or weren't happy with.

 

The economy and the market may have 99 problems, but a social media bubble isn't one.

By MSN Money Partner Wed 12:36 PM
Caption: The 'Facebook' logo is seen on a tablet screen
Credit: © LIONEL BONAVENTURE/AFP/Getty ImagesBy Tim Mullaney, MarketWatch

Janet Yellen made a fuss by slipping a line into her semi-annual Congressional testimony on the economy that social-networking stocks were in a bit of a bubble.


Beginning with Facebook's (FB) second-quarter earnings report Wednesday, we'll see if she was way more wrong than right.


Yellen's wrong about this bubble three different ways. First, social-media stocks as a group aren't very expensive, and the best of breed, like Facebook and YouTube owner Google (GOOG), are actually pretty cheap. 


Second, the flaws of less-premium social-media stocks, like Groupon (GRPN) and Zynga (ZNGA), are well-appreciated and realistically appraised, which is one reason why you've routinely seen initial public offerings by social-media firms struggle and even flop, in a way barely seen among 1998-1999 Web companies.

 

Puma Biotechnology shares soar after it says it wants to file for marketing approval of an experimental breast cancer drug.

By MSN Money Partner Wed 12:07 PM
Credit: © Rafe Swan/Corbis

Caption: A graduated pipette being inserted into test tubeBy Reuters with CNBC.com

Puma Biotechnology (PBYI) said its experimental breast cancer drug met its main goal in a late-stage trial, but the options market is smelling something fishy.


Shares of the company, which doesn't have any drug in the market, spiked nearly 300 percent on Wednesday. 


Puma said on Tuesday it plans to file for marketing approval of neratinib, codenamed PB272, in the first half of 2015.


Adjuvant treatment with the drug showed a statistically significant improvement in disease-free survival of 33 percent versus patients on placebo, according to trial data. Adjuvant treatment, or additional treatment, is given after the primary treatment.

 
Tags: PFE

The company plans to close stores and lay off employees, and says it needs to make some deeper changes.

By MSN Money Partner Tue 4:38 PM
© Ed Andrieski/AP
Crocs shoes on displayBy Hayley Peterson, Business Insider

Crocs' (CROX) comeback plan is a bust.

The company is cutting jobs and closing stores amid plummeting net income. 


The company said Tuesday that it plans to close 75 to 100 of its 624 stores globally and lay off 183 employees out of more than 5,000. Its stock price rose more than 12 percent to $16.68 as investors applauded the move.


Net income fell a whopping 44 percent for the second quarter to $19.7 million, though revenues rose 3.6 percent to $376 million. 


Crocs President Andrew Rees said in a statement that the performance shows "the need for dynamic change in our strategy, organization and approach to the market."


Crocs was hoping that a new, sleeker line of shoes that was released this year -- including ballet flats, pumps, and open-toe wedges -- would revitalize the brand. But the company's new shoe styles failed to offset falling demand for its signature plastic clogs.

 
Tags: CROX

The category is seeing less enthusiasm from investors than any other.

By MSN Money Partner Tue 2:47 PM
Image: Stock market report © ULTRA.F/Digital Vision/Getty ImagesBy Dan Strumpf, The Wall Street Journal

Small-company shares' summer swoon deepened Monday, underscoring investor concern about valuations.


The Russell 2000 ($TOMX) index of smaller companies, typically those with market values below $1 billion, dropped 0.4 percent Monday, outpacing a 0.3 percent decline in the Dow Jones Industrial Average ($INDU) and a 0.2 percent slide in the  Standard & Poor's 500 Index ($INX).


Monday's drop comes as smaller shares are enduring a second downdraft this year. So far, the Russell is alone among major U.S. stock indexes in losing ground in 2014, falling 1.5 percent compared with the S&P's 6.9 percent advance.


The retreat hasn't quieted the calls by bearish analysts that the Russell index, comprising companies ranging from drug developer Idenix Pharmaceuticals (IDIX) to media company A.H. Belo (AHC) and wireless-technology company ParkerVision (PRKR) appear overvalued, judging by prices as a multiple of earnings for the latest year.

 

CNBC host Jim Cramer says stocks should be crushed by global turmoil. Instead, they're doing fine.

By MSN Money Partner Tue 1:06 PM
Credit: © Richard Drew/AP
Caption: Specialist Jay Woods is reflected in one of the screens at his post on the floor of the New York Stock Exchange, Wednesday, June 18, 2014By Lee Brodie, CNBC

Although stocks closed lower on Monday, the declines were modest with the Dow Jones Industrial Average ($INDU) and Standard & Poor's 500 Index ($INX) falling a fraction of a percent.


Many investors, including CNBC host Jim Cramer, found the relative strength somewhat curious, given the widespread geopolitical unrest.


Israeli jets, tanks and artillery pounded Gaza again as the death toll from a two-week conflict topped 500. Also, fighting flared in the Ukrainian city of Donetsk as investigators began to inspect the bodies of the victims of the Malaysia Airlines crash. In addition, the United States and the European Union announced further economic sanctions against Russia.


"You'd think the market would get absolutely crushed," noted Cramer. But it didn't. 


Here are Cramer's reasons why:

 

Biotech deals still dominate the pipeline for initial offerings, however.

By InvestorPlace Tue 12:39 PM

Credit: © John Crowe/Alamy

Caption: An El Pollo Loco Restaurant in Upland Calif.By Tom Taulli


Last week was a hot one for initial public offerings, which saw deals such as TubeMogul (TUBE) and Sage Therapeutics (SAGE) each jump more than 60 percent on their first days.


There was some underlying weakness in the IPO market -- many of last week's deals saw pricing reductions to gin up demand -- but we've still seen a flood of IPOs lately, which will continue this week with 14 new stocks on deck. (Including three holdovers from last week -- Medical Transcription Billing, Microlin Bio and Pfenex).


Let's take a look at some of the highlights:

 

Reaction to the streaming media company's latest quarterly results has been mixed. Here are a few key things to note.

By TheStreet.com Staff Tue 12:34 PM

The Netflix company logo is seen at Netflix headquarters in Los Gatos, Calif. © Ryan Anson/AFP/Getty ImagesBy Keris Alison Lahiff, TheStreet


Netflix (NFLX) reported its second quarter and judging by trading volatility, with moves within a tight range, investors aren't quite sure what to make of it.


On the one hand, the online streaming giants boasted a total membership base 33 percent larger than a year earlier, far exceeding its own estimates.


On the other, earnings missed estimates. Earnings of $1.15 a share fell shy of forecasts by a penny, according to Thomson Reuters estimates, while revenue of $1.34 billion was in-line with expectations.

 

New transactions with the Kalashnikov company were banned after July 16 as US sanctions kick in. But current gun owners are fine.

By MSN Money Partner Tue 12:32 PM
Credit: © PhotoXpress/ZUMA Press/Corbis
Caption: Mikhail Kalashnikov, soviet-Russian arms designer with his Kalashnikov machine gun at the exhibition in Kremlin museumBy Dan Goldstein, MarketWatch

If you like your AK-47, you can keep your AK-47. That’s the message from the U.S. Treasury Department to U.S. gun owners.

Despite slapping sanctions on the famed assault-rifle maker Kalashnikov last week, along with other Russian defense companies, in response to suspected Russian involvement in the shoot-down of the Malaysian jetliner over the Ukraine, the Treasury's Office of Foreign Assets Control (OFAC) says U.S. owners of the weapons can still own them and resell them at gun shows so long as they don't owe the parent company any money.


"If a U.S. person is in possession of a Kalashnikov Concern product that was bought and fully paid for prior to the date of designation (i.e., no payment remains due to Kalashnikov Concern), then that product is not blocked and OFAC sanctions would not prohibit the U.S. person from keeping or selling the product in the secondary market, so long as Kalashnikov Concern has no interest in the transaction," the Treasury Department states on its website in a frequently asked questions section.

 
Tags: RGRSWHC

Pipeline owners are making big profits on oil coming from North Dakota's Bakken fields. But a lot of natural gas continues to be flared due to low prices.

By TheStreet.com Staff Mon 3:29 PM

A pump jack pulls crude oil from the Bakken region of the Northern Plains near Bainville, Mont. © Matthew Brown/AP PhotoBy Dana Blankenhorn, TheStreet


The Bakken oil and gas shale play in North Dakota delivered over 1 million barrels of oil per day in May, the state says, and the number is still heading up.

But producers aren't getting anything like the prices, or margins, of foreign suppliers, due to a shortage of pipeline capacity, according to the Congressional Research Service.


Pipelines would deliver oil to refiners for $5/barrel but producers are paying $10 to $20 per barrel to move it out by rail.  Rail is more flexible, with shorter contracts. Rail is also faster, meaning faster payments. Rail currently has over 60 percent of the market, according to the North Dakota Pipeline Authority.


But the cost differences are driving a move toward pipelines.

 

Investors need to be aware of the downward trend for sales of carbonated beverages.

By Benzinga Mon 3:00 PM

Cans of Pepsi and Coke on display
© Mark Lennihan/APBy Nelson Hem


The earnings crunch is well underway, and leading soft drink producers Coca-Cola (KO), Dr. Pepper Snapple (DPS) and PepsiCo (PEP) will be taking the earnings stage this week.


Investors have to be aware of the downward trend for sales of carbonated soft-drink beverages -- last year soda consumption fell for the ninth consecutive year. 


Both Coke and Pepsi continue to build their portfolios of alternative beverage brands, but Pepsi also has its snack foods business. It has so far resisted the urging of activist investor Nelson Peltz to unlock value by breaking up the company.


Coca-Cola

Analysts on average predict that this Atlanta-based company will report Tuesday before the opening bell that its revenue for the second quarter rose fractionally year-over-year to $12.83 billion. Earnings are expected to be flat as well, coming in at $0.63 per share, the same as in the year-ago period.

 

The company, which reports its quarterly earnings Tuesday, has once again become an investor favorite.

By MSN Money Partner Mon 2:25 PM
Credit: © Stephen Lam/Reuters
Caption: File photo of the Apple Worldwide Developers Conference in 2013By Jay Yarow, Business Insider

Apple (AAPL) reports earnings on Tuesday.

A lot has changed since the company's last reported earnings at the end of April. 

  • Apple split its stock 7-for-1.
  • Apple paid $3 billion for headphones company Beats.
  • Apple hosted WWDW, its big developers conference, where it announced new Mac software, iOS 8, and a programming language called Swift.
  • Apple introduced a new lower-cost iMac at a $1,099 price point.
 

Prices have been falling for weeks, signaling an end to a record run for the sector.

By MSN Money Partner Mon 1:48 PM
Image: Stock investor © CorbisBy Ben Eisen, MarketWatch

Weeks of falling junk bond prices have started to spook some bond investors, signaling that the record run for the riskiest part of corporate debt may be ending.


Bond investors have been piling into high-yield debt for years as they search for income in a low-rate environment, but yields had dropped so much that even the Federal Reserve, normally not one to comment on asset prices, has raised concerns.


"Those valuations are very, very lofty right now. We're talking to clients about taking everything they own and paring back credit risk from the weakest part of the credit universe," said Richard Sega, chief investment officer at investment manager Conning, which manages $92 billion in assets.

 

5 signs generally indicate when stocks are peaking. None are apparent now, says an Oppenheimer analyst.

By MSN Money Partner Mon 1:25 PM
Credit: © Image Source/Corbis
Caption: Bull and Bear MarketsBy Myles Udland, Business Insider

Ari Wald, a technical analyst with Oppenheimer, is out with a note Monday that outlines five signals that indicate a bull market top.


"As it stands," Wald writes, "we think the absence of these signals argue against an imminent end to the cycle."


The signals, per Wald, are:

  • Moderation in the S&P 500's uptrend.
  • Signs of distribution and narrowing participation.
 

So far, 2014 has been unusual in many ways. The data suggests the bull market is not over yet.

By MSN Money Partner Mon 1:02 PM
Credit: © Carlo Allegri/Reuters
Caption: Trader Anthony Rinaldi is reflected on a screen as he works on the floor of the New York Stock Exchange on Monday in New YorkBy Tim Clift, MarketWatch

For years, we've expected interest rates to rise. That day is now in view. 


Earlier this month, the Federal Reserve said it will wind down its quantitative-easing program and cease buying Treasury bonds and mortgage-backed securities as soon as October. In the past, Fed Chairwoman Janet Yellen has testified that she would consider raising rates as soon as six months after the end of quantitative easing.


So how should investors be thinking about the second half of 2014? Is this a trial balloon for the markets? And how much of an effect is the end of easing likely to have on individuals' portfolios?

 

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[BRIEFING.COM] The stock market maintained a narrow trading range on Thursday before ending the session essentially where it began. The S&P 500 added less than a point, while the small-cap Russell 2000 (-0.2%) underperformed.

Equity indices displayed early strength thanks in part to an overnight boost from better than expected economic data in China and Europe. Specifically, China's HSBC Manufacturing PMI surged to an 18-month high (52.0 from 50.7), while Eurozone Manufacturing PMI ... More


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