If everything goes as planned, this week will be the busiest for initial public offerings since 2000.
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After a brief respite, stocks are plunging again. We're retesting the lows, but the bottom hasn't fallen out.
Stocks were plunging Thursday in reaction to some very poor economic data. The Philadelphia Fed Business Outlook Survey dropped to its worst levels since early 2009 as results badly missed Wall Street estimates. The General Business Conditions component dropped to negative 30.7 vs. the positive 1 analysts were expecting. Ugliness was seen in new orders, shipments and employment.
If there was any silver lining, it was that the Philly Fed and Wednesday's Empire State Index don't yet suggest the all-important economy-wide ISM Manufacturing Index has dropped into recessionary territory. Moreover, the Philly Fed survey was conducted between Aug. 8 and 16, so it was no doubt affected by the recent financial market volatility.
If markets rebound -- as I expect heading into next week's speech by Federal Reserve Chairman Ben Bernanke in Jackson Hole, Wyo., where new market-supporting initiatives will likely be unveiled -- business confidence should be restored quickly. Remember that while a new recession is still a distinct possibility, we don't have the normal preconditions. Profitability is still growing, interest rates are near zero, jobs are being created, inflation is low, and the Fed is being extremely accommodative.
In roller-coaster market conditions, yields offer investors a seat belt.
Frank Byrt, TheStreet
All U.S. equity mutual fund categories have seen large outflows this year, except for so-called equity-income funds, which took in $11 billion through Aug. 10, Standard & Poor's said. Investors are piling into the safest stocks as the U.S. economy is slowing. Thursday, Morgan Stanley (MS) lowered its forecast for global economic growth.
The firm's MarketScope Advisor unit recently highlighted its three top-rated five-star equity-income funds that are benefiting from those flows and suggests that "investors should follow suit" in their investment choices.
This spectacular blowup will create bargains in tech stocks, but wait until the dust has settled.
NetApp (NTAP) is a real blowup, and it puts the blowup right at the feet of Washington, D.C. The problem is that even without Washington, it was probably the wrong time to own it, because tech is so, so problematic right now.
You have a triple whammy against the sector now. Europe, where so much tech is sold, is going off the grid because of the debt crisis.
The U.S. is a mess -- although not going into a recession -- and government spending, which has been a big part of tech sales, is being cut, in some cases dramatically.
Finally, we have studied tech for many years, and it has rarely paid to own tech stocks before the last week of September. We are in the technology dog days, when owning the stuff is totally precarious, as those who have NetApp stock know all too well.
Investors are already reacting, and their reactions will have big effects.
By Dan Caplinger
Few weeks on Wall Street can match the craziness that last week gave investors. Four days of huge volatility, followed by what seemed like a quiet Friday by comparison with a 125-point jump for the Dow, has everyone on edge.
In the aftermath, everyone's looking for answers about what's to come. Poring through all the things that investors did during last week's roller-coaster ride yields many different insights:
- On the commodities front, hedge funds poured into gold and precious metals, but interest in other commodities like base metals and foodstuffs largely evaporated. In particular, copper saw speculative demand drop by more than 60% for the week, potentially boding ill for big copper producers Freeport-McMoRan (FCX) and Southern Copper (SCCO).
Statoil is on a roll, announcing its third high-impact discovery this year.
Sitting out the madness or rebalancing portfolios? MSN Money readers share their strategies.
Many of MSN Money's readers have recently shared what they're doing in this topsy-turvy market, and I bet their advice is just as good as any that you'd find from a professional.
On MSN Money's Facebook page, Chris S. says he has been timing major market cycles since 1980. He thinks you can time the market -- but you just can't time it on a short-term basis. "You have to educate yourself and study, and most small investors do not do that," he writes.
Worries about Pentagon cuts have hit defense stocks hard, but sentiment now appears to be turning.
The current crisis in Europe is a continuation of the financial meltdown that struck the US in 2008, says the billionaire investor, and the future of the euro depends on Germany.
By Dan Freed, TheStreet
Soros made the comments in a interview with German publication Der Spiegel, where he weighed in provocatively on several topics.
Asked to compare the 2008 crisis in the U.S. subprime market with the current European crisis, Soros said, "This crisis is still the continuation of the same crisis."
The retailer wants 'Jersey Shore' star Michael Sorrentino to stop wearing its clothes. Is this just an ill-conceived publicity stunt?
Not Abercrombie & Fitch (ANF). The apparel retailer is not happy that its clothing is favored by Michael "The Situation" Sorrentino, one of the stars of the reality show "Jersey Shore." And Abercrombie allegedly wants Sorrentino out of its clothes so badly that it's willing to pay him for it.
The company said that it offered Sorrentino a "substantial payment" to wear something else and that it's "urgently awaiting a response." Company shares are down more than 8% Wednesday, by the way.
So what's so wrong, exactly, with The Situation wearing Abercrombie? The company says "this association is contrary to the aspirational nature of our brand" and "may be distressing to many of our fans."
Chart patterns show the recent price decline is just a correction within a long-term uptrend.
Star investment managers purchased technology and energy stocks while paring financial holdings.
By Chris Stuart, TheStreet
Wall Street's brightest investment minds were required to release their holdings this week, giving mere mortals insight into their strategies.
Here's a breakdown of the top hedge fund and investment managers, and the winning and losing industries and stocks during the second quarter, the latest for which information is available.
In financials, Appaloosa Management, a top-performing hedge fund firm run by David Tepper, cut its bank stock holdings by 6%. Tepper reduced his stake in Bank of America (BAC) by 42%. Citigroup (C) is still Appaloosa's biggest holding, as the hedge fund holds 7.2 million shares. In the quarter, the fund trimmed the stake by 5%.
Consumer spending, corporate spending and the game-changing iPad are making life difficult for the veteran PC maker these days.
By Jeff Reeves, Editor, InvestorPlace.com
Dude, who's getting a Dell (DELL) these days? From recent financial reports, it looks like only a precious few consumers.
Founder and CEO Michael Dell announced Tuesday a meager growth projection of just 1% to 5% on the year, and Dell shares took a tumble. Shares were off about 8% Wednesday morning.
We'll see lower stock prices until large companies say the downturn is only temporary.
So far, Urban Outfitters (URBN) is in a class by itself in saying that the last 10 days leading up to its conference call were disastrous in at least one of its divisions, Anthropologie. I am still reeling from that startling statement and have tried to back it up with others to be sure that URBN isn't something unto itself.
I didn't get it from Home Depot (HD), which didn't have anything negative to say at all. Last night, when talking to Steven Sadove, the CEO of Saks (SKS), I heard that the days leading up to the quarter have been business as usual, consistent with excellent metrics. I didn't hear it from Howard Schultz on Tuesday either, with Starbucks (SBUX) seeing no slowdown.
But last night on the Dell (DELL) call we got lots of evidence that consumer demand is "weaker and a bit more uncertain," which translated into a hideous outlook: revenue growth going from a 5%-9% increase, totally respectable, to 1%-5%, completely unacceptable, hence why we are seeing so much selling.
Their Urban Outfitters moment, reiterated several times like on the URBN call, specifically identifies "the last few weeks" as the time frame.
The projections from South America's largest McDonald's franchiser sound great -- until you look at the inflation battles ahead.
There's a lot riding on the rest of the year.
By Rick Aristotle Munarriz
It' going to be an eventful next few months for Sirius XM Radio (SIRI), and most of it should be good. Let's go over a few days that shareholders should already be looking forward to in the coming months.
Sirius XM investors may not take Clear Channel (CCMO) seriously, but the terrestrial giant is investing a lot of might and star power into promoting an upgrade of its iHeartRadio app.
Next month, Clear Channel is hosting a two-day music festival in Las Vegas to promote the streaming application's update. Not so humbly self-billed as "the biggest live music event in radio history," magnetic recording stars including Lady Gaga, Coldplay, and Jay-Z are scheduled to take the stage to show the terrestrial radio operator some promotional love. According to Clear Channel, the music festival sold out 10 minutes after tickets were put on sale to the general public in July.
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[BRIEFING.COM] The stock market ended the Wednesday session on a mixed note with small caps displaying relative strength. The Nasdaq Composite (+0.5%) and Russell 2000 (+0.4%) registered modest gains, while the Dow Jones Industrial Average (-0.2%) and S&P 500 (+0.01%) underperformed.
Despite the mixed finish, the key indices traded higher across the board at the start of the session after the advance reading of second quarter GDP surpassed estimates (4.0% versus Briefing.com ... More
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