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.

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We may be seeing a standoff between Germany and the European Central Bank.

By Jim J. Jubak Jun 10, 2011 4:56PM
Jim JubakThe German government and European Central Bank are playing "huhn" (chicken, to us Anglophones) with the euro and the Greek debt crisis.

With the deadline for a new "solution" to the Greek debt crisis closing fast -- June 24 is the date that keeps coming up -- both sides have stepped up the rhetoric.

German finance minister Wolfgang Schaeuble told German legislators today, June 10: "Participation of private creditors in cases of insolvency is indispensable."

Meanwhile, European Central Bank president Jean-Claude Trichet not only repeated his statement that the ECB opposes any effort to require holders of Greek debt to participate in any mandatory extension of maturities on Greek bonds, but has turned that opposition into a warning.
 

Concerns about profit and revenue dog the radio company, set to debut under the ticker symbol P.

By Kim Peterson Jun 10, 2011 4:32PM
Updated Monday, June 13

This week brings us Pandora, another tech IPO that investors appear eager to snap up. But is the Internet radio company a good buy?

Investors are so enthusiastic that Pandora raised its price range Friday to $10 to $12 from the original $7 to $9 a share. The company also boosted the total offering by 1 million to 14.7 million shares.

If those shares go for $12, Pandora would raise $202.6 million in the initial public offering, Dow Jones reports. And the company would be valued around $1.9 billion.

Is Pandora truly the next big IPO, as the following video states? 

Comparisons with Build-A-Bear and Heelys are ridiculous.

By Motley Fool Pick of the Day Jun 10, 2011 3:03PM

By Rick Aristotle Munarriz

 

Shares of IMAX (IMAX) traded as much as 8% lower today after a Seeking Alpha contributor published a bearish take on the company.

 

Calling IMAX a fad stock and a premium cinema gimmick are some pretty heavy bearish assumptions. I spoke to IMAX CEO Rich Gelfond today, who naturally wasn't very happy with Larry Meyers' piece.

 

"IMAX has been in business for 43 years," Gelfond responds. "I find it unusual to call a 43-year old business a fad."

 

Meyers compares IMAX to Jones Soda (JSDA), Build-A-Bear Workshop (BBW), and Heelys (HLYS). It's a laughably unfair comparison at all three levels.

 

A spokesman for 1 of the 6 publicly traded banks tells TheStreet that the Fed's plan is actually a good idea.

By TheStreet Staff Jun 10, 2011 2:51PM

By Philip van Doorn, TheStreet

 

The likely expansion of the Federal Reserve's stress tests beyond the largest banks could send these stocks reeling even further -- but is unlikely to have much of an immediate effect on most of the banks that would be subject to the ramped-up government scrutiny.

 

The Federal Reserve plans to expand its annual stress tests to review banks' capital adequacy to include all financial holding companies with total assets in excess of $50 billion, according to a Bloomberg report citing "people familiar with the discussions." So far, 19 banks have gone through two rounds of the tests.

 

Banks have been responding to a slew of new regulations in recent years. The CARD Act, passed in 2009, ended several practices that boosted credit card fee revenue. The Durbin Amendment, a provision of the Dodd-Frank banking reform legislation that will severely cap the interchange fees that large banks charge retailers to process debit card transactions, will soon present new challenges for banks.

 

Pump prices have fallen steadily over the past month as oil prices and demand have come down.

By Kim Peterson Jun 10, 2011 1:28PM
Image: Buying gas (© moodboard/Corbis/Corbis)Gas prices are finally falling -- just what the slumping economy needs.

The average nationwide price for a gallon of regular gasoline is $3.72, down a penny from Thursday, 7 cents from a week ago and 24 cents from a month ago.

And it looks like that trend may continue for a while, the way oil prices are going. Friday saw a sharp drop in light sweet crude for July delivery to less than $100 a barrel. The price drop came after reports that Saudi Arabia would boost production to 10 million barrels a day in July.

On top of that, the demand for gas -- at least in the U.S. -- is down. In the four-week period ended June 3, gasoline use was 1.3% lower than it was in the same period last year, according to MasterCard. We've seen the same pattern for months now. 
Tags: gm

Sharp recent gains may mark the beginning of a new uptrend. Investors who act now can get solid entry points on 3 industry leaders.

By MoneyShow.com Jun 10, 2011 11:15AM
By Tom Aspray, MoneyShow.com

Thursday's USDA crop report hit commodity pits hard, with corn surging to an all-time high of $7.90 per bushel. To put this in perspective, last July, corn hit a low of $3.24 per bushel. The expected year-end corn inventories for next year dropped 22%.

The agricultural stocks were some of the biggest gainers in Thursday's market rebound. The S&P Fertilizer & Agricultural Chemical Index peaked in February and has since been in a downward-sloping trading channel. It has been showing better relative performance than the S&P 500 since mid-May, as it is up 11.1% versus a 2.9% decline for the S&P 500.

The higher close on Thursday improved the short-term outlook for stocks, as the McClellan Oscillator, a short-term Advance/Decline (A/D) indicator, has turned up from -194 and is now at -72. There is, however, no clear evidence that the correction form the early-May highs is over. The intermediate-term analysis is still positive despite the 6.7% correction in the S&P 500.

Normally, I try to avoid stocks in the news, as I try to spot them before they show up on Wall Street’s radar. Occasionally, just one day’s trading is enough to indicate that a correction is over, and this is the case for three of the best-known fertilizer stocks.
 

Companies catering to the jobless -- including search services, for-profit educators and discount retailers -- might gain as the economy struggles.

By TheStreet Staff Jun 10, 2011 11:07AM

Image: Construction workers (© image100/Corbis)By Jamie Dlugosch, Stockpickr

 

A 9.1% unemployment rate sounds like a bad number -- and it is -- but for some stocks, the poor jobs market is a boon for business. Companies catering to the unemployed, including job search and posting services, for-profit education businesses and discount retailers, all stand to prosper as the economy lags.

 

From a social perspective, the situation is bad -- and probably worse than the numbers show -- but we are here to make money. What I see in the current environment is fertile ground to grow. More importantly, the situation is unlikely to change soon.

 

That means profit opportunities will be steady and consistent for years. Given that the market usually affords such companies premium valuations for such dependency, I would encourage investors to snap up these stocks now before they go too far too fast.

 

The investor has endured controversy over the years but has managed to save face.

By TheStreet Staff Jun 10, 2011 10:43AM

By Don Dion, TheStreet

 

"It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently." -- Warren Buffett

 

Although his successful, multi-decade investing career has drawn followers, the roots of Warren Buffett's appeal can be traced back to more than just his ability to make money.


Thanks to his extensive philanthropic work, optimistic outlook and folksy, grandfather-like charm, the world-famous investor has managed to construct a nearly bulletproof positive reputation.

 

That's not to say that this reputation has not been tested. On the contrary, over the past few years, a number of his actions have been greeted with ample criticism from market commentators and Buffett followers.

 

There's lots of trouble with big financials, but after sharp declines, this may be a buying opportunity.

By InvestorPlace Jun 10, 2011 9:19AM
By Jeff Reeves, Editor, InvestorPlace.com
 

Warren Buffett famously has said, "Be fearful when others are greedy and greedy when others are fearful." Easier said than done, right?


Well, the good news is that it's easy to find where others are fearful. Bank stocks are off sharply year to date, and many are approaching new lows. A battered mortgage market, threats from Moody's to downgrade debt at major financials and fears over new financial regulations are just a few reasons investors are shunning the sector.


But that fear could be a huge buying opportunity for aggressive investors willing to take some risk, with the potential of big long-term rewards when the dust settles.

 

There aren't enough stories out there like that of Titan Machinery, which has multiple moving parts all falling into place at the same time.

By Jim Cramer Jun 10, 2011 9:13AM

the streetthe street logoMaybe the solution is to have more companies like Titan Machinery (TITN).

 

I had the CEO of Titan on "Mad Money" last night, and I felt like I was talking to someone from the good old days, whenever they were. Titan is a dealer of tractors and construction equipment in the Midwest -- especially the upper Midwest -- and it's in a boom time, as anyone who was on the company's call can attest to. The farmers are awash with cash and, of course, still getting subsidies. Corn prices are incredibly high, so they can buy more equipment. And the flood damage that a lot of the country has experienced is leading to a surge in construction machinery.

 

All of this in an area that has about 3% unemployment, because Titan also happens to serve the areas being affected by huge shale gas finds.

 

Let's see, a seller of construction and agricultural equipment in farm and oil boom towns -- it doesn't get better than that.

 

Was last month's economic slowdown just a bump in the road?

By Jim J. Jubak Jun 9, 2011 5:14PM
Jim JubakIt's cold comfort -- but it is comfort nonetheless.

The latest release of the Beige Book, a collection of conversations among the 12 regional Federal Reserve banks and businesses in their regions, argues that last month's slowdown in the U.S. economy may have been caused mostly by temporary factors.

In region after region, the Beige Book reports companies citing disruptions to their business because of shortages of parts or end products, virtually all related to disruptions to the global supply chain caused by the March earthquake and tsunami in Japan.

On Tuesday, June 7, Fed Chairman Ben Bernanke said that the economic recovery, while slow, appears to remain on track. The dip in job creation to just 54,000 in May was temporary, he said.

At the time, many economists and Wall Street analysts wondered what Bernanke knew to prompt that confidence.
 

The long rally in Treasury bonds is set to fizzle as inflation, credit risk and the end of QE2 weigh on prices.

By Anthony Mirhaydari Jun 9, 2011 3:39PM

Over the past few months, U.S. Treasury bonds have defied the naysayers and pushed to levels not seen since last October. This came as a surprise to many people, especially since the government has already hit the debt ceiling and three major credit rating agencies have threatened to downgrade the U.S. credit rating if Washington fails to act as technical default looms in August.

 

The rise was driven by an increase in demand for haven assets as the economy hit another soft patch. Other factors included the European debt crisis, stabilization in the U.S. dollar and a whiff of disinflation as Wall Street marked down growth expectations.

 

But now, the naysayers look ready for their time in the sun as risk appetites rebound and the economy looks ready to re-accelerate and surprise newly pessimistic investors. And that means it's time to bet against the U.S. government by betting against its bonds. Here's why.

 

The retailer likes to be known for its pricier, trendier designs. But that doesn't fly in this economy.

By Kim Peterson Jun 9, 2011 3:37PM
Target (TGT) has for years spelled out exactly what store it wants to be.

You want cheap stuff? Go to Wal-Mart (WMT). But if you want fresher, better-looking, more awesome stuff, go to Target. Oh sure, you'll pay more, but that's the price of being cool.

Target has Zac Posen. Target has seahorse wedge sandals. A $60 wall mural. A $70 pair of earrings. But as the economy continues to sputter, what Target doesn't have is enough sales.

"Has Target lost its cachet?" wonders The Wall Street Journal this week. The company had just a 2% rise in same-store sales for its fiscal first quarter, far below the 3% to 4% analysts were expecting. And sales in May were at the low end of guidance at a 2.8% increase. 

The online auctioneer is getting some analyst love, but the future will be challenging.

By Motley Fool Pick of the Day Jun 9, 2011 3:36PM

By Rick Aristotle Munarriz

 

What do eBay (EBAY) and San Jose, Calif. rockers Smash Mouth have in common? Well, they both had some huge hits in the late 1990s, but we really haven't heard a lot out of either of them lately.

 

I don't know what Smash Mouth is up to these days, but eBay is usually making headlines for all of the wrong reasons.

 

Its namesake marketplace has been meandering in recent years. It sold off two-thirds of Skype two years ago for billions less than what Microsoft (MSFT) was willing to pay earlier this year. PayPal has been the resilient bright spot, though it recently took a hit in China by ending its relationship with Alibaba. eBay has nibbled at mostly smallish acquisitions, but few are likely to move the needle the way that PayPal has done.

 

However, at least one analyst sees eBay differently than I do.

 

The latest chart analysis confirms an important low for natural gas, and several great plays are now being presented, including an ETF that could triple.

By MoneyShow.com Jun 9, 2011 1:31PM
By Tom Aspray, MoneyShow.com

The purchase of XTO Energy in December 2009 by Exxon Mobil (XOM) for $31 billion raised some eyebrows and made it the largest producer of gas in the US. The recent $1.7 billion acquisitions of Phillips Resources and TWP, Inc. gives Exxon Mobil access to 317,000 acres in the Marcellus Shale.

The timing for Exxon looks pretty good, as the natural gas futures appear to have completed a major bottom. In early May, I noted that the on-balance volume (OBV) on the United States Natural Gas Fund (UNG) had formed a five-month bullish divergence. That fund now has the potential to triple from current levels.

The decision by Germany to close its nuclear plants is likely to be followed by similar action from other European countries. This should be an added positive for natural gas, which is the cleanest nuclear alternative.
 
Tags: etf

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[BRIEFING.COM] The stock market finished the Thursday session on a higher note with the S&P 500 climbing 0.5%. The benchmark index registered an early high within the first 90 minutes and inched to a new session best during the final hour of the action.

Equities rallied out of the gate with the financial sector (+1.1%) providing noteworthy support for the second day in a row. The growth-oriented sector extended its September gain to 1.9% versus a more modest uptick of 0.4% for the ... More


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