If everything goes as planned, this week will be the busiest for initial public offerings since 2000.
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While U.S. consumers are proving remarkably resilient, fear is helping keep many consumer stocks attractive
Despite concerns about skyrocketing gas prices, the U.S. consumer is continuing to prove remarkably resilient, according to the latest retail sales figures. According to Thomson Reuters, same-store sales at 25 major stores jumped an average of nearly 9% in April vs. the same month a year ago. Even accounting for the fact that Easter fell in late April this year as opposed to early April last year (which meant more Easter-related shopping was done in March last year), sales have been fairly strong.
Still, the high gas prices and lingering weakness in the job market are leaving a cloud hanging over many consumer-oriented stocks. And that's created some good buying opportunities, several of which are popping up on the radars of my Guru Strategies (each of which is based on the approach of a different investing great).
As an additional bonus, consumer and food stocks tend to be two of the most resilient sectors during the summer months -- after many investors act on the old adage, "Sell in May and go away." That's what a study recently highlighted by MarketWatch's Mark Hulbert found. The study, performed by Ben Jacobsen and Nuttawat Visaltanachoti of New Zealand’s Massey University, examined the "Sell in May" phenomenon. It found that from 1926-2005, all sectors and industries performed better during winter than summer, but that the effect was "almost absent in sectors related to consumer consumption".
The maker of voice recognition technology gets a lift on talk it is in discussions with Apple
The website TechCrunch reported that Apple has been negotiating a deal with Nuance, which develops voice-recognition technology. It could be an acquisition, but it's more likely a partnership, writes MG Siegler. It turns out that a company Apple acquired last year, Siri, relies on Nuance technology.
Siri technology is expected to play a big role in future operating systems for Apple, Siegler writes. So Nuance could be along for the ride as well.
The game is completely addictive. But does it have the potential to become a major entertainment brand?
Rovio, the company that makes the game, hopes for an initial public offering in three to four years, the chief marketing officer told a Finnish newspaper. "We are not in a hurry," added Peter Vesterbacka, according to Reuters.
He also thinks Rovio could become the world's leading entertainment brand in three years. Give the guy points for being ambitious, however unrealistic that sounds. He does go by the nickname "Mighty Eagle," after all.
A boost in consumer confidence should be good news for most, but not all, casino stocks. Having done well with my first casino recommendation in March, I give you one more to consider here.
The company overtakes Google with a name value of $153 billion.
Apple's brand is now worth $153 billion, according to a study by Millward Brown, a global brands agency. So the brand knocks out almost half of Apple's market cap. If you subtract the $66 billion in cash the company is sitting on, that leaves a value of about $103 billion for the rest of the company.
Is the brand really worth that much? Peter Walshe, an executive at Millward Brown, says the brand is what allows Apple to sell at higher prices. People who buy Apple products are buying the brand as well.
Last week's commodities rout sent shivers through the markets, and some companies will fare worse than others.
By Jake Lynch, TheStreet
Commodities cratered last week, with silver posting its biggest decline since 1975 and oil recording its largest drop in three years, sending a chill through the markets as the hottest, and best-performing, investments turned cold overnight.
Increases in Comex margin requirements decimated bets on silver, which plunged 27% in a week, and gold slid for three days, the worst decrease in a year.
Individual investors, who have been playing the commodities markets through exchange-traded funds, have been burned. The heavily traded ProShares Ultra Silver (AGQ) fund has dropped by 48% in just five trading sessions, illustrating Newton's law of investing: What comes up, must come down. Still, the sell-off has positive implications for the economy.
Two new PowerShares funds track the least- and most-volatile stocks in the benchmark index.
By Roger Nusbaum, TheStreet
These new funds seem to appeal to two different types of investors: those who want to make aggressive, speculative bets without the potential disadvantages of levered long funds; and those who have lost confidence in their investing abilities or have realized they have a limited tolerance for volatility.
The new site, called GrouponLive, will offer discount tickets to concerts and sporting events. With video interview.
Live Nation Entertainment (LYV) and Groupon: A match made in heaven.
The nation's biggest concert promoter said it's partnering with Groupon to launch a new ticketing deals website that will offer discount tickets to concerts and sporting events. It's another step forward for Live Nation, which has suffered in the economic downturn.
Concert attendance is down nationwide -- last summer, ticket sales fell by 12%. People don't really want to buy an $85 ticket with $30 in service fees loaded on top. Live Nation, which owns Ticketmaster, suffered a $228.4 million loss last year, and its share price stalled out between $10 and $15. Today, shares fell less than 1% to $10.70.
Post continues after this video interview with the heads of Groupon and Live Nation:
The Seagate-Samsung deal underscores how flash is encroaching on HDD territory.
By Cindy Johnson
As earnings season starts to wind down and investors reflect on how the tech landscape is changing, it'd be easy to ignore one sector seeing the most dramatic changes: the hard disk drive (HDD) industry.
Among HDD makers, Seagate (STX) reported adjusted earnings per share of $0.25, down a whopping 76% year over year and $0.02 below the consensus estimate. Revenue fell by 12% year over year. Competitor Western Digital's (WDC) adjusted EPS declined by 61% year over year and revenue fell by 15%, though at least WDC's EPS of $0.66 matched analysts' meager expectations.
Japan-related supply constraints took much of the blame for the disappointing results. That didn't hold Intel (INTC) back during the quarter, though. Intel also overcame shifting demand in the PC industry, another cause of HDD weakness -- and one that's unlikely to reverse course. Both consumers and enterprises are shifting from notebooks to tablets. That means they're also shifting from HDDs to flash-based solid-state drives (SSDs).
The social-networking company will issue 7.8 million shares priced between $32 and $35 apiece.
LinkedIn, the leading social network for professionals, released the pricing details of its eagerly awaited IPO this morning. The company intends to issue 7.8 million shares under the proposed ticker LNKD at a range of $32 to $35. At the midpoint, the valuation would be $3.3 billion.
But it's a good bet that the opening price will be 30% to 40% higher when the shares hit the market, which will probably be in the next week or so.
Founded in 2003, LinkedIn is a pioneer in Web 2.0. The company is a kind of Rolodex for the 21st century, allowing professionals to network over the Internet without putting up with those goofy family photos and embarrassing comments from ex-girlfriends that can abound on other sites like Facebook and Twitter. LinkedIn is meant to be for professionals first, an important distinction that makes it unique.
LinkedIn's growth rate has been consistently strong. Now the website has more than 100 million members.
The iShares Silver Trust and other commodity-linked exchange-traded funds could see more volatility in coming sessions.
By Don Dion, TheStreet
Here are five ETFs to watch this week.
It was a tough week for commodities as oil, copper, gold and various agricultural products faced heavy selling pressure.
Silver witnessed one of the biggest retreats of all. Prior to last week's selloff, this industry-linked precious metal had been thrust into the spotlight as prices fast approached nominal all-time highs. This dramatic ascension appears to have been stifled, however. In the opening days of May, the physically based SLV suffered a steep decline that resulted in the fund giving back a month's worth of gains.
Sell in May and go away is still the play this week
As predicted here the market moved lower last week. The S&P 500 lost nearly 2% during the period as investors locked in gains from what had been a powerful move higher.
The losses would have been worse had it not been for the national euphoria over the killing of Osama Bin Laden. A strong job report on Friday also helped keep the losses to a minimum.
Without those events stocks were poised to lose 3-4%. Nothing earth shattering there since stocks had moved higher in the previous two weeks. Some profit taking is to be expected.
Given that we only lost about half what I expected I would advise more caution for the week ahead. Small caps will likely lead the way lower making the pick of the ProShares Short Russell 2,000 (RWM) the place to be this week.
While we should be more concerned with Friday's employment figures, the weak dollar and strong euro are still driving this market.
Ouch! The charts of the oils and the industrials look like they are hanging by a thread. The drugs and the utilities, meanwhile, are so overextended that it’s painful to look at them! That was my feeling after scanning the chart book while the oil futures sprung back to life in the early Monday morning hours.
It's a tough moment for the charts of many of the industrials and their derivative commodity plays. But if this is the rolling bull market that we have seen forever, then you want to bet that the correction in the oils and industrials might be nearing its conclusion -- they are so instant -- and that the drugs, the utilities and the like must be sold.
Every weekend when I look at these charts I am always amazed at how the worst of the previous week or two becomes the best. I think it could happen again this week, too. The rotations are that swift and seem to catch so many people unaware. So, what do we watch?
The central bank and the people who run it may not not perfect, but that doesn't mean they're evil.
Misinformation about the Federal Reserve abounds these days. And that misinformation cuts both ways. For every conspiracy theorist who labels the central bank and its chairman Ben Bernanke as the root of all economic evils, there is a brainwashed Fed defender who just doesn't get it.
I don't pretend to be impartial when it comes to the Federal Reserve. I have my list of personal gripes with its policies. But there's one question at the core of most Federal Reserve criticism that spawns nearly all others: Is the Fed evil?
It's important to note that whether or not the Fed makes mistakes isn't the core issue here. The central bank has the potential to harm the economy with its policies, and sometimes it does. That is an indictment not of the institution itself but of the human beings at the helm.
The long-term trend for stocks is positive, but that outlook could change for some sectors if Friday's bounce doesn't find some momentum early next week.
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3 stocks will be in the spotlight Thursday as investors try to make sense of the numbers from the sector.
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[BRIEFING.COM] S&P futures vs fair value: -9.40. Nasdaq futures vs fair value: -25.00. U.S. equity futures are on the defensive amid cautious action overseas. Global equities have been pressured by disappointing earnings from heavyweights like Adidas, Samsung, and Lufthansa. The S&P 500 futures hover nine points below fair value.
Reviewing overnight developments:
- Asian markets ended mixed. Japan's Nikkei -0.2%, Hong Kong's Hang Seng +0.1%, and China's Shanghai ... More
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