The most likely scenario is that the markets will begin to rise from here -- and that bounce is just beginning to take hold.
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This small company is a big player in the electrical industry.
For our pick of the day, Fool analyst Jason Moser is making a stop in Smallville -- where Houston Wire's specialized products and services separate it from the competition.
Rex Moore, Motley Fool Top Stocks editor
In a world that grows more wireless by the second, it's ironic but true: We still need wires. Sure, our smart phones, laptops and the Internet all come sans cables these days, but it all has to start somewhere. And Houston Wire and Cable Co. (HWCC) is there to make sure it all gets connected.
The battered financial has nowhere to go but up -- if you believe Wall Street price targets.
There's no shortage of articles offering the best stock picks for the new year. But allow me to throw one more on the pile before the ball drops with my recommendation of Bank of America (BAC). Why B of A? In a nutshell, I don't think things can get much worse for the battered bank.
Admittedly, this is a bit of a risky call, despite BAC rising about 17% in the past month. Bank of America has many problems in many areas, from a backlog of foreclosures to new regulations to Uncle Sam's ownership stake to plain old bad PR. But if you don't want any risk, you simply shouldn't be buying individual stocks in the current volatile market.
There are plenty of reasons to talk yourself out of buying B of A. But here are the three big reasons I found that talked me into buying:
The daily discount site is clearing the way to raise almost $1 billion in investor financing.
Groupon, the discount-deals site, is negotiating financing commitments with some of the biggest names on Wall Street, The New York Times reports. The company is preparing to go public as soon as the end of next year.
The Wall Street Journal reports that the financing under discussion could run as high as $950 million. That's because Groupon wants approval to sell as many as 30.1 million preferred shares of stock at $31.59 each.
Bargain valuations, steady revenue and emerging markets are reasons to buy.
My top stock pick for 2011 is a tech play. That may not surprise you, considering the big run by technology companies in the second half of 2010. But what may surprise you is what tech stock I'm throwing my weight behind: a tiny company called Microsoft (MSFT).
Admittedly, Microsoft hasn't given investors a lot to be happy about lately. The stock has been kicked to the curb, down about 8% this year, while the broader market has gained about 12%. If you're a momentum investor, this may turn you off, but I believe that the time is right for the rotation of capital back into this old standard. (Microsoft owns and publishes MSN Money.)
Why? Here three big reasons:
Expect controversy in gold funds and a comeback of leveraged funds, among other shifts, in the year ahead.
By Don Dion, TheStreet
With total U.S. assets recently crossing the $1 trillion mark, the ETF industry has continued to swell in 2010, becoming an undeniable force in the financial universe. The story of this rapid growth has had plenty of triumphs as well as controversy. Looking ahead to 2011, here are five predictions of what's next for exchange-traded funds.
1. Physically backed gold ETFs stir up controversy. While the rumor mill has buzzed about the trio of U.S.-listed physically backed gold ETFs -- SPDR Gold Shares (GLD), iShares Comex Gold (IAU) and ETFS Physical Swiss Gold Shares (SGOL) -- for some time now, controversy may go mainstream in 2011. "Gold bugs" and certain industry insiders have relished opportunities to whisper about the gold that's behind these huge ETFs, but the sheer size of these funds will undoubtedly begin to prompt questions on a larger scale.
It's tempting to chase the huge returns these names have generated in 2010. But remember: The higher they climb, the harder they fall.
By James Dlugosch, Stockpickr
Recent trading activity for Netflix (NFLX) offers investors a cautionary tale with respect to stocks with big valuations. Since crossing $200 at the end of November, shares of the home delivery video giant have dropped by more than 10% in December.
Investors, take note: The higher they climb, the harder they fall. For those chasing returns or momentum stocks, buying Netflix at the end of November would have been a mistake. Are there other stocks trading for big valuations investors should now avoid?
Certainly the warning signs were there for Netflix. Prior to November, the stock was a big winner. Shares had more than tripled in value in 2010, thanks to earnings growth and a future that many people predicted was unlimited.
One analyst, citing internal sources, says the new BlackBerry Playbook needs help.
The upcoming BlackBerry PlayBook from RIM has a battery that lasts only a few hours per charge, writes Shaw Wu, an analyst with Kaufman Bros. The Digital Daily blog picked up on the report.
If that's the case, the PlayBook will have a hard time making a strong run against the iPad, which can last for nearly 10 hours on one charge. Even Samsung's Galaxy Tab can go about six hours, writes John Paczkowski. Update: RIM has responded to Wu's claim. More below.
With the greenback sliding again, foreign stocks, gold and industrial metals are on the move.
It's well known that the U.S. dollar plays a unique role in the global economy. As the world's de facto reserve currency, it's always in high demand, especially in times of stress. That makes it, along with U.S. Treasury bonds, the haven asset investors flock to when fear and uncertainty strike.
And since most of the world's tradable commodities are denominated in dollars, its undulations affect the prices of things like gold, crude oil, copper and other metals. The strength and weakness of the dollar also push and pull foreign stocks, as hair-trigger hedge fund types always want to be positioned in assets denominated in rising currencies.
The snack-maker says half of its products will be now made from natural ingredients.
Well, Frito-Lay now wants to change that, according to USA Today. The snack-maker, a unit of Pepsico (PEP), says that in 2011, 50% of its products will be made from all-natural ingredients.
MSG will be removed from Lay's Barbeque and Tostitos Hint of Lime chips. Some products will lose the artificial colors as well.
These aggressive plays could gain from the noted investment strategist's anti-consensus expectations.
By Paul Mazzilli, TheStreet
Doug Kass, the investment strategist and a RealMoney Silver contributor, recently published his widely followed "15 Surprises for 2011." Below are some aggressive ways to play eight of those surprises through ETFs.
Note that many of these plays include leveraged and inverse ETFs, which are most suitable for short-term trading and which may have tracking errors over time.
Surprise: In line with consensus, the domestic economy experiences a strong first half, but several factors conspire to produce a weakening second half, which jeopardizes corporate profit growth forecasts.
ETF play: Stay invested early in 2011, but later in 2011, establish a long position in a leveraged inverse ETF that seeks minus 200% returns on a broad market index. The most popular is the ProShares UltraShort S&P500 (SDS).
From video Barbie to Tonka Chuck, toys topped the list of holiday must-haves.
One analyst said Mattel (MAT) and RC2 (RCRC) were the best performers.
Mattel shares have been on a nice six-month run, going from just less than $22 to close to $26 as of Wednesday. RC2 shares have climbed from $16 to $21.30.
Fears of military spending cuts are overblown, and these picks are well-positioned to win new contracts.
Rex Moore, Motley Fool Top Stocks editor
If, like me, you're an 8-year-old boy at heart, it's hard to imagine that missiles, tanks and fighter jets could ever fall out of favor.
Yet our allies in Britain are busy decommissioning warships, delaying weapons upgrades and canning the development of some high-tech military vehicles. Here on U.S. soil, meanwhile, we're hearing rumors that cuts in defense spending are as certain as slop in the mess hall (or a bad-tasting MRE). These fears have weighed on defense stocks, sending the group down 8% since the beginning of the year.
Privately held shares are being swapped so frequently that regulators are paying attention.
This is the same problem that forced Google (GOOG) into an IPO perhaps earlier than its founders wanted.
Facebook has issued privately held shares to employees and other investors, and those shares are being traded so much that the Securities and Exchange Commission has asked Facebook for more information about what's going on. The SEC has made similar requests in to Twitter, Zynga and LinkedIn, the Times reports.
These funds are well positioned to profit from a global wireless boom.
By Don Dion, TheStreet
Whereas the gadgets were once used mainly to stay in contact with friends and loved ones through phone calls and texts, consumers are increasingly turning to their iPhones, Droids and BlackBerry devices to connect with the world around them, surf the Internet, play games, check email and keep a constant eye on work.
Downloadable films feel like one more doomed move to right the once-dominant department store chain.
By Jeff Reeves, editor of InvestorPlace.com
Though it's been a happy holiday for many retailers -- sales data Tuesday confirmed many shops are on track for their best December in three years -- one battered big-box store that can't seem to get it right is Sears Holdings (SHLD). The operator of Sears and Kmart stores has projected sales will slide about 4% in the current quarter year over year.
Poor sales have become a habit at Sears and Kmart, and they have sparked an air of desperation in 2010 -- from testing Sears grocery delivery in urban markets to relinquishing a retail monopoly on the Craftsman brand via a partnership with Ace Hardware.
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Lending was up in the first quarter, but that jump has hidden the fact that individuals are still having a tough time getting loans.
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[BRIEFING.COM] The stock market ended the holiday-shortened week on a mixed note as the Dow Jones Industrial Average shed 0.1%, while the S&P 500 added 0.1% with seven sectors posting gains.
Equity indices faced an uphill climb from the opening bell after disappointing quarterly results from Google (GOOG 536.10, -20.44) and IBM (IBM 190.04, -6.36) weighed on the early sentiment. Google reported earnings $0.15 below the Capital IQ consensus estimate on revenue of $15.42 ... More
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