Investors know what's working and what's not. Jim Cramer says these stocks could power higher through the end of the year.
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With dividends and gold in focus, these funds should perform well.
ETF investing has been a lot of fun as the stock market took off in September, but exchange-traded funds and stocks vacillated last week. After the momentous run for investments in September ran out of steam, it was -- as I said last week -- a mixed bag.
Could we expect anything else? As the month came to an end with one of the best Septembers ever, it was only natural to have a pause.
In some ways, however, a pause could be considered a victory -- and an opportunity for ETF investors.
Discretionary-income stocks like Williams-Sonoma and Best Buy are far more telling than consumer confidence surveys, and their charts say good things about this market.
By Jim Cramer, TheStreet
Whenever I hear the term "ailing consumer," I cringe. No choice. I am a stock guy, and while I can see data that certainly show weakness in the macro, data from stocks -- not the government -- inform my view.
That's all I could think about as I perused chart after chart this weekend. The strength in these charts is remarkable. Among the best names in the book are some of the most discretionary: Williams-Sonoma (WSM), for fancy housewares; Coach (COH), for expensive handbags; Starwood (HOT), for high-end vacationing; Ralph Lauren (RL), with top-notch apparel; and Best Buy (BBY), which hasn't quit since that good quarter.
There are others that could be considered "pulse" plays, meaning they show the consumer with a pulse, like Direct TV (DTV), Viacom (VIA.B) and Discovery (DISCA), three entertainment entities that you could live without.
Some top strategists come to different conclusions.
Ever since the financial crisis and market crash of 2008, investors have been bombarded by talk of the "new normal," the notion that we've entered a new world in which growth will be slow and stock returns will be well short of those investors had become accustomed to.
But is the new-normal notion true? Well, this week, some sparks flew around that question as some of the world's top strategists offered diverging views of whether such a dismal period is in fact upon us.
On the "no" side -- quite adamantly -- was Kenneth Fisher, the author, Forbes columnist and money manager. Speaking at the Forbes Global CEO Conference in Sydney, Fisher called the new-normal concept idiotic and said things are not, as many people would have you believe, different in this recovery.
Last week was a good time to be in the market. This week looks to be just as good.
By the end of the week, I'm so confused about what happened and why that my head is just spinning. Each weekend I use Barchart to mine the data that tell me what happened and how I should plan my next week.
I use three different yardsticks that each measure the market's momentum, but each does it in a slightly different way. I feel good when all three point in the same direction as they do this week. Let's take a look.
Concerns over currency depreciation are misplaced. A falling dollar is exactly what we need.
The U.S. dollar has been dropping like a piano off a rooftop. Since June 7, the US Dollar Bullish Index Fund (UUP) has lost more than 12%. This drop effectively reversed the rise that coincided with the frightened flight to the dollar that started with the Dubai debt troubles last November and continued during Europe's debt woes in spring.
More recently, concerns over the health of the economic recovery here in the United States -- tied with the Federal Reserve's recent announcement that it could very well engage in another round of money printing to support growth -- has weighed on the dollar particularly hard over the past month.
For many people, the dollar's fall is a concern. But as long as the decline remains orderly, it shouldn't be: There are a number of reasons a weaker dollar is in the best interest of the economy and investors right now. And this provides yet another reason I continue to maintain an optimistic long-term outlook.
Vale has good dividend news for shareholders, and is planning a share buyback.
Looking for a big shareholder-friendly Brazilian commodities play?
I'd look right past Petrobras (PBR), where the Brazilian government took a bigger stake (48%) after the company's $67-billion share offering last week, to Vale (VALE), the country's big iron ore exporter. (For more on why the Petrobras offering was bad news for investors, see my post).
Vale announced two important moves for shareholders last week. First, the company will pay out $2.75 billion in dividends to shareholders in three tranches by next January. The cash for this dividend payout comes from Vale's sale of its aluminum assets to Norsk Hydro (NHYDY) for $4.9 billion.
Google's Android is now neck-and-neck with Apple's iPhone.
By Jeff Reeves, InvestorPlace.com
The iPhone continues to lose ground to the gaggle of Google-powered smart phones running the Android software platform. And if Apple doesn’t do something fast, it risks losing its perch among smart-phone manufacturers.
Specifically, 38% of some 4,000 surveyed said they would prefer to buy a phone running the Apple iOS in the next 90 days and 37% of respondents were eyeing an Android-powered phone. That’s a big shift from three months ago, when 50% of future buyers were favoring the just-released iPhone and 30% were anticipating an Android smart phone.
The index is close to seeing its 50-day average surpass its 200-day average. What does the phenomenon mean?
A golden cross is generally considered good news for stocks, and one hasn't been seen in the Dow Jones Industrial Average since 2005. A golden cross occurs when the 50-day average moves higher than the 200-day average (when both are rising).
The 50-day average for the Dow is 0.1% away from the golden cross, Bloomberg reports. It would take a significant sell-off to avoid a golden cross, writes one Seeking Alpha contributor.
The retailer partners with Humana to beat out other plans for Medicare recipients.
Wal-Mart (WMT) upended the drug industry in 2006 by offering $4 generic drugs. Now the retailing giant is at it again, unveiling the cheapest prescription drug plan in the country.
Wal-Mart has partnered with health insurance company Humana (HUM) and will offer the plan to people on Medicare, Bloomberg reports. Starting Jan. 1, the plan will cost only $14.80 a month -- less than half the average Medicare premium for prescription drugs.
It's a win-win for both companies. Humana wants to boost its market share and hopes Wal-Mart will bring in enough business to keep its drug plans profitable. Wal-Mart wants more people to visit its pharmacies instead of Walgreens (WAG) or CVSCaremark (CVS).
Microsoft's big 3-phone debut at AT&T will take the spotlight off Apple for a change.
By Scott Moritz, TheStreet
AT&T is expected to unveil phones from HTC, Samsung and LG, according the The Wall Street Journal. They will be the first phones in the U.S. to run on Microsoft's long-awaited Windows 7 operating system. Given what's at stake for Microsoft and the size of its bank account, the Windows 7 event at AT&T will not be a low-key affair.
The timing of the announcement, reported to be Oct. 11, and the media blitz leading up to the launch in November will attempt to put Microsoft phones center stage during the holidays. (Microsoft owns and publishes MSN Money.)
A double standard exists in the media: Being bearish means never having to say you're sorry.
By Jim Cramer, TheStreet
Asymmetrical thinking. That's what my friend Tom Keene at Bloomberg calls the notion of how you're viewed as an excellent thinker and a helpful participant in the debate if you are negative about a stock or the market -- right or wrong. If you are positive and right about the stock and the market, it means very little. And if you are positive and wrong about the market, then you are roundly criticized, often to the point that it ain't worth it. That's how bad the heat is.
We had a classic example in the papers this week. In Wednesday's Wall Street Journal a constantly saturnine writer, Kelly Evans, who writes a very important article on the left-hand corner of the "Money and Investing" section, penned a piece called "Weak Economy Saps Dollar Stores' Strength." In it there were a series of negative thoughts about Family Dollar (FDO), which was due to report the very morning the article appeared.
The incredibly cautionary article talked about how the "discount space is looking increasingly crowded" and how there already may be too many stores. Then the article gets more negative: "More troubling, the squeeze on dollar stores' core lower-end shoppers is getting worse as unemployment continues to hover just below 10% and the economic rebound proves anemic." That macro backdrop, Evans writes, "is likely to put pressure on margins."
One website takes a screwdriver to Apple's latest gadget and finds a chunk of storage.
One of the most notable features in Apple's (AAPL) new Apple TV device is the storage -- or, more specifically, the lack of storage. That's one reason the device, which brings online video to your television, is so tiny and affordable.
The previous Apple TV had a 160GB hard drive, but Apple now wants people to rent movies and TV shows instead of buying them, thus eliminating the need for storage.
Or so we thought. The tech website iFixit got hold of the new gadget and took it apart -- only to find 8 gigabytes of storage space included.
Every Dreamliner delay hurts, but this plane has a huge order book awaiting its arrival.
That's set up an opportunity to buy this stock for the eventual good news about its product cycle while getting paid a yield of 2.55%, just below the 2.65% yield on a ten-year Treasury.
Boeing's shares were down 5.4% Wednesday from their price on Aug. 2. You don't have to look very hard for a reason for the drop: another setback for Boeing's oft-delayed 787 Dreamliner.
After blasting higher on dollar weakness, gold and gold stocks look ready for a pullback.
Gold has been a hot commodity over the last few months as the U.S. dollar tumbled. The trend picked up some momentum lately after the Federal Reserve announced last week that it was shifting its focus from fighting inflation to fighting deflation -- and would consider another round of money printing to support its efforts.
As a result, since July 28 the Gold Trust SPDR (GLD) is up 12.7% and the Market Vectors Gold Miners (GDX) is up 20% while the S&P 500 only managed to add 2.8%. Gold mining stocks have even outperformed the broad index since stocks put in a low on August 26. this was helped of course by the 4.8% slide in the dollar.
But now, there are signs that gold mining stocks are poised for a meaningful pullback. Despite the push to new highs by gold prices, mining stocks Kinross Gold (KGC) and Newmont Mining (NEM) have lagged behind. A similar "negative divergence" warned to trouble back in June. Let's take a look at a few examples of the weakness that has begun to plague the industry group.
One market observer says Sept. 30 in a midterm year is a special day.
Sept. 30 in a midterm election year is generally the market's low point of a presidential election cycle, Eddy Elfenbein writes. It's the best day to buy stocks, he adds.
Elfenbein looked at the numbers over the entire history of the Dow and found that the Dow generally gains about 24% in the one-year period starting Sept. 30 of the midterm election year.
If the numbers hold true, that means the Dow could see a 24% rise from today through Sept. 6, 2011.
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For the most part, the stock market was a sideshow. The main trading events were seen in the commodity and Treasury markets, both of which saw some decent-sized losses within their respective complex.
Dollar strength was at the heart of the weakness in ... More
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