Wild market ride is just beginning
Wild market ride is just beginning

October is known for above-average volatility, though the reasons are unclear. Expect more of the same this time around.

VIDEO ON MSN MONEY

A former broker shares an 11-point checklist.

By Kim Peterson Jul 6, 2011 2:12PM
With about 10,000 stocks to choose from, picking a winner can sometimes feel impossible.

But former stockbroker Kevin Matras says his checklist works. Matras, a contributing editor at Zacks Investment Research, shares his strategy in the following video. Before he buys a stock, he says, he puts it up against this basic set of building blocks. If a stock passes, he says, it has a high probability of success.

By the way, five stocks currently sail through his checklist. I'll go through those stocks after the following video.

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The nation is slowly starting to face the consequences of its actions.

By V.N. Katsenelson Jul 6, 2011 2:06PM
Party rulers in China are trapped in a position that chess players deeply fear -- zugzwang, where any move made puts you at disadvantage. In China, the potential cost of both action and inaction is economic collapse.

 

China is slowly starting to face the consequences of its actions — loans grew by more than 30% a year over the past few years — and inflation is rising fast. Inflation in developed countries is unpleasant, but it is tolerable.  For a developing country — China, despite its size, is still a developing country — it can be catastrophic.  In developed countries, we spend two or three times less on food as a percentage of our income as do people in developing countries.  Therefore, though food inflation is unpleasant, we have a much greater tolerance (margin of safety) for it.  While food inflation the US can mean fewer trips to restaurants or no summer vacation, food inflation in China leads to hunger.

 

Here's the skinny on the video game company as it prepares to go public.

By TheStreet Staff Jul 6, 2011 11:50AM

By Eric Jackson, TheStreet

 

A lot has been written about Zynga in the past week since it filed its S-1 last week, revealing more details about its financials and future IPO plans.

 

Overall, most folks in the press have described the company positively because it appears to be making money compared with Groupon.

 

The company does have a number of strengths, but the general view of the business press is badly misinformed because of a lack of familiarity with the gaming sector.

 

Here are some myths and truths about Zynga:

 

There is substantial upside potential in minerals, and risk-controlled entry points are evident for 3 leading producers.

By MoneyShow.com Jul 6, 2011 11:48AM
By Tom Aspray, MoneyShow.com

Tuesday's announcement from the Geneva-based World Trade Organization (WTO) found that China "Violated international trade law by artificially restricting exports of nine raw materials." These raw materials are critical to the production of aluminum, steel and chemicals.

Though rare-earth minerals were not included in the ruling, it is thought to set a precedent for an outstanding complaint against China for restricting the export of 17 rare-earth minerals. Last year, China temporarily halted exports of rare-earth minerals to Japan.

Over the weekend, it was also reported that Japanese experts have found a large deposit of rare-earth minerals on the floor of the Pacific Ocean. The size of the mineral discovery is estimated to be 1,000 times more than the current proven reserves, which are mostly in China.

In an early June article, "Sweet Spot for Rare Earth Stocks," I was looking for a further decline in rare-earth stocks before a bottom could be completed. These stocks did drop into the middle of June but have since rallied sharply, and some rare-earth minerals recently doubled in price amid reports of apparent hoarding. But have the rare-earth stocks now completed a significant bottom?
 

A growing number of financial advisers prefer to blend active and passive strategies.

By TheStreet Staff Jul 6, 2011 10:54AM

the streetBy Stan Luxenberg, TheStreet

 

Financial advisers argue endlessly about whether index funds are superior to actively managed portfolios. Some advisers use index funds exclusively, while others believe they can outdo the benchmarks with actively managed funds. But a growing number are taking a hybrid approach, mixing actively managed funds with passive ETFs and index funds.

 

"It is rare for us to see an adviser who puts everything in one kind of investment," says Sue Thompson, the managing director of BlackRock, which operates the iShares family of ETFs.

 

Thompson says some advisers start with a core of ETFs, then buy a few actively managed funds to add spice or reach asset classes that are not well served by ETFs. Other advisers start with a core of active funds and add ETFs on the margins.

 

JPMorgan Chase and IBM, among others, tend to advance after reporting second-quarter results.

By TheStreet Staff Jul 6, 2011 10:23AM

the streetBy Robert Holmes, TheStreet

 

Some Dow stocks, such as JPMorgan Chase (JPM) and IBM (IBM), tend to perform better than others after reporting second-quarter earnings results.

 

That's not the case with Disney (DIS) and Microsoft (MSFT).

 

Alcoa (AA) unofficially kicks off the earnings reporting season July 11 after the stock market's closing bell. The aluminum producer's stock doesn't fare well after reporting second-quarter numbers, falling an average of 0.7% the following day, according to data collected over the past 10 years.

 

Disney, Microsoft and Exxon Mobil (XOM) typically fall an average of 2% in the trading session after the companies report financial results for the second quarter. (Microsoft owns and publishes MSN Money.)

 

CEO Mark Zuckerberg talks up the power of his social network's infrastructure, but can the deal fend off a hot new video feature from Google? With video analysis.

By InvestorPlace Jul 6, 2011 10:18AM

By Jeff Reeves, editor of InvestorPlace.com

 

Facebook made a splash Wednesday with a major upgrade to its ubiquitous social-media platform: a video chat feature via a partnership with Skype.

 

The move comes along with upgrades to groups, chatting and buddy lists, adding an extra layer of interactivity to Facebook. That's saying something, considering the site already boasts 500 million active users who spend more than 700 billion minutes per month on its site.

 

So what is the motivation for the upgrade to chatting and Facebook-Skype synergy? To keep people connected, sure, and CEO Mark Zuckerberg acknowledged in his press conference Wednesday that Facebook chat was a bit clunky and needed some improvement. But more importantly, to keep users loyally plugged in as competitors look to get a slice of Facebook's massive social-media pie.

 

Hoping to avoid a run on Greek banks, the European Central Bank becomes more open-minded about its rules.

By Jim J. Jubak Jul 5, 2011 4:55PM
Image: Jim JubakThe Greek debt crisis is like an onion. Peel away one layer and you find another -- and then you cry.

Remember last week? The big test was two votes by the Greek Parliament on a new austerity package.

Pass that, the Greeks had been told by the IMF, the EU and the European Central Bank, or we won't give you the $17 billion you need to avoid defaulting on your government debt in August. So the Greeks voted to cut their budget, raise taxes and sell off government assets.

But that only moves the crisis from worry over a default in August to worry over a default in, well, July.

Eurozone leaders are supposed to be putting together a second rescue package for Greece, with a vote on the package around July 11. A second package is necessary because the first rescue package, passed last year, was designed only to get Greece to 2012.
 

Betting against this company is stupid.

By Motley Fool Pick of the Day Jul 5, 2011 3:39PM

By Tim Hanson

 

It's not often that a company you've criticized invites you over for a tour and tea, but that's precisely what happened to me recently in Beijing when I visited Baidu's (BIDU) corporate campus in the northwestern part of the city. And after spending a full day meeting employees and getting a sense of the company's culture and growth strategy, I'm beginning to think that my skepticism of the company has been misguided.

 

I'll tell you why, but first I need to explain what I used to think.

 

This story begins 1,800% ago
Baidu went public in 2005, and given the excitement about emerging markets then, the stock nearly doubled on its first day of trading. It's looked expensive to me ever since. One reason for that is Baidu was (and to some extent remains) a Google (GOOG) clone.

 

The company plans to offer video streams in three languages to 43 countries later this year.

By Kim Peterson Jul 5, 2011 3:07PM
Netflix (NFLX) stock was a big mover Tuesday, jumping more than 7% on news that the company will expand into 43 countries this year.

This is a huge deal for the video-streaming and DVD-by-mail company. Netflix has gone international only once, launching services in Canada last year. Now it plans to offer videos in Spanish, Portuguese and English to subscribers in Mexico, Central America and South America as well as in the Caribbean.

Analysts think there are 40 million to 45 million broadband customers in Latin America and the Caribbean. Think about that in terms of Netflix Canada, which won the loyalty of 8% of broadband households within seven months, says Citi analyst James Rivett.

The following video has a pretty meaty discussion about Netflix's expansion and what it means for the stock. Check it out.

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Fidelity introduces 4 targeted products that reduce interest-rate uncertainty.

By TheStreet Staff Jul 5, 2011 2:57PM

By Stan Luxenberg, TheStreet

 

Plenty of investors are worried that interest rates will rise in coming years. That could be bad news for bond funds. When rates rise, bond prices tend to fall. So investors in bond funds can't be sure how much money they will have on any particular date.

 

To help reduce the uncertainty, Fidelity Investments recently introduced four municipal funds that target specific dates, ranging from 2015 to 2021. The funds hold bonds that mature near the target dates. The idea is that shareholders will receive their principal back on the target dates.

 

The funds could be attractive for cautious investors who are saving for specific events. Say you will need to make college tuition payments in 10 years. You could invest in Fidelity Municipal Income 2021 (FOCFX).

 

With the sale of the struggling roast beef chain officially behind it, Wendy's sheds the Arby's name while keeping a small stock interest in the company.

By TheStreet Staff Jul 5, 2011 2:15PM

By Miriam Reimer, TheStreet

 

Wendy's (WEN) is once again a solo fast-food name brand -- dropping Arby's from its name now that its sale of the struggling roast beef chain is complete -- and the company is forging ahead with new menu items, an updated logo and a focus on global growth.

 

Wendy's said early Tuesday that it completed the sale of Arby's to private equity firm Roark Capital Management, a long-anticipated divestiture announced in June. Effective immediately, its corporate name was changed to The Wendy's Company, and its common stock will continue to trade under the ticker WEN.

 

The sale of its struggling Arby's chain showed that Wendy's was looking to deleverage its balance sheet and finally divest a brand that's been dragging on its financials for years.

 

Lawmakers have less than a month to set aside the political rhetoric and finally work out a deal.

By Kim Peterson Jul 5, 2011 2:03PM
We're less than a month from the point where the U.S. government risks defaulting on its debt. Can Congress put aside the hot air and actually hammer out a solution before then?

At this point, negotiations stand pretty much exactly where they were two weeks ago, when House Republicans pulled out, The Washington Post reports. And we've heard plenty of bluster from both sides of the aisle since then.

Congress is in full debate over whether to lift the country's $14.3 trillion debt ceiling by Aug. 2. If the impasse continues after that point, we could very well see a plunge back into recession, a crumbling stock market and a financial ripple effect across the globe.

Check out the following analysis of the debt ceiling drama from CNBC.

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After one of the best 5-day performances in years, stocks have more upside progress yet to come.

By Anthony Mirhaydari Jul 5, 2011 1:09PM

Equities enjoyed one of their best performances of all time last week on signs of renewed economic vigor and progress by European leaders to quell the latest round of the Greek debt crisis. The "re-recovery" I've been writing about in my columns and blogs posts has arrived, and investors are crawling over themselves to participate after stocks fell to their most oversold levels since the late 1990s by some measures.

 

It was only the 10th time in the history of the S&P 500 since 1928 that it gained at least 0.75% for five straight days. History also suggests Tuesday's slight weakness was to be expected: Seven of the other nine examples dipped the next day. But in eight of those nine examples, buying the dip resulted in gains two weeks later.

 

I think a similar performance is in store for us now, thanks to cautious sentiment, impressive market breadth and strengthening economic fundamentals. But above all, the Federal Reserve's "stealth stimulus" -- a subject I've touched on frequently -- will keep funneling easy money into risky assets like stocks as the same dynamic that powered the housing bubble is at work again.

 

Funds tracking the Japanese economy, corn prices and the euro will be in the spotlight for the next few days.

By TheStreet Staff Jul 5, 2011 10:26AM

Image: Stock investor (© Tom Grill/Corbis)By Don Dion, TheStreet

 

Here are five exchange-traded funds to keep an eye on this week.

 

1. iShares MSCI Japan Index Fund (EWJ)

 

The Japan-tracking EWJ spent much of the month of June treading water, subdued below its 50-day moving average. At the close of the month, however, the fund caught a break. Thanks to a three-day ascent during the middle of last week, shares of EWJ managed to recapture levels seen at the start of May.

 

In the coming days, as we take our first steps into the second half of 2011, it will be interesting to see if EWJ can capitalize on last week's strength. The Japanese markets still have ample ground to cover before the fund regains the highs witnessed before the devastating earthquake and tsunami. Along the road to recovery, expect headwinds to persist.

 

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[BRIEFING.COM] The stock market began the new week on a cautious note. The S&P 500 lost 0.3%, but managed to erase more than half of its opening decline. Thanks to the rebound, the benchmark index reclaimed its 50-day moving average (1976.78) after slipping below that level in the morning.

Equities slumped at the open amid a couple global developments that dampened the overall risk appetite. Continued student protests in Hong Kong and a potential response from China weighed on the ... More


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