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.


T-Mobile users are up in arms about the proposed acquisition. With video updates.

By Kim Peterson Mar 21, 2011 3:02PM
AT&T (T) and T-Mobile. Was there ever a deal so universally reviled? People across the board are holding their noses at this proposed $39 billion marriage.

"It's hard to find winners, apart from AT&T and T-Mobile shareholders," Om Malik writes on the GigaOM technology blog. The biggest losers in the deal, he says, would be consumers. That's because T-Mobile has offered cheaper voice and data plans and because the market would have only three main national players: AT&T, Verizon (VZ) and Sprint (S).

Phone handset makers would also lose, Malik writes, because there would be one less carrier that would buy GSM-based phones from shops like HTC and Motorola (MSI).

T-Mobile customers are up in arms. Having your carrier acquired by the worst cellphone company in the U.S. wouldn't make anyone happy.

Post continues after this video of the head honchos at both companies defending the deal: 

Be more bullish about the broker if it can seal the deal.

By Motley Fool Pick of the Day Mar 21, 2011 1:54PM

By Rick Aristotle Munarriz


Sector consolidation is back among the discounters in the brokerage space. Charles Schwab (SCHW) is buying optionsXpress (OXPS) in a deal that's valued around $1 billion.


The leading discount broker is offering 1.02 shares for every share of the options trading specialist. The value will fluctuate as Schwab's stock goes up and down, but it was a 17% premium based on Friday's close of both equities.


It's a great deal for Schwab. It's nabbing a rising star in options trading at the right time and at a small premium. The same can't necessarily be said for optionsXpress. Its shares traded as high as $21.07 just three months ago. Why is it cashing out for less than $18 based on the initial deal?


The nation's largest retailer has been in a nerve-wracking US slump. Can it revive its sluggish business? With video updates.

By Kim Peterson Mar 21, 2011 1:48PM
Credit: (©Mel Evans/AP)
Caption: Wal-Mart StoreThe economy is slowly coming back to life, but you wouldn't know it by looking at Wal-Mart (WMT).

The nation's largest retailer has stalled, unable to climb out of the worst U.S. sales spiral in its history. For seven straight quarters, U.S. sales have dropped -- an alarming trend that the company is scrambling to break.

The company made some bad calculations, particularly as the economy was heading downhill. The stock has been a nonperformer, dropping nearly 6% in the past year to $51.89. Its three-year stock performance isn't pretty.

What went wrong at Wal-Mart? Here are four huge problems that the company needs to address: 

Sprint's stock sinks after AT&T says it will acquire T-Mobile. Shares of Leap, MetroPCS and US Cellular rise. Plus, video analysis of the deal's regulatory hurdles.

By TheStreet Staff Mar 21, 2011 10:59AM

TheStreetBy Scott Moritz, TheStreet


AT&T's (T) plan to buy Deutsche Telekom's (DT)T-Mobile, the fourth-largest telecommunications company, would create the nation's biggest phone service provider and leave a pile of winners and losers in its wake.


While the $39 billion cash-and-stock deal, if approved after a long review, won't close for another year, investors are staking their positions now. And early moves indicate that Wall Street is gearing up for deal time in telecom.


Industry giants like Caterpillar aren't the only players that will benefit from post-quake reconstruction.

By TheStreet Staff Mar 21, 2011 10:17AM

By Jake Lynch, TheStreet


Japan is at the onset of a massive period of rebuilding, in which many American companies will participate.


Among them are construction-equipment maker Caterpillar (CAT) and power-plant maker General Electric (GE), two of the biggest U.S. companies.


But two smaller companies, whose shares have recently climbed, are Chicago Bridge & Iron (CBI) and Clean Harbors (CLH). With market values of $3.8 billion and $2.5 billion, respectively, they are Japan-rebuild plays that demand consideration. They have clean balance sheets and competent stewardship. Below is a closer look. Still, investors ought to do further research.


The goal is to preserve last week's gains.

By Jamie Dlugosch Mar 21, 2011 9:43AM

As expected the market took a tumble last week. The S&P 500 lost nearly 2% during the five days of trading, but the results could have been much worse. Late in the week buying kept the damages to a minimum.


Disaster in Japan, worries about inflation, geopolitical risks were the excuses for the pull-back. Remove the headlines though and stocks on pure valuation alone were due for a correction.


The best way to make money with a correction is to trade exchange traded funds with a long/short approach. Last week’s pick of the ProShares Ultra Short Technology ETF (REW) worked perfectly gaining 5.5%.


I would lock in those gains and replace this fund with the ProShares Short S&P 500 (SH) for this week.

Tags: etf

If the $39 billion deal is approved, there will be big changes in store for consumers.

By InvestorPlace Mar 21, 2011 9:43AM

Image: Businesswoman on cellphone (© Corbis)By Jeff Reeves, Editor of InvestorPlace.com

For T-Mobile customers who thought they would never see an iPhone on their network, your day has come. Kind of.

AT&T Inc. (T) has announced plans to buy T-Mobile USA from parent Deutsche Telekom in a $39 billion deal, creating the largest cellphone company in the U.S. With nearly 130 million subscribers, the move, if approved by regulators, would put AT&T handily above rival Verizon (VZ) and its 102 million customers.

The red tape will take a full year to unwind, according to estimates, but when it's over, the buyout will mean big things for all cellphone customers, not just T-Mobile users. Here are five ways the buyout changes the game for everyone:


Once the negative spin sets in on this weekend's good news, jump into stocks like these.

By Jim Cramer Mar 21, 2011 9:25AM

the streetjim cramerThe market is trading like a bunch of done deals: AT&T (T) will get T-Mobile, the allies will make swift work of Gadhafi, and Japan's nukes aren't blowing. Wishful thinking?


The speed with which everything has happened in the past 48 hours has had a strange effect: There hasn't been enough time for bearish traders to create the backlash, negativity and skepticism that usually infect the media.


In other words, we are seeing things as they might be. One, the bad guy will be removed in North Africa, which will lead, when he is finished, to the completion of the great oil overthrow now that the Saudis have restored control. Two, the merger will get through even if it shouldn't, because this Justice Department is more concerned with getting everyone access to broadband service and AT&T will agree to give it to them. And three, the panic-mongers in the media and the now-revealed-to-be-totally-off-the-reservation Nuclear Regulatory Commission have been silenced by exactly what Glenn Williams said would silence them: power being restored to the plants.


Give it time, like by this afternoon, and here is how it will be spun. First, Gadhafi is dug in and won't surrender anytime soon, which will cause oil to go to $140 -- just heard that on TV -- and slow down economic growth worldwide. Second, the deal will never get through, because it basically brings the field down to two players, as Sprint (S) doesn't have the ability to play now. And third, don't count your chickens, as there is still plenty of danger lurking at those reactors.


Despite the disaster in Japan, central banks in developing economies remain committed to fighting inflation.

By Jim J. Jubak Mar 18, 2011 8:26PM
Jim JubakIt will take more than a tsunami and the potential for a nuclear disaster in Japan to divert the People's Bank of China from its efforts to tame inflation.

China's central bank has raised reserve requirements for the country’s biggest banks by another 0.5 percentage points, to 20%, effective March 25. This is the third increase in the reserve requirement in 2011, and will require banks to put an additional $53 billion into reserves.

Money that goes into reserves is money that can’t be lent. That slows the economy, and pushes against rising inflation.

Economists are forecasting that inflation will pick up to a 6% annual rate in March. That would be the fastest increase in prices since July 2008.

The news from the Middle East and Japan has rattled the market, but health care stocks are holding up well

By John Reese Mar 18, 2011 6:33PM

For much of the two-year-plus stock market rally, the health care sector has been left far behind the rest of the market. From the March 9, 2009, low through Feb. 23 of this year, for example, the S&P 500 gained more than 93%; the Healthcare Select SPDR exchange-traded fund, meanwhile, gained less than half that -- just 46.3%.


That's changed recently. While the rest of the market has stumbled amid the turmoil in the Middle East and the tragic earthquake and tsunami in Japan, many health care stocks have pushed higher. And year-to-date, long-term care facilities, medical care, and health care plans are all among the top industries in terms of year-to-date returns, according to Morningstar.

Even with their strong performance in recent months, many healthcare stocks still look quite attractive to my Guru Strategies, each of which is based on the approach of a different investing great. With fears about the health care bill starting to subside, and with fears of an economic slowdown causing many investors to focus more on defensive areas of the market, I thought it would be a good time to take a look at some of the health care plays my models are highest on right now:


Dubious short-term stunts could quash the java giant's long- term growth.

By Motley Fool Pick of the Day Mar 18, 2011 3:03PM

By Alyce Lomax


Starbucks' (SBUX) latest moves have investors buzzing -- but with the coffee colossus's former glory potentially gone for good, perhaps they should be mourning instead.


Investors cheered Starbucks' deal to provide K-Cups for Green Mountain Coffee Roasters' (GMCR) Keurig single-cup brewer, and they're salivating over rumors that Starbucks might acquire coffee rival Peet's (PEET) . The upswing is all the more welcome given the turbulent times the java king has weathered.


A recent New York Times article portrayed CEO Howard Schultz as a changed man, humbled by the company's tough years. In 2006, Starbucks stopped reporting monthly same-store sales figures -- right around the time those numbers stopped consistently thrilling and amazing investors.


From trucks to electronics, supply-chain problems resulting from the disaster are surfacing worldwide.

By Kim Peterson Mar 18, 2011 1:41PM
Image: Man changing oil (© Ron Chapple/Getty Images/Getty Images)We're already seeing production problems around the world as a result of the Japan disaster.

General Motors (GM) became the first carmaker to suspend operations in the U.S. as a result of the earthquake. Starting Monday, it will close its plant in Shreveport, La., because it can't get enough parts from Japan.

That plant makes the Chevrolet Silverado and the GMC Canyon, according to Bloomberg. Analysts were surprised at how quickly GM reacted. "We didn't expect for this ripple to hit quite this fast for North American plants," said an analyst at IHS Automotive.

Toyota (TM) can't get parts either and has pulled the plug on overtime and holiday work at its 14 North American plants, according to Kyodo News. The plants have only about two weeks' worth of parts left. 
Tags: gm

An FDA panel recommends pulling the flavored smokes from store shelves, but analysts are skeptical that the agency will follow through.

By Kim Peterson Mar 18, 2011 12:30PM
Image: Man smoking (© Steve Mason/Photodisc Blue/Getty Images)A panel at the Food and Drug Administration has recommended removing menthol cigarettes from the U.S., saying the public would be healthier as a result.

The FDA doesn't have to follow its panel's recommendations, but it often does. So there's a good chance that menthol cigarettes, which make up nearly a third of all U.S. cigarette sales, will disappear from store shelves. If it happens, the FDA said, it will be years from now, according to Dow Jones.

What's so wrong with menthol cigarettes? They're the preferred choice for adolescents, and the panel worries that menthols are a gateway to youths becoming regular smokers, according to Dow Jones.

The recommendation would dramatically affect Lorillard (LO), which makes the menthol-flavored Newport line. Newports make up about 90% of Lorillard's sales. Altria (MO) and Reynolds American (RAI) also sell menthols, but their sales are more evenly distributed across non-menthols and other products. 

Pepsi drops behind Diet Coke in Super Bowl advertising. Gilbert Gottfried makes insipid jokes about the Japan tragedy on Twitter. KV Pharmaceutical goes price gouging.

By TheStreet Staff Mar 18, 2011 10:39AM

Here is this week's roundup of the dumbest actions on Wall Street.


5. Pepsi fizzles out


Who needs to waste money advertising in the Super Bowl? Maybe PepsiCo (PEP).


Beverage Digest released annual market share data on Thursday that showed that Pepsi is no longer playing second fiddle to Coca-Cola (KO). Now it's third fiddle, behind Coke and Diet Coke. There was a time that Pepsi sought to seriously challenge Coke. Now, it seems the company is taking the fizz out of its own sales through its own brand of savvy marketing. Read more


We've yet to receive an all-clear in Japan, but might the nuclear crisis be resolved without an Armageddon scenario after all?

By Jim Cramer Mar 18, 2011 9:06AM

jim cramerthestreetWhat happened to the "losing battle" stories? What about the "increasingly desperate measures?" Where did those stories go that said Japan’s nukes would blow in the next 48 hours? What happened to them?


No, the nukes aren't all clear. In fact, I will give you the whole-nine-yards caveat: long slog, might be weeks, even months, radiation could always leak, it could always meltdown ... blah, blah, blah.


But here we are, three days after the losing battle was lost and the desperate measures failed and it looks like there is the distinct possibility that the United States was wrong when it said there was no water on the spent fuel rods and was wrong when, not for attribution, it made it clear to the big-time press guys that all was about to fail and they should run for their lives. You know they were doing that, right? Behind the "not for attribution" stuff? You know they were teaching those lightweights in Japan a thing or two about radiation and nuclear reactors.


So, while no one is ever going to argue against getting out of town when there’s a chance radiation could spew, it does look like, for now, that those very, very few who said that things could possibly maybe work out with no massive destruction could be well, ahem, right.



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[BRIEFING.COM] The major averages ended the midweek session with slim gains after showing some intraday volatility in reaction to the release of the latest policy directive from the Federal Open Market Committee. The S&P 500 added 0.1%, while the relative strength among small caps sent the Russell 2000 higher by 0.3%.

Equities spent the first half of the session near their flat lines as participants stuck to the sidelines ahead of the FOMC statement, which conveyed no changes to the ... More


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