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Vinayak
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Everything posted by Vinayak
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Gold: Near Term Puts Gold is once again on the rise, but this is just a blip in my opinion. The shiny precious metal is on an uptrend and has hit a near term resistance point. The technical indicators are bearish in multiple time frames and it could dip below $1350 as soon as next week. Equities should regain their upward momentum next week after a rough time last week which was understandable given the elevated levels.
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US April New Home Sales Rise More than Expected by 2.3% to 454,000 Annual Rate US Initial Jobless Claims Fall 23,000 Last Week, More than Forecast, to 340,000 These positive macro data releases could see some upward momentum in the US markets after a bit of a pullback this week. There is the US Durable Goods Orders and this will come out as trading opens on the NYSE so there will be a big impact. There is already a bullish sentiment among traders as the forecast is for a value of 1.7% up from the previous value of -5.7%. Then for the Asian markets: China Manufacturing Unexpectedly Contracts in May, HSBC Index Shows Japan's 10-Year Benchmark Yield Advances to 1%, Highest Since April 2012
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GOOG: A Stock To Watch Google Said to Consider Buying Waze, Risking Bidding War With Facebook This makes a lot of sense for GOOG to do in order to check FB. Additionally, Waze seems to be having a superior technology to GOOG's app and so the Israeli startup might be worth acquiring for the search giant. GOOG in a new antitrust probe regarding how the internet company handles some ad sales The top player in web display advertising with a 15.1 percent market share in 2012 of the $15 billion U.S. display ad market (FB has a 14.6 percent share) is continuing to face some challenges. Google is already trying to convince European antitrust investigators to wrap up a separate antitrust probe. It will be interesting to see how the stock price reacts to these developments.
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HP Q2 Adj. EPS $0.87, Est. $0.81 Apple Mobile Devices Approved for Use on US Military Networks
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US Indices: Near Term Pullback The big news out of the US Federal Reserve Chairman Ben Bernanke's testimony to Congress and other speeches is that he and the other members said more QE is needed. I tend to agree and that is what is holding the indices at such elevated levels. It has also been responsible for better macro data and this can be seen across the globe. The Nikkei has been on a roll and we saw Japan's Q1 GDP rises to an annualized 3.5% vs the estimated 2.7%. As far as the US is concerned, there has been a lot of varied data. The US April Index of Leading Economic Indicators rose 0.6% at the same time that housing Starts in the US fell 16.5% in April to a 853,000 rate. Then we had the US May Philadelphia Fed Factory Index at -5.2 vs the 1.3 estimated value. Its pretty unpredictable right now, but I think this pullback is just a blip in a long term uptrend.
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Sales of Previously Owned US Homes Climb to Three-Year High, Rising by 0.6% in April Fed Chief Ben Bernanke Says Premature Fed Tightening Would Endanger Recovery
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Target Earns $0.77 per Share in Q1; Missing Estimates of $0.84 per Share Swiss Franc Weakens Through 1.26 Per Euro for First Time in Two Years Fed's Dudley Says Decision on Tapering QE Will Take Three to Four Months UK Retail Sales Unexpectedly Fall 1.3% on Drop in Food Demand King Defeated for a Fourth Month as BOE Majority Watches Inflation. Inflation shows more than forecast to 7-month low. Apple CEO Tim Cook Testifies on Offshore Tax Practices JP Morgan's Jamie Dimon Seen Keeping Chairman and CEO Title in Preliminary Voting at Shareholder Meeting Sprint Increases Its Offer for the Rest of Clearwire to $3.40 per Share from $2.97 per Share
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DELL: Playing of the Earnings Miss and Recent Bearishness Source: InvestorAide Dell (DELL) showed weakness and the numbers are pretty jarring. It reflects the dying PC market; sector reports illustrate that this is the biggest quarterly decline in PC sales since these figures started being recorded. And not to mention the numerous shareholder disputes that has been plaguing Dell. The company has been forced to look at new strategies. Dell’s profits for Q1 slid 79%. The P/E ratio paints a favorable picture, but even that has creeped up over 10. Additionally, it isn't as healthy as some of its closest competitors. The key chart failures make Dell's stock price action look bearish. The Fib resistance appears to be in the mid-14s and further technical analysis demonstrates the case for some puts. Option traders should note the downside bias and the fact that DELL is well past resistance. Nonetheless, I will look to play off of the earnings miss in DELL. I will entering into some monthly and weekly puts on the large cap tech stock.
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FTSE 100 Closes At Highest Level Since September 2000 The FTSE 100, boosted by central-bank stimulus, added 32.57 points (0.5%) to 6,755.63 at the close in London. There is a lot to like about the UK because it’s a global market and investors love the fact that it exposes their portfolios to emerging markets at a cheap price and via a London listing. The Royal Bank of Scotland Group Plc (RBS) jumped 4.5 percent as Numis Securities Ltd. upgraded the financial stock. EasyJet Plc (EZJ) rose 4 percent after Ryanair Holdings Plc (RYA) posted a 13 percent increase in full-year profit. Furthermore, Europe’s largest discount airline Ryanair hit a record high in Dublin.
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Yahoo! Will Buy Tumblr for $1.1B, Mostly in Cash Yahoo! is really hoping for a big turnaround under Marissa Mayer and this latest move is a hope that the acquisition of the white-hot blogging site will do precisely that. Tumblr may be a big deal right now, but how Yahoo! will make money out of the acquisition isn't as clear cut. So I strongly believe that Yahoo! stock will slide in the coming weeks and how it does in the future will depend on the success of Tumblr and other factors. Tumblr seems to be getting the better end of the deal as it needs the advertising that the Yahoo! deal will bring. This is definitely big news in the tech world right now and I will be watching this one closely for you.
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Yahoo! Will Buy Tumblr for $1.1B, Mostly in Cash Yahoo! is really hoping for a big turnaround under Marissa Mayer and this latest move is a hope that the acquisition of the white-hot blogging site will do precisely that. Tumblr may be a big deal right now, but how Yahoo! will make money out of the acquisition isn't as clear cut. So I strongly believe that Yahoo! stock will slide in the coming weeks and how it does in the future will depend on the success of Tumblr and other factors. Tumblr seems to be getting the better end of the deal as it needs the advertising that the Yahoo! deal will bring. This is definitely big news in the tech world right now and I will be watching this one closely for you. Actavis to Buy Warner Chilcott for $8.5B in Stock Deal This deal creates a money-saving lower tax rate for the generic drug make Actavis, and now the combined company would have $11B in revenues.
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IBM: Excellent Value For Money The common stock valuation ratios are reflective of IBM being renowned as the industry leader. Additionally, highly successful value investor Warren Buffett recently stated that he would buy more IBM stock "from time to time." Since 2000, IBM has lowered its share count by a third due to the drop in revenue growth. This has seen the stock price appreciate over the last 10 years by a great deal. Additionally, the EPS has also gone up. The remarkable fact is that for each $1,000 of stock owned over the last 13 years, the quarterly dividend has added up to a whopping $2,200. This is more than double the initial investment, without taking into account the gain in the stock price. IBM has tremendous potential I have always been a firm believer in innovation. IBM is the most innovative business around as indicated by the fact that it has gotten the most patents since the year 2000. The Dividend Discount Model shows that IBM is a great investment idea as the current stock price of $203.03 is much lower than the calculated intrinsic value of $455.63. This is a much bigger difference than what we saw in the case of SAP AG (SAP) which had an intrinsic value of $83.56. IBM is definitely good value for the money and past performance shows that it keeps returning that value to investors through dividend increases and buybacks, in addition to stock price appreciation. Read more here: http://seekingalpha.com/article/1439671-ibm-excellent-value-for-money
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It does appear to be so for the moment at least. Gold futures are still down even as there was some weak macro data from the U.S. and a pullback in the USD. There has been a lot of strength in equities recently and the climbing USD contributed to the metal's losing streak, which has cut prices by a total of 6% in six sessions.
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Technical Indicators: bearish on the near term; long term The US inflation and factory numbers weren't that impressive and this was the main reason behind the rise in the EUR/USD currency pair today. This trend will obviously not continue. The US economy is strengthening even though the mixed bag of data we are getting suggests otherwise. Moreover, there is the weakness in the Euro zone with GDP numbers missing estimates, etc and also the recent ECB rate cut. These are essential to bolster growth in the EU, but bad for the Euro.
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Bill Gates Dethrones Carlos Slim as Richest Man as Microsoft Hits 5-Year High Dell Earns $0.21 Per Share in Q1, Missing Estimates of $0.35; Revenue of $14B Tops Estimates
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US Jobless Claims Jump to Highest Levels in Six Weeks US April CPI Fall 0.4%; CORE CPI Up 0.1% Housing Starts in US Fell 16.5% in April to 853,000 Rate Berkshire Hathaway Rating Cut Based On Methodology Change: S&P Berkshire Hathaway cut to AA from AA+ by S&P Japan's Q1 GDP Rises Annualized 3.5% vs Estimated 2.7% Ga Wal-Mart Sees Q2 EPS of $1.22 - $1.27 vs Estimates of $1.29
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TOTAL SA: Worth a Quick Trade? TOT is currently trading at $50.11 and extensive fundamental analysis reveals that the stock is undervalued. The profitability ratios are not too bad and even the near term price action is encouraging for bulls. TOT has generally better return on sales ratios than BP PLC (BP) and Royal Dutch Shell (RDS.A) over the last five years. Nonetheless, it lags behind industry leaders Exxon Mobil Corporation (XOM) and Chevron Corporation (CVX). Total SA continues to explore for new sources of oil with tremendous success. Investors and option traders should keep a watchful eye on the company's dividend behavior over the next year and any big developments that may come out of its joint-venture with Qatar Petroleum.
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Homebuilder Confidence in US Rises in May to 44 from a Revised 41 on Improving Outlook Industrial Production in US Declines by Most in Eight Months US April Producer Prices Drop 0.7%, Estimate was for Drop of 0.6%. New York Area Manufacturing Unexpectedly Slides Some updates to keep in mind while trading the US financial markets today and this week in general. I watch Bloomberg so you don't have to.
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The FTSE has been bullish after the latest financial news: http://www.traderslaboratory.com/for...tml#post180085 DAX and Euro Stoxx continue to climb, surprisingly.
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EUR/USD bearish after latest financial news: http://www.traderslaboratory.com/forums/market-analysis/15950-bloomberg-updates-9.html#post180085 This downtrend should persist through the trading day.
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BOE Raises Growth Outlook as It Sees Inflation Pressures Easing Euro zone GDP fell by 0.2% in Q1 2013 -- more than expected, but less than Q1 2012 Euro-Area Recession Deepens as Contraction Exceeds Estimates France Slips into recession during Q1 2013 as GDP shrinks 0.2%, official figures show
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Greece Raised to B- from CCC by Fitch; Outlook Stable A mixed bag of updates from the Euro zone here. But with all the attention on the region, this is a win for the bulls!
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German Investor Confidence Increased Less Than Forecast in May It was a big blow for Germany to see its ZEW survey miss the forecasts for May and by quite a big margin. Market analysts had estimated an increase to 40.0, but the German economic indicator only rose to 36.4 from 36.3 in April. This is reflective of the troubles in Spain and Italy which have high unemployment and are in a recession. Verizon Wireless to Distribute $7B to Owners Vodafone, Verizon
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The recent ECB rate cut will bolster the Euro zone economy and will turn the current stabilization into some good growth. This will soften the euro versus the dollar in the near term. The strengthening US economy will further bring down the EUR/USD currency pair. It appears that the long term indicators are bearish and there will be a downtrend.
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US Economic Outlook The FOMC will keep buying $80 billion every month in securities. What is more, they promise to inform us prior to stopping. Earnings have been fairly good and the labor market is recovering steadily and is back to where it once was prior to the recession. Housing data has been on an uptrend and now there was the unexpected gain in retail sales that is highly positive. When there are better job numbers and higher sales, it is great for the US economy. What is needed now is for the US to keep this momentum going and then more people will buy in. Keep the bullish sentiment going. You have more than sufficient reason to do so.