Morning Coffee with TradingMarkets

  • January 8, 2008
  • David Penn

Good Morning!

Eli Lilly, AT&T Advance…Krispy Kreme Seeks New Leadership…Schultz Takes CEO Role at Starbucks, Announces Store Closures…Sallie Mae Gets New Chairman…Retail Sales Up Year Over Year…Circuit City’s December Sales Slide…Intel To Try Phone Chips Again…Merrill Anticipates Weak Earnings from Citigroup, JP Morgan…Microsoft Buys Fast Search…Pending Homes Sales Expected to Report Lower…Asian stocks up, European stocks up. The dollar is trending lower against the Euro, higher against the yen. And the futures are moving higher in the hour before the bell…

The S&P 500 took out the post-Thanksgiving lows on an intraday basis. But buyers showed up to move the market off the lows to close up for the day near the middle of a fairly wide range. Monday was relatively weaker for the Nasdaq, which has made the more decisive move lower in 2008 among the major indexes. Attention will soon shift toward companies reporting earnings, though the economic reports such as Pending Home Sales due out today may serve as a preoccupation or opportunity as traders see fit.

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TradingMarkets 5 Business Stories You Need to Know

Gold Soars Toward Record – Forbes

Weak dollar, high oil prices help gold rally to all-time high of more than $875 per ounce in London trading. Rush of buying seen as gold price edged above resistance at $870. Additional buying pressure expected with beginning of gold futures trading in China today. Find out which gold stocks are worth investing in–and which are better left avoided–by checking our industries ratings at PowerRatings.net.

Eli Lily Rallies On Upgrade Despite New Drug Concerns – CNN Money

Recession, smecession, say Morgan Stanley analysts, and that earnings from Eli Lilly are likely to “hold up” even in the event of recession.
Our PowerRatings (for Industries) says Lily as a stock is a pretty good house in a great neighborhood. But are there even better options in the group?

Deustche Bank: AT&T “Top Pick” – Bloomberg

Bank names telecom company among best large cap bets. AT&T recently won a major contract to network Deustche Bank, which has been positive on AT&T suppliers and related companies, Sigma Designs and CommScope. Our PowerRatings rank Communications Equipment among those industries most likely to be higher one year from now.

Bear Stearns CEO Steps Down – Bloomberg

Massive subprime-related losses lead to the removal of another Wall Street CEO. This time, it’s Bear Stearns James Cayne who will give up his position as chief executive officer, but remain on as chairman. When it comes to big time Investment Brokerages, our PowerRatings suggest that there are better bets out there for investors than Bear.

Starbucks’ Schultz Steps Up – Bloomberg

Howard Schultz moves into CEO spot as former chief executive officer is sacked. Shares rallied as Schultz, who founded the company in Seattle, announced slowed growth in new stores and the closure of some existing, underperforming stores. Starbucks is high rated stock in a high rated industry: a PowerRatings Perfect Storm. But Schultz’s creation isn’t the only great property in the Specialized Eateries neighborhood, as our PowerRatings show.

» For more stories as they happen, go to our Breaking News section.

TradingMarkets 7 Stocks You Need to Know for Today

Here are 7 stocks for traders for today from TradingMarkets.com:

» For a list of today’s highest PowerRating stocks, click here.

TradingMarkets 5 Top PowerRatings Stocks for Today

Company
 Symbol PowerRatings
Bally Technologies BYI 10
Restoration Hardware RSTO 9
TiVo TIVO 9
Garmin GRMN 9
Olympic Steel ZEUS 8

» View More Stocks

TradingMarkets Tracking the Wizards

Hedge Funds Up 52%, 27% in 2007 – Financial News Online

Paulson Capital’s event-driven fund, Citadel Investment Group’s Kensington flagship fund among winners in 2007 with returns of 52% and 27% for the year, respectively. Goldman’s Global Alpha Fund among bigger hedge fund losers in 2007.

Cramer’s Four Dividend Plays – TheStreet.com

Mad Money guru Jim Cramer picks Dow Chemical, Bristol-Meyers Squibb, Verizon and Philip Morris as opportunities for dividend hungry investors. But which two of these four stocks is more likely than the others to be higher one year from now? Hear what Cramer has to say, then browse over to PowerRatings.net for the answer.

Icahn Effect Fails to Boost Motorola – New York Times

Famous activist hedge fund manager continues to rattle the cage at Motorola since his failed bid to win a board seat in January 2007.
But the company’s shares continue to languish. Lackluster interest in new products also blamed for declining lack of interest in Motorola stock.

» View Portfolios of Prominent Investors

TradingMarkets Playbook

With the markets testing or breaking their autumn lows, the possibility of a rally has grown. We see this a number of ways: as a normal consequence of a market revisting previous lows, as a growing number of high PowerRating stocks, as a response to very oversold conditions and maybe even a function of the growing pessimism reflected in the near-consensus that 2008 will be a recession year.

In any case, the key will be follow-through to the upside. If the buyers are able to repel any effort to drive the market lower, especially on a closing basis, then it would be a very bullish development for stocks. Comparing the moves lower so far in 2008, the more battered stocks appear to be among the Nasdaq names.

David Penn is Senior Editor at TradingMarkets.com.

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