Tuesday Morning Coffee with TradingMarkets

  • February 26, 2008
  • David Penn

Good Morning!

Final Obama,Clinton Debate Tonight Before Ohio, Texas Votes… MBIA Ends Dividend… Siemens To Cut 4,000 Jobs… Sales of Existing Homes Lower… Stiglitz Blames Greenspan, Bernanke for U.S. Economic Woes… FosterWheeler Misses… Microsoft, Rite Aid Up, Premarket… Foreclosures Surge 90% in January as ARMs Reset… Producer Price Index, Consumer Confidence Reports Out Today… IBM Plans New Mainframe, Will Compete with Hewlett Packard.

Asian stocks up… European stocks up… Greenbacks moving llower against the Euro, British pound… And the futures are trending higher in the hour before the bell.

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TradingMarkets 5 Business Stories You Need to Know

Home Depot Earnings, Forecast Disappoint – Bloomberg

Lower quarterly guidance and a forecast below analyst estimates were little surprise in Home Depot earnings announcement this morning, as the weak housing market continued to take its toll on the home improvement retailer. Sales said to fall as much as 5% in 2008.

Macy’s Beats Estimates – Blogging Stocks

Macy’s exceeds estimates for the fourth quarter and provides guidance that is roughly in line with expectations. Blames broader economic weakness for less assertive guidance, but the company says it has still managed to outperform its peers. Nordstrom, which saw its profts fall for the first time in five years, appears to agree.

Still Lower for Greenbacks? – DailyFX

Team Boris Schlossberg talks about the possibility of a dollar breakdown in the face of U.S. economic weakness and continued Fed rate cuts. Over the past week, the U.S. dollar has fallen hardest against the New Zealand and Australian currencies, less so against the British pound and Japanese yen.

Analysts: Lower Prices Needed to Clear Home Inventory – Wall Street Journal

Slightly slower deterioration in the sales of existing homes will do little to help clean up the nation’s oversupply of houses on the market. Analysts say lower prices will be required in order to encourage buyers to re-enter falling market.

The Bernanke Recession – MarketWatch

MarketWatch’s Paul Ferrell lists 11 reasons why what he calls the “Bernanke-Paulson” recession is not only already here, but will last until 2011. Stagflation, subprime credit woes, and commodities replacing the U.S. dollar as the real world currency are all on Ferrell’s list.

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
Yahoo! YHOO 9
Repligen RGEN 8
UltraShort Technology Proshares REW 8
ITT Educational Services ESI 8
IRIS International IRIS 8

» View More Stocks

TradingMarkets Tracking the Wizards

Pimco’s Gross Prefers Aussie Bonds to U.S. Treasuries – Bloomberg

The Fed’s failure to fight inflation is blamed by bond manager for his preference to Australian government bonds over Treasuries. Gross expects continued monetary accommodation especially in an election year.

Winter’s Value Stock Winners – Barron’s

Wintergreen Advisors, David Winters, counts legendary trader Michael Price among his guides in the way of value investing–and calls the market right a “gigantic after Christmas sale” in this Barron’s interview.

Up or Down? TradingMarkets New Trading Contest – TradingMarkets

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TradingMarkets Playbook

Among our suggestions yesterday was a caution against being aggressively short. This was based on some softening in the ratio between low and high Short Term PowerRatings stocks. Because, relatively speaking, fewer stocks were making consecutive highs, displaying extremely high RSI values, or moving dramatically higher in a short period of time, we thought that the market had an opportunity to move higher in the near term.

Compared to what we’ve seen in recent weeks, there has been an increase in the number of opportunities to the long side for buyers of weakness. A coming test of the February highs–more likely in the Dow Industrials than the Nasdaq–will provide either the opportunity for that weakness, or a resumption of the trend toward more stocks being overextended as the market moves higher.

David Penn is Senior Editor at TradingMarkets.com.

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