Morning Coffee with TradingMarkets
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Good Morning! |
Weak Jobs Report May Lead to Further Rate Cuts…Toyota Biggest Selling Carmaker in U.S….Mortgage Rates Slip…Thain Promises to End “Subprime Orgy” at Merrill…Fox Business Network Struggles for an Audience…Crude Oil Lingers Near Century Mark…China Continues to Brake Economy…Talbots to End Children’s, Men’s Clothing Sales…Obama, Huckabee Win Iowa Primary…Japan Lower…European shares higher…The dollar is trending higher against the Euro, yen…and the futures are moving higher in the hour before the bell.
The market yesterday soared and swooned, but eventually ended up pretty much in same position it
ended the day before. Of the three major indexes, the S&P 500 and Nasdaq appear to be the strongest, with the alone Dow having taken out the December lows. Yesterday’s trading also took the Nasdaq down below its 200-day moving average on a closing basis. On the economic front, the jobs report is likely to be the focus of attention on this final trading day of the week, with investors looking for signs that the economy, while perhaps slowing, remains strong with businesses continuing to add workers at a healthy rate.
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TradingMarkets 5 Business Stories You Need to Know |
Merrill’s Thain To End “Subprime Orgy” – Bloomberg
Former “Goldman Guy” will use his experience as a mortgage trader to help Merrill Lynch climb out of the $7.9 billion hole created by the writedowns of the firm’s mortgage-related debt.
The Economy and $100 Crude – Marketwatch
On any list of possible reasons for recession in 2008, the prospect of triple digit oil is consistently near the top. Causes of $100 crude range from political instability in oil-producing nations, continued growth in China and the falling U.S. dollar. Consequences of $100 crude for the U.S. economy, however, remain hard to pin down.
Mortgage Rates Follow Long Rates Lower – Wall Street Journal
Finally succumbing to the gravitation pull of lower bond rates, mortgage rates in the United States have fallen to their lowest levels in a month. National average interest rate for traditional fixed 30-year mortgages fell to 6.07%. The rate on 15-year fixed loans fell to 5.68%.
Bear and Merrill’s CDO Suicide Pact – Bloomberg
Merrill Lynch’s sale of collateralized debt obligations to traders at a Bear Stearns hedge fund led to an “unforgiven” margin call and a liquidation that initiated a fire sale of CDO assets this fall. Both Merrill and Bear lost billions.
Job Growth Expected Slower But Steady – Marketwatch
Investors grow cautiously optimistic that today’s jobs report will show slow, but still steady job growth. Analysts suggest that the market’s response to the jobs number is often a fleeting one due to the report’s limited time series.
For more stories as they happen, go to our Breaking News section.
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TradingMarkets 7 Stocks You Need to Know for Today |
Here are 7 stocks for traders for today from TradingMarkets.com:
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Finish Line
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FINL |
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PowerRating) missed earnings on Thursday afternoon, reporting -$0.17 EPS versus expectations of -$0.15 EPS. -
Global Payments
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PowerRating) beat earnings expectations on Thursday with $0.48 EPS over $0.45 EPS. -
A. Schulman
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PowerRating) announces quarterly results on Friday before the market opens, with traders looking for $0.26 EPS. -
AZZ Incorporated
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PowerRating) is looking to announce $0.53 EPS before the bell on Friday morning. -
Analysts will be watching for Texas Industries
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PowerRating) to report $0.88 EPS on Friday morning before the market opens. - Celgene
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PowerRating) rallied over 6% after announcing it should complete its takeover of Pharmion to close in April. - CVS Caremark
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PowerRating) fell 7% on Thursday after announcing that December sales were lower than expected.
For a list of today s highest PowerRating stocks, click here.
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TradingMarkets 5 Top PowerRatings Stocks for Today |
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Company
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Symbol | PowerRatings |
| Alpha Natural Resources | ANR | 9 |
| Herman Miller | MHLR | 9 |
| Transmeta | TMTA | 8 |
| Telecom Argentina S.A. | TEO | 8 |
| Unibanco Uniao de Bancos | UBB | 8 |
| View More Stocks |
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TradingMarkets Tracking the Wizards |
Mark Hulbert Reviews the Newsletters – Marketwatch
Among Hulbert’s annual observations: the best newsletter from 2007 will likely be a poor choice for investors in 2008.
Breeden Doubles Down on Zale – New York Times
SEC chairman turned activist investor nearly doubles his investment in Zale, a jewlery company. Richard Breeden’s hedge fund, Breeden Capital Management, now owns 13.3% of the jewelry company’s shares outstanding.
Former Goldman Trader Sentenced for Insider Trading – New York Times
Insider trading scheme netted ex-trader Eugene Plotkin $6.7. Getting caught–and copping a plea–will net Plotkin four years and nine months.
View Portfolios of Prominent Investors
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TradingMarkets Playbook |
The markets are exceptionally oversold. We can tell this from looking at indicators like the 2-period RSI in the S&P 500, which is under three. The last time the S&P 500’s 2-period RSI was this low was back in October 2007, and a strong, eight-day rally began immediately afterward. We can also tell that the market is becoming more attractive by looking at the number of high PowerRatings (for Traders) stocks, which has been increasing.
All this tells us that the market could bounce from these levels at any time. The futures moved lower after the weaker than expected jobs report. Any ability by the market to rally off of intraday lows–or even to simply close near the highs of the day, will be a bullish first step toward turning the market higher in January.
David Penn is Senior Editor at TradingMarkets.com.
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