Morning Coffee with TradingMarkets
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Good Morning! |
Berkshire Buys Big Marmon Stake…Yen Dips to Seven-Year Low…Singapore Buys Merrill Shares at Discount Price…Asian Stocks Up Four Days in a Row…Leap Wireless to Restate Financials…Holiday Sales Up 3.6% in U.S…Toyota Optmistic on 08 Sales…Soft November Homes Sales Anticipated…Asian Stocks Up…Dollar Moving Higher Against Pound, Lower Against Aussie…Futures Trending Higher in the Hour Before the Bell.
Typical end-of-month bullishness so far has combined with typical end-of-year markups to give a bullish tilt to trading in the final days of December. Volumes are expected to be light, and the absence of major market moving news suggests that most traders and investors will be spending more time planning for the first few weeks of 2008 than they will be working the final few days of 2007.
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TradingMarkets 5 Business Stories You Need to Know |
Merrill Sells Stake to Singapore – Reuters
Sale of up to $6.2 billion in shares to Singapore Temasek part of massive capital raising strategy. Discounted pricing leads to three percent drop in Merrill shares in Monday trading.
Holiday Sales Up But Short of Optimistic Projections – Wall Street Journal
Retailers gear up for post-shopping season sales in the wake of a strong, but not overwhelming winter holiday consumer turnout. Surges early and late combined with generous discounts helped retailers ring in a positive end-of-year.
Berkshire Buys 60% of Marmon – Wall Street Journal
Warren Buffett’s Berkshire Hathaway pays $4.5 billion as part of deal to eventually buy all of industrial conglomerate from Pritzker family. Purchase makes Berkshire Hathaway majority owner of company that specializes in plumbing pipes and railroad tank cars.
Home Buyer’s Paradise – New York Times
As subprime mortgage woes continue and foreclosures rise to record levels, savvy and patient buyers swoop in to buy properties at significant discounts at real estate auctions. Speculators who drove real estate market higher reappear to pick up the pieces–and potentially profit big—from a boom gone awry.
Hedge Fund Owner Killed in Plane Crash – Bloomberg
Michael Klein of California-based hedge fund, Pacificor LLC, young daughter and pilot found dead after plane crashed in Panama. A fourth passenger was injured but survived. Party was traveling from Islas Secas, a Pacific island owned by Klein, when plane was last seen on December 23.
» 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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Wyeth
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PowerRating) is suing Teva Pharmaceutical
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PowerRating) in a patent dispute over the generic heartburn drug Protonix. -
In related news, GE Capital, a unit of General Electric
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PowerRating), is acquiring most of Merrill Lynch’s commercial finance business. -
Marsh & McLennan
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PowerRating) is looking for a new CEO after Michael Cherkasky, the current President and CEO, was forced to step down due to the company’s poor performance in 2007. -
Alcoa
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PowerRating) agreed to sell its packaging and consumer businesses to the Rank Group Ltd. of New Zealand for $2.7 billion. - Pershing Square Capital Management increased its stake in Target
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PowerRating) to 9.97%. - United Rentals
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PowerRating) terminated its merger deal with Cerberus and requested a $100 million termination fee.
» 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 |
| Synaptics | SYNA | 8 |
| Warner Music Group | WMG | 8 |
| Omrix Biopharmaceuticals | OMRI | 8 |
| Sally Beauty Holdings | SBH | 8 |
| Restoration Hardware | RSTO | 8 |
| » View More Stocks |
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TradingMarkets Tracking the Wizards |
Whitman Likes Bond Insurers – CNBC
Founder, manager of Third Avenue Value Fund takes the other side of the bet many hedge funds have made against bond insurers. Says short-sellers don’t understand the insurance business and that continued access to capital will cure most of what ills the sector.
Cardoso’s Maxima Asset Management Wins with Tough Love – International Herald Tribune
Buying companies no one else wants and then “telling them what to do” to be successful continues to be a winning strategy for a Brazilian fund that has outperformed all other Brazilian-based equity and hedge funds in 2007.
Ackman Adds More Target – New York Times
Pershing Capital Management increases stake in top retailer to 10% from 9.6%. Hedge fund boss also in discussions with Target’s management about ways to boost the company’s stock price.
» View Portfolios of Prominent Investors
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TradingMarkets Playbook |
The small cap stocks continue to be the more impressive stocks, insofar as they are likely to test the December highs before the week is out. And as noted above, end-of-month bullishness and end-of-year markups look to represent the two bullish horns of the final week of December 2007. The resumption of the rally in the second half of December continues to move almost vertically, making for fewer of the types of trading opportunities that we like to see.
Although not wildly overbought in technical terms, the Russell 2000 is up five days in a row. It may be difficult for less patient traders to avoid it, but chasing the market into year-end is not the most advisable strategy.
Instead, waiting for some profit-taking to bring stocks lower is likely to be the smarter move.
David Penn is Senior Editor at TradingMarkets.com.
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