Let 2006 begin
Morning News of Note:
- Credit Crunch: CREDIT CRUNCH...American consumers have happily charged yet another banner holiday season to their credit cards and now, some analysts warn, they could face a hangover in the new year. A combination of higher interest rates, bigger home heating bills, and a slowing housing market could make it more difficult for people to pay down their balances or meet minimum payments on their credit cards, analysts said. (Full Story) NY Post
- TOL KBH RYL HOV: Growth May Slow In 2006 as Market For Housing Cools Uptick in Business Spending Is Expected to Cushion Blow To Economy, Forecasters Say...Strong spending by businesses should power the nation's economy to a fifth straight year of expansion in 2006, according to a survey of economists' forecasts, but a softening housing market is likely to slow the overall pace of growth. For the past five years, real-estate wealth has supported the economy by providing consumers with cash to buy everything from designer kitchens to luxury vacations to new or second homes. Some economists believe that the boom has been responsible for creating more than one million American jobs since 2000. (Full Story) WSJ
- L: Watching the Web on TV Virtually Limitless Content Could Revolutionize Viewing; Cutting Out Cable Companies...The past year has seen an explosion of video content on the Internet as major entertainment companies have begun making thousands of hours of sports, music videos, movies, news and other programs available on the Web. Now some of the biggest technology and media companies are trying to make it easier to watch Web-based content on TV sets, as well as on computers. Those efforts, a major focus at this week's Consumer Electronics Show in Las Vegas, eventually could have a major impact on the way consumers throughout the world watch television. While cable and satellite TV services offer hundreds of channels and up to thousands of video-on-demand choices, the amount of content available on the Web is virtually limitless. "We're going to see in 2006 and 2007 a much more well-established Internet access into televisions," says Peter Weedfald, who heads the consumer-electronics business in the U.S. for Samsung Electronics Inc. (Full Story) WSJ
- SBUX: U.S. coffee shop chain Starbucks (SBUX) has won a lawsuit against a Chinese company, Shanghai Xingbake, that had adopted its Chinese name and a similar green logo. The Chinese media reported that the Shanghai court ordered Shanghai Xingbake to stop using the name, to pay $62,000 in compensation and to issue an apology in a local newspaper
- ELOS: pre-announced Q4 revs of $24MM vs consensus $28.3MM
Market Comments: The market opened higher this morning, but we'll have to see if it can hang on to the early gains. Retail stocks are under heavy pressure this morning. Oil is trading higher, while the ISM Index came in below expectations (54.2 vs. 57.5 consensus).
Piper put out a $600 price target on GOOG. AAPL and SNDK are nicely higher in early trading also. Energy stocks are us across the board.
2005 ended with a weak finish, so let's hope that some of the weakness that many were fretting would surface in January has already taken place. The SPX has corrected to its 50-day moving average, which is a logical area of support.