Wednesday, March 08, 2006

Looking For Support

Morning News of Note:
  • VZ: Verizon Hits Hurdles in Big Bet On New High-Speed Network Two years ago, Verizon Communications Inc. Chief Executive Ivan Seidenberg made a colossal gamble. He put Verizon on course to spend billions of dollars on a new network of fiber-optic cable that would carry television, Internet and voice directly into homes across the country. The goal: dominate the new race among phone, cable and Web companies to supply those digital services bundled into one package. (Full Story) WSJ
  • INTC: Intel Announces a New Design for Chips The Intel Corporation went on the offensive on Tuesday, showing off a new design for powerful, energy-efficient processors that it hopes will help it gain back the market share it has lost to its rival, Advanced Micro Devices. Intel, the world's largest semiconductor manufacturer, demonstrated its latest chip technology just days after it disclosed it would miss its first-quarter financial targets because of a slowdown in demand and a slight loss in market share. (Full Story) NY Times
  • Oil: OPEC Is Likely to Hold Output, Even as Some See a Price Drop With oil prices above $60 a barrel, OPEC ministers meeting here today are all but certain to opt to continue pumping crude at near-capacity levels -- and raking in record revenues, which are expected to top $500 billion this year. But behind the scenes, some in the Organization of Petroleum Exporting Countries are fretting about an eventual plunge in prices. (Full Story) WSJ
  • MOT: Motorola launches 3G mobile phone in the Taiwan market - Digitimes. Digitimes reports Motorola launched the RAZR V3x, a third-generation (3G) phone, in Taiwan yesterday. The 3G model supports multimedia offerings including real-time two-way video calling, a built-in 2-megapixel camera and Bluetooth connectivity. Sales of 3G mobile phones may account for 15-20% of total handset sales in Taiwan in 2006, with sales of approximately 1-1.5 million 3G phones, according to Tom Hsiao, president of Motorola Electronics Taiwan
  • PG: Gillette's five-blade razor grabbed 55% of market shortly after launch-FT. Gillette's new five-blade Fusion product grabbed 55 percent of new razor purchases only four weeks after its launch. Fusion and a battery-powered, vibrating razor version called Fusion Power, are priced at a 30 per cent premium to Mach3, a three-blade product that cost 50 percent more than its predecessor. Data from Information Resources Inc, a consumer researcher, show that both Fusion products together accounted for over half of all purchases of complete new razor sets in the four weeks to February 19. Gillette is owned by Proctor & Gamble
  • US Economy: Fed Gov Moskow said next FOMC decision is much less certian; Fed Funds in neutral range; economy been quite positive, oulook is good; core inflation at upper end of comfort zone; slowdown in housing prices shouldnt damage growth; steeper curve shows higher rate expcations, not a sign of inflation worries (Tuesday)
  • Mad Money Summary: Cramer opened up his show discussing the Fox television show "24" and how watching the show makes him long for a "fascist police state." When he thinks of a police state, he wants to buy FLIR Systems (FLIR), a company which excels in infrared technology. He believes the company, which makes most of its money in government contracts, will make money on port security if the Democrats don't kill the Dubai deal. Cramer then discussed the railroad industry, saying it was time to ring the register on Union Pacific (UNP), Burlington Northern (BNI) and Norfolk Southern (NSC). He does believe, however, that their are still opportunities in Genesee & Wyoming (GWR), "the greatest little railroad you never heard of," which he says still has room to grow. Marketwatch columnist Herb Greenberg then joined Cramer on his show to discuss several stocks. Greenberg was negative on Sunrise Senior Living (SRZ), but Cramer said he sees the stock going higher. Greenberg was also negative on Marchex (MCHX) and Harley Davidson (HDI). Cramer then discussed a bargain stock, Applied Micro Circuits (AMCC), which operates in the optical networking complex. He used to hate Applied Micro, and said the stock was a real dog, but that has changed. In the Lightning Round, Cramer was bullish on Nokia (NOK), Dynegy (DYN), El Paso (EP), Verifone (PAY), Sara Lee (SLE), BHP Billiton (BHP), Forward Air (FWRD), United Parcel (UPS), First Marblehead (FMD), Acadia Pharma (ACAD), Alcan (AL), UBS (UBS), Legg Mason (LM), Shaw Group (SGR) and Yahoo! (YHOO), and was bearish on Taser (TASR), Intel (INTC), Axcan (AXCA), Sovereign Bank (SOV) and H&E Equipment (HEES)

Market Comments: The market closed in the upper half of yesterday's range, but breadth was pretty awful. The Hi/Lo index for the NYSE also went into negative territory for the first time since December. Much of the focus is on bond yields, even though the yield on the 10-year finished lower yesterday after an early spike.

Stocks opened under a bit of pressure again this morning, but I would not be surprised to see the market hang tough at the bulls defend the SPX 1275 level. Interest rate sensitive stocks like housing and utilities are down the most so far, while defensive drug and consumer stocks are higher.

long INTC, PG


Post a Comment

<< Home