Tuesday, March 07, 2006

Markets at Testing Support

Morning News of Note:
  • GOOG: Google lets slip talk of online storage service Google Inc. is preparing to offer online storage to Web users, creating a mirror image of data stored on consumer hard drives, according to company documents that were mistakenly released on the Web. The existence of the previously rumored GDrive online storage service surfaced after a blogger discovered apparent notes in a slide presentation by Google executives published on Google's site after its analysts presentation day last Thursday (Full Story) Washington Post
  • TIVO VZ: TiVo to Expand TV Recording to Cell Phones TiVo subscribers will soon be able to program television recordings straight from cell phones using the Verizon Wireless network. An agreement with Verizon Wireless, to be announced Tuesday, expands on TiVo Inc.'s strategy to bring the digital video recording pioneer's capabilities beyond its set-top-boxes and the television, and directly to cell phones for the first time. (Full Story) Washington Post
  • XLNX: XLNX sees Qtr revenues up 1%-5%, unchanged from previous guidance. Says Virtex-4 sales are strong with solid increases from each of the three family domains
  • US Economy: TEC Intl sm and mid sized co 1Q CEO survey index 104.2 vs 99.2 in 4Q; CEOs expect to hire more and increase fixed investment; 45% of CEOs surveyed said overall economic conditions improved during past year vs 37% in 4Q
  • Mad Money Summary: Jim Cramer opened his show discussing an orphan stock, or a stock which trades without any analyst attention, that can make mad money. The name of the company is NightHawk Radiology (NHWK). The company is based in Australia and Switzerland, and they receive X-rays over the Web and send the results back to hospitals in the U.S. while American doctors sleep. He says that demand is outpacing supply and that the market is nowhere near saturation. Cramer then discusses the telecom sector, where he feels Atheros Communications (ATHR) is worth buying. He feels the company is a "mini-Broadcom" with greater growth potential. Cramer then discussed TreeHouse Food (THS), which was recently given an Underweight rating by a JP Morgan analyst. He feels the stock is going higher, not lower. Cramer then welcomed Tsipi Kagan, the CFO of Radvision (RVSN), onto the show. Mr. Kagan said the success of the company is in part due to a huge homeland security contract with the government. The company is also involved with the upcoming 3G rollout in the U.S. In the Lightning Round, Cramer was bullish on Apple (AAPL), The Pantry (PTRY), Sherwin-Williams (SHW), Target (TGT), Home Depot (HD), Lowe's (LOW), Best Buy (BBY), Finisar (FNSR), LifeCell (LIFC), Wyeth (WYE), Microsoft (MSFT), Nabors Industries (NBR), Schlumberger (SLB), Halliburton (HAL) and Sirius Satellite Radio (SIRI), and was bearish on Abbott Laboratories (ABT), Sniffex (SNFX), Bristol-Myers Squibb (BMY), Johnson & Johnson (JNJ), International Paper (IP), Univision Communications (UVN), Grant Prideco (GRP) and Google (GOOG)

Market Comments: The market has opened under pressure this morning. Asian markets closed lower overnight. And TXN reported in-line results, but that is often not "good enough" for the market. Of course, I prefer a market that opens weak and gains strength into the close.

The indexes are now testing their 50-day moving averages. Also, both have posted distribution days in 2 of the last 5 sessions. So I want to be cautious here, and let any potential correction play itself out before getting aggressive. It has been a while since we have had any meaninful pullback, so maybe the market is simply due for one.

Crude oil is down a bit this morning, and energy stocks are once again under pressure. The yield on the 10-year is up to 4.75%, so expect to hear the media focus on this.

long GOOG


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