Friday, March 24, 2006

Morning Bounce

Morning News of Note:
  • COH KSS: Coach sues Kohl's for trademark infringement-Women's Wear Daily. Coach (COH) has filed a lawsuit against Kohl's (KSS) for alleged trademark infringement and breach of contract for violating earlier settlement agreements between the companies. According to court documents, Kohl's allegedly infringed on Coach trademarks on a broad range of handbags and accessories sold in Kohl's stores and online. Kohl's declined to comment on the lawsuit.
  • CEPH: Cephalon ADHD Plan Is Set Back A Food and Drug Administration panel recommended that the agency reject a proposed drug from Cephalon Inc. to treat children and adolescents with attention deficit hyperactivity disorder because of concerns it might cause a potentially fatal skin condition. The outside panel of medical experts said that while it believed the drug would be effective at treating ADHD, it simply didn't have enough data on whether the drug could cause Stevens-Johnson Syndrome, a severe skin rash that can be fatal. (Full Story) WSJ
  • Fund Flows: equity funds rptd outflows ($1.7bln), ex ETFs rptd inflows $2.768bln, incl $1.68bln into domestic equities, lgst inflow since 2/9/05; taxable bond funds rptd inflows $787m; HY funds rptd inflows $49m, first inflows since 12/7/05; money mkt funds rptd inflows $17.492bln -- AMG Data
  • Mad Money Summary: Cramer opened his show discussing technology, saying the easy money was already made in Intel (INTC), Broadcom (BRCM) and Marvell (MRVL), and you should look past them to SiRF Technology (SIRF). The company makes a chip that is inside Garmin's (GRMN) new global positioning system device. Then he discussed Germany's SolarWorld, a German solar power company whose stock is coming to America. He says to get the stock before it comes to us so you can get it before it jumps. Then Cramer cautioned his viewers not to buy stock in after hours trading because "you'll never be fast enough" to compete against the most ruthless professional traders. Cramer welcomed Hibbett Sporting Goods' (HIBB) CEO Michael Newsome to the show. The company is a regional retail story with room to grow. The store currently operates in a 22-state area in the Sunbelt, but has identified 400 markets that it can expand. In the Lightning Round, Cramer was bullish on Starbucks (SBUX), optionsXpress (OXPS), Teva Pharmaceutical (TEVA), Broadwing (BWNG), Level 3 Communications (LVLT), Qwest (Q), Brookfield Asset Management (BAM), Brocade Communications (BRCD), Valero (VLO), Avon (AVP), Birch Mountain Resources (BMD), BHP Billiton (BHP), Agilent (A) and American Eagle Outfitters (AEOS), and was bearish on Blockbuster (BBI), Movie Gallery (MOVI), Bentley Pharmaceuticals (BNT), Intuitive Surgical (ISRG), Edge Petroleum (EPEX), Intevac (IVAC), Western Refining (WNR), Wendy's (WEN), Guidant (GDT), Waters (WAT) and Korea Electric Power (KEP).

Market Comments: After opening under some selling pressure, the market is now nicely higher. Maybe the $25 point surge in GOOG is actually helping. Now we need AAPL to pick itself up off of the canvass as well.

Also, a bigger than expected decline in Feb. new home sales is helping move bond yields lower. This is one of those times where we need to see some weak economic data to help our cause with the Fed.

The 10-year yield is down 5 basis points to 4.69%. Stocks are up pretty much across the board right now.



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