Investing
The view from PIMCO: The dollar keeps falling, and that's a good thing
What economist or investment managing director isn't advocating a strong dollar policy? A healthy currency usually means a nation's fiscal and monetary policies are solid, it's living within its means and its economy is growing, with goods/services that are competitive in global markets. Well, put PIMCO Managing Director Scott Mather in the contrarian camp. Mather says additional dollar weakening for the already beaten-down buck, which he called "inevitable," will not only benefit the U.S. but will also help rebalance the global economy. The dollar has weakened about 5% versus the euro and 10% versus the British pound so far in 2009.
Stocks edge higher as weak buck lifts commodities
The stock market turned higher as gains in shares of materials and technology companies offset concerns about mounting debt levels around the world.
The advance follows a day of back-and-forth trading Wednesday as investors grew cautious about rising government debt levels in Spain, Greece and other countries.
Kroger plunges after earnings. Time to buy on weakness?
Shares in Kroger (KR) have tumbled more than 15% since the supermarket giant said Tuesday its third-quarter earnings missed Wall Street's forecast by massive 10 cents a share, prompting the company to cut its outlook.How can Kroger, a company that should be benefiting from cash-strapped consumers eating more meals at home, be faring so poorly? Price deflation. Yes, traffic to grocery stores is up, but frugal shoppers are increasingly going for stuff that's on sale (which hurts margins). And, of course, there's intense price competition from Wal-Mart (WMT), Supervalu (SVU) and Safeway (SWY). The result was a lousy quarter, with more headwinds to come.
Gene Marcial's Inside Wall Street column has a new home: DailyFinance
After writing BusinessWeek's widely read Inside Wall Street column for 28 years, I'm moving. From now on, you'll find Inside Wall Street only online at AOL's terrific new financial resource, DailyFinance. Though relocated, the column will maintain its particular purpose: to be an "equal opportunity" service that gives the small guy -- the individual investor -- a fair shake. Inside Wall Street aims to fill individuals in with the tightly guarded information that only big investors and institutional houses normally get. Inside Wall Street tries to balance such a lopsided situation by reporting on the moves big investors are making based mostly on the information they get by virtue of their huge investing power.
Madoff victims may recover more cash via new tax rules than from clawbacks
Bernard Madoff's victims may recover more of their lost funds by filing tax claims than they could hope to get from trustee Irving Picard's recovery efforts. So far, he's recovered only about $1.5 billion in assets to be split among customers with estimated losses of $19.4 billion. Picard has also filed lawsuits to recover another $15 billion from some of the Madoff firm's institutional clients and individuals, but how much of that will be clawed back -- if any -- remains to be see.While some investors have received insurance payouts of $500,000 each from the Securities Investor Protection Corporation, certain victims are finding that the fastest way to recover some of their losses is by filing for tax refunds. As victims of a Ponzi scheme, they can generally deduct nearly all their qualified loses, including any "phantom income" (income reported, but never taken out of the account) in the year the fraud was discovered. This speeds up the process because victims normally would have to wait for years to deduct their losses.
Goldman Sachs' favorite emerging-market bet for 2010
The growth stories in the BRIC countries appear in sharp contrast to the view in developed markets, which are struggling to stabilize and reignite wide swaths of their economies; leading indices in Brazil, Russia, India, and China have all handily outperformed the S&P 500 ($SPX) in 2009. But only one country was singled out by Goldman Sachs (GS) macroeconomic and commodity analysts in a note to clients highlighting the group's "Top Trades for 2010" -- and that is the low organic growth, commodity-driven economy of Russia.
Citing a "still bullish long-term view on energy and the broader commodity complex," Goldman is targeting a 25% return from a U.S. dollar-denominated index known as the Russian Depository Index (RDX), of which three stocks -- Gazprom (OGZPY), Lukoil (LUKOY) and the oil company Rosneft -- comprise more than 50% of the weighting. In addition to oil and natural gas, the index also has companies exposed to steel, gold and nickel. Goldman estimates that oil prices will average $90 per barrel in 2010, which will allow a quick and healthy rebound in profits for Russian energy companies, leading to the stocks trading at a mere seven times forward earnings.
Schwab's frequent traders see a U.S. recovery over the next 12 months
Broker Charles Schwab (SCHW) recently asked its elite "active trader" clients how they see the economy shaping up. It found that a majority (54%) said they're now feeling bullish enough about business and the stock market that they expect a recovery within 12 months. Another 18% of these high-net-worth clients who make 36 or more trades a year believe the economy could recover in as little as six months. With such a large percentage of active traders feeling optimistic about the economy, it's not surprising that nearly two-thirds (63%) plan to increase their trading activity in the next six months as well. These are among the results of the latest Charles Schwab Active Trader Sentiment Survey, released on Tuesday. Conducted in October, the survey collected responses from nearly 300 traders.
Stocks in the news: Texas Instruments, PepsiCo, Apple
Texas Instruments (TXN) lifted its fourth-quarter outlook, but the sales forecast disappointed investors. Sales will be between $2.9 billion and $3.02 billion this quarter, compared with a previous forecast of $2.78 billion to $3.02 billion. Analysts surveyed by Bloomberg had forecast $2.93 billion on average. Shares declined 2% in pre-market trading.
PepsiCo Inc. (PEP) lowered the top end of its revenue and earnings outlooks for fiscal 2009 below Wall Street estimates, but reiterated its 2010 guidance on Tuesday. The reason is it stepping up investments in projects aimed at increasing its growth and profitability amid falling North American soft drink sales. PepsiCo also said it had reached a distribution agreement for certain Dr Pepper Snapple Group Inc. (DPS) brands. Shares fell 1.5% ahead of the bell.
Stocks poised to bounce back from Tuesday's declines
U.S. stocks are poised to open higher Wednesday morning, with investors hoping to recoup some of Tuesday's losses. But in markets overseas today, concerns are growing that some countries may not be able to repay their debt. In the U.S., discussions of a TARP extension and the health care reform bill are also in focus this morning.More here: Before the bell: Futures higher after Tuesday's declines
Chinese carmakers surge as sales top 12 million, Suzuki gets a boost from VW
In Asia Wednesday, major indexes closed lower. In Japan, the Nikkei Index fell 1.3% to 10,005 and in Hong Kong the Hang Seng Index was down 1.4% to close at 21,742. In China, the Shanghai Composite Index lost 1.7%, ending the day at 3,240.Cars were the talk of the town today as the China Association of Automobile Manufacturers announced that this year's car sales have topped 12 million units so far, up more than 30 percent from last year, and that November sales for all vehicles were up 98%. Bloomberg reports that more than 20% of the cars sold have a price tag of around $5,000, putting pressure on carmakers to develop inexpensive, small cars to cater to the Asian market as opposed to the enormous, gas-guzzling SUVs still popular in the U.S.
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Most Actives
| Symbol | Last | Change | Volume | ||
|---|---|---|---|---|---|
| C | 3.86 | -0.05 | 1.28% | 399.89M | |
| BAC | 15.39 | -0.02 | 0.13% | 199.47M | |
| SPY | 110.02 | 0.41 | 0.37% | 155.06M | |
Biggest % Gainers
| Symbol | Last | Change | Volume | ||
|---|---|---|---|---|---|
| VCI | 19.48 | 3.17 | 19.44% | 2.39M | |
| JTX | 4.88 | 0.75 | 18.16% | 3.26M | |
| FBP | 2.44 | 0.36 | 17.31% | 5.05M | |
Biggest % Losers
| Symbol | Last | Change | Volume | ||
|---|---|---|---|---|---|
| MOV | 9.45 | -1.40 | 12.90% | 2.13M | |
| SFH | 9.62 | -0.98 | 9.25% | 4,500.00 | |
| CFX | 12.31 | -1.08 | 8.07% | 217,775.00 | |