While the DJIA and the S&P 500 have stabilized in recent weeks, the Nasdaq has found itself in quite a nice little uptrend. After declining steadily all year, the selloff in technology accelerated as market participants convinced themselves that all of the macroeconomic data and IBM's latest stumble indicated an economy in pain and in danger of a severe contraction. As we entered earnings season, all three major indices collapsed, falling 3% to 5% in less than a week in the middle of last month.
The bears were in full control and as confident as they'd been since late 2002. Stocks were indicating a coming recession, or so we were told. The bears argued that twenty years of policies from a careless Federal Reserve were finally going to come back to haunt us, as the Fed had finally painted itself into that corner and cracked the economy with its endless rate hikes.
Even the few bulls who didn't capitulate and/or buy into the so-called weakened-economy thesis couldn't find anything to be bullish about away from energy. The last bulls standing based their hopes on a Fed that would stop raising rates.
Fast forward a month -- what's changed? For one, no one can agree on the economy anymore. The consensus is that there is no consensus. The bears are still certain that the Fed's got no bullets left and the economy's teetering. The bulls figure that maybe the economy's not so bad after all, so although they still hope for the Fed to back off, they also hope that earnings can justify higher prices again. And of course, stocks have rallied, especially in tech.
Despite the big tech rally, the Nasdaq is still down nearly 10% this year. I continue to find valuations in tech that have a compelling risk/reward to the long side. I'd been getting increasingly aggressive to the long side into the collapse, and I'm now trying to be patient. I'd used a lot of call options to build positions, and as stocks have run up, those call options make me yet "longer" as they kick in. Discipline dictates trimming here and there, but I remain aggressively long. Stocks ebb and flow and it shouldn't shock any of us if the markets were to pull back yet again, and it's important to be prepared.
Speaking of pullbacks, it's looking like it'll be an ugly open. The day is young though, and we'll have lots more action before it's over.
Napster (NAPS) sai täna hommikul positiivseid kommentaare, Brean Murray alustas aktsia katmist ja sihiks seadis $8. Pärast suurt langust võib aktsia isegi väikese tõusu teha, eelturul ca 15c plussis.
Napster started with a Buy at Brean Murray; $8 tgt (NAPS) 3.88 : Brean Murray initiates NAPS with a Buy and $8 tgt. Firm believes that external mkt conditions speak to increases in consumer spending on digital media. They see less expensive telecommunications and consumer electronics leading to greater consumption of digital media. This is further supported by the RIAA legal actions aimed at discouraging illegal consumption, and music cos increasingly working with the online community. Firm thinks the co is well positioned in this mkt, the co's brand is well known and in the "to go" mkt has the first-mover advantage. /Briefing/
Gapping up on strong earnings/guidance: SPLS +5.7%, HD +3.8% (also Deutsche upgrade), DE +3.5%, SNDA +2.1%, ASYS +27%, SRSL +7%, .... Other News: WPCS +15% (awarded $7 mln project from major wireless carrier), ONNN +8.5% (presented at JP Morgan conference), REGN +8% (positive clinical data), IDNX +4% (Pennsylvania police orders), RMBS +2.9% (Playstation 3 to use co's products), ONXX +2% (Bear Stearns upgrade)...Stem cell stocks are strong as lawmakers may have enough votes to overturn funding ban: ASTM +20%, STEM +10%, GERN +5.1%.... Under $3: OMNI +22% (reports Q1).
Gapping Down
Gapping Down on disappointing earnings/guidance: XIDE -49% (also sees debt covenant violations), A -2.6%, OPTC -6.5%, SNIC -4.6%... Other News: VLCCF -4.3%, VRTX -2.9% (profit taking after recent move higher), BOOM -2.4%, UTHR -2.3%, FORD -2.2%, OSIP -2.1% (data from Tarceva trial program), AAPL -1.7% (Thomas Weisel says high-end iPods sales appear to have slowed down considerably), TASR -1.3% (to delay 10-Q).
MOSY Monolithic System Tech started with a Buy at Stanford; tgt $8 (5.68 -0.05)
Stanford initiates MOSY with a Buy and $8 tgt. Firm believes that the co is on the cusp of a turn-around, as it rebuilds its licensing and royalty base after suffering a failed merger with Synopsis. Firm notes that 1Q05 revs grew 120% sequentially, and 2Q05 guidance calls for another strong qtr. Firm believes that NEC (Nintendo), Fujitsu, Sony, and SigmaTel (SGTL) are emerging as significant customers in the near-term.
Stops .. sometimes they save you from pain, sometimes they prevent the gain :) XIDE on siis näide viimase kohta. Siiski, tegemist oli kauplemisideega, mille idee ei toiminud ja seetõttu oli stopi käikuminek ainuõige lahendus.
15:39 NFLX Hearing NFLX sell-off attributed to a number of factors, including: heightened competition from BBI, options activity ahead of expiration, profit-taki (13.96 -0.89)
Net Sales: $1.86 billion (5% increase quarter over quarter; 8% decrease year over year) - vs EST 1,80 mld Net Income: $305 million (6% increase quarter over quarter; 18% decrease year over year) EPS: $0.18 ($0.01 increase quarter over quarter; $0.04 decrease year over year) - vs EST 0,17 New Orders: $1.55 billion (7% decrease quarter over quarter; 30% decrease year over year) - vs EST 1,55 mld
