SOME Recommendations Performance - July 09, 2010
Success is simple. Do what's right, the right way, at the right time.
Success is simple. Do what's right, the right way, at the right time.
Another great week has been had, due to the continued uplift of the market, for recommendations, therefore profits have grown accordingly. As the market has improved we have been able to capitalize on this situation and members who followed these recommendations for the past week enjoyed a 675% gain.
Here are the gains on some of the stock options recommended by SOME during the last week:-
Madison Square Garden, Inc. (MSG)…………….21%
SunTrust Banks, Inc. (STI)…………….24%
H&R Block (HRB)…………….23%
IShares Hong Kong Fund (EWH)…………….33%
VIVUS, Inc. (VVUS)…………….26%
Trina Solar Limited (TSL)……………47%
Delta Air Lines, Inc. (DAL)…………….35%
Banco Santander, S.A. (STD)…………….36%
Google Inc. (GOOG)……………27%
Suntech Power Holdings Co., Ltd.……………33%
The Mosaic Co. (MOS)……………40%
OmniVision Technologies, Inc. (OVTI)……………..29%
AK Steel Holding Corporation (AKS) ……………….25%
The CBOE Volatility Index (VIX)………………25%
Congratulations on a great week and let’s keep the profits rolling!
If you are not already a member of Stock Options Made Easy, then you may wish to become one so that you can benefit from the profits that are being generated!
Friday saw the stock market end its best week in a year with another gain as investors bet that companies will report strong second-quarter earnings.
The Dow Jones Industrial Average (DJIA) spent the majority of the session hovering just north of breakeven today, as a round of recalls from Johnson & Johnson (JNJ) and some anxiety ahead of Alcoa's (AA) upcoming earnings report kept the blue chips in check. The tech-rich Nasdaq Composite (COMP), on the other hand, spent the day comfortably higher after news that China renewed Google's license to operate in the country. The renewal was in doubt because of a strained relationship between the company and China's government over censorship of search results.
Nevertheless, even the blue-chip bulls were determined to end the holiday-shortened week on a high note, with all three major market indexes once again accelerating their upward trajectory in the final hour of trading.
"After dropping all five days last week, we bounced all four days this week," noted Schaeffer's Senior Technical Strategist Ryan Detrick, who attributed the "oversold bounce" to sentiment growing "a little too negative." However, voicing what many investors are thinking heading into the weekend, Detrick poses the question: "Can the bulls stay in control? The upcoming earnings season might be the deciding factor."
"The market has rebounded this week in anticipation of a fairly decent period of corporate earnings," said Tyler Vernon, chief investment officer at Biltmore Capital. "This will be a nice bounce, but long term; I think a lot of the concerns about the global economy are still there."
While there haven't been many positives on the economic front, there's been some optimism that companies will still be able to continue to make profits, even with the economic strain.
Results for Major Market Indexes
The Dow Jones Industrial Average (DJIA – 10,198.03) finished the day, with another gain of 59.04 points, or 0.58%.
The S&P 500 Index (SPX – 1,077.96) had a gain, on the day, of 7.71 points, or 0.72%.
The Nasdaq Composite (COMP – 2,196.45) also had a good gain of 21.05 points, or 0.97%.
The Russell 2000 Index of smaller companies had the best gain of 9.16 points, or 1.48%, to settle at 629.43.
Financials were among the big gainers Friday, with JPMorgan Chase (JPM,), Citigroup (C), US Bancorp (USB) and Regions Financial (RF) among the stocks lifting the KBW Bank (BKX) index by 2.4%.
Soaring 5.3%, the blue chips enjoyed their strongest weekly rally since the week ended July 17, 2009. Just over half of the 30 stocks on the Dow closed higher, led by economically-sensitive Caterpillar (CAT) and Alcoa (AA). The index's worst performers were Johnson & Johnson (JNJ) and Microsoft (MSFT).
Johnson & Johnson (JNJ.N) was the biggest drag on the Dow, falling 1.4 percent to $60.54 a day after it recalled more Tylenol and other over-the-counter drugs following consumer complaints of odors. The move expands a recall started in January.
The Nasdaq Composite jumped almost 1% and also posted its best week in nearly a year. The index was driven higher by big gains from technology stocks like Research in Motion (RIMM) and Google (GOOG).
Underscoring the softening economic worries, the economically-sensitive basic materials sector jumped as more than 2% on Friday. Individual stocks like U.S. Steel (X) and Freeport McMoRan (FCX) saw even heavier buying.
By the close of the week, after four days of positive figures, the Dow Jones Industrial Average (DJIA) added more than 500 points, or 5%, to finish its best week in a year.
The S&P 500 Index (SPX) advanced roughly 5.0% for the week.
Meanwhile, the Nasdaq Composite (COMP) finished up the week on a good gain also, with a 3.5% gain.
Trading volume was light, signaling that many investors were staying out of the market. But those who were trading appeared optimistic about the company reports that will be announced starting next week.
The day's trading volume fell well below last year's estimated daily average of 9.65 billion.
Market breadth was positive and volume was very light. On the New York Stock Exchange, winners beat losers by almost four to one on volume of 880 million shares. On the Nasdaq, advancers beat decliners by three to one on volume of 1.61 billion shares.
Notes of Interest….
• The Dow Jones Industrial Average’s (DJIA) finished a hair's breadth above its 10-week moving average – a feat not accomplished since late April.
• The S&P 500 Index (SPX) ended with a gain of 7.7 points, or 0.7%, to settle north of both its 10-day and 20-day moving averages for the first time since June 21.
• Crude futures for August delivery advanced 65 cents, or 0.9%, to end at $76.09 per barrel – black gold's first daily finish atop the $76-per-barrel level in eight sessions. For the week, the front-month contract rallied an impressive 5.5%, marking the commodity's best weekly finish in nearly six weeks.
• Gold futures also ticked higher today, as the malleable metal's recent finish beneath the $1,200 level sparked a run of bargain-hunting buyers. In addition, economists at Deutsche Bank opined that concerns about gold being "overbought" aren't justifiable until the precious metal explores the $1,400 neighborhood. Against this backdrop, gold for August delivery added $13.70, or 1.2%, to end at $1,209.80 an ounce. For the week, the front-month contract inched 0.2% higher.
• Bonds: Treasury prices fell, raising the yield on the 10-year note to 3.06% from 3.02% late Thursday.
News on the economy wasn't as upbeat. Inventories held by wholesalers rose in May for a fifth straight month though sales dropped for the first time in more than a year. The government said wholesale inventories rose 0.5 percent and sales dropped 0.3 percent. It was the first drop since March 2009, when major stock indexes hit a 12-year low. Economists surveyed by Briefing.com expected inventories to rise 0.4%.
But investors didn't appear fazed by the inventories report. Instead, the market appeared to hold on to optimism fed by Thursday's report of a drop in the number of newly laid off people seeking unemployment benefits. That report ended a string of bad news about the job market, and likely contributed to investors' more positive mood going into what's known as earning season.
Overseas markets rose after a surprise interest rate hike in South Korea was seen as a sign of confidence that the global economy will continue expand. Central banks around the world, including the U.S., have kept rates at historically low rates to stimulate growth.
In currencies, the euro slipped back below the $1.27 level and its two-month highs. A weaker euro tends to hurt commodities and market sentiment.
European Markets: gained, with Britain's FTSE 100 rising 0.5%, Germany's DAX advancing 0.5% and France's CAC 40 climbing 0.5%.
Asian Markets: rallied after South Korea raised its benchmark interest rate, seen as an optimistic sign for the economy. Japan's Nikkei rose 0.5%, Hong Kong's Hang Seng gained 1.6% and the Shanghai Composite rose 2.5%.
Company Earnings Reports
Company News and Movements:
• Google: The Internet behemoth renewed its license with the Chinese government to operate its site in that country, following a four-month battle over censorship.
A renewal had been in question due to tension between the company and China over the censorship of search results. But Google's decision last week to no longer automatically redirect users of Google's China site to its uncensored Hong Kong site seemed to pave the way for the renewal.
Google (GOOG) shares gained 2.4%.
• Shares of BP were in focus as bankers on Wall Street say the embattled company is being bombarded with offers of interest from rivals weighing a potential bid and that it is considering all of them. BP says no sale is on the table but its clear rivals are circling as the U.K. company has lost half of its market value since the giant oil spill in the Gulf of Mexico began.
• Comcast’s (CMCSA) $30 billion NBC Universal joint venture with General Electric (GE) is set to win regulatory approval from the European Union next week, Reuters reported. The companies didn’t offer any concessions and the EU hasn’t sought any, the wire service reported.
• Madison Square Garden (MSG), parent of the New York Knicks, slumped 4.5% after LeBron James told the world he’s headed to the Miami Heat, meaning the Knicks lost out on the biggest free agent prize in NBA history. Signing James would have been a big financial boost to the Knicks and the stock had run up earlier in the week amid buzz he could be coming to Broadway.
• Air Products and Chemicals Inc (APD) late Thursday raised its hostile bid for rival Airgas Inc (ARG) by 5.8 percent to $5.3 billion, but the offer remained slightly below the company's current market value. Air Products rose 1.4 percent to $69.74, while Airgas rose 1.6 percent to $64.90.
The following companies had some impressive options movements:-
• Procter & Gamble (PG)
• CSX Corporation (CSX)
• Sequenom (SQNM)
• Suntech Power Holdings Co., Ltd.
• The Mosaic Co. (MOS)
• OmniVision Technologies, Inc. (OVTI)
Friday's modest moves weren't surprising. Traders often avoid making big bets just before earnings releases because the reports provide a good picture of how companies are performing. Investors will look closely at forecasts for future quarters because economic reports in the past two months have raised questions about the pace of the rebound.
"It's time to determine if this is just a soft patch in the recovery or if it's the beginning of a second leg down. That's what the market is struggling with," said Dan Deming, a trader with Stutland Equities in Chicago.
Investors will want to know whether companies are feeling the effects of slower growth and whether they believe the recovery will gain momentum in the coming months. Stocks fell over the past couple of months because data showed the economy was growing, but not as fast as had been forecast.
The 526-point surge on the Dow this week represented a serious rebound from two weeks of economic gloom and doom that left the benchmark index at eight-month lows.
“Investors were leaning too far in the negative direction. We need to treat what we’ve seen on the week as a little bit of snapback from some deeply oversold levels,” said Craig Peckham, equity trading strategist at Jefferies & Co. “There’s a lot to prove over the next two weeks in corporate earnings season to show the negative sentiment was wrong.”
Wall Street’s fears of a double-dip recession have receded this week ahead of earnings season. The bar has been lowered for this earnings season given recent economic jitters, but the markets will be looking for signs a slowdown is hurting Corporate America. The optimism heading into earnings season is largely based on the lack of negative pre-announcements from companies that typically prelude a disappointing batch of results.
“Without those warnings signals, people are setting up for in-line to better results. With the market as cheap as it got last week, it left a bar that was probably too low,” said Peckham.
Earnings season starts with aluminum producer Alcoa Inc. (AA) on Monday. The company's stock rose 1.9 percent ahead of its report. Other companies scheduled to release results next week include banking giants JPMorgan Chase & Co. and Bank of America Corp. General Electric Co. and chipmaker Intel Corp. are also scheduled to report earnings next week.
Analysts currently expect year-over-year growth of 27%, according to the latest figures from Thomson Reuters.
"We expect to see good margins, very healthy balance sheets and companies basically saying that even with the slowdown, we are very well prepared for it," said Marc Pado, U.S. strategist at Cantor Fitzgerald & Co. in San Francisco.
"We have been seeing from previous data that companies are not building inventory and not adding workers. In other words, they are very well positioned for the worst case scenario," Pado said.
"The earnings are expected to again beat expectations as they have the past couple quarters, but what they're looking for is the guidance," said Roy Williams, chief executive of Prestige Wealth Management. "That will be the big indicator."
Williams expects the earnings season to be positive for the stock market if it can return investors' focus to U.S. corporate fundamentals from the global concerns, especially regarding the euro zone, that have hurt the market in recent months.
"My hope is the earnings will improve the psyche of the individual investor," he added. "We do face challenges, and we're going to have a lot of volatility, but ... the economy is continuing to grow."
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