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Buzz Bits: Dow and Nasdaq Finish Lower

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Answers I Really Wanna Know... - Todd Harrison - 3:15 PM


  • Isn't this the quietest down 250 you've ever seen?

  • Will the tape play downside ketchup to the financials or will the suddenly green financials buoy the tape?

  • Wouldn't there be plenty of time to go to Cabo with Jessica Simpson after the playoffs were over?

  • You're watching this action in beta, right?

  • Is this finally the year-end unwind (out of bang for the buckers and back into banks)?

  • Chevy Chase or Steve Martin?

  • If you take care of the minutes, won't the hours take care of themselves?

  • If the S&P is a moth, is 1405 the flame?

  • Or the other way around?

  • Have you ever had Puffins?

  • 18 characters in one and a half hours?

    R.P.



Aggies! - Quint Tatro - 2:46 PM

They still could go either way Minyans, but I still like the way these agriculture stocks are holding up as we head into the close. I have been in and out of some Agrium (AGU) all day and just added back a touch here in anticipation of a trend line break higher.

I probably wouldn't add any more on the break however I suspect it may get going if it could muster a move through the upper line. On the other hand, if it breaks below the bottom line of support, the added shares will be tossed.


Click here to enlarge.


Position in AGU


Pair of dates to watch... - David Miller - 1:46 PM

On January 23, the FDA is due to respond to Genentech's (DNA) application for approval of Avastin in breast cancer. The ODAC panel voted 5-4 that the drug did not demonstrate sufficient efficacy and safety for approval. Most biotech "experts" have voted their dollars in this direction (I agree). With some sell-side analysts calling it a 50-50, DNA could still take a hit as generalists and retail sells the bad news. If the FDA does approve Avastin for this indication, DNA stock would likely pop over 10% and it could be very good for the entire sector.

On January 17, the FDA should issue a decision on ZymoGenetics' (ZGEN) RecoThrom. This drug helps surgeons slow blood loss in the surgical field. Current US market is about $250M, with a potential to grow much larger worldwide. Bayer (BAY) is ZGEN's worldwide partner. This approval has been oddly controversial in the investment community (not at the FDA), largely because ZGEN's competitors have been talking trash and have suckered a couple of prominent sell-side analysts. If approved, look to see drops in stock price at King Pharma (KG) and Omrix (OMRI).

Position in ZGEN


Minyan Mailbag: Is Mastercard Immune? - Minyan Peter - 12:48 PM

Minyan Peter,

Any thoughts today on Mastercard (MA) getting walloped along with American Express (AXP) and Capital One (COF)... since MA doesn't take credit risk, could this be a potential time to pick up some shares on weakness?

Thanks
Minyan James


James,

To date MA has been immune from the credit crunch because MA doesn't take credit risk, but what AXP suggested in their release and on their call, and what we have seen from the retailers this week, is that spending is slowing - and that is the core of MA's business - transaction volume.

I would also put out there the specific language AXP chose in their press release:

"American Express said it expects to report overall growth in worldwide Cardmember spending of about 16 percent for the fourth quarter (13 percent on a foreign exchange adjusted basis). The growth rate, however, trailed off to 13 percent in December (10 percent FX adjusted) with particular weakness in U.S. billings."

At least to me, choosing to speak about "worldwide spending" and "particular weakness in U.S. billings" raises the question as to whether or not spending outside of the U.S. is also slowing.

To date, MA has tried to position itself as largely insulated from a slow down in U.S. spending because of non-U.S. spending growth. The news by AXP last night puts that at least into question.



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