Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Afternoon Snack

By

PrintPRINT

If I had to choose one theme today, it would have to be short covering. A quick scan of a few large cap names show us that the shorts are still alive and plentiful. General Motors (GM: NYSE) is up over 6% today. Why? Is it because their 0% financing is making them money? Is it because their profit margins are expanding? I don't think so! Take a look at Merck (MRK: NYSE). Here is a company with zero in its pipeline and it is up almost 3%! I guess they did report a rise in profit so it is justified. What was the rise attributed to? Better drugs? No, it was because of cost cutting. Cost cutting? I thought we got past that earlier this year but I guess Merck forgot to do that when every other company did.

My point is that often times people get sucked into things, whether it is in the market, in their personal lives, or business in general by just taking things for what they are. If you tune into the teletubbies they will talk about how great the action is in these stocks! Come on! And the sad part is that people will believe them. If we got the chance to ask them the simple question of "why?" I wonder what their response would be. In fact I often do this with people I know. They make a statement and I press them on why they think that. More times than not I find that people don't know what they are talking about and they just regurgitate information.

I bet a few of you are wondering if I am having a bad day. All this negativity! No I am not having a bad day but I am astonished about how people take things on the surface for what they are and do not have the ability to formulate their own opinions. So with the market making new 52-week highs, and with everything appearing to be fine, I just wanted you Minyans to look around, ask a few questions and figure out why the market is up today.

A quick snapshot of the market shows that software is making the biggest percentage gains on the day. The semis, broker/dealers, and Internets are also performing well. The NDX is setting up for yet another test of the 1450 level. The S&P is holding strong and the Dow is acting well. The real test will come at 2:00 because the last two days have been met with selling at that time. Remember, the trend is your friend!

No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE