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Buzz Bits: Dow, Nasdaq Climb Into the Green


Your daily Buzz & Banter highlights...


Editor's Note: This is a small sample of the content available on the Buzz and Banter.

Earnings Report - MV News

  • Amazon (AMZN) reports 1Q EPS of $0.26, may not be comparable with $0.15 cons on revs of $3.02 bln vs. $2.92 bln cons.
  • Sun Micro (SUNW) reports 1Q prelim GAAP EPS of $0.02, may not comparable to $0.01 cons on revs of $3.28 bln vs. $3.42 bln cons.
  • C.H. Robinson (CHRW) reports 1Q EPS of $0.42 vs. $0.38 on revs in-line of $1.62 bln.

Futures Tidbits - Sally Limantour - 3:20 PM

Introducing more dazzling things to trade:
  • Lehman Brothers (LEH) and the Chicago Mercantile Exchange (CME) will launch the world's first exchange traded contract which will have a mix of six major types of dollar-denominated bonds. This will allow investment managers to trade futures based upon their most popular bond benchmarks.

  • China securities regulator is likely to grant the first license to trade index based futures within the next month, a futures contract based on the Shanghai Shenzhen 300 index. One of the licenses will be granted to Great Wall Futures. That's not a joke.

  • A new exotic derivative is swimming your way at the Fish Pool exchange in Norway. Today they began trading salmon futures.

  • Hey I would rather take delivery of wild salmon than pounds of pork bellies.

  • The CME has recently created futures contracts tied to hurricane activity in the US. I bet we can figure out some interesting spreads there.

  • What's next?

Buzz in the Afternoon - Todd Harrison - 2:34 PM

  • The Zegna Capri suit? Hey President Fish, we should throw a party so your pants can meet your ankles!

  • We've seen a slew of Yahoo July 30 call buyers as the stock probes the 200-day and eyes the rather meaty $3 gap above.

  • While I'm trading lighter and tighter into my (much needed) respite next week, I'm getting that ol' familiar feeling that DJIA 13K won't be mounted on the first attempt.

  • I've already heard folks calling for DJIA 14K. Please don't anticipate the anticipator or, if you do, be sure to define your risk. You can do anything as long as you're disciplined.

  • Dow Chemical has quietly edged back to levels preceding the "private equity leak." Be sure you see it but remain wary of invisible catalysts.

  • Remember when we asked what we can do to help the folks affected by the Virginia Tech tragedy? Well, there is. On Tuesday, May 1st, there will be an uber-fun fund-raiser at the Stone Rose in NYC. Tickets are $50 each with the proceeds benefiting those suffering in Blacksburg. Please contact our friends at Ken Sunshine for more information. And thanks, Minyans--this is what community is all about.


Off Target - Jeff Macke - 9:39 AM

Target (TGT) whiffed on Same Store Sales last night, becoming the first of what I expect to be a whole big train of light sales reports from the retail space. Blending March and April, the company expects to see sales of 3-4%. With the 12% already reported for March, that means something in the neighborhood of (7) to (8%) SSS for April.

We've talked before about the retailers entering a tough time of the year. Target's news today is what "tough time of the year" looks like. Something else to keep on your radar is that April marks the end of 1Q for the retailers; meaning we're getting into Warning Season for the group.

What am I doing about it? Staying hunkered down in mainstay Investment positions in the retailers (Safeway (SWY) and Nordies (JWN)), eyeballing my hypothetically horrid timing on my Wal-Mart (WMT) optimism and staying as cool as possible. No matter how many obituaries you read in the coming days and weeks, the consumer isn't "dead." He's just resting until back-to-school.

Position in SWY, JWN

Inflection Point - Jeffrey Cooper - 9:07 AM

Despite a down day on Monday, there was little sign of a post-expiration hangover as volume was light.

However, 1484 S&P cash may be an inflection point to watch:

  • It represents a measured move up from the March 14th low.
  • The low on March 14th was 1364. From there the index rallied up to approximately 1439 virtually uninterrupted.
  • An advance of 75 points. From there the S&P pulled back to tag its 20 dma on March 30th at 1409.
  • A measured move of 75 points from 1409 projects to 1484.

With the expiration pin the tail on the donkey game over, it will take more buying to support the index at this level in the short term.

Moreover, note the weakness in the likes of heavyweights Google (GOOG) and Chicago Mercantile Exchange Holdings (CME) on Monday. If the pressure there reflects institutional liquidation we should see another down day---particularly if an up open sees the S&P go red and stay there after the first hour.

Be that as it may, a two to three day pullback looks to set up the run for Dow 13,000 for the weekend headline.

Stocks of interest: Apple (AAPL) showed the first signs of upside momo in weeks on Monday as it plays Ketchup. If the market has an agenda higher, AAPL may be a good tell as the chart has traced out a big picture cup and handle. Isn't it special that this is being gamed off this pattern right in front of earnings?

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No positions in stocks mentioned.

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