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Buzz Bits: Dow, Nasdaq Head Upward


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

Earnings Report - MV News

  • Paychex (PAY) reported Q4 EPS of $0.32 (in-line) on revs of $440.5 mln vs $433.2 mln cons.
  • Micron (MU) reported Q3 EPS of $0.12 vs $0.08 cons on revs of $1.31 bln vs $1.36 bln cons. Gross margin was 25.1%.

And after all the Jacks are in their boxes... - Todd Harrison - 3:49 PM

Well, that was fun. I didn't think it was possible for the financial markets to make jury duty look exciting but sure 'nuff, today's fray had all the edges of a marble. As old school Minyans know, I like to put it out there--particularly in front of a pending vacation--and I've been scanning the globe looking for some meat for ye faithful. It wasn't meant to be and as such, I'm the trading equivalent of a vegetarian.

We edge towards the bell with the world watching, waiting and otherwise debating the state of the Minx. On the one hand, Hoofy will offer that this is a retest and, thus far, a "higher low." The view from Red Dye, however, finds textbook churning under resistance. Such is life when viewing the dew through a technical lens where hindsight provides clarity.

Inherent in either interpretation, natch, is the simple fact that there are four metrics. I would argue that the structural and psychological pillars will trump the charts once these "catalysts" pass so be wary of levels as an absolute guide. A smart man once told me that when you're too smart to buy 'em and too scared to short 'em, you should step back and watch for a while. Truth is, while I'm doing less in front of my much needed respite, I'm not entirely sure that I would be more aggressive if I were to hang in the hood.

One thing's for sure, we'll have plenty to chew on tomorrow when Boom Boom steps to the forefront. In the meantime, I'm gonna hop on this 4pm call--chew through the 5pm staff meeting--dutifully focus on my 6pm meeting---and then meet Sir Succo and the boys for a belated birthday belt. And you know what? it could be worse...

Fare ye well into the bell and have a fantastic overnight "session."


Flashback! - Bill Meehan - 3:11 PM

This day in market history...

  • Closing levels 2 years ago
    • DJIA: 10,357.09
    • Naz: 2,019.82
    • S&P 500: 1133.35
    • Crude: 26.79
    • Gold: 313.90

This day in Minyanville history...

  • In '04, Prof. Roney took at look at the Fed's Past as it prepared to raise rates for the first time in more than 4 years. They've yet to stop and another announcement comes tomorrow.

In other news...

  • In 1997, Mike Tyson snacked on Evander Holyfield's ear during their heavyweight championship fight. I'm sure we all remember this cover.

NXR and NXQ coming into range again for you bargain hunters - Bennet Sedacca - 2:06 PM

We brought these up way back last Fall when they were in this price range and also in the 8% discount to NAV area. These are just about the only NON LEVERAGED closed end muni funds I know of, with by far and away the lowest fee structure.

We bought 'em and sold 'em into the muni rally earlier this year but are in once again. The yields close to 4.9%, after tax, monthly, which is in the 7.53% tax equivalent yields area. I must admit they are not exciting, but as George Soros aptly said, 'investing isn't meant to be exciting.' They are of high quality and reasonable duration and low turnover.

  • fees around .35% (very low)
  • low turnover (around 10%)
  • average duration around 5 years (reasonable)

There are two problems with them and it's why we have to be careful. 1) They are not terribly liquid and 2) could be attacked by tax selling/swapping later in the year. Overall, excellent value if one is careful buying. In the spirit of full disclosure, we are bidding for them both at times and expect to add to positions.

Position in NXR and NXQ

Dicey - Kevin Depew - 1:13 PM

Yesterday we talked a bit about the DeMark TD-Sequential buy signal in the Nasdaq Composite. Today we're getting a TD-Sequential buy signal in the Nasdaq-100 (NDX). We're slowly edging closer to potential TD-Sequential buy signals in the SPX, Russell 2000 and Dow as well.

These "buy " signals, if they register, will be occurring within a longer-term (monthly DeMark as well as PnF Bullish Percents) negative context, so for what it's worth I expect them to be somewhat short-lived, though certainly tradeable for those who are nimble enough. With that in mind, I have a shopping list of specific situations to go along with the negative RUT/positive SPX position that is part of a longer-term thesis. Still, I believe the "meat" on the bone this summer will ultimately be a move below these levels.

Position in RUT/SPX equivalents

Why Do Hedge Funds Hate America? - Adam Warner - 10:53 AM

Every time you think Congress can't figure out a way to waste more time, they come up with a new one. Instead of devising some new hedge fund regulation that will in all likelihood NOT have any effect on whatever perceived ill they are trying to fix, they should maybe educate the Pundit Class on hedge funds to begin with.

Hedge Funds are not some monolithic cabal meeting somewhere and plotting how they can manipulate world markets. At least I don't think they are, lol.

Seriously, the growth in hedge funds and hedge fund influence over the years has corresponded to an era marked by a decrease in overall volatility. Yes, you will see blips like this spring when a bunch of hedgies apparently exit crowded trades at once. But net-net, what caused overspeculation to begin with, hedge funds or extended easy monetary policy? And how will some sort of token gesture of regulation have any remote effect?

Do as they do, not as they say - Rod David - 10:48 AM

Was Tuesday's decline really related to the FOMC announcement? Far and wide - from mainstream financial media to market pundits - that's how the drop was described yesterday. Ummm, would that be Thursday's FOMC announcement? Wow, an event two days into the future doesn't usually dominate a session's price action, influencing the majority of market participants. An event that was already expected to have a negative outcome, just short of the Fed suspending all new lending.

So, is price going to deteriorate further and even more dramatically one day away from the event? Crash Thursday morning? Or is there nothing left to fear from Thursday afternoon, since Tuesday's drop already discounted the bad news, and the market has already postured itself defensively. Pardon us for considering this scapegoat to be a little too convenient, and for considering the marketplace to be a little too eager to latch onto this convenient scapegoat. This morning's opening gap up peaked where any higher would have signaled a reversal of yesterday's decline, so market participants don't appear to believe it, either.

Higher highs this morning would be too late to be relevant as a breakout. This morning's optimism has already passed the point where it could have been considered effective, and not ineffectual. A break lower before noon under yesterday's low wouldn't be any more credible.

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