Before The Bell: The Race For Corn; Chinese iPhone On Hold
Biotech firms race to develop drought-resistant crops. Talks between Apple and China Mobile end without agreement.
Morning Perspective: The Race For Corn
Reuters reports Monsanto (MON), DuPont (DD), and biotech firms are competing against each other in a race to develop crops that are able to thrive when water is in limited supply. Corn is the main target of all companies due to its wide variety of applications, and Monsanto expects to have its first drought-tolerant corn to hit the market by 2010. DuPont has targeted 2012 for their release. Further, with scientists predicting a trend of worsening drought conditions and increasing water shortages; these factors have pushed agricultural research to the forefront. Read Professor Ryan Krueger's article from last month, The Other Side of a Pair of Uncomfortable Trades.
From the Bull Pen: Investors can play MON on the long-side; near-term sell-stops below $116. The Powershares water ETF (PHO) is also an option; sell-stops below $19.
From the Bear Cave: Bears see a downtrend in DuPont; buy-stops can be placed above $47.
Chinese iPhone On Hold
Bloomberg reports talks between China Mobile (CHL) and Apple (AAPL) to sell the iPhone in China have ended with no agreement. The parties ended negotiations because Apple wanted more revenue from game, music and video services than China Mobile was willing to offer. All hope for a deal is not lost, however, as both parties are set to meet for another round of talks today. According to government data, China has 539.4 mln wireless subscribers, a number larger than the combined populations of the U.S, Japan, and U.K combined. For other plays, read Professor Fil Zucchi's Long and Short Ideas from Morgan Stanley.
From the Bull Pen: Those remaining bullish on CHL see a nice entry should the stock retreat to $80; sell-stops can be placed below.
From the Bear Cave: Technically speaking, bears see resistance for Apple at $180. A downside entry can be attempted should the stock rally to that level and buy-stops may be placed above.
Click on Minyanville's Spotlight Stocks for more company-specific ideas.
Quick Check Around the World
The Street didn't get the expected snowfall this Monday morning and instead see a mixed bag of foreign markets.
Asian trading closed with the Hang Seng -1.48%, Nikkei -1.93%, Sensex -0.48%, Taiwan +1.79% and Shanghai +0.24%.
A quick check across the pond finds the CAC +0.22%, DAX +0.26%, FTSE +0.06%, ATX -0.61%, Swiss Mkt. +0.29% and Stockholm +0.51%.
A Look At Commodities
Crude oil is higher+1.10 to 93.79. Gold is moving this morning +12.00 to 909.70. Silver is +0.10 to 16.273, and copper is up +4.55 to 332.90.
The dollar index is down -0.462 to 75.524.
As of 8:45 AM EST, S&P and Nasdaq futures are higher by 10.2 and 22.5 respectively to 1418 and 1948.
On the Radar
Today's radar is light with no economic events scheduled.
Click here for the full trading radar.
Happy Monday, Minyans! Good luck!
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