Two Ways To Play: Wal-Mart Fights For Your Rebate
Retailers slash prices to get a piece of the $117 billion pie.
According to Bloomberg, Wal-Mart (WMT) said it will cash tax rebate checks for free and cut prices on a number of its products this week as Americans begin to receive their rebate checks. The world's largest retailer will cut prices on key grocery items including shampoo, breakfast juice and others and will unveil additional rollbacks in the coming weeks to help shoppers stretch their dollars. This week Americans will be receiving $117 bln in tax rebate checks, and other retailers such as RadioShack (RSH), and Kroger (KR) have announced incentives of their own. See Professor Kevin Depew's Five Things You Need To Know:
From the Bull Pen: WMT is best-in-breed but the stock has had a 16% run in the last month. Bulls willing to ride the upside can set near-term sell-stops below $54. Another option may be Target (TGT); sell-stops may be set below $52.50.
From the Bear Cave: Bears see a downside play in Kroger (KR); buy-stops can be set above $26.60.
Visa Hit in After-Hours
Last night Visa (V) reported earnings for 2Q of $0.52 per share, $0.07 better than consensus estimates of $0.45. Revenues jumped 22% year-over-year to $1.45 bln largely inline with expectations. The company said growth would average 11-15% over the next three years with common earnings per share growth of 20% or greater and annual free cash flow in excess of $1 bln. But shares of the company were hit in after-hours trading due to extreme expectations and concerns on how the U.S. economy would affect the company's earnings going forward. For context, see Professor Andrew Jeffery's Visa Breaks IPO Record.
From the Bull Pen: Bulls welcome the pullback in Visa and can set sell-stops below $70.
From the Bear Cave: Bears can fade American Express (AXP) into $50 resistance with buy-stops above that level.
For more ideas, check out Minyanville's Spotlight Stocks.
Quick Check Around the World
Asian trading closed with the Hang Seng +0.97%, Sensex +2.13%, Taiwan -2.07% and Shanghai +1.40%.
A quick check of Europe finds the CAC -0.28%, DAX -0.43%, FTSE +0.16%,
As of 8:30 AM EST, S&P futures are lower -1.3 points to 1396, and Nasdaq futures are lower -3.25 points to 1923.
A Look At Commodities
In commodities, crude is down -1.46 to 117.25. Gold is lower -10.7 to 884.90. Silver is off -0.34 to 16.670, and copper is lower -1.75 to 391.80.
The dollar index is higher +0.339 to 72.840.
On the Radar
9:00 S&P/Case Shiller Home Price Index
9:00 S&P/Case Shiller Composite 20 y/y: -12.0% cons.
10:00 Consumer Confidence: 62.0 cons.
Click here for the full trading radar.
Good luck, Minyans!
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