Buzz Bits: Dow, Nasdaq Surge
Your daily Buzz & Banter highlights...
Thanks Scoop! - Todd Harrison - 3:38 PM
So, Elmer's on the tape offering that China has all the characteristics of a bubble. Raise your hand if you're having a flashback to the 'irrational exuberance" comments he made in 1996 (before the 100% rip that followed)? I don't profess to have insight on the timing although, so it's said, I agree with him on his conclusion. Therein lies the crux of the issue at hand: timing.
While I try not to dwell on regrets, I made a mistake this morning in not being more vocal with regard to the price action. Between Citi, UBS and Netbank--not to mention the quarter-end gamesmanship in the rear-view--the flat pre-market futures was all we needed to know as it pertains to underlying demand. You don't have to agree with it, you simply have to respect it. I'm all about the latter matter but failed to highlight it as I otherwise could have.
Be that as it may, the beauty of this business is that it offers opportunities at redemption on a daily basis. Along those lines, we tie up this meaty case of the Mondays with an eye towards S&P 1555 (defined risk), lethargic action in a bunch of betas (stealth supply with green screens?) and a wary eye towards non-confirmations (BKX, Trannies). Again, only hindsight will provide absolute clarity so we'll take these lessons in tow as we tie up the first fifth of this freaky week.
As always, I hope this finds you well.
Energy Drink - Adam Michael - 3:35 PM
I am at the IPAA Oil & Gas Symposium in San Francisco this week where many of the energy companies I follow are presenting. One of my favorites which I have written on extensively in the past (see archives) is BPZ Energy (BZP).
During today's presentation, BPZ said it expects to have 4,000 barrels of oil production by December coming from its Corvina field, which will ramp to 8,000 barrels by July 2008. This is very positive and significant news. Short interest is a huge 4 million plus shares in this stock and the bears have it wrong big time in my opinion. I will have more details to follow, hopefully tomorrow.
Position in BZP.
Digital Storage Names Worth a Look - Sean Udall - 2:10 PM
VMWare (VMW) is approaching $90 and it's not the only business in storage with good prospects going forward.
QLogic (QLGC): The stock is bouncing and has just retaken the 50-day ma. I like the large spread between the 50 and 200 dmas and I would use the 200 day as a resistance point to set up trades with. I still think the stock over-reacted to a missed quarter, but the miss was muted and business trends have been known to be lumpy for QLGC. Also, the stock pretty much pegged its long term support on recent sell-off. I started a QLGC position last week.
Network Appliance (NTAP): I've written a bit about this stock and I think it may have the best combination of growth for the price in the storage space. It is also tied into the virtualization game with VMW/EMC (EMC). 50 dma is currently serving as resistance. I think it becomes support in the not-too-distant future.
Finisar (FNSR) -- while maybe not known primarily for storage, FNSR has a suite of products for SAN monitoring, analysis and optimization. This is another stock that really got smacked on its last quarter and it just nudged guidance lower. Stock held multi-year support like QLGC and I think its business trends are strong longer term. With a $100 mln-plus possible settlement waiting in the wings (from DTV), the stock looks too cheap here and could play catch-up with the storage leaders.
Position in QLGC, NTAP and FNSR.
Between the Ticks - Jeffrey Cooper - 9:32 AM
- On Friday some go-to glamors such as Blue Nile (NILE) and Blue Coat Systems (BCSI) failed to rally out of classic pull back positions
- Deckers Outdoors (DECK) tailed off after tagging prior highs.
- Baidu.com (BIDU) should be interesting to watch today: it is coiled to pop out of a classic momentum pullback postion---will it follow through or leave a Hook, Line and Sinker sell signal?
- Despite the new highs in Garmin (GRMN) on Friday, apparently the distribution under the surface I thought I was noticing was some smart money as the stock is down 11 this AM following through on Friday's "tail".
Position in GRMN.
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