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Before The Bell: Starbucks Needs A Jolt; More Brains From Intel


Schultz is wooing back customers; Big Blue gets wiser.

Morning Perspective: Starbucks Needs A Jolt

According to Bloomberg, Starbucks (SBUX) CEO Howard Schultz may attempt to boost sales by introducing a new loyalty program. Analysts say Schultz may offer free coffees or discounts to customers using prepaid cards in hopes of not losing them to competitors like McDonald's (MCD). The company has already begun to offer two hours of free AT&T (T) wireless internet access a day to customers using prepaid cards. Analysts also say that SBUX may lower prices on food and drink combinations to improve sales. The company recently said first-quarter sales growth slowed to 17%, it's slowest in two years. Professor Jeff Macke recently mentioned Starbucks in Snowed In Stock Picks.

From the Bull Pen: Professor Macke see upside potential in SBUX; sell-stops set below recent lows $16.77. He also likes MCD; sell-stops can be set below $52.

From the Bear Cave: Bears see a downside play in The CheeseCake Factory (CAKE); entry at $21.50; buy-stops can be set above.

More Brains From Intel

According to the Bloomberg, Intel (INTC) gave new details of its new generation of high performance chips. The world's largest computer-chip maker will sell semiconductors packing six processors built into one piece of silicon as soon as the second half of this year. The company's most advanced chip currently only has four processor, and analyst expect the new chip, called Dunnington, will win orders from rival Advanced Micro. Last year, Intel CEO Paul Otellini sped up the development of new chips after Advanced Micro (AMD) stole market share from the company in 2006. For context on the tech space, see Todd's Random Thoughts.

From the Bull Pen: Those bullish on INTC can play the upside with sell-stops below $20. Applied Materials (AMAT) is also an option; sell-stops can also be set below $20.

From the Bear Cave: Bears can play the downside in AMD; entry at $6.75 (50 DMA) with buy-stops above.

For more ideas, see Minyanville's Spotlight Stocks.

Quick Check Around the World

Asian trading closed with the Hang Seng +1.42%, Nikkei +1.50%, Sensex +0.16%, Taiwan +0.65% and Shanghai -3.96%.

A quick check of Europe finds the CAC +2.34%, DAX +2.46%, FTSE +2.39%.

As of 8:30 AM EST, S&P futures are higher by 18 points to 1297, and Nasdaq Futures are up by 21 points to 1716.

A Look At Commodities

Commodities are higher. Crude oil is up +2.29 to 107.94. Gold is higher +7 points to 1009.50. Silver is up +0.103 to 20.325, and copper is higher +5.8 to 377.00.

The dollar index is lower -0.232 to 71.222.

On the Radar

PPI (m/m): 0.3% vs. 0.4% cons.
Core PPI (m/m): 0.5% vs. 0.2% cons.
PPI (y/y): 6.4% vs. 6.8% cons.
Core PPI (y/y): 2.4% vs. 2.1% cons.
Housing Starts: 1065 k vs. 995 k cons.
Building Permits: 978 k vs. 1020 k cons.

2:15 FOMC Rate Decision: 2.0% cons
5:00 ABC Consumer Confidence: -30 prior

Click here for the full trading radar.

Happy FOMC Day! Good luck!
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No positions in stocks mentioned.

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