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Before The Bell: Dell Continues Restructuring; Wal-Mart Coffee


Wal-Mart is targeting the socially conscious, economically challenged consumer.

Morning Perspective: Dell Restructuring Continues

Yesterday after the bell, computer maker Dell (DELL) said it planned to cut product costs and shut down its desktop manufacturing facility in Austin, Texas. According to Dow Jones, the company said the move will allow the company to better focus on its global consumer, enterprise, notebooks, small and medium enterprise, as well as emerging markets areas. The company also said it will cut at least 8,800 jobs on top of the 3,200 cuts it has made over the last nine months. Further, Dell expects to achieve a saving of about $3 billion over the next three years and realize benefits as early as the second half of the current fiscal year. Todd mentioned Dell recently in Ten Tips For A Tough Tape.

From the Bull Pen: Bulls believe Dell will continue to fall victim to Hewlett Packard (HPQ). Sell-stops on HPQ can be set below recent lows ($43.20).

From the Bear Cave: Bears can play the downside in Dell; buy-stops above $20.

Green Wal-Mart Coffee

Reuters reports Wal-Mart (WMT) will sell its own line of private-label coffees beginning this month. Six coffees under the Sam's Choice brands will be sold in all of its stores in the U.S. In addition, the coffees will be labeled Rainforest alliance, and fair trade certified in an effort to appeal to the growing market of the socially conscious consumer. These coffees will be required to pass through specific economic, social, and environmental standards that target long-term sustainability. Further, the coffees will also be priced at $5.88 for a 10-12 ounce bag in hopes of appealing to consumers faced with higher fuel costs and more challenging economic conditions. Professor Michael Paulenoff mentioned Wal-Mart recently in A Winning ETF Trade.

From the Bull Pen: Those bullish WMT can play the upside; sell-stops can be set below the 50-DMA ($50.21).

From the Bear Cave: Bears can look elsewhere for a downside play such as J.C. Penney (JCP). Entry may be near $40 with buy-stops above $42.

For more ideas, see Minyanville's Spotlight Stocks.

Quick Check Around the World

Asian trading closed with the Hang Seng +1.26%, Nikkei +1.04%, Sensex -0.11%, Taiwan -1.78% and Shanghai -4.13%.

A quick look across the pond finds the CAC +1.86%, DAX +1.87%, FTSE +1.27%

As of 8:30 AM EST, S&P futures are higher +13.40 to 1337, and Nasdaq futures are up +21 points to 1812.

A Look At Commodities

Commodities are mixed. Crude oil is lower -0.59 to 101.00. Gold is lower -17.60 to 898.60. Silver is down -0.30 to 17.020, and copper is off -10.95 to 375.40.

The dollar index is higher +0.389 to 72.191.

On the Radar


10:00 ISM Manufacturing: 47.9 cons.
10:00 Construction Spending (m/m): 47.9 cons.
10:00 ISM Prices Paid: 71.5 cons.

Click here for the full trading radar.

Don't get fooled today! Good luck!
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No positions in stocks mentioned.

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