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Two Ways To Play: I'll Buy That For a Dollar!

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Strengthen your portfolio in good times and bad.

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Cheap Is In!

According to Bloomberg, stores that specialize in items that cost $1 or less are outperforming other US retailers as consumers shun high-priced goods in favor of cheaper alternatives. 99 Cents Only (NDN), Dollar Tree (DLTR) and Family Dollar (FDO) had the highest returns in the Russell 3000 Retail Index among companies with at least $1 billion in revenue.

99 Cents Only led the list with a 59% year-to-date gain (including dividends) through yesterday's close. Ranked fifth on the list was Wal-Mart (WMT), the world's largest retailer, with a 17% gain. This news comes as the International Council of Shopping Centers said yesterday that same-store sales rose at their weakest weekly pace since April.

For context on the economy, see Toddo's The Great Expression.

From the Bull Pen: The charts for these discount stores are compelling, especially when compared to luxury retail. But bulls looking to play these stocks should wait for a pullback. For Family Dollar, one option is to enter if and when the stock can fall to near the $24-$25 level.

From the Bear Cave: Is Sony (SNE) headed below $20 in the near future? Bears can set a tight buy stop above $23.


Quick Check Around the World

Asian trading closed with the Hang Seng -0.73%, Nikkei -1.29%, Sensex -3.08%, Taiwan -0.50% and Shanghai 0.84%.

Glancing towards Europe, we see the CAC 1.25%, DAX 0.80%, FTSE 1.36%

As of 8:20 a.m. EST, S&P Futures are trading -3 to 890, and Nasdaq futures are -10 to 1213.


A Look At Commodities

Crude oil is trading -1.07 to 58.26. Gold is -2.900 to 729.90. Silver is -0.185 to 9.620 and copper is -10.40 to 164.25.

The dollar index is +0.242 to 87.317.


On the Radar

Economics

07:00 Bloomberg Global Confidence
07:00 MBA Mortgage Applications
03:00 ABC Consumer Confidence

Click here for the full trading radar.

Good luck today!
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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