Buzz Bits: Dow and Nasdaq On the Rise
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Earnings Report - MV News
- Casey's General (CASY) reports $0.30 EPS vs. $0.26 cons on revs $1 bln vs. $1 bln cons.
- Spartech (SEH) reports 2Q $0.49 EPS may not be comparable vs. $0.47 cons on revs $377.4 mln vs. $396.55 mln cons.
Dizzy Miss Lizzy- Todd Harrison- 3:53 PM
The last five sessions have seen more swings than a Hedonism vacation, 20-handle bipolar whips with hard dips and sharp blips. One minute you're up half a million in soybeans and the next, BOOM, your kids don't go to college and they've repossessed your Bentley. It's crazy. It's stressful.
While the VXO is off 6% today, you don't have to be Black or Scholes to understand that volatility is back. My sense, and something we've been talking about all year, is that it'll continue through the rest of '07. That's good news for the disciplined set but, as many folks are finding out, it can be painful if you're a half a step slow.
I don't profess to know what the future holds but with my money, I remain choked up on my risk bat. I'm involved, mind you, just smaller and tighter than I have been during any point of my sixteen year career. Days like today make me feel silly for not playing bigger but, then again, it felt right as rain yesterday. Go figure.
In any event, the worlds most important stock will rock the house tomorrow morning so make sure you're comfy as Grandma Goldman sets the table. I'm not involved in the name but that's entirely alright. As I wrote this morning, you don't have to own financials to have exposure to the group.
I'm hoppin' as we've got a full plate post-market plate and then, well, I'm taking my best buddy of 20 years out for his birthday. Yep, President Fish is growing older as we speak and tomorrow we'll celebrate his 39 fruitful years. I am blessed to have people like that in my life and that's something that the market will never take away. Win, lose or draw.
Fare ye well into the bell and have a snazzy night.
Nat Gas Update- Adam Michael- 2:39 PM
- Southwestern Energy (SWN) – Up about 14%. It's a Fayetteville shale play. I still like this one.
- Ultra Petroleum (UPL) – Up about 7%. Love the asset, but it has exposure to big differential because of its Rocky Mountain location. Pass for now, I think you will see low 50's again.
- Carrizo (CRZO) – Up about 27%. Time to ring the register on this one.
- Teton (TEC) – Down about 6%. The company announced financing, another Rockies play, and there are too many negatives here. Move on.
- American Oil & Gas (AEZ) – Up 7%. Still the most speculative name with a possible significant company changing catalyst (soon) in Fetter well. I still like it, but this one is very risky.
Another large cap natural gas play I like, and should have included on my previous list, is Chesapeake Energy (CHK). You can't go wrong with strong management, and Aubrey McClendon is as good as they come.
Position in AEZ
More on steepening and trend lines...- Bennet Sedacca- 12:32 PM
From an intermediate perspective (the red line), I guess you could say the trend here is broken.
And while the green 'support' line is crudely drawn, you get the picture. Short term bullish.
Click to enlarge
But what about that white line?
If this were a stock would you buy it? I would...Especially as it pulls back today.
What is it? It is the spread between 2's and 10's. Yep, the steepening trade is ON.
Will it be a bear steepener like we've had (long rates rising faster than short rates) or a bull steepener?
Only my hair dresser knows...
Position in 10's
Morning Thoughts- Sally Limantour- 8:36 AM
- 4 ½ year high against the yen. Too much liquidity, not enough interest in US treasuries and inflation concerns are all causing the drudging in bond land. Concerns about mortgages and ARM's are prevalent and Countrywide Financial (CFC) said its foreclosure rate doubled in the year to May '07. Higher rates make corporate borrowing more expensive which is negative for the stock market.
- It looks as if the 30 year Treasury futures could be heading for the 2004 lows at 102.28. This is putting upward pressure on the dollar and downward pressure on gold. The gold market is holding the important 65 week moving average but it is getting close to testing it.
- The news the other day with New Zealand intervening in its currency market has some nervous that a wave of intervention amongst some of the world's leading banks may begin. This would be a warning sign for the carry trade unwind and could affect markets across the globe in all asset classes. It's something we need to listen to as this is a multi-year build up of strategies and coupled with higher interest rates could kill the golden goose.
- There is an article in FT today quoting Bill Gross (the "Bond King"). It is worth reading as it sums up the "conundrum" pointing out how globalization and financial innovation have favored corporations.
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