Tag Archives: Banking stocks

Stocks to Focus for Monday, April 20, 2009

YOU make hay when it’s hot and sunny …. You make money when the markets are HOT!!!  The markets have been hot for the past few weeks … 

TaurusTrader portfolio had a great week ….  We were able to sell  6 positions for profit.  CMED (12.9%), AGU (10.7%), TNA (18.7%), WNR (15.3%) and GNK (18.0%) hit their profit targets.  GNK was sold on Friday (Apr 17) @ 18.50.  We added GNK on April 14 for $15.67 … that’s an incredible 18% profit in just 3 days!  WNR was also sold on Friday for $13.60.  WNR was bought on 3/17/2009 for $11.80.  During the week, we also liquidated 50% position in AMR for a 31.1% profit.  XRT was stopped out, but we still made >1% profit on the position.  All remaining positions advanced for the week.

By the end of the week TaurusTrader swing portfolio had positions in –  AMR (50%), FCN, HON, HSP, WDC, EXP, and FMX.

This coming week should be interesting as more and more companies stepping n to earning confession. 

BAC released Q1 earnings this morning …. it earned (EPS 0.44) more money in Q1 compared to all of last year!  Banking sector earnings look decent.  However, the threat of ‘stress test’ and lack of details there off, credit card defaults, and commercial real estate worries – are holding back any advance in stock prices. 

With the global economy showing signs of stabilizing, M&A activities have started to emerge. ORCL announced a $7.4 billion ($9.50 a share) deal to acquire JAVA this morning, triumphing over IBM  …. these are good signs.

For Monday … I’ll again be on the side line, but will be closely watching the technology, transport, and banking sectors for new opportunities.

Happy trading …

TaurusTrader

http://www.taurustrader.wordpress.com

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Stocks to Focus for Thursday – April 16, 2009

Wednesday’s recap:  What a mad dash to finish …. Stocks surged in the last hour before closing, lifting all three major indices from deep red to green.  

The last-hour surge pushed the Dow up 109 or 1.4%  to 8030.  The S& P 500 index rose 10.6 points  or 1.3%  to 852, and the Nasdaq snuck in to green with a final minute thrust and edged up 1.08, or 0.1% to 1627.   Crude 16 cents to settle at $49.25 a barrel, while gold was down $1.50 to $893.50 an ounce.

The impetus for the final hour turn around was provided by the observation in Federal Beige Book that economic contraction may be slowing down.  The market interpreted this as ‘the end is closer’ ….

TaurusTrader portfolio had a decent day.  AMR was one of the stars in today’s rally, hit it’s first target of $4.85 for a profit of 31.1%.  50% position in AMR was closed today.  For the remaining 50%, the second target is $6.50.  XRT was stopped @ $24.60 (stop moved up once), but still made over 1% profit.  AGU again came very close to hitting the profit target for the second day in a row.  FCN, HON, and EXP had decent gains.

Picks for Thursday, April 16:  An increasing stream of quarterly results from companies is likely to add to the market’s volatility.  Reports from JPM andGOOG on Thursday could reshape how investors feel about the financial and technology industries. Figures are also due on home construction and unemployment claims.

I’ll wait for reports from JPM and GOOG before committing fresh money on new picks.  However, if JPM reports a great quarter, and the market responds positively, I would buy FAS (Financial 3X long ETF) at around $9.50, and hope to ride the momentum till it hits $11.60.

I’ll also have following stocks on my radar for any swing trading opportunities:  WFC, MS, MELI, IPI, HP, TCK, and BX

That’s it for now …. Good luck trading.
TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Watch for Wednesday – April 15, 2009

Tuesday’s Market Recap:  Markets pulled back responding to unexpected poor retail sales data and also on worries about banks ahead of key earning reports.  Markets were in extremely overbought condition, and in my opinion, this pull back was needed. 

For the day, Dow lost 138 points or 1.7%, to close at 7920. The S&P 500 lost 17 points or 2%, to 841, while the Nasdaq shed 28 points or 1.7%, to 1626.   Crude fell 64 cents to settle at $49.41 a barrel, and gold lost $3.80 to $892 an ounce.

Financials led the stock market lower on Tuesday as investors brushed off an upbeat earnings by GS and focused on disappointing economic data.  Retail sales for March came in at -1.1%, far below the expected, a 0.3-percent increase.  Excluding the autos, sales fell 0.9%.  January and February sales figures were, however,  revised upward.  Still, the unexpected sharp drop spooked the market.  Meanwhile, the PPI dropped 1.2%.  Excluding food and energy costs, core PPI was flat.  Business inventories dropped 1.3% in February as expected.

A spirited speech by President Obama explaining the origin and nature of the economic crisis, and an all out effort by the administration to grow the economy – could not inspire the markets.  Similarly, Ben Bernake’s speech was also ignored despite his observation that “the economic decline is slowing down off late”

TaurusTrader portfolio closed a position for profit and added a new position.  CMED hit the profit target of $18.60 in the morning for a 12.9% profit.  AGU and AMR came very close to hitting target before retreating. Very volatile  TNA lost about 10% for the day.  Today’s pick, GNK was bought at $15.67.  The other pick, FAS did not activate the buy limit, hence was not bought.

Focus list for Wednesday:  Earnings and economic data will be the center of focus again on Wednesday.  INTC reported earnings of 11 cents a share after the close on Tuesday.  This beat the street expectation handily, but the shares were down in after-hours trading as the chip giant refused to provide an outlook.  The rail-road giant, CSX was up over 3% in the after hours trading following it’s better than expected earnings report.

On the economic front, the scheduled events for Wednesday include:  Weekly mortgage applications; NY Fed Empire State survey; CPI; industrial production; weekly crude inventories; NAHB housing index; Fed’s beige book.

Markets are still in a flux …. It is hard to predict the short term direction.  TaurusTrader portfolio has 12 open positions, and is well diversified.  I’ll be watching my positions with tight stops.  I do not want to risk more capital on new positions.  I’ll be happy to watch from the side lines, at least for now on Wednesday.

If there are questions, please do post ….

Happy trading …

TaurusTrader
http://www.taurustrader.wordpress.com

Week Ahead for Stocks – April 13 to 17, 2009

The coming week is filled with market moving economic and earnings data releases.  It would be interesting to see whether the momentum built upon WFC preannouncement would continue with other positive earning releases.  29 of S&P 500 companies, including 5 Dow components (highlighted in bold) are scheduled to announce earnings.  I would be watching the following releases intently:

  • Monday: JBHT, TLB
  • Tuesday:  FAST, GS, JNJ,ADTN, CSX, INTC
  • Wednesday:  ABT, SCHW, INFY, LUFK, BTU, PGR, CCK, KMP, LSTR, LLTC, STX
  • Thursday:  APH, BAX, BGG, GPC, ITW, JPM, NOK, NVR, PH, PII, SON, LUV, TITN, VIP, BIIB, GOOG, ISRG, SNDK, TK, WERN
  • Friday:  AOS, BBT, C, GE

Economic data:  Following economic data releases are scheduled:

  • Tuesday:  March producer prices and Retail sales
  • Wednesday:  Consumer price index, industrial production data for March, New York manufacturing survey, and housing market index for April, Beige book, Crude inventories
  • Thursday:  Housing starts, Jobless claims, Philly Fed survey, and Natural gas report
  • Friday:  Consumer sentiment from the University of Michigan, and Ben Bernanke speaks

For details on economic data releases, please refer to:   http://online.barrons.com/public/page/barrons_econoday.html

TaurusTrader portfolio:  To begin the week, the portfolio contains 12 positions.  All 12 have positive unrealized gains and some have have substantial accumulated profits.  So, I’ll be moving the ‘stop loss’ limit on these picks to protect profit and to reduce losses if the market turns against us.  The new stops are noted in “bold” in the following table. 

Stock

Bought on

Entry price

Stop

Target

4/9 close

Gain/loss (%)

WNR

Mar 17

11.80

11.85

13.60

12.95

9.75

AGU

Mar 19

37.50

34.50

41.50

38.47

2.48

AMR

Mar 16

3.70

3.55

4.85

4.52

22.16

FCN

Mar 12

47.80

45.15

52.00

48.48

1.42

HON

Mar 24

29.01

28.50

32.40

31.04

7.00

HSP

Apr 02

31.41

28.60

35.50

32.15

2.36

WDC

Apr 02

20.10

19.98

23.00

22.11

10.00

TNA

Apr 02

20.05

18.50

23.80

23.10

15.21

EXP

Apr 02

25.50

22.75

28.50

26.51

3.96

FMX

Apr 03

27.08

24.50

30.50

27.89

2.99

CMED

Apr 06

16.48

16.03

18.60

17.84

8.25

XRT

Apr 09

24.28

24.60

26.78

25.65

5.64

I do not have any picks for Monday … I’ll wait for a day or two and see how this earnings season would roll out. Per my previous post, I’ll not be day trading.  hence, will not provide any day trade picks for Monday also. 

If there are questions or comments, please do post …..

Have a great week and happy trading.
TaurusTrader
http://www.taurustrader.wordpress.com

Weekly Market Recap – April 06 to 09, 2009

Another incredible week …. five consecutive week of gains!!  The week however began on a negative note with a downgrade of prominent banks and a downbeat forecast for banking sector by Calyon Securities analyst Michael Mayo.  But the tides turned on Wednesday with the news of a $1.3 billion merger deal between home building giants PHM and CTX.  insurers also got a boost on a news that certain insurers might get help from the TARP moneys.  Thursday was a note worthy when Wells Fargo (WFC) preannounced a surprise forecast of $3 billion first quarter profit.  Stocks rallied across the board. 

For the week, the Dow was up 0.8%; the S&P 500 gained 1.7%, and the Nasdaq rose 1.9%.  Crude almost remained unchanged, but Gold lost a little luster (-1.4%). 

The volatility Index (VIX), otherwise known as the “fear index” sank below the 40-point mark for the first time since last September, 2008.

Index

Started Week

Ended Week

Change

% Change

YTD %

DJIA

8018

8083

65

0.8

-7.9

Nasdaq

1622

1653

31

1.9

4.8

S&P 500

843

857

14

1.7

-5.2

Crude

$52.51

$52.24

-$0.27

-0.5

17.1

Gold

$894.6

$881.7

-$12.9

-1.4

0.1

 

In TaurusTrader swing portfolio, we added 3 new positions – CMED, OMTR, and XRT.  Two positios – WFC and OMTR were stopped out.  Two recommendations, BCE and RRC did not hit the target buy price.   By the end of the week, TaurusTrader portfolio had following positions:

Stock

Bought on

Entry price

Stop

Target

4/9 close

Gain/loss (%)

WNR

Mar 17

11.80

10.95

13.60

12.95

9.75

AGU

Mar 19

37.50

34.50

41.50

38.47

2.48

AMR

Mar 16

3.70

2.80

4.85

4.52

22.16

FCN

Mar 12

47.80

45.15

52.00

48.48

1.42

HON

Mar 24

29.01

26.50

32.40

31.04

7.00

HSP

Apr 02

31.41

28.60

35.50

32.15

2.36

WDC

Apr 02

20.10

17.98

23.00

22.11

10.00

TNA

Apr 02

20.05

17.95

23.80

23.10

15.21

EXP

Apr 02

25.50

22.75

28.50

26.51

3.96

FMX

Apr 03

27.08

24.50

30.50

27.89

2.99

CMED

Apr 06

16.48

14.20

18.60

17.84

8.25

XRT

Apr 09

24.28

22.40

26.78

25.65

5.64

Picks stopped out

WFC

Apr 03

16.26

14.90

19.00

19.27

-8.36

OMTR

Apr 06

15.01

13.90

17.10

14.20

-7.40

Picks that did not trigger & dropped

RRC

Apr 06

46.04

43.20

50.50

42.72

dropped

BCE

Apr 03

21.77

19.90

24.50

20.90

dropped

Apart from these. TaurusTrader also has small open positions in WFC  (bought at $13.75), and MS (bought at $22.30).  These trades were discussed in my April 2 blog.

Next week is a heavy economic and earnings data driven week …. please trade cautiously.

If there are questions or comments, please do post …..

Have a great week and happy trading.

TaurusTrader

http://www.taurustrader.wordpress.com

Week Ahead for Stocks – April 6 to 10, 2009

It’s been great 4 weeks for the stock markets which saw 4 straight weekly gains. For Dow, this 4-week gain is the largest percentage gain since 1933.  The gains were widespread.  Nine out of 10 sectors in S&P gained, and the lone exception was health care which lost about 2%.   Nasdaq is now over 2% positive for the year.  There were some good news amidst several negative economic data that market ignored in anticipation that the bottoming process of economic downturn is imminent.  There are still concerns abound, especially with the housing, commercial real estate, unemployment, and of course the banks and their balance sheet.   Any bad news can pull the indices back down to earth easily.

Official earning season kicks off on Tuesday with Alcoa stepping in to earnings confession.  Earnings estimate for major companies have dropped significantly.  More than 70% of S&P companies are expected to post a decline in earnings compared to the past year.  So, the earnings season is a major concern for markets.

Around 30 companies are expected to report earnings this week.  I’ll be watching the following releases closely –

  • Monday:  APOG, BLUD
  • Tuesday: AA, BBBY, MOS, RT
  • Wednesday: STZ, FDO, GBX, SGR, WDFC, SMSC
  • Thursday:  CBK, MTRX
  • Friday: Market is closed for Good Friday.

For details on earnings calendar, please visit:  http://www.zacks.com/commentary/10514/Earnings+Preview+for+Apr+6+-+10

Economic Calendar: Following economic news might have impact on the markets –

For details, please refer to:   http://online.barrons.com/public/page/barrons_econoday.html

  • Monday: Fed Gov. Kevin Warsh speaks on Financial Markets.
  • Tuesday: Red book, Consumer credit data.
  • Wednesday: MBA purchase applications, Whole sale trade, EIA petroleum reserve data, FOMC minutes.
  • Thursday: Chain store sales, International trade data, Initial weekly jobless claims, Import-export prices, EIA nat gas report. Larry Summers speaks at 12 pm.  Money supply.
  • Friday: Treasury surplus.  Markets closed for Good Friday.

Picks for Monday, April 6: Markets have gone up too fast too soon.  No major data releases are scheduled, hence markets will have a calm day to digest past moves.  Weekend news events may influence a positive market open.  Ben Bernanke indicated that the credit markets may be thawing …. this is a good sign.  Also, the European banking giant, HSBC raised $17 billion in a largest ever rights offer in UK, which was well received.

As I complete this post, Asian markets are doing OK, and pretty much ignored North Korea’s Rocket launch and the following world condemnation.

I will keep the following stocks on my radar through out the week for possible inclusion in swing portfolio or for day trading opportunities:

KMB, COP, SGP, WAB, OMC, TTC, UL, HLF, TIE, WLL, MET, SII, HAIN, PTEN, AA, SD, HXL, OIS, EXM, ADM, PBR, SLAB, DRYS, MOS, MELI, FAS, BAC, MTH, IYT, ARO, FOSL, DZZ, and DIG.

If the stocks continue with their momentum to upside, I expect to see considerable downside potential for Gold (GLD, DGP) and Gold mining stocks (XME, GOLD, AUY).  So, watch carefully if you have any gold or gold mining stocks.

I’ll be looking to add the following to TaurusTrader swing portfolio on Monday:

  1. CMED – Buy above 16.48, stop $14.20, target $18.60 (very volatile)
  2. RRC – Buy above $46.04, stop $43.20, target $50.50
  3. OMTR – Buy above $15.01, stop $13.90, target $17.10 (very volatile)

Per my previous post, I’ll not be day trading.  hence, will not provide any day trade picks for Monday.

If there are questions or comments, please do post …..

Have a great week and happy trading.

TaurusTrader

http://www.taurustrader.wordpress.com

Stocks to Watch for Friday April 3, 2009

Thursday’s market recap: Another great day!  Even though it could not hold on to it  at close,  Dow breached 8000 mark for the first time since Febrauary 9.  Nasdaq is now positive for the year!  S&P somehow managed to hold above the critical 833 support level.

The Dow gained 216 or 2.8%, to close at 7978.  It had earlier gained as much as 314 points.  The S&P index gained 23 points or 2.9%, to end the day at 834. The Nasdaq rose 51 points or 3.3%  to close at 1603.

Crude rose $4.25 to settle at $52.64 a barrel, while gold fell $18.80 to $908.90 an ounce.

Traders were in buying mood.   Markets opened up nicely in the morning despite some negative data on jobless claims.  There were again small doses of good data that helped.  Banking sector had a some relief with FASB’s decision to relax mark to market rule on toxic assets.  Markets also liked the news coming out of G-20 meeting in London of heads of states.  G-20 leaders decided to fund IMF over $1 trillion to help troubled nations around the world, and also agreed to formulate stricter global regulation of financial institutions.  ECB lowered interest rate by 0.25%, to bring the rate down to 1.25%.  Factory orders posted a larger increase in February.  This news came on the heels of yesterday’s better than expected data on pending home sales, manufacturing activity and auto sales.

TaurusTrader’s swing portfolio had a nice day.  All 4 of yesterday’s picks – EXP, WDC, HSP, and TNA, were bought, and had decent  gains.

Focus list for Friday, April 3: There are signs to support that this rally may have more ‘juice’ left in the tank to run.  As I said in my earlier posts, small doses of good news have started coming in indicating that this recession has started to recede.  Benefits from innovative plans, at least some, put forth by the new administration appear to slowly seeping in to the economy.   CNBC’s Bob Pisani observed that mutual funds are getting back to the market to scoop up stocks.   Commodity prices are going up.  Copper just made a new 5-month high.  Copper is a good indicator of economic growth.  Similarly the transportation index, which went on a tear today!   I also expect that the Banking stocks to continue their momentum following the boost they got from Thursday’s favorable mark to market ruling by FASB.  RIMM reported exceptional quarter after Thursday’s close, and was up over 20% in aftermarket hours.  Folks, these are some good signs ….

However, we can’t let our guard down.   The optimism could be easily crushed if tomorrow’s jobs report surprise us with lousier than lousy expected data.  Economists predict  a loss of 654 K jobs in March, and unemployment rate  to rise to 8.5%,  from 8.1%  in February.

TaurusTrader swing portfolio picks for tomorrow, Friday April 3 are:

  1. FMX – Buy above $27.08, stop at $24.90, target $30.60
  2. BCE – Buy above $21.77, stop at $19.90, target $24.50
  3. WFC – Buy above $16.26, stop at $14.90, target $19.00

There are no day trade picks for Friday.

Please follow all trades with protective stops. The markets  may be kind to you,  but  it can turn against you any time unexpectedly!

Good luck trading.

TaurusTrader

http://www.taurustrader.wordpress.com