Need to Know
MAY 14, 2013
6 gut checks before the stock market's opening bell
By Shawn Langlois
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Lamborghini
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Good morning.
It's been a record 177 days since we last felt a 5% correction. That includes 17 straight Tuesdays of Dow gains, which marks the best "day of the week" streak since 1968, when Wednesdays rose 24 in a row. Today could make it 18, especially now that cyclicals are joining the party .
At this point, you might be experiencing a stage-3 case of FOMO (fear of missing out ), which has left you desperately crunching numbers, sifting through stock filters and scouring trends in search of the next participant in this rally. How about Blyth ? The most shorted stock on the S&P 1,500 . It's down double-digits since April and is due for a Tesla-type squeeze, right? Maybe BlackBerry or Apple . Or Nokia, our call of the day. Good luck with those darts.
The bigger question is whether you should be dancing around the long side of this relentless market at all. For every tasty valuation nugget or chart drawing you in, up pops a warning sign designed to flummox and distract.
But, according to Mark Hanna of the Market Montage blog , "in times like this it is intellectually bankrupt to pretend it matters –- all that matters to this market is central bankers in every corner of the world uniting in driving up asset prices. Until something changes this market really only goes in one direction."
And when that changes, we're screwed, huh? No expertly-crafted investment approach can save us from life without sprinkles of Fed-infused honey kisses? Most pundits seem to be living in the moment but girding for a worst-case scenario, a race-for-the-door stampede that will leave investors picking their teeth off the floor.
Then there are guys like Scott Grannis, who is more worried about the Fed over-staying the course . "All things considered, there is nothing very scary going on," he wrote. "The only thing to be worried about is that the Fed fails to reverse QE in a timely fashion, since that could unleash a tidal wave of inflation."
Key market gauges: Futures on the Dow and the S&P are edging lower, after a mostly quiet session to start the week. Europe is sagging again, after last week's four-day buying spree, while Asia ended the day with a murmur, except for a 1.1% drop in Shanghai .
Crude futures are dropping below $95 a barrel, extending yesterday's declines after the International Energy Agency said strong oil production in the States is expected to outpace the demand in emerging markets. Read: Futures movers.
The economy: Philly Fed President Charles Plosser is in Stockholm this morning, saying the Fed should slow down its asset purchases now . Not doing so would undermine its vow to respond to improving economic conditions. If the economy keeps heading in the current direction, Plosser said purchases could end this year.
Separately, the National Federation of Independent Business reported its small-business optimism index rose 2.6 points to 92.1 in April to more than offset March's drop. Later, the import price index will be released at 8:30 a.m.
The buzz: Dan Loeb is calling for a breakup of Sony Corp. after his hedge fund accumulated a stake in the company. "So while Third Point supports your agenda for change, we also believe that to succeed, Sony must focus," Loeb wrote in his letter . The stock is up nicely premarket. Read more from The Tell .
Many have tried to unlock $SNE before and the company has been a fabulous destroyer of its own wealth.
— Jim Cramer (@jimcramer) May 14, 2013
"Scared as hell," JB Straubel has been a driving force behind Tesla's success, and the company is again a top trender. Short-sellers have been fleeing with what's left of their bearish bet, while there's an outbreak of strained shoulders among Tesla bulls from all that self- backpatting. Next stop, $100?
Joining Tesla on the StockTwits radar this morning are Under Armour , Priceline.com , and Lululemon . BlackBerry and Nokia will also be in the spotlight throughout the day. Read about their plans to rebuild their positions in the smartphone market.
The chart of the day: A guest on the Of Two Minds blog offered a stark commentary on cycles, time and choices we're facing. "So here we are, like those before us, warning of our own Great Depression, of our own World War, or of even larger cycles like the fall of the English, Spanish, or Roman empires," he wrote. "And so far as we can tell, few listen and nothing changes. Why? Because it isn't time. " He used this chart as an example of how poorly the mainstream media covered and will continue to cover historic shifts. Click here to see which time quotes the numbers represent .
It's been a record 177 days since we last felt a 5% correction. That includes 17 straight Tuesdays of Dow gains, which marks the best "day of the week" streak since 1968, when Wednesdays rose 24 in a row. Today could make it 18, especially now that cyclicals are joining the party .
At this point, you might be experiencing a stage-3 case of FOMO (fear of missing out ), which has left you desperately crunching numbers, sifting through stock filters and scouring trends in search of the next participant in this rally. How about Blyth ? The most shorted stock on the S&P 1,500 . It's down double-digits since April and is due for a Tesla-type squeeze, right? Maybe BlackBerry or Apple . Or Nokia, our call of the day. Good luck with those darts.
The bigger question is whether you should be dancing around the long side of this relentless market at all. For every tasty valuation nugget or chart drawing you in, up pops a warning sign designed to flummox and distract.
But, according to Mark Hanna of the Market Montage blog , "in times like this it is intellectually bankrupt to pretend it matters –- all that matters to this market is central bankers in every corner of the world uniting in driving up asset prices. Until something changes this market really only goes in one direction."
And when that changes, we're screwed, huh? No expertly-crafted investment approach can save us from life without sprinkles of Fed-infused honey kisses? Most pundits seem to be living in the moment but girding for a worst-case scenario, a race-for-the-door stampede that will leave investors picking their teeth off the floor.
Then there are guys like Scott Grannis, who is more worried about the Fed over-staying the course . "All things considered, there is nothing very scary going on," he wrote. "The only thing to be worried about is that the Fed fails to reverse QE in a timely fashion, since that could unleash a tidal wave of inflation."
Key market gauges: Futures on the Dow and the S&P are edging lower, after a mostly quiet session to start the week. Europe is sagging again, after last week's four-day buying spree, while Asia ended the day with a murmur, except for a 1.1% drop in Shanghai .
Crude futures are dropping below $95 a barrel, extending yesterday's declines after the International Energy Agency said strong oil production in the States is expected to outpace the demand in emerging markets. Read: Futures movers.
The economy: Philly Fed President Charles Plosser is in Stockholm this morning, saying the Fed should slow down its asset purchases now . Not doing so would undermine its vow to respond to improving economic conditions. If the economy keeps heading in the current direction, Plosser said purchases could end this year.
Separately, the National Federation of Independent Business reported its small-business optimism index rose 2.6 points to 92.1 in April to more than offset March's drop. Later, the import price index will be released at 8:30 a.m.
The buzz: Dan Loeb is calling for a breakup of Sony Corp. after his hedge fund accumulated a stake in the company. "So while Third Point supports your agenda for change, we also believe that to succeed, Sony must focus," Loeb wrote in his letter . The stock is up nicely premarket. Read more from The Tell .
Many have tried to unlock $SNE before and the company has been a fabulous destroyer of its own wealth.
— Jim Cramer (@jimcramer) May 14, 2013
"Scared as hell," JB Straubel has been a driving force behind Tesla's success, and the company is again a top trender. Short-sellers have been fleeing with what's left of their bearish bet, while there's an outbreak of strained shoulders among Tesla bulls from all that self- backpatting. Next stop, $100?
Joining Tesla on the StockTwits radar this morning are Under Armour , Priceline.com , and Lululemon . BlackBerry and Nokia will also be in the spotlight throughout the day. Read about their plans to rebuild their positions in the smartphone market.
The chart of the day: A guest on the Of Two Minds blog offered a stark commentary on cycles, time and choices we're facing. "So here we are, like those before us, warning of our own Great Depression, of our own World War, or of even larger cycles like the fall of the English, Spanish, or Roman empires," he wrote. "And so far as we can tell, few listen and nothing changes. Why? Because it isn't time. " He used this chart as an example of how poorly the mainstream media covered and will continue to cover historic shifts. Click here to see which time quotes the numbers represent .
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Colin Seymour
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The call of the
day: Nokia is hosting an event in London to showcase its latest
Lumia smartphone. Seeking Alpha's Abu Bakr Hussain said "several exciting
new entrants" this week will make good on the CEO's promise of new
products and provide "a welcome boost to Nokia investors who are well
used to a roller coaster ride watching the stock." In the medium term, he
said he sees the stock breaking through $5 a share
. Hussain is not alone with a bull call on Nokia heading into this week.
Richard Oldfield of Oldfield Partners named the stock as one of his two long ideas at the London Value
Investor Conference. He said capitulation for the stock is nigh.
Random reads: Looking for a professional "date"? Don't bother with LinkedIn . It's not like World War II, when "a comfort women system was necessary ," right Toru?
Angelina's op-ed on why she had a preventative double-mastectomy . "My doctors estimated that I had an 87% risk of breast cancer and a 50% risk of ovarian cancer."
Wired calls the concept Lamborghini Egoista "unsufferably psychotic, wholly insane, impractical to a fault" and that it "revels in its own decadence and depravity." You know, "just what a supercar should do."
I stink at this game -- never was that good at geography -- but it still got its hooks in me. Barely got this blog out. Didn't help that Google is marking the 37th anniversary of Breakout with a time-suck of its own .
Need to Know starts early and is updated as needed until the opening bell, but sign up here to get it delivered once to your e-mail box. Be sure to check the Need to Know item. The e-mailed version will be sent out at approximately 8:45 a.m. Eastern. Follow @slangwise on Twitter.
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Random reads: Looking for a professional "date"? Don't bother with LinkedIn . It's not like World War II, when "a comfort women system was necessary ," right Toru?
Angelina's op-ed on why she had a preventative double-mastectomy . "My doctors estimated that I had an 87% risk of breast cancer and a 50% risk of ovarian cancer."
Wired calls the concept Lamborghini Egoista "unsufferably psychotic, wholly insane, impractical to a fault" and that it "revels in its own decadence and depravity." You know, "just what a supercar should do."
I stink at this game -- never was that good at geography -- but it still got its hooks in me. Barely got this blog out. Didn't help that Google is marking the 37th anniversary of Breakout with a time-suck of its own .
Need to Know starts early and is updated as needed until the opening bell, but sign up here to get it delivered once to your e-mail box. Be sure to check the Need to Know item. The e-mailed version will be sent out at approximately 8:45 a.m. Eastern. Follow @slangwise on Twitter.
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