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Need to Know
MAY 08, 2013
6 gut checks before the stock
market's opening bell
By Shawn Langlois
Good
morning.
Sir Alex Ferguson once said, "It's getting tickly now -- squeaky-bum
time, I call it." The retiring Manchester United manager was
talking about soccer, of course, but he could have just as easily been
referring to this market.
The Dow just blew through 15,000 for the first time, while hardly anybody
even notices the S&P's daily assault on the record books anymore.
Tuesdays are even getting into the act, having notched their 17th straight rally . We need
someone to put this in perspective, right Josh Brown?
"If anything, too much perspective has been driving people out of
their minds," the Reformed Broker blogger wrote .
"Everyone has their perspective, whether you've asked for it or not.
What you probably need is less perspective, or should I
say more perspective from people whose perspective has been helpful."
Alas, we're in the business of perspective, so let's get on with the show.
We have Nouriel Roubini saying we could be in store for a big crash over the next two years.
Then we get MarketWatch's Mark Hulbert and Charles
Passy telling us about the inconvenient truth of inflation
and what 15,000 really means to you .
Brown: "Enough already. Just stop it."
OK, fine. Not sure if this last bit here qualifies as perspective, but here
it goes anyway: Money has flowed out of equities for six years in a row,
according to numbers crunched by J.P. Morgan. SIX. More than $580 billion
has moved out of stocks during that time, yet here we are, reluctantly
dragged to new highs in what's been dubbed "the most hated rally
ever." Such a move has one blogger blurting out: WTF! (meaning
"watch the flows," of course). More on this from the chart gut
check below.
Key market gauges: The Nikkei is at it again, closing
up almost 1% after yesterday's 3.6% push to five-year highs. This time, the
rest of Asia kept pace. Europe is following up with some gains
of its own, though it's mostly a tepid advance for the region. Futures on
the Dow and the S&P aren't showing much just yet, but they
look poised to avoid a reversal after the recent batch of gains.
Earnings: Tesla headlines today's earnings
roundup, with investors looking for updates on deliveries, gross margin,
and maybe a little something about where the company stands on the Model X.
Good things are expected considering just how much the
stock has rallied in recent weeks. AOL , Green Mountain Coffee Roasters ,
Groupon and our parent News Corp. all report throughout the
day. Read: Stocks to watch .
The buzz: Yahoo is drawing attention on Google's
business pages on a report that it's trying to worm its way out of its Web-search
pact with Microsoft . That and word that it could be in talks to buy Hulu . Either
way, the stock is up more than 1% premarket. J.C. Penney , after its warning of a first-quarter slump , is
also drawing clicks in the early hours.
On StockTwits, video-game maker Electronic Arts is trending after the
company posted a drop in fourth-quarter earnings . The
good news is that the company will enter the post-Alex Ferguson era as a partner with FIFA through 2022 .
Abercrombie & Fitch has the hive buzzing in hopes that the stock
can keep its bullish momentum going through its monthly sales tally due Thursday.
Shares rallied more than 6% in yesterday's session.
The chart of the day: This factoid may or may not surprise
you. As mentioned, stocks have hit these all-time highs even as money has
been pouring out of equities. The Kimble Charting Solutions blog offers
up this compelling breakdown of the trend, and asks the question,
"what would happen to stocks if they would experience only part of the
$1.3 trillion of bond inflows have seen over the past six years?"
The
call of the day: Citi is running a series of
interesting takes in which analysts compare major global competitors. The
most recent one hits close to home as Walter Pritchard says Oracle is
the pick over rival SAP . He took a look at 12 categories and concluded
that Oracle takes eight of them, including valuation, margin expansion
potential, and m&a capacity. It hasn't played out that way in the
past year though, as SAP stock has easily outperformed Oracle. Disclosure: My wife
is a long-timer at Oracle, and I own shares in my retirement account.
Random reads: Rush Limbaugh, that cuddly ball of reason,
unbiased righteousness and sensitivity, unloads on Lauryn Hill for her
slavery comments.
Remember that amazing, made-for-the-big-screen diamond heist
in Brussels? Well, they caught the guys -- 31 of them anyway .
Mom always said stay away from those heavy metal guys .
Can you claim a score of 55 or more on Klout? If so, you may be entitled to some free wi-fi and beer
in American Airlines's first-class lounge.
Before the gum-chomping Manchester United general called it quits today,
The Roar explained why he's the best of the best , saying
"you might see another Pele, Maradona and Messi but I doubt if anyone
will see the next Sir Alex Ferguson."
While we're on the subject ... "A game is just a game, but when
the game in question is European soccer, it tends to be viewed as a
Rorschach test for the health and confidence of nations." In other
words, Germany wins , says Angela Merkel.
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