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Need to Know
JUNE 04, 2013
6 gut checks before the stock
market's opening bell
By Shawn Langlois
Good
morning.
Two trends enter, one trend leaves. Will Super Tuesdays make it 21 in a row
or is the Hindenburg Omen -- OK, it's more of a
signal than a trend -- about to blow the lights out on this rally? Something's
got to give.
In the early going, the Tuesday streak has the upper hand in the battle of
preposterous indicators, as stocks in the U.S. and around the world are
pushing higher. Perhaps the Omen and the June Swoon can team up to thwart the
streak.
Or maybe we can put all these ridiculous musings aside and focus on an
issue that invites only rational thinking, like when the Federal Reserve,
in its infinite wisdom, will start tapering. Some say June. Others, like Nouriel Roubini , are targetting 2015.
Goldman Sachs chief economist and Pimco's Bill Gross say it could be September .
Regardless of when Ben Bernanke and his minions finally decide to turn off
the spigot, we can at the very least find solace in knowing their actions
will have been for the greater good. Or at least the greater good of the wealthy . See,
much more sensible.
Key market gauges: Europe is clawing back in a big way from yesterday's
losses. The Nikkei also regained a big chunk of its nasty loss to
start to the week, adding 2.1% in another volatile session (more on that
below). Futures on the Dow and the S&P are showing signs
that the Tuesday trend could continue, with both teetering around the flat line .
The economy: CoreLogic provided more evidence of a rebound in
housing as prices rose 12.1% in April from a year ago, the fastest rate
since February 2006. In March, home prices climbed 10.5% from a year
earlier. Separately, the U.S. trade deficit climbed 8.5% to $40.3 billion
in April from a revised $37.1 billion in the prior month, as imports from
China surged after the end of a major holiday season in that country. Also
of note, two voting Fed members will speak during today's session.
The buzz: Intel is the top-trending ticker on
StockTwits after the company announced that it's setting up a $100 million fund to invest in
"perceptual" computing tech like voice and gesture control. Intel
also heralded in its next- generation chips in a bid
to revive the slumping PC market. The stock rallied 4% yesterday and
is now up almost 20% in the past three months. Other trending tickers
include Visa , BlackBerry and Aegerion Pharma .
Dunkin Donuts is headlining Google's business page this morning thanks
to the artery-busting debut of its bacon, egg and doughnut -- yes, doughnut --
sandwich . Not to fret, Dunkin' says it's only 360 calories;
though that would most definitely change if you were to substitute the
traditional glaze for, say, a maple sprinkle. As long as they don't lick them before they serve them to
you, why not? Remember the Burger King Mimosa? Me neither. Slideshow: 5 fast-food meals that redefine breakfast
.
Mark Pincus, the founder of Zynga , is also a hot topic after his company slashed its staff by 520 in a move that
caused the online gaming company to dump 12% of its value. It closed
under $3 a share but is sneaking past that level premarket. Here are some scenes of the aftermath , courtesy of
Buzzfeed.
Like Zynga, Pandora took a beating, down 10.6% on word of Apple's
latest online music potential. There's not much sign of a bounce,
either, though that could change if Josh Brown's idea of Amazon as a suitor pans out.
Things are looking a bit better for GM , with its shares up big premarket
after Standard & Poor's said it was bringing the stock back in the
S&P 500. GM was bounced from the index back in 2009 after the company
filed for bankruptcy.
The chart of the day: The whole point of central bank
intervention, according to this statement on Investopedia , is to
"mitigate the natural ups and downs of economic cycles." The
Sober Look blog posted this chart to show just how well that concept is working in Japan,
which hasn't seen this much volatility since Fukushima.
The
call of the day: "Investors should look for
a pacemaker to follow a less risky, lower-returning, but more
life-sustaining path," advises Pimco's Bill Gross in his latest investment outlook . He says
the Fed's plan assumes higher asset prices will spur growth, but that
"it doesn't seem to be working" because "more and more debt
cannot cure a debt crisis unless it generates real growth." Then he
says something about an "arrhythmic heart" and "deoxygenated
blood" but you can read the rest yourself. Read more about Bill Gross's grim diagnosis on The Tell
blog.
Random reads: Warren Buffett had better up his social-media
game if he wants to get on "The Top 50 Social CEOs on Twitter"
list.
"Toro, one more!" The life and times of Dear Leader's cherished sushi chef .
Google just put the kybosh on porn for its Glass store.
Good luck with that, as Max Rivlin-Nadler writes "of course, like all
technology, people will find a way to harness this power for pornography,
whether Google likes it or not."
It's no Hindenburg, but this is still a whopper of a boat-launch fail .
Is that Luigi or Mario? Take a nostalgic stroll through your video-game
childhood with the magic of Tetris and some
guy with lots of time on his hands.
What's another $2.5 million when it comes to love.
Especially when you're a famous Facebook billionaire and have already
spent $10 million on "a cottage, fake ruins, waterfalls, staircases
and a huge dance floor near iconic redwoods and a stream with threatened
steelhead trout."
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