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Need to Know
JULY 10, 2013
6 gut checks before the stock market's
opening bell
By Shawn Langlois
Good
morning.
Stocks aren't showing much in the predawn U.S. hours, but, one way or
another, the Fed minutes will probably change all that by midday.
Then again, incessant taper talk seems to be losing its all-consuming hold
on markets as traders warm up to the recent batch of good economic news and
the prospects of a better-than-expected stretch of earnings.
If the bears don't have the taper to cuddle up to, what do they have? Well,
not a whole lot at this point. "All the world loves a lover, and all
the world hates a bear," says Slope of Hope blogger Tim Knight . "It's
never easy being the ursine type in this world, but I'm truly starting to
believe that it's worse than ever."
Along with those betting on the death of this bull run, he's hoping that
the Fed minutes lead to a tipping point for the market. "As
disappointed as I've been over the years," Knight says, "I'm not
counting on it." But judging from the reaction we've seen the last three times minutes were released
, maybe he should turn that frown upside down. In each case, traders took
the Fed's yellow flag as a reason to unload stocks.
Key market gauges: Both Japan's Nikkei and South
Korea's Kospi fell after China reported a 3.1% year-on-year drop in
June exports and a 0.7% contraction in imports. The Shanghai Composite ,
however, managed to shake off early losses, riding financial and
real-estate stocks to a 2.2% gain. Read: China stocks rise despite trade data; Japan
drops .
Europe is flip-flopping around the breakeven
point this morning. The same thing looks to be in store for U.S. markets
when they open. Futures on the Dow and the S&P are barely lower.
Meanwhile, the dollar is back off from yesterday's three-year high
against the pound, while gold is getting ready for some Fedspeak with
a small gain .
The economy: Economists will tear into the minutes from the
Fed's last meeting at 2 p.m. Eastern, scouring for clues as to the timing
of the tapering plans. Then, Ben Bernanke will speak to a bunch of
economists shortly after the stock market closes. We'll see how much
forward guidance comes out of a speech about the Fed's first 100 years. He
will also take questions at that point. Read: Spotlight on economy .
The buzz: The "Gigli"-ification of "The
Lone Ranger" has Disney drawing clicks. After an abysmal showing
that saw the $250 million-ish mega-budgeted Johnny Depp vehicle bring in
less than $50 million over five days, Disney is left with a potential $100-million write-down for
the fiscal fourth quarter. While reviewers, pro and armchair alike,
eviscerate the film, investors don't seem to mind. Disney shares are up 30%
this year, including a 1% gain this week.
The Lone Ranger got his name from going to the theater and watching
"The Lone Ranger".
— Beth Armogida (@BethArmogida) July 8, 2013
Nu Skin is one of the big premarket movers, with shares adding 14%
after the anti-aging skin-care company raised its outlook thanks in large
part to the demand rush it's seeing from China. Heading in the other
direction, Fly Leasing shares are taking a hit after the
aircraft-leasing firm said it would sell up to $160 million worth of shares
in a secondary offering. Read: After hours .
Facebook is seeing a spike in attention on StockTwits, where it seems
to be winning back some fans. Still, bullish sentiment is at a lowly 61%,
compared with 86%-plus for fellow top-trending tickers Netflix and
Hewlett-Packard . Citi just initiated coverage of Facebook with a neutral rating . And an upgrade
from Citi is helping to boost H-P shares almost 3% premarket.
The chart of the day: Old-school tech companies have enjoyed
a renaissance during this bull market, but Greg Harmon of Dragonfly Capital
points to one stock that's been sitting fully clothed on the
couch during this "retro orgy". Citrix Systems
has been hurting but it has put in three legs of a
"double-bottoming W pattern" and is "working on that last
leg," Harmon wrote. The stock is down at $64.16 and it completes the
"W" at $82. Furthermore, the relative-strength index and the
moving-average convergence/divergence indicator are also bullish.
The
call of the day: Yelp shares jumped 7%
yesterday on word of its food-delivery service launch , and
that's just the beginning, according to The Fly. "This is one of those
press releases that will be forgotten in a few days or weeks, then permeate
greatness into the company for years, similar to the day Apple announced
iTunes," he wrote. The Fly previously sold his position but, in light of
the news, plans to buy it back. "I can't think of a social media stock
that is killing it like Yelp," he says. "I am going to stalk this
stock like a creepy serial killer hiding in the shrubs."
Speaking of Apple , CNET bids a happy fifth birthday to the Mac
maker's app store by saying "you're great, now change."
Random reads: Score one for the hard-line pro-lifers.
They just found a new poster child in a raped 11-year-old who wants to have the
baby because "it will be like having a doll in my arms." Much too
gloomy for this gut check. Let's switch to dueling Hoffs.
So, it turns out Dustin Hoffman has ignored countless ugly women in his
life. This post-Tootsie epiphany video went viral
this week -- 2.1 million hits and counting, at last check. Touching, sure,
but it doesn't even come close to reaching the emotional pitch of this inspiring ode to iced coffee ,
courtesy of the other Hoff.
The biggest rip-off in travel is about to end with free hotel Wi-Fi becoming the industry standard . Yet a
shocking 36% of hotels STILL don't offer it.
Manchester United gets its tweet on , as the last of the 20
Premier League football clubs to open an official Twitter account.
Unparalleled access, exclusive content…we've got it all. pic.twitter.com/XHzpWkfjTr
— Manchester United (@ManUtd) July 10, 2013
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