Tracked.com Topics

The NEW Tech Boom

By Taryn Cooper, at 5:48 pm on December 21st, 2009

Inevitably with the end of the decade near we’re going to hear about Top Ten lists ranging from television shows to albums and now with technology events, according to this post from Tech Republic.  No doubt, technology drove much of the economy over the past ten years, and it is far from bottoming out at this point.

At the end of the year 2000, we saw the tech bubble about to burst, and it’s almost literally come full-circle in this year.  Possibly the biggest the-more-things-change-the-more-they-stay-the-same story of 2009 was that AOL went public,  spinning-off from Time Warner officially earlier this month.

One of the most intriguing stories in tech-media is the advent of social networking sites.  I would love to see the statistics on it, but I am sure there is a high percentage of folks using MySpace, Facebook and Twitter on a daily basis, showing just  how much technology has evolved in the past 10 years.  In fact, an article came out today on Twitter, and how they are in-the-black since it’s 2006 inaugural year.  Remember how long it took tech-retail stalwart Amazon.com to return a profit in the early part of the decade?

Google has also done its part to change the face of technology as well, after going public in 2004.  They’ve been incredibly acquisitive, buying such “hot” technology properties as YouTube and AdMob.  Except for today, when Google almost announced a deal where they would acquire customer-ratings service Yelp.com, however the deal reportedly fell through at the last minute.

Ten years ago, no one had ever heard of “smart phones,” let alone owned one.  Mostly anyone who uses a cellular phone has some kind of  “smart phone” ability, mostly made by Research in Motion or Apple.  Motorola emerged as the Phoenix out of the ashes with its new Droid product this year, making the smart phone choices numerous.

At the end of 2000, websites were shutting down and the “old economy” was thumbing their collective noses at the idea of the “new economy.”  What we’ve seen however in the last ten years is that it’s not only resistant, it has evolved and looks like it is here to stay.  Most of us should be interested to see what is going to happen in the next ten years.

Tags: , , , , , , , , , , , , , , , ,

Wall Street Wrap

Wall Street Wrap – What a Difference One Number Makes – GDP

By Robert Perrego, at 5:05 pm on October 29th, 2009

Yesterday everyone was throwing the towel in, yours truly included.  Bill Gross from PIMCO was calling a top, Cramer on Mad Money was turning cautious, which given his naturally bullish direction says something.  The charts looked ugly with uptrend line breakdowns from Apple Inc. (NSDQ: AAPL) to Zix Corp. (NSDQ: ZIXI).  All seemed lost and the market rally we have been enjoying since March, was about to become the market we did not enjoy before last March.

Well GDP to the rescue! Last night when thinking about today’s GDP release I had two thoughts; 1) 3%, Really?, and 2) Ok, maybe we are coming off a lower base that could bounce back.  Also, Goldman Sachs Group Inc. (NYSE: GS) had just pulled their estimate down to 2.7% from 3%, and these guys usually get it right.  Well, maybe Randolph and Mortimer did not pay Beeks enough to get the numbers ahead of time, as the announcement at 8:30 this morning had Goldman with egg in their face for pulling their horns in just prior to a surprise upside beat – 3.5%!

The cash for clunkers program kicked into this number significantly as motor vehicle output added 1.66% to the 3.5%.  There was a lot of discussion about the fact that the ‘clunkers’ program pulled forward future purchases, so this 1.66% might be at the expense of Q4’s number.  Also, with 2% of this 3.5% attributed to stimulus spending, what do we have when those dollars run out?  Not to sound like a math whiz here, but that would be about 1.5%, and that is slow but better than nothing.

Once the GDP number came out the futures took off like a rocket.  Gold jumped as did oil, and just about the only thing that dropped was that pesky counter-trend dollar.  The Dow Jones Industrial Index closed up 199.89 (+2.04%, 9,962.58) while the S&P 500 beat all the major indexes gaining 23.48 points (+2.25%, 1,066.11).  The Nasdaq 100, the ‘tech trade’, added 29.21 points (+1.73%, 1,711.27).  Finance was the hot sector up 3.89%, with consumer cyclicals coming in second at  +2.84%.  Even with a 3% plus jump in the per barrel price of oil, the energy sector was only up 1.81%.

New York Spot Gold was up $19.40 an ounce (+1.89%, $1,047.10, 4:28 p.m.) as Newmont Mining Corp. (NYSE: NEM) reported their earnings were up 75% over last year’s same quarter number.  With gold above $1,000 for just about all of October, Newmont is most likely having a very good fourth quarter as well.

Nymex crude got back to its tricks jumping $2.41 a barrel (+3.11%, $79.97, 4:22 p.m.) as more growth means more energy demanded.  I would guess that it did not hurt that the dollar got hit as the PowerShares Bull Dollar ETF (NYSE: UUP) dropped 16 cents or 0.70% to $22.57.  The ‘risk trade’ is back on it seems, as the good GDP number seemed to hint it was safe to short the dollar and take those funds and buy the big banks, tech, developing markets stocks, gold, and just about anything other than bonds.  This ‘risk trade’ was being unwound over the last few days as the shorts being bought back in on the dollar caused it to rally off the bottom sharply.

If we get the ‘carry risk trade cowboys’ back en mass here, and they hammer away at this dollar, we could see higher highs for the indexes.  Note (not a pun) that by shorting the dollar and taking those funds to buy stocks, these risk ropers are creating money to trade with by increasing their leverage on funds invested as well as having a nominal price upward effect on stocks by decreasing the relative value of the dollar.  So, not only does the knocking down of the dollar create paper stock inflation, but the creation of the funds via margin and shorting creates more dollars technically and hence more inflation.  In the opposite, when this trade is unwound, the removing of this double edged liquidity causes more rapid drops.  An old saying on Wall Street goes; “Fear is stronger then greed”, and if they start to sell and unwind this dollar trade the move lower will be swift.  Stay on your toes.

Tags: , , , , , , , , , , , , , , , , , , , , , , , ,

Wall Street Wrap

Wall Street Wrap – The Selloff Gains Steam as The Dollar Rallies

By Robert Perrego, at 5:23 pm on October 28th, 2009

The inverse correlation between the dollar and the market continues to hold as the Dow Jones Industrial Average sold off 1.21% (-119.48, 9,762.69) while the PowerShares Dollar ETF (NYSE: UUP) gained 0.40%.  Leading the Dow 30 into the tank was Caterpillar, Inc. (NYSE: CAT) which dropped $2.26 (-3.98%, $54.43) as the Durable Goods report this morning missed expectations coming in at up 1% while expectations were for up 1.5%.  New Home Sales also disappointed (402K vs. 440 exp.) and the Dow Jones Industrial Index uptrend line, that has been in effect since the market bottom in March, was broken to the downside.

The Nasdaq 100 was the weakest of the three indexes, dropping 2.34% (-40.40, 1,682.06) as technology was hit hard.  Apple Inc. (NSDQ: AAPL) lost $4.97 (-2.51%, $192.40) as the uptrend line in effect for that stock since July 7th was broken today.  The next two support levels for Apple are $191 and $186.  Intel Corp. (NSDQ: INTC) broke its uptrend line in effect since February 23rd and also broke down through its 50 day exponential moving average (EMA) at $19.51, dropping $0.71 (-3.59%, $19.03) with minor support in the $18.60 area and gap support at $18.  The S&P 500 dropped 1.95% (-20.78, 1,042.63).

Since the market bottom on March 9th, the Dow has enjoyed a nicely confirmed uptrend line that was set by three points; the bottom, July 10th and October 2nd.  The close below the uptrend line on Monday was the first cause for worry, and yesterdays close below this line was a second day break, which is one indicator or confirmation the trend line would fail.  To technical analysts, today’s sell-off comes as no surprise and to those watching the dollar rally, today’s stock performance was expected.

As I have mentioned in many previous ‘Wraps’, the dollar bottomed out last Thursday and has been rallying since.  The major market indexes all peaked last Thursday and the S&P 500 has dropped 4.6% since.  The UUP has its 50 day EMA just above it at $22.84 as resistance while the Dow has its 50 day EMA just below it at 9,667 as support.  The S&P 500 has 50 day EMA support at 1047 while the Nasdaq 100’s was broken today (1,688 vs 1,682 close).

Going Down?

Going Down?

Bill Gross, a Managing Director at PIMCO, the largest bond fund in the world, called the market top yesterday in his monthly market commentary.  The big question is whether or not this is just another correction or is it a reversal in market trend and heading lower?  While the S&P 500 and Nasdaq 100 broke their longer term uptrend lines awhile ago, now with the Dow Jones Industrial Index break, all three indexes are showing weakness.  The Dow, which was most likely oversold in March, ran up 54% bottom to top, and that is a nice move.

The economic and fundamental reasoning behind the decline of the dollar was a $1.4 trillion current budget deficit, all the money spent and/or committed to attempt to haul the country (approx $12 trillion) out of recession and future spending programs being debated now in D.C.  These factors still exist and the longer term trend for the dollar could be lower, so if the relationship continues to hold, the stock market should find a bottom soon and head higher again.  This could all be nothing but ’stock inflation’ and not be creating real value as the drop in the dollar kills purchasing power while stock prices increase.  Given the choice between higher and lower stock prices, most people would choose higher.

The dollar rally hit gold and oil prices with New York Spot Gold dropping $11.90 an ounce (-1,14%, $1,027.70, 4:54 p.m.) and Nymex crude lost $2.09 a barrel (-2.63%, $77.28, 4:50 p.m.)

Remaining Economic Reports expected this week:

  • Thursday: 8:30 a.m. GDP (3.0%) and Jobless Claims (525K)
  • Friday: 8:30 a.m. Personal Income and Outlays (0.0%, -0.5%) and Employment Cost Index (0.5%), at 9:45 a.m. Chicago PMI (48.5) and at 9:55 a.m. Consumer Sentiment (70.0).

Tags: , , , , , , , , , , , , , , , , , , , , , , , , ,

News

Hunt for a Green October

By Mark Pason, at 5:37 pm on October 27th, 2009

October, the month of Halloween, has been anything but scary for a few tech titans.  Jeff Bezos, the Founder, Chairman, CEO and President of Amazon.com (NYSE:AMZN) is having quite a month so far.  In a time where many CEOs and Board Members own very little of their company’s stock, Bezos continues to put his money where his mouth is, still owning almost 22% of AMZN’s total shares outstanding.  As of Tuesday’s close, Bezos has made an October profit of $2.96bb.  Bill Gates, who owns a little over 8% of Microsoft (NASDQ:MSFT), through Cascade Investments, made a $2.6bb profit so far in October.  Steve Jobs who, surprisingly, owns less than 1% of Apple Inc. (NASDQ:AAPL) cleared only $91mm on his 5.5mm shares.

You will rarely find an executive who has his hands around the day-to-day operations of a company more than Jeff Bezos.  The fact that he owns 22% of the company is a real incentive for him to come to work with his “A” game each day.  One last note about Bezos.  He doesn’t sit on the board of any other public company.  Why waste time and energy at another company’s board meetings when you can be working on the next version of the Kindle, making your $11.5bb worth of AMZN stock worth just a little more?

Greenoctober

Tags: , , , , ,

News

Wall Street Wrap – Apple and the Dollar Jump, Caterpillar Creeps Back

By Robert Perrego, at 5:21 pm on October 20th, 2009

Apple Inc. (NSDQ: AAPL) handily beat earnings yesterday after the close and its stock jumped in thin after hours trading to as high as $204 a share.  Apple posted earnings of $1.82 to the $1.42 (analyst’s estimate), AND beat on revenues by $670 million, which is impressive as few companies are beating on both the top and bottom lines these days. We can give Apple the hat-trick and tip our hats here as not only did they beat analysts estimates for revenue and earnings, but they beat last years Q3 revenues ($7.9B) as they are expanding their business in a shrinking economy.

During the regular trading session today, Apple closed at $198.76 (+4.68%, +$8.90).

Dow Jones component Caterpillar Inc. (NYSE: CAT) had a good day after a surprisingly large earnings beat coming in at 64 cents a share vs. the analysts expected 6 cents.  This does not say a lot for the estimates put out by Wall Street.  The relative valuation of Caterpillar is getting a bit high if you look at the fact that they made $1.41 a share in Q3 2008 when the stock was trading in the mid 60’s.  Today, the company posts 64 cents and the stock closed at $59.61 (+3.04%, +$1.76), with a tax benefit that once you strip it out, the earnings would be about 43 cents a share.  On a relative P/E basis this makes the company 3 times as expensive today.

Overall the market was down as the Dow dropped 50.71 points (-0.50%, 10,041.48) and the S&P 500 dropped 6.85 points (-0.62%, 1091.06).  The Nasdaq 100 hung in there tough, dropping less than a point down only 0.49 (-0.02%, 1756.19) aided by Apple’s strength.  The weakest sectors today were consumer cyclicals down 1.37% and finance down 0.84%.  The tech sector was one of the few bright spots adding 0.32%.

Overall, the market was down as the recent trend of the market going opposite the dollar continues.  As mentioned in my Wall Street Wrap yesterday, the action in the dollar has been dictating where commodities and the stock market itself trade.  As the dollar gets weaker it takes more of them to buy a stock and it seems this is causing ’stock inflation’.  The PowerShares Bull Dollar ETF (NYSE: UUP) jumped 0.44% today (+$0.10, $22.46) as the market sold off, and the peak in intra-day trading of the UUP today at 11:45 a.m. (+0$0.16) was pretty close to the bottom in the Dow which was at 12:05 p.m. (-98.77).

Everything seems to be hinging on the dollar lately as Barron’s called for Bernanke to raise rates this weekend with their cover story.  The U.S. Government has pumped the economy liquid with dollars in response to the credit crash, and now with the dollar dropping, the amount of coverage this issue is getting seems to be non-stop.  Is all this media coverage and debate about the dollar, and what the Fed should do now, causing this liquidity and dollar issue to be so center stage that its impact is being overstated?  The stock market itself, it seems, is taking its cues from the dollar, where in the past commodities and commodity related stocks traded off the dollar through the inflation linkage.  Now, with the markets trading like a proxy inverse of the dollar, is this an implicit admission of the existence of ’stock inflation’ and of yet another bubble being pumped into the market via massive cash liquidity?

Earnings Scheduled for Tomorrow:  (AFFX, -0.09, after the close), (APD, 1.12, before the open), (ADS, 1.34), (MO, 0.47, bto), (AMGN, 1.27, atc), (CTXS, 0.41, atc), (CLB, 1.13, atc), (DST, 0.92, atc), (EBAY, 0.37, atc), (LLY, 1.02), (FCX, 1.35, bmo), (GENZ, 0.44), (KEY, -0.41, bmo), (KMP, 0.37), (NE, 1.53, atc), (PJC, 0.40, bmo), (STJ, 0.58), (BA, -2.12, bmo), (SWK, 0.62, bmo), (USB, 0.27, bmo), (WFC, 0.36, bmo)

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , ,

« Older Entries
Newer Entries »