Today’s Market

Today was a strong day for energy, and a crummy day for most everything else. The price of crude oil jumped over $2. The S&P 500 lost -0.24%, while our Buy List dropped -0.30%. Nine of our stocks were up, fifteen were down, and Dell (DELL) was unchanged. Expeditors International (EXPD) closed at a new 52-week high. What a great stock! Varian Medical Systems (VAR) is also at a new high. The stock has been our top-performer for the month, rising nearly 15%. Financial services are my first true love. Health care stocks are more of a friend with benefits.
The two big drags on our Buy List were eBay (EBAY) and Frontier Airlines (FRNT). eBay was hurt by the announcement from Google (GGOG) of its new Google Base service. According to the WSJ:

Google Base would let users submit information to a searchable Google database, according to a page posted at base.google.com that was available briefly on Tuesday.
In the Web page, Google cites “description of your party planning service,” “listing of your used car for sale,” “articles on current events from your website” and “database of protein structures” as types of content that a user could submit. Several Web logs also carried an image of another Google Web page that contained a form for entering information such as price, property type, and photos, presumably for listing real estate for rent or sale.
Google in a statement described the service as “an early-stage test of a product that enables content owners to easily send their content to Google.” It said it didn’t have anything further to announce about it. Google confirmed the screenshots posted on blogs were legitimate.
The existence of Google Base heightens anticipation of the Mountain View, Calif., company’s long-expected entry into direct competition with online auctioneer eBay, which also owns a minority stake in classified listings site Craigslist Inc.

eBay might be weak tomorrow due to Amazon’s (AMZN) lousy earnings. The company’s profits dropped from $54 million to $30 million, although sales rose 27%. The reason for the bad earnings was a $40 million legal charge. The company settled a patent-infringement suit with Soverain Software LLC. Even without the charge, Amazon’s earnings would have dropped. This has been a theme for Amazon for the past few quarters–higher sales, lower profits. I’ve always believed this company has been overhyped.
Tomorrow, three of our Buy List stocks report earnings, Zimmer Holdings (ZMH), CACI International (CAI) and Varian Medical (VAR).
Perhaps the most underreported story today is that the 10-year Treasury bond yield closed over 4.5% today, the highest in seven months. I didn’t see anything on CNBC about this. Also, the two-year Treasury note is about to make a four-year high. Here’s a chart of the 10-year yield since April. The message is that money is leaving stocks and bonds and is going into gold and other hard assets.
10-Year.bmp

Posted by on October 25th, 2005 at 5:11 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.