Morning News: March 29, 2013
Posted by Eddy Elfenbein on March 29th, 2013 at 7:20 am

Cyprus President Confident Crisis ‘Is Contained’

Norms on Baguette Size to Windows Choking France, Report Says

Japan’s Jobless Rate Up To 4.3%; Prices, Manufacturing Fall

Cyberattacks Seem Meant to Destroy, Not Just Disrupt

Economy Up 0.4% in Fourth Quarter

Jobless Claims Rise, But GDP Data Shows More Growth

U.S. Clean-Gasoline Rule Opposed by Oil Group Said Near

Amazon Buys Book-Recommendation Site Goodreads

Sprint Nears a U.S. Deal to Restrict China Gear

Amazon, Overstock Lose Challenge to N.Y. Web Sales Tax

Underappreciated Consumer Stars In S&P 500 Rally

Should the Government Finance New-Energy Technologies?

Is Steven A. Cohen Buying Off The U.S. Government?

Joshua Brown: The Lurkers of Wall Street

Phil Pearlman: 2nd Quarter Outlook: Waiting for Godot…

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We’re an All-Time High
Posted by Eddy Elfenbein on March 28th, 2013 at 4:01 pm

1,569.02.

Q4 GDP Growth Revises to +0.4%
Posted by Eddy Elfenbein on March 28th, 2013 at 11:33 am

When the initial report on fourth-quarter GDP came out, Wall Street was shocked to learn that it was -0.1%. The economy actually got smaller. One month later, the report was revised to +0.1%. Today it was revised again, this time to +0.4%.

Morning News: March 28, 2013
Posted by Eddy Elfenbein on March 28th, 2013 at 11:08 am

S&P 500 Breaks Above Record High

Jobless claims rise, but GDP data shows more growth

Angry Cypriots withdraw bank deposits

US economy grew at 0.4 percent rate in 4Q, slightly better than last estimate

OECD predicts stronger global growth

RIM Swings to Black, Sells a Million Z10s

Duncan Hines parent Pinnacle’s shares jump in market debut

Freddie Mac: 30-year fixed mortgage rate at 3.57%, up slightly

Red Hat Drops After-Hours
Posted by Eddy Elfenbein on March 27th, 2013 at 5:37 pm

Last month, I listed eleven stocks to sell right now. One of the eleven was Red Hat ($RHT).

At the time, Red Hat was going for $55.33 which I thought was very over-priced. The stock closed today at $49.97. But after the close, the company reported earnings of 36 cents per share which was six cents more than expectations. Revenue, however, fell short of expectations.

In after-hours trading, the stock was as low as $42.80 although it’s currently down 5.4% to $47.28 per share.

Riverbed Technology Below $15
Posted by Eddy Elfenbein on March 27th, 2013 at 3:27 pm

Riverbed Technology ($RVBD) recently gave guidance that didn’t impress investors. As a result, the shares have dropped down to a good price. The company sees Q1 earnings between 23 and 24 cents per share on revenue of $257 million to $266 million.

Here’s how Riverbed describes itself:

Riverbed delivers application performance for the globally connected enterprise. With Riverbed, enterprises can successfully and intelligently implement strategic initiatives such as virtualization, consolidation, cloud computing, and disaster recovery without fear of compromising performance. By giving enterprises the platform they need to understand, optimize and consolidate their IT, Riverbed helps enterprises to build a fast, fluid and dynamic IT architecture that aligns with the business needs of the organization.

Here’s a look at RVBD’s stock along with its earnings-per-share:

The Shrinking Stock Market
Posted by Eddy Elfenbein on March 27th, 2013 at 12:19 pm

Since 2000, the U.S. stock market has been shrinking. USA Today has some numbers:

The Wilshire 5000 index is a market measure of all the U.S.-based firms that have shares that can be traded. For decades, it’s been a proxy for the size, breadth and value of the entire stock market.

But even the Wilshire 5000 can’t maintain enough companies to reach its namesake number. There now are 3,678 companies in the index, is down by more than a third in a decade and off by nearly half from its level in 2000, says Wilshire Associates.

The number of publicly traded companies always ebbs and flows, but the current number has fallen steadily since at least 2000. At 3,678, the number of companies available for the public to invest in is much closer to the low of 3,069 in February 1971 than to the high of 7,562 in July 1998. Granted, there are thousands of stocks traded on “Pink Sheets” and other lightly or unregulated markets, but the Wilshire 5000 only includes those that trade on an exchange such as the New York Stock Exchange or Nasdaq.

It’s not just a blip with the Wilshire 5000. The total number of listed securities trading on the Nasdaq OMX and NYSE Euronext exchanges was 4,916, according to the World Federation of Exchanges. The number of listed securities on these two critical exchanges has fallen every year since 2009 and is down 32% since 2000 and 39% from the recent peak in 1997. Making that more troubling: That number includes listings that aren’t companies, such as exchange-traded funds, which have soared in popularity.

JPMorgan Chase’s Legal Woes
Posted by Eddy Elfenbein on March 27th, 2013 at 11:36 am

I’m a big fan of JPMorgan Chase ($JPM) as an investment but I have to concede that the bank is not exactly Mr. Popular with the American public. The bank’s legal problems continue to mount, and I think it’s time for Jamie Dimon to go. He’s a brilliant executive but he’s now more of a liability than an asset. As a rule of thumb, banks should be boring. Having Jamie around makes JPM anything but boring. He recently expressed his disagreement with an analyst by saying, “that’s why I’m richer than you.” Some people find this hilarious. Me, not so much.

The New York Times noted that “at least” eight different federal agencies are currently investigating JPM. Yikes, that ain’t good. Plus, there’s still the problem of the London Whale fiasco and now the Feds are looking at criminal charges that JPM lied to investors. If that’s not enough, the Feds are also looking at the possibility that the bank didn’t reveal suspicions about Bernie Madoff.

Earlier this year, the big banks agreed to a settlement over mortgages abuses. The banks were supposed to go through their mortgages one-by-one and rectify the mistakes. Well, JPM screwed this up. To be fair, the other banks are having difficulty resolving this as well, but it’s another headache JPMorgan doesn’t need.

Again, to be fair to JPM, many of these issues seem to be areas where the bank was acting in good faith but simply bungled. Plus, the amount of money involved, even in the London Whale trade, are relatively small compared with the bank’s overall profile, but there are too many headlines to worry about.

Personally, I’d like to see Jamie go, and I’d like to see the bank split up.

We Still Can’t Make a New High
Posted by Eddy Elfenbein on March 27th, 2013 at 11:08 am

The stock market yet again approached its all-time record, and yet again stepped back from a new high. The S&P 500 got as low as 1,551 this morning but it’s been gaining back ground since then.

There doesn’t seem to be a wide dispersal in today’s market, meaning most stocks are behaving similarly. Some of the defensive areas like utilities and healthcare are up a small amount while the more cyclical areas are down, but nothing too serious.

Late yesterday, shares of Nicholas Financial ($NICK) dropped from close to $15 to $14.35 at the end of trading. The selling continued this morning and the shares bounced off $14.01. No, there’s no news about a buyout. I think this is pure speculation. I warned investors to expect some of this. Unfortunately, this is part of owning stocks and there’s not much we can do. If there’s any news about NICK, I will let you know.

Morning News: March 27, 2013
Posted by Eddy Elfenbein on March 27th, 2013 at 5:48 am

Amid Crisis, Cypriots Look Inward

Cyprus Capital Controls First in EU Could Last Years

Fitch Upgrades Philippines To Investment Grade; Outlook Stable

U.S. Asks Liechtenstein For Data In Swiss Banking Probe

Sales of New Homes Sink 4.6% in February

Fed Tells Citi To Improve Anti-Laundering Systems

Berkshire Set to Get Big Goldman Stake

Is J.C. Penney a Lost Cause?

JPMorgan Chase Faces Full-Court Press of Federal Investigations

Ericsson In Talks To Buy Microsoft’s TV Software Unit

Allianz Buys Turkey’s Yapi Kredi Sigorta for $879 Million

In a Faded Wall St. Scandal, Lessons for a Current One

$616 Million Poorer, Hedge Fund Owner Still Buys Art

Howard Lindzon: Bitcoin…The Jurassic Park of Currencies

Jeff Carter: Should You Work From Home?

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