Morning News: July 6, 2012
Posted by Eddy Elfenbein on July 6th, 2012 at 7:31 am

Lagarde Says IMF to Cut Growth Outlook as Global Economy Weakens

Italian Bonds Fall From Grace on Contagion Concern

Italy Approves €4.5 Billion in Spending Cuts for 2012

German Industrial Production Increased More Than Forecast in May

Chinese Cars Make Valuable Gains in Emerging Markets

Oil Drops in New York as Growth Concern Weighs on Demand Outlook

Hopeful Signs Emerge For Struggling US Jobs Market

Fewer Americans Than Forecast File Unemployment Claims

US Fixed Mortgage Rates Fall To New Record Lows

Retail Sales Rise Only 0.1% In June

HTC 2Q Profit Falls as Smartphone Competition Intensifies

JAT Capital, Down 20%, Is a Lesson in Volatility

Dynegy Inc. Files for Bankruptcy in Plan to Merge With Unit

Jeff Miller: June Employment Report Preview

Howard Lindzon: Trading Netflix – the Power of Collaborative Equity Selection

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How to Know When to Sell
Posted by Eddy Elfenbein on July 5th, 2012 at 6:13 pm

Morning News: July 5, 2012
Posted by Eddy Elfenbein on July 5th, 2012 at 7:07 am

Lagarde Consumed by Crisis Steers IMF Tough Love to EU

Draghi-King Push May Mean Bigger Step Into Zero-Rate Era

German Factory Orders Unexpectedly Rose on Euro-Area Demand

Ireland Takes First Step Towards Bond Market Return

Spain Meets Target at Bond Auction as Borrowing Costs Rise

Britain’s Hidden Hunger Puts Spotlight on Cameron Budget Cuts

Oil Jumps $2 On Norway Strike

Apple Said to Plan Smaller IPad to Vie With Google Nexus

In Silicon Valley, Chieftains Rule With Few Checks and Balances

Volkswagen to Buy Remaining Stake in Porsche

Boeing Seeks Big Farnborough Orders Under New Boss

Luring Online Shoppers Offline

Barclays’ Ex-Chief Spreads the Blame in Rate-Rigging Scandal

Credit Writedowns: How To Achieve Financial Reform in China

Stone Street: Accountability – Taking Stock

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Happy 236th, America!
Posted by Eddy Elfenbein on July 4th, 2012 at 10:10 am

I hope everyone has a wonderful Fourth of July.

Morning News: July 4, 2012
Posted by Eddy Elfenbein on July 4th, 2012 at 8:02 am

Former UK Minister Denies Talks With BOE Over Libor Adjustments

IMF Urges U.S. Lawmakers to Remove ‘Fiscal Cliff’

Draghi’s Giant Leap on Rates May Be Small Step for Euro

Mexico’s Slim Not Eyeing More Europe Buys For Now

Manchester United Shoots for $100 Million IPO

Big Banks’ ‘Living Wills’ Aiming for Bankruptcy Not Bailouts

Finding Success on the Oil Frontier

Orders to U.S. Factories Rise for First Time in Three Months

Auto Sales in June Provided Bright Spot for U.S. Economy

Mercedes Extends Luxury Lead as U.S. June Sales Rise 7.6%

JPMorgan Probed Over Potential Power-Market Manipulation

Twitter Adds to Pressure on Facebook in Mobile Ads

A More Perfect Union, Built on Shared Debt

Jeff Carter: Happy July 4th

Epicurean Dealmaker: Ready, Fire, Aim

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Morning News: July 3, 2012
Posted by Eddy Elfenbein on July 3rd, 2012 at 7:23 am

Greece Must Pay Suppliers’ Arrears: EU Taskforce Head

BRICs Priced for Economic Meltdown

Europe’s Banking Chief Wields New Power in Crisis

Malaysia’s IHH Healthcare Said to Seek $2 Billion in IPO

Australia Holds Key Rate at 3.5% as Hiring, Currency Strengthen

Sour Global Economy Drains Confidence From Deal Makers

U.S. Manufacturing Shrinks, 1st Time in Nearly 3 Years

California Lawmakers Pass Historic Foreclosure Protections

Diamond Quits as Pressure Mounts on Barclays Over Libor

Former Brokers Say JPMorgan Favored Selling Bank’s Own Funds Over Others

Let’s Put A Smile On Your Facebook

Samsung Loses Bid To Lift Ban On U.S. Tablet Sales

Microsoft Takes $6.2 Billion Charge, Slows Internet Hopes

Cullen Roche: Wall Street’s Analysts Are Excessively Bearish

Joshua Brown: This Is…How You Say? Ah Yes, Bad.

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Dividends Up 15%
Posted by Eddy Elfenbein on July 2nd, 2012 at 8:18 am

Dividends continue to be popular. During the second quarter, the S&P 500 paid out $7.49 (adjusted to the index) in dividends. That’s a 14.9% increase over last year. That’s a payout ratio of less than 30% so it’s hardly stretching companies at all.

Here’s a look at the S&P 500 (in blue, left scale) while its trailing dividends (in black, right scale). The two lines are scaled at a ratio of 50-to-1 so anytime the lines cross, the dividend yield is exactly 2%.

I think it’s fascinating how closely the S&P 500 has tracked 50 times its dividend over the last 10 years (except during the financial crises).

Morning News: July 2, 2012
Posted by Eddy Elfenbein on July 2nd, 2012 at 7:04 am

Euro Leaders Turn to Central Bank for Help to Tackle Crisis

Agius Steps Down As British Bankers’ Association Chairman Amid Interest-Rate Probe

Greece Accused of Wasting Time on Bailout Negotiations

Top Auditor Says France Needs EUR43B to Respect 2012, 2013 Deficit Targets

Japan Tankan Confidence Improves Even as Yen Limits Exports

Iran Won’t Endure West’s Sanctions

In Caymans, It’s Simple to Fill a Hedge Fund Board

Bond Market Backs Obama With Record Demand for New Debt

Euro Zone Factories Hit Hard In June, Job Cuts Rise

Apple Pays $60 Million to End China IPad Fight With Proview

Why Bristol And Astra Teamed Up To Buy Amylin In Unique $7 Billion Deal

Linde to Fund Lincare Deal With $4.5 Billion Acquisition Loan

Ingram Micro to Buy BrightPoint for $650 Million

Pragmatic Capitalism: How the U.S. Economy will Impact the Presidential Election

Roger Nusbaum: The Big Picture for the Week of July 1, 2012

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Vacation Time
Posted by Eddy Elfenbein on July 1st, 2012 at 8:58 pm

I’m off to Newport this week for some sailing and to celebrate July 4th so posting will be light. There also won’t be a CWS Market Review this week. The stock market will close at 1 pm on Tuesday and will be closed all day on Wednesday. I expect trading volume to be light this week.

The big news story will be Friday’s jobs report. The last report was a dud. Wall Street currently expects 100,000 nonfarm payrolls, and the unemployment rate to stay at 8.2%. They’ll also revise previous months’ numbers.

A few weeks ago, Bernanke testified before the Joint Economic Committee and addressed employment:

This apparent slowing in the labor market may have been exaggerated by issues related to seasonal adjustment and the unusually warm weather this past winter. But it may also be the case that the larger gains seen late last year and early this year were associated with some catch-up in hiring on the part of employers who had pared their workforces aggressively during and just after the recession. If so, the deceleration in employment in recent months may indicate that this catch-up has largely been completed, and, consequently, that more-rapid gains in economic activity will be required to achieve significant further improvement in labor market conditions.

We’ll see if the sluggish trend continues. I’ll also be curious to see what Monday’s ISM report has in store. Anything above 52ish is fine. A number below that is a concern.

The Buy List So Far
Posted by Eddy Elfenbein on July 1st, 2012 at 9:32 am

The first half of the year is over and thanks to a nice rally on Friday, our Buy List is up 7.61% for the year. That trails the S&P 500 just slightly — the index was up 8.31% for the first six months of 2012. Including dividends, our Buy List was up 8.71% while the S&P 500 was up 9.49%.

We’ve beaten the S&P 500 for the last five years in a row. I’m not at all worried about us making it six straight. For the complete six-and-a-half year record of the Buy List, we’ve nearly doubled the return of the S&P 500, 49.72% to 25.19%.