Tuesday, September 7, 2010

Daily Markets - Three Risks Specific To Bond ETFs

Daily Markets - Three Risks Specific To Bond ETFs

Three Risks Specific To Bond ETFs

Posted: 07 Sep 2010 03:17 PM PDT

As investors seek to add diversification to their portfolios and remain wary of the overall economic health of the US, some have turned to bond exchange traded funds [[ETFs]] to complete their portfolios and for good reason.  These ETFs often offer low cost alternatives, asset allocation and exposure to hard-to-reach markets and sectors; however, they carry unique risks as well.
In addition to carrying the risk of default and interest-rate risk, which all nearly all bonds carry, bond ETFs … [visit site to read more]

TIPS And Inflation

Posted: 07 Sep 2010 03:05 PM PDT

Interest rates have three major parts. The first is what is known as the real interest rate, or how much the market is willing to pay you to defer your consumption of goods and services into the future. The second part is an expected rate of inflation. After all, if you want to defer buying a car today so you can buy a better car in the future, it will not help you much if you earn 5% per year on your money if the price of cars goes up at 10% per year. The final part is to compensate you for … [visit site to read more]

Neutral On Nucor Corp.

Posted: 07 Sep 2010 02:35 PM PDT

We reiterate our Neutral recommendation on Nucor Corporation (NYSE:NUE). Nucor Corporation, the nation's largest recycler of steel scrap, is facing higher costs in scrap and scrap substitute prices, which is the most significant elements in the total cost of steel production.

Lower production rates at the mills have slowed the rate at which they consume the higher cost iron units, in particular pig iron inventories. However, pig iron consumption had increased midway through 2009. Moreover, a … [visit site to read more]

Airline Traffic Shoots In Mexico

Posted: 07 Sep 2010 02:35 PM PDT

Aeroportuario del Sureste, S.A.B. de C.V. (NYSE:ASR), a top Mexican airport operator, recorded a 8.9% increase in passenger traffic for August 2010 in comparison with the same period of fiscal 2009.

Domestic traffic rose 2.5% while International traffic shot up by 15.1% year over year. In July 2010, Aeroportuario del Sureste recorded a 16.2% year-over-year increase in its traffic with a 3.5% increase in domestic traffic and 29.8% International traffic.

In the second quarter of fiscal 2010, … [visit site to read more]

Nissan Focuses On Argentina

Posted: 07 Sep 2010 02:35 PM PDT

Nissan Motor (NASDAQ:NSANY) intends to strengthen its presence in Argentina by forming a partnership with Manuel Antelo in late 2011. At the end of 2011, the responsibility to market the automaker's products in the country will be handed over to Antelo from its present distributor, Renault Argentina S.A.

Presently, Antelo is the owner and President of CAT Group, a French multinational company specializing in vehicle and parts logistics. He is also the owner of Car One Argentina, the largest … [visit site to read more]

Air Products Ups Airgas Offer Again

Posted: 07 Sep 2010 02:05 PM PDT

Air Products and Chemicals Inc. (NYSE:APD) has made a third revision to its take-over offer price for rival Airgas Inc. (NYSE:ARG). Air Products is now offering $65.50 per share in cash, up 9% from the initial offer price of $60 per share (all in cash). The new offer values Airgas at $5.48 billion and represents a 50% premium over the closing price of Airgas' shares on February 4, 2010, the day before Air Products announced its proposal to acquire Airgas. Air Products claims that the deal at $65.50 … [visit site to read more]

Boeing Dreams Big

Posted: 07 Sep 2010 01:35 PM PDT

Boeing Company (BA), with a steady recovery in the U.S. and Canadian economies, dreams big for its commercial airlines business. The bullishness was reflected in Boeing’s 2010 North America (U.S. and Canada) market outlook forecast on September 2, 2010. Boeing forecasts that air carriers in North America will take delivery of about 7,200 new airplanes over the next 20 years at an investment of $700 billion.

Paradigm Shift

Boeing forecast a paradigm shift to the fortunes of the U.S. and … [visit site to read more]

Rite Aid Comps Again Decline

Posted: 07 Sep 2010 01:35 PM PDT

Rite Aid Corp. (RAD), one of the nation's leading drugstore chains, reported lackluster same-store sales (comps) results down 1.0% in August 2010 from July. Rite Aid's same-store sales continue to move in the wrong direction, with August 2010 marking the 15th consecutive month of negative comps. Rite Aid had last witnessed positive same-store sales of 0.6% more than a year ago, in May 2009.

Monthly Performance in Detail

Rite Aid's August overall comps dropped 1.0%, after falling 1.1% in … [visit site to read more]

Owen-Illinois Unit To Offer Notes

Posted: 07 Sep 2010 01:35 PM PDT

International glass manufacturer and seller Owens-Illinois Group Inc. (NYSE:OI) announced that its wholly owned subsidiary, OI European Group B.V., intends to offer €500 million ($644.5 million) aggregate principal amount of Senior Notes due 2020 in a private offering, which is subject to market and other conditions.
 
OI European Group B.V. plans to utilize the net proceeds of the issue to repay borrowings of Owens-Illinois made under the revolving credit facility and for general corporate … [visit site to read more]

Teradata Partners Electronic Arts

Posted: 07 Sep 2010 01:35 PM PDT

A leading provider of Enterprise Data Warehousing (EDW) solutions, Teradata Corp. (NYSE:TDC) announced a two year partnership with Electronic Arts Inc. (NASDAQ:ERTS), a premier video game developer and publisher. 
Under the agreement, Electronic Arts will deploy Teradata's complete Managed Services support, which is a part of its EDW platform. This partnership is one of the largest Managed Services agreements for Teradata in the U.S., the company pointed out.
 
The partnership will enable … [visit site to read more]

Goldman To End Proprietary Trading

Posted: 07 Sep 2010 01:35 PM PDT

Goldman Sachs & Co. (GS) has decided to close down its principal strategies desk, a unit that is in proprietary trading, according to a report by Bloomberg News. The decision to spin off the proprietary trading businesses followed the regulatory reform bill that became law in July 2010.

The Dodd-Frank financial reform bill, which was signed into law by President Obama in July, has a number of provisions that would affect the business model of the financial institutions significantly. A … [visit site to read more]

BB&T Downgraded To Underperform

Posted: 07 Sep 2010 01:35 PM PDT

We have downgraded our recommendation on BB &T Corp. (NYSE:BBT) to Underperform from Neutral. The rating change in based on deteriorating credit quality and concerns related to rising non-interest expenses.
 
BB&T's second quarter 2010 operating earnings of 33 cents per share were in line with the Zacks Consensus Estimate. However, operating earnings were favorable compared to the prior quarter and prior-year quarter. Including merger related expense of 3 cents, earnings stood at 30 … [visit site to read more]

Ford And Changan May Expand

Posted: 07 Sep 2010 01:35 PM PDT

The Chinese automaker Chongqing Changan Automobile has entered into discussions with its joint venture (JV) partner Ford Motor Co. (NYSE:F) to expand their presence outside China. To this extent, Changan is also teaming up with Shanghai Automotive Industry Corp. ("SAIC") in order to expand its tie up with Ford beyond the current terms and conditions.

Last month, Ford, Changan and Mazda Motor Corp. have received approval from the Chinese government to split their three-way JV, Changan Ford … [visit site to read more]

EA Adds New Technology

Posted: 07 Sep 2010 12:35 PM PDT

A leading developer and publisher of video games, Electronic Arts (NASDAQ:ERTS) studio –Black Box is adding Dolby Laboratories Inc.'s (NYSE:DLB) Dolby Axon voice chat technology to its hugely popular multiplayer online (MMO) racing action game – Need for Speed World.
Dolby Laboratories is a leading provider of high quality audio and surround sound technology. Axon voice chat technology ensures noiseless and echoless communication among team members. Players can chat using any stereo headset, … [visit site to read more]

AMPH Redeems Preferred Stock

Posted: 07 Sep 2010 12:35 PM PDT

The board of directors of American Physicians Service Group (NASDAQ:AMPH) has decided on an early redemption of all the 3% Series A redeemable preferred stock, worth $6 million. The board also decided to pay accrued dividends on the preferred stock through the redemption date. The payment will be made on September 24, 2010, to shareholders on record as of September 3, 2010.
The 3%f Series A redeemable preferred stock was issued in 2007 in payment of refundable surplus deposits provided by insured … [visit site to read more]

Michael Burry, Predictor Of Mortgage Collapse, Bets On Farmland, Gold

Posted: 07 Sep 2010 12:25 PM PDT

Michael Burry

Michael Burry, the former hedge-fund manager who predicted the housing market's plunge, said he is investing in farmable land, small technology companies and gold as he hunts original ideas and braces for a weaker dollar.
"I believe that agriculture land — productive agricultural land with water on site — will be very valuable in the future," Burry, 39, said in a Bloomberg Television interview scheduled for broadcast this morning in New York. "I've put a good … [visit site to read more]

Dulles Airport Has Busiest Month In 5 Years

Posted: 07 Sep 2010 12:21 PM PDT

 
July is always the single busiest month of the year for passenger travel at Washington Dulles International Airport, but July this year was even busier than normal.  Passenger traffic reached almost 2.3 million travellers in July, which was 2.2% above traffic in July of last year, and was the highest monthly passenger count since August of 2005 (data here), almost five years ago (see chart above).  Compared to last year, both domestic and international … [visit site to read more]

Forex Trading: EURUSD Making New Lows. 100 Day MA Level Eyed At 1.2676

Posted: 07 Sep 2010 12:09 PM PDT

Telekomunikasi To Upgrade Networks

Posted: 07 Sep 2010 12:05 PM PDT

P.T. Telekomunikasi Indonesia Tbk. (NYSE:TLK), the largest integrated telecom service provider of Indonesia, has undertaken a massive project to upgrade its backbone network. The new transformation initiative will converge IP and optical networks to enable Telekomunikasi to effectively tackle growing data traffic, simplify network structure, and reduce costs.
 
In order to counter increasing competition in the Indonesian telecom market, Telekomunikasi has already decided to spread out its … [visit site to read more]

HeartWare To Advance Clinical Trial

Posted: 07 Sep 2010 12:05 PM PDT

Recently, HeartWare International (HTWR) has received approval from the US Food and Drug Administration (FDA) for an IDE (Investigational Device Exemption) supplement. Subsequent to this approval, HeartWare will be able to enroll another 54 patients in its ADVANCE bridge-to-transplant (BTT) clinical trial under a Continued Access Protocol (CAP). 
 
Earlier, in April 2010, the FDA had permitted HeartWare to enroll 54 patients under the BTT trial and the final patient was implanted … [visit site to read more]

Using A Personal Credit Card For Business Expenses – Good Or Bad Idea?

Posted: 07 Sep 2010 11:53 AM PDT

Can’t I Just Use My Personal Credit Card For Business Expenses?

According to the 2009 National Small Business Association survey, a whopping 86% of small businesses say they use their personal or business cards primarily or exclusively for business purposes.

There are several downsides of putting business expenses on your personal consumer credit card:

1. Accounting issues. Mixing personal and business expenditures on a consumer credit card can lead to accounting problems. If you put … [visit site to read more]

BCE Downgraded To Neutral

Posted: 07 Sep 2010 11:35 AM PDT

We are downgrading our recommendation for BCE Inc. (NYSE:BCE), Canada's incumbent telecom carrier, to Neutral from Outperform on increased concerns about the entrance of additional wireless carriers. Currently, the stock has a Zacks #3 Rank (Hold). BCE Inc. is 100% subsidiary of Bell Canada.
 
The second quarter earnings of BCE Inc. surpassed the Zacks Consensus Estimate and the year-ago quarter on strong TV and wireless growth. Consolidated revenue increased 3.3% year over year on higher … [visit site to read more]

Caught In The Vice Of Moving Average Compression

Posted: 07 Sep 2010 11:17 AM PDT

I’ve been struggling for several days trying to come up with something new to write about, some new insights, some new strategies …. something. So far, everything seems to be moving along in line with expectations:

The market is cooperating in forming the right shoulder of the inverted head+shoulder pattern, what others now say is one of the most reliable reversal patterns.
I’ve been buying tech stocks and they all mostly seem to be leading the charge higher
Precious metals, whether gold, … [visit site to read more]

ITT Wins US Army Contract

Posted: 07 Sep 2010 11:05 AM PDT

ITT Corporation (NYSE:ITT) has received a contract to supply its AN/AVS-6(V) 3 aviator night vision goggle and spare image intensifier tubes to the US Army. The contract has been awarded by the U.S. Army Research, Development & Engineering Command.
 
The order, valued at $19.9 million, also includes ITT's night vision technology, the MX-10160C. This is the company's Generation 3 Pinnacle image intensifier, providing the soldiers with clear and sharp night vision. The MX-10160C is in … [visit site to read more]

Excel Maritime Improves TC Contract

Posted: 07 Sep 2010 11:05 AM PDT

Maritime Carriers Ltd. (NYSE:EXM), a leading worldwide seaborne transporter for dry bulk cargoes, recently improves and consolidates the time charter contracts for its fleet. The company announced that it has entered into a time charter agreement with a first class European charter for its Panamax bulk carrier M/V Powerful. The duration of the agreement will be a minimum of 11 months and a maximum of 13 months.
 
With this new time charter deal, Excel Maritime now secured under time charter … [visit site to read more]

Suncor Upgraded To Neutral

Posted: 07 Sep 2010 10:35 AM PDT

We have upgraded integrated energy company Suncor Energy Inc. (SU) shares to Neutral from Underperform. The company's impressive second quarter 2010 results, aided by the additional upstream production from the Petro-Canada merger and higher crude prices along with an updated guidance, give us enough reasons to be optimistic about the stock's growth momentum for the remainder of 2010.
 
Suncor enjoys the benefits of significant oil-sands and conventional production platform, large … [visit site to read more]

Zimmer And Accentus Join Up

Posted: 07 Sep 2010 10:35 AM PDT

Recently,  a leading orthopedic medical devices company with primary focus on hip and knee implants, Zimmer Holdings (NYSE:ZMH), entered into an agreement with UK based medical technology company, Accentus Medical. Following this agreement, Zimmer will use Accentus' Agluna anti-infective technology for several of its products. Financial details of the agreement were not disclosed.
 
As per terms of the agreement, Zimmer will be able to utilize Agluna for joint reconstruction and … [visit site to read more]

FE-AYE Merger Jumps Another Hurdle

Posted: 07 Sep 2010 10:11 AM PDT

Diversified Electric company, FirstEnergy Corp. (NYSE:FE) received positive recommendations from four proxy advisory firms for its proposed merger with Allegheny Energy Inc. (NYSE:AYE). These four independent advisors have recommended FirstEnergy shareholders to vote in favor of the proposed merger.
 
The four firms include ISS Proxy Advisory Services; Glass, Lewis & Co.; PROXY Governance Inc.; and Egan-Jones Proxy Services. FirstEnergy is scheduled to conduct a special shareholders meeting … [visit site to read more]

Kohl’s August Sales Rise

Posted: 07 Sep 2010 10:11 AM PDT

Departmental store operator Kohl’s Corporation (NYSE:KSS) reported a 4.5% hike in its comparable-store sales for the four-week month ended August 29, 2010, ahead of Street expectations of 2.6%.  Total revenue for the month rose 7.7% to $1.42 billion as compared with $1.32 billion in the year-ago period. The company expects the positive trend to continue for the rest of the year.
 
The robust performance in August was mainly driven by positive same store results experienced at all … [visit site to read more]

Next Stop, Infrastructure?

Posted: 07 Sep 2010 10:11 AM PDT

In an effort to rev up the sluggish economic recovery, President Obama has proposed $50 billion in spending to improve the nation's roads, airports and railways. The President's speech at a Labor Day event yesterday in Milwaukee, Wisconsin called it a long-term investment intended to create jobs. Could this really spur the economy, or is it being irresponsible for the federal government to further extend deficit spending in this way?

Though government efforts so far have succeeded in … [visit site to read more]

AstraZeneca Inks Agreement

Posted: 07 Sep 2010 10:11 AM PDT

Recently, AstraZeneca PLC (NYSE:AZN) and India based generic company Aurobindo Pharma Ltd. inked a licensing and supply agreement aimed at enabling the Indian company to supply solid dosage and sterile products for emerging markets.  The products will be marketed in various emerging markets across the globe. The scope of the deal will expanded with time.
This deal, whose financial terms were not disclosed, highlights AstraZeneca's efforts to strengthen its presence in emerging markets. The … [visit site to read more]

Paying Dividends

Posted: 07 Sep 2010 10:11 AM PDT

Last week the stock market had a good week, and the bond market corrected a bit. Still, relative to the yield on the 10-year t-note of 2.71% on Friday, stocks look extremely attractive.

The S&P 500 is trading for just 13.4x consensus expectations for 2010, and 11.6x 2011 expectations. That translates into earnings yields of 7.46% and 8.62%, respectively. However, an earnings yield does not provide you with that much cash in your hand.

For an apples to apples comparison, it is the dividend … [visit site to read more]

Denbury Cancels ENP Deal

Posted: 07 Sep 2010 10:11 AM PDT

Plano, Texas-based Denbury Resources Inc. (NYSE:DNR) and Encore Energy Partners LP (NYSE:ENP) have terminated their previously announced deal related to Elk Basin assets sale. Denbury had initially signed the deal for significant capital requirements for its core CO2 tertiary operations.
 
Both the parties noted that no agreement could be reached on the value of the potential tertiary reserves.
 
Denbury has now shifted its focus to sell its interest in Encore Energy Partners GP LLC, the … [visit site to read more]

Mid-America Buys Texas Property

Posted: 07 Sep 2010 10:11 AM PDT

Mid-America Apartment Communities Inc. (NYSE:MAA), an apartment-only real estate investment trust (REIT), recently acquired The Venue at Stonebridge Ranch, an upscale 250-unit apartment community in Dallas, Texas MSA (Metropolitan Statistical Area) for an undisclosed amount.
Developed in 2000, The Venue at Stonebridge Ranch features superior amenities such as oversized garden bathtubs, walk-in showers, walk-in closets and a resort-style pool, along with WiFi areas and garages. The acquisition is … [visit site to read more]

Equinix Poised For Growth

Posted: 07 Sep 2010 10:11 AM PDT

Leading data center solutions provider Equinix Inc. (NASDAQ:EQIX) announced the expansion of its second International Business Exchange (IBX) data center, TY2, in Tokyo. The expansion will strengthen the company's footprint in Tokyo and serve the growing demand for data center services from cloud and IT service providers, content companies and financial firms in Japan.
 
The company expects to add 140 cabinets at a cost of $9.0 million by the fourth quarter of 2010. Upon completion, the total … [visit site to read more]

Vornado Realty To Buy Back Debt

Posted: 07 Sep 2010 10:11 AM PDT

Vornado Realty Trust (NYSE:VNO), a leading real estate investment trust (REIT), recently announced a debt buyback offer totaling $404.5 million due 2026 and 2027. The company would fund the debt buyback with cash from its operating partnership.
The offer included about $382.1 million 3.63% convertible senior debentures due 2026 and $22.5 million 2.85% convertible senior debentures due 2027. Vornado Realty has priced the offering at $1,020 for every $1,000 of the 2026 debentures and $1,015 for … [visit site to read more]

NuStar Remains Neutral

Posted: 07 Sep 2010 10:11 AM PDT

We are maintaining our Neutral recommendation on NuStar Energy L.P. (NYSE:NS) units with a target price of $62.
San Antonio, Texas-based NuStar Energy is a master limited partnership ("MLP") engaged in the transportation and storage of crude oil as well as refined products in the U.S., the Netherlands Antilles, Canada, Mexico, the Netherlands and the U.K.
The partnership is one of the largest asphalt refiners and marketers in the U.S. and the second largest independent liquids terminal … [visit site to read more]

JDS Uniphase Enters New Venture

Posted: 07 Sep 2010 10:11 AM PDT

The leading supplier of fiber optic components and modules used in advanced high-speed communications networks, JDS Uniphase Corporation (NASDAQ:JDSU) is trying to get a foothold as a chip supplier in the concentrated photovoltaic (CPV) market.
CPV cells technology is considerably expensive and is designed to capture concentrated sunlight within solar panels for electrical power generation. However, according to various industry researches, the CPV market size may go beyond $3 billion by 2015 and … [visit site to read more]

Gilead Files MAA For HIV Drug

Posted: 07 Sep 2010 10:11 AM PDT

Gilead Sciences Inc. (NASDAQ:GILD) recently announced that it has submitted a Marketing Authorization Application (MAA) to the European Medicines Agency (EMA) seeking approval for its once daily, single tablet, fixed dose combination of Truvada and TMC278 (rilpivirine) as a HIV treatment for adult patients.
The MAA will first be reviewed by the Committee for Medicinal Products for Human Use (CHMP) and, based on the CHMP's opinion, the EMA will deliver its decision regarding the approval of the … [visit site to read more]
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