3 Stocks
(GYMB) 4Q profits rose 10% but that's old news...the bombshell came in the form of 1Q guidance more akin to a swan song... Citing the weak economy and tougher safety standards (man, this is just the tip of that heavy regulation iceberg that is going to crush industries as varied as banking, medicine, food, imports and insurance) on children's apparel and accessories, management sees earnings of $0.18 to $0.25. The street was looking for $0.76, and investors fled the stock after the bell.
(WTW) posted earnings of $0.56, beating the Street by $0.04 and offered guidance for FY09 $2.50 to $2.75. The Street is at $2.62
(CIEN) reports before the open and this could help telecoms stocks eager to make a move higher. In the October quarter the company missed consensus by 267% this time around the street is looking for a loss of $0.07 on revenue of $171.6 million FY09 consensus is -0.06 on revenue of $707.6 million
China Marches On -- Thank Goodness There is Some Leadership In the World
Midday rallies have been a part of this market for some time so there wasn’t a lot of celebrating when the market closed yesterday. Instead of heading for local watering holes, weary traders, with a slightly springy step, when home to contemplate what awaits with the jobs report tomorrow. Wednesday, I mentioned how a bunch of companies in a variety of industries saw their share prices edge higher even as they suffered news that reflected poor past execution or increased business challenges in the future. So Wednesday was a ray of sun on our tired faces. I wouldn’t call it a mirage but some might call it sucker’s rally.
The fact is from a trader’s point of view the bigger risk right now is missing a bear market rebound. The thing about those kinds of moves is they happen suddenly so it’s easy to get left at the station or stuck in your foxhole. Of course if the numbers are as devastating as those from ADP and other sources then there is a chance the market could get hit again.
Investors are like Wile E. Coyote in the sense they have been blown up so often at this point they simply sigh and brace for impact. Essentially what the late selling was -- folks dumping and bracing. We have a few ideas we didn’t ask folks to take profits on only because each tick up here is a major percentage gain.
After yesterday I’m wondering if my buddy Jim Rogers has it right and I should get my son cracking on his Mandarin immediately. Of course Jim is one of the best forward-thinkers of our time and focuses on the [really] long term. It’s interesting that the world’s equity markets would surge on news of another stimulus package in China, but crumbled like a rock when our package was announced. It speaks volumes about the notion our plan was really stimulus.
Of course the idea that the Chinese are ready to pump as much as another $1.5 trillion into their economy is mind-boggling. Lets face it folks China doesn’t have to break the printing press and push come to shove they could always redeem some US Treasury bonds. In the meantime China has announced it will boost military spending by 15%, the nineteenth time in the last two decades the country has increased its military budget. So while we pussyfoot around with Russia and make nice with Iran, China plows ahead on the economic and military fronts.
I’m a fan of Sun Tzu but what the folks running China are doing is a combination of than Art of War and Machiavelli’s “The Prince.” These guys are serious about taking over the world. There have been many times in history when China had the technology (naval, weapons and manpower) to become a global power but instead the citizens built a long wall and let the world go by while it just minded its own business. That will never happen again.
Not only are there global ambitions (their push into Africa is downright scary) but there is a homegrown appetite for stuff…the same stuff the folks here built and shipped to rich nations for a long time.
Plus, I’m fond of saying you can’t take a person from a bicycle to a car and think you’ll get that person back into a bicycle…not going to happen.
Large banks take beating on Wall Street
Charles Payne: 3 Stocks, Charles’ Choice
