Month: September 2013

By HY Markets Forex Blog

Crude prices declined on Wednesday, after Syria agreed to give up its stockpiles of chemical weapons, easing worries over the Middle East exports. On Tuesday, the US crude inventories data showed a higher drop that analysts predicted.

The West Texas Intermediate October deliveries dropped 0.27% lower to $107.10 per barrel on New York’s Nymex as of 5:05am GM, while the European benchmark Brent crude advanced 0.24% higher to $111.52. Worries over the possibility of the US military intervening in Syria pushed WTI crude $112 higher a barrel at the beginning of September.

Syria have accepted Russia’s proposal to give up chemical weapons, which would possibly avert a US military strike in Syria. The US senate is expected to vote on a resolution for a military strike in Syria by the end of the week.

Investors worries that if any military intervention in the Syria occurs, it could spark conflicts in the neighboring oil-rich countries such as Iraq and Saudi Arabia, threatening the global oil supply chains within the region.

Crude prices – US stockpiles drop

The world’s leading oil consumer’s crude supplies posted a drop of 2.9 million barrels last week, surpassing analysts’ prediction of a 1 million barrel fall, according to reports from the American Petroleum Institute.

Gasoline stockpiles rose by 195,000 barrels, while distillate supplies increased by 807,000 barrels.

Report from the US Department of Energy is expected to be released later in the day.

China Production

Investors are mainly focused on the Chinese economic fundamentals as China remains the second-largest oil consuming country in the world.

The country’s industrial production increased by 10.4% in August, the National Bureau of Statistics reported on Tuesday. The industrial production grew from the previous month’s 9.7% reading in production levels.

The growth rate of the Chinese industrial production reached the highest in 17 months in August.

Visit www.hymarkets.com  today and find out more on how you can how you can trade Energy products with only $50 

The post Crude Prices Falls on Syria Pause appeared first on | HY Markets Official blog.

Article provided by HY Markets Forex Blog

By HY Markets Forex Blog

The European Stock futures were seen trading flat on Wednesday, as investors hopes that the US-Syrian conflict may be averted.

Futures of the Euro Stoxx 50 traded 0.11% lower at 2,849.50 at the time of writing, while the futures for the German DAX gained 0.01% to 8,460.30 at the same time, as the French CAC 40 futures advanced 0.01% to 4,114.30 and the UK FTSE 100 futures declined 0.12% lower to 6,592.50.

European Stocks – Syria Strike pushed back

On Tuesday, the US President Barack Obama asked Congress to push back the vote on whether the US military should intervene and take action against Syria, after Syria agreed to accept the Russian proposal to give up its chemical weapons.

“It’s hard to find a more market-friendly outcome from the developments and Russia, the US, Syria, Israel, and many other nations will be fairly content about the fact that ultimately key leaders are finding good middle ground,” chief market strategist at IG Chris Weston stated in a note.

European Market – Economic News

Germany’s consumer prices came in flat in August on a monthly basis, compared to the high 0.5% recorded in the previous month, while it advanced 1.5% year-on-year, according to reports from the Federal Statistical Office.

Meanwhile in France, the final non-farm payrolls declined 0.2% in the second quarter, compared to the 0.1% drop in the previous three month period, the French National Institute for statistical and Economic Studies reports confirmed.

The European Commission President Jose Manuel Barroso is expected to give a speech to the European Parliament about the state of European Union later in the day.

Asian Stocks

Asian shares were seen moving higher on Wednesday, driven by the gains in Japan on the higher earnings predictions for exporters caused by the softer yen. The positive sentiment in the world’s number two economy remains after the country posted an upbeat sales and industrial output data in the previous session.

Hong Kong’s Hang Seng index fell 0.30% lower to 22,908.12 points at the time of writing, while the Chinese benchmark Shanghai Composite gained 0.06% to 2,238.30.

The post European Stocks Mixed As Syrian Tensions Ease appeared first on | HY Markets Official blog.

Article provided by HY Markets Forex Blog

By WallStreetDaily.com

With the situation in Syria, the “Fed taper” and a possible emerging markets meltdown in the works, there’s a ton of uncertainty swirling around the market right now.

So much so, that it’s hard to prevent our emotions from taking center stage and interfering with our investment decisions.

Since our emotions tend to mislead us, though, it’s important to rely on the one thing that never lies instead.

And that’s data!

To help us in this quest, we reached out to the undisputed champion of data tracking for the S&P 500 Index – Howard Silverblatt.

He’s the Senior Index Analyst at S&P Dow Jones Indices. And ever since taking the position in 1997, every major financial publication in the world has come to rely on his timely insights. (If you don’t believe me, just Google him.)

The Wall Street Journal actually calls him the “High Priest of Stats.”

In our exclusive interview, he demonstrates precisely why he’s a “go-to” source. He reveals…

• A “big drop” that we should expect right after Thanksgiving.

• Two records that S&P companies keep breaking.

• One type of stock we’ll want to own if the market happens to succumb to any of the uncertainties above (and hit the skids).

• Two big changes coming to the Fed that we need to factor in to the timing of the taper.

• A surefire stock bubble indicator. (Hint: It’s not flashing any warning signs, even though September is usually the worst month for stocks.)

He even shares a few data points from his most recent research on small caps, which hasn’t even been published yet.

To hear it all for yourself, simply click on the image below. Or you can read the transcript here.

Ahead of the tape,

Louis Basenese

P.S. Speaking of interviews… Tomorrow at 2:37 PM EST, I’ll be joining John Ransom, Finance Editor for Townhall Finance, to discuss what the latest market trends mean for investors. The interview will be broadcast on 30 different radio stations throughout the country. The easiest way for you to gain access, however, is by going here after the show. Be sure to tune in!

The post Keynote Speaker Series: Howard Silverblatt, Senior Index Analyst At S&P Dow Jones Indices appeared first on Wall Street Daily.

Article By WallStreetDaily.com

Original Article: Keynote Speaker Series: Howard Silverblatt, Senior Index Analyst At S&P Dow Jones Indices

Today, the United European Currency tested week high of 1.3280. However, the pair was not strong enough for further upward movement thus it came back to lows. 

By Profit Confidential

When retailers in the U.S. economy warn about their sales being in a slump or start to forecast rough roads ahead, it should be a warning to investors of an economic slowdown ahead. The logic behind this is very simple: Retailers in the U.S. economy show trends about consumer spending; if retailers are worried, it means consumer spending is in trouble.

One way to get an idea about bleak consumer spending is by looking at what happens during the peak buying seasons. In the most recent peak buying season, being the back-to-school shopping season, retailers in the U.S. economy were only able to lure in customers by slashing their already low prices.

The president of Retail Metrics (a company that provides estimates of same-store sales), Ken Perkin, said, “They [discounts] seem to be above the norm. That was emblematic of just the lack of demand for back-to-school.” (Source: “U.S. retailers rely on deep discounts to win back-to-school shoppers,” Reuters, September 5, 2013.)

In the very recent past, we have heard from retailers like Wal-Mart Stores, Inc. (NYSE/WMT) and Macy’s, Inc (NYSE/M) about how they are struggling with their sales. And that’s a problem when you have both low-end and higher-end retailers facing similar customer demand issues.

The Cato Corporation (NYSE/CATO) is an apparel and accessory chain founded in 1946. The company reported its same-store sales in August were down two percent compared to the same period a year ago. The CEO of the company, John Cato, said, “August same-store sales were within our range of expectations and consistent with our current trend. We remain cautious in regard to the remainder of the year.” (Source: “Cato Reports August Same-Store Sales Down 2%,” The Cato Corporation web site, September 5, 2013.)

While retailers face soft—and in some cases, declining—demand in consumer spending, I have another concern that doesn’t get much mainstream attention: how the pullback in consumer spending will impact the American jobs market.

Since the beginning of the so-called recovery, we have seen a spur in retail jobs. If we start to see retailers post poor sales because consumer spending is in a slump, jobs created in the low-paying sector will diminish as quickly as they were created.

It’s very simple: we can’t have economic growth in the U.S. economy until the average American Joe starts to spend. When he spends, it creates jobs and it keeps the economic cycle rolling. As I have mentioned many times in these pages, consumer spending makes up more than two-thirds of the U.S. gross domestic product (GDP)—that’s why it’s so important that consumers spend.

Retail stocks are a leading economic indicator. When I look at the retailers today, I see a declining trend in their prices. One of my favorite leading indicator retail stocks to watch is The Gap, Inc. (NYSE/GPS). Its stock price is down roughly 13% off its August highs—not good news at all for this sector.

Article by profitconfidential.com

By Profit Confidential

The way things are going, the place to be in capital markets seems to be in energy. Oil and gas stocks, particularly smaller ones, continue to be solid earners in a stock market looking for direction.

While oil prices gyrate on geopolitical events, market speculators have been bidding the commodity based on the slightly positive tone in U.S. economic data. It doesn’t take a lot for market participants to bid oil. The only way to beat it as a consumer is to own a piece of the company.

While many junior oil and gas producers are moving higher in value on the stock market, valuations are particularly lofty. They were high to begin with, before recent events in Syria, but they have only gotten worse. Now isn’t particularly a good time to be considering new positions on the stock market, but the energy sector is a bright light in an otherwise lackluster environment.

Jim Rogers, the “Investment Biker,” wrote that he would continually analyze all capital markets, but trade very little. He would wait until an investment opportunity became so compelling, and then take on a considerable position (with leverage).

I don’t see this kind of opportunity with oil, but I do see it in natural gas as a longer-term, cyclical play after the natural gas build-out is completed.

One of the most successful natural gas  producers on the stock market has been Cabot Oil & Gas Corporation (COG). Even with flat natural gas prices, this oil and gas producer is up four-fold since the beginning of 2010. Its valuation is super lofty, but then again, this enterprise is delivering on its promises. Second-quarter 2013 production grew 52% to 95.2 billion cubic feet. Earnings grew 148% to $89.1 million. The number was actually higher save for a few one-time items.

There’s a lot to be said, in my view, for a company like Chart Industries, Inc. (GTLS), which offers a way to play the natural gas build-out. The company works with oil and natural gas producers to create storage solutions for hydrocarbons. This enterprise is growing, its management team is diligent in the way the company expands, and the stock is also selling to China, where there is a voracious appetite for energy storage solutions.

Chart Industries is a mature business, but it generated second-quarter revenues of $298.3 million for a solid gain of 24%.

The company’s order backlog is at a record $664 million. Second-quarter earnings were $20.0 million compared to $17.9 million.

Chart Industries is selling product to PetroChina Company Limited (PTR). The company just announced another $50.0-million order on top of a $45.0-million order for self-contained liquefied natural gas station modules.

The company’s second-quarter earnings result beat consensus, and while 2013 revenue expectations are still the same, Chart Industries boosted its bottom-line forecast for the year. (See “How to Play the Bakken Oil Boom While Oil & Gas Companies Are at Their Highs.”)

In terms of a multiyear investment theme, I’d seriously consider some sort of exposure to natural gas. But it doesn’t have to be a pure play producer like Cabot Oil & Gas. A company like Chart Industries would be a worthy addition for long-term portfolios on a major price retrenchment.

Article by profitconfidential.com

By Profit Confidential

If you like taking some risk but also love the idea of making some good price appreciation, then read on, as there are alternative ways of earning dividend income without having to buy General Electric Company (NYSE/GE) or The Procter & Gamble Company (NYSE/PG).

Recently, I talked about some smaller dividend paying stocks, such as Och-Ziff Capital Management Group LLC (NYSE/OZM), with a dividend yield of 5.3%, and Fortress Investment Group LLC (NYSE/FIG), with a dividend yield of 3.3%, which you can read more about in “The Benefits of Lesser-Known Small-Cap Dividend Stocks.” Yet these dividend paying stocks are more conservative and offer less upside price appreciation potential.

If you want a bit more risk along with the dividends, there are other small-cap dividend paying stocks available.

Many of these dividend paying stocks are found on the small-cap Russell 2000 index, which has an average dividend yield of 1.29%.

World Wrestling Entertainment, Inc. (NYSE/WWE) has been a big dividend payer with a dividend yield of 4.9%. It’s likely not on your radar unless you happen to watch WWE wrestling. (You know the fake wrestling. No, it’s not real.) The fact is the WWE has a significant global following and reported over $1.0 billion in revenues in 2012. While paying out an excellent dividend yield, the stock is also up 15.9% over the past 52 weeks and is outperforming the S&P 500.

Chart courtesy of www.StockCharts.com

PetMed Express, Inc. (NASDAQ/PETS) is the largest pet pharmacy in the United States. The company sells prescription and non-prescription pet medications, along with other health products for pets. The company just increased its quarterly dividend to $0.17 for a dividend yield of 4.5%. The stock has advanced an impressive 47% over the past 52 weeks, easily beating the S&P 500.

Chart courtesy of www.StockCharts.com

Knoll, Inc. (NYSE/KNL) makes workplace and residential furnishings that have won multiple awards. Trading at 13.64X its estimated 2014 earnings per share (EPS) of $1.13 and with a price-to-earnings growth (PEG) of 0.48, the stock has excellent value. Knoll has underperformed the S&P 500, gaining 1.46% over the last 52 weeks, but the upside capital appreciation potential is huge, and you can still earn a nice 3.2% dividend yield.

Chart courtesy of www.StockCharts.com

In the biotech area, Meridian Bioscience, Inc. (NASDAQ/VIVO) researches, manufactures, and sells diagnostic test kits, purified reagents, and other products. The kits are used for such medical conditions as gastrointestinal, viral, and respiratory infections. Sales are to hospitals, laboratories, research centers, diagnostics manufacturers and biotech companies in over 60 countries. Meridian has good upside and pays a 3.4% dividend yield. You would have also beaten the S&P 500 as the stock advanced 27% over the past 52 weeks.

Chart courtesy of www.StockCharts.com

Article by profitconfidential.com

By Profit Confidential

The U.S. national debt has increased significantly over the last few years, especially after the credit crisis struck the U.S. economy.

To stop the economy from totally collapsing, the U.S. government incurred several trillion-dollar budget deficits in a row as it spent to revive the economy. As yearly budget deficits piled on, the U.S. national debt rose. Today, the U.S. economy has the biggest debt in monetary terms than any other country in the global economy. In fact, if you add together the national debt of Greece, Spain, Portugal, and Japan, collectively, their debts are less than the national debt of the U.S. economy.

What happens next?

At present, the U.S. government is making payments on its old debt by simply borrowing more debt. Hands down, this is the biggest Ponzi scheme in play. But as I have written before in these pages, our national debt-to-gross domestic product (GDP) is only 105%. In Japan, the national debt-to-GDP is 205%. Hence, if we follow Japan’s example, our debt could double from here.

The U.S. government should hit its debt limit in October. And Congress will increase that debt limit as it always does.

Eventually, the only way to reduce the national debt, especially if interest rates rise, is to raise taxes. But it is a double-edged sword. Raise taxes and you stifle the U.S. economy, as higher taxes negatively affect consumer spending. Don’t raise taxes and you still have a problem with a mounting national debt.

Will the U.S. come out with some law that if a group of citizens or a corporation has a certain amount of cash, they will get a special tax assessment on capital? This action makes more sense than an across-the-board tax increase.

It happened in Cyprus. Now we hear something similar is being done in Poland. To help its national debt situation, the Polish government has decided on reforms that move bond assets from private to state funds. Private pension funds are saying the move is unconstitutional. Crazy, but true; this is what is happening in Poland. (Source: Reuters, September 4, 2013.)

In the case of the U.S., I don’t think we have to worry about special tax assessments right now. They will be a thing of the future, not today. If we follow Japan’s route—and it looks like we are—we can add another $15.0 trillion in debt before the government gets desperate (save and except sharply higher interest rates or a total collapse in the value of the U.S. dollar).

Article by profitconfidential.com

By Profit Confidential

In these pages, I have written extensively on how central banks will ultimately be the ones who drive gold bullion prices much higher. The phenomena of these banks getting back into gold (after they were net sellers for years) started in mid-2009.

The chart below clearly shows the rise in gold bullion reserves held by central banks across the global economy; its trend is quite impressive, even for a gold bug like me.

Central banks’ gold reserves have increased about 6.4% since the first quarter of 2008 to the first quarter of 2013. (Source: World Gold Council, last accessed September 6, 2013.) While on the surface that sounds like a small number, the actual increase is 1,717 tonnes of gold—equal to about 64% of the total amount of gold produced annually.

And the buying continues. In the second quarter of this year, central banks bought more gold. They purchased 71 tonnes of the yellow metal. (Source: World Gold Council, August 15, 2013.)

Why are these banks running towards gold bullion? It’s because they are getting out of U.S. dollars as their reserve currency. The chart below tells that story.

This chart is something gold bears refuse to acknowledge. It shows the percentage change from a year ago in U.S. dollar reserves at central banks around the world. You can see how, since 2007, the U.S. dollar has become less of a reserve currency for these banks.

The actions of the central banks, in buying more gold bullion and getting away from the U.S. dollar as their reserve currency, speaks louder than words—and the two charts above just give me more ammunition to be bullish on gold bullion.

Michael’s Personal Notes:

The U.S. national debt has increased significantly over the last few years, especially after the credit crisis struck the U.S. economy.

To stop the economy from totally collapsing, the U.S. government incurred several trillion-dollar budget deficits in a row as it spent to revive the economy. As yearly budget deficits piled on, the U.S. national debt rose. Today, the U.S. economy has the biggest debt in monetary terms than any other country in the global economy. In fact, if you add together the national debt of Greece, Spain, Portugal, and Japan, collectively, their debts are less than the national debt of the U.S. economy.

What happens next?

At present, the U.S. government is making payments on its old debt by simply borrowing more debt. Hands down, this is the biggest Ponzi scheme in play. But as I have written before in these pages, our national debt-to-gross domestic product (GDP) is only 105%. In Japan, the national debt-to-GDP is 205%. Hence, if we follow Japan’s example, our debt could double from here.

The U.S. government should hit its debt limit in October. And Congress will increase that debt limit as it always does.

Eventually, the only way to reduce the national debt, especially if interest rates rise, is to raise taxes. But it is a double-edged sword. Raise taxes and you stifle the U.S. economy, as higher taxes negatively affect consumer spending. Don’t raise taxes and you still have a problem with a mounting national debt.

Will the U.S. come out with some law that if a group of citizens or a corporation has a certain amount of cash, they will get a special tax assessment on capital? This action makes more sense than an across-the-board tax increase.

It happened in Cyprus. Now we hear something similar is being done in Poland. To help its national debt situation, the Polish government has decided on reforms that move bond assets from private to state funds. Private pension funds are saying the move is unconstitutional. Crazy, but true; this is what is happening in Poland. (Source: Reuters, September 4, 2013.)

In the case of the U.S., I don’t think we have to worry about special tax assessments right now. They will be a thing of the future, not today. If we follow Japan’s route—and it looks like we are—we can add another $15.0 trillion in debt before the government gets desperate (save and except sharply higher interest rates or a total collapse in the value of the U.S. dollar).

What He Said:

“I’ve been writing to my readers for the past two years claiming the decline in the U.S. property market would not be the soft landing most analysts were expecting, but rather a hard landing. My view remains unchanged. The U.S. housing bust will be cut deeper and harder than most can realize today.” Michael Lombardi in Profit Confidential, June 13, 2007. While the popular media was predicting a bottoming of the real estate market in 2007, Michael was preparing his readers for worse times ahead.

Article by profitconfidential.com

By Profit Confidential

Many of the stock market’s leading stocks (mostly blue chips) have been pulling back recently, even in the face of rising key stock indices. This is both a telling and healthy development for a market that’s been due for a meaningful retrenchment for a long time.

While a lot of the stock market’s best-performing blue chips aren’t too far off of their highs, there’s definitely been some repositioning going on among institutional investors. This is a possible indicator that the stock market is now rotating out of its safest names that have been performing so well this year. It very much is an equity market dynamic worth following.

One of my favorite stocks for long-term investors seeking dividends is Colgate-Palmolive Company (CL). This is not a burgeoning biotechnology stock, but that’s not the point. If you can get a 10% total return, including dividends, in a year from a company that isn’t going to go broke in the next recession, well, that’s meaningful for a stock market investor who is saving for or is already in retirement.

Colgate-Palmolive is five points off its all-time record high set in May of this year. The stock’s current dividend yield is 2.4%, and its trailing price-to-earnings (P/E) ratio is 24, which many may argue is pricey.

This is a company that has a long-term track record of solid business execution and not surprising Wall Street on the downside. It’s the kind of company worth considering on major retrenchments.

Another favorite of mine for long-term stock market investors is PepsiCo, Inc. (PEP). It’s a better business than The Coca-Cola Company (KO), even if you prefer the taste of “Coke.”

PepsiCo has been a much more consistent company in terms of its share price performance compared to Coca-Cola. It’s also a more consistent earner, and while it’s not the fastest mature enterprise in the landscape, its track record of wealth creation including dividends is undeniable. (See “Two Important Factors Now Working Against Stocks.”) It’s a company that I think will keep on delivering on its promises. Soda and snacks continue to be a very good business.

Finally, one of my favorite benchmarks is still Johnson & Johnson (JNJ). Like many blue chips, this pharma healthcare company has experienced long periods of nonperformance on the stock market. After a sustained period of wealth creation (and this doesn’t account for dividends) in the late 1990s and early 2000s, the company traded range-bound from 2005 until 2012. Then the stock accelerated tremendously to its current level.

Johnson & Johnson is eight points off its record high set in mid-July. It has been one of the stock market’s best wealth creators in the large-cap space, and it remains, in my view, a company worth accumulating when it’s down in price.

I find the price retrenchment among many of the stock market’s leading blue chips to be a meaningful development. Combined with a reduction in quantitative easing, it’s a signal that this stock market is about to experience a change in trend.

Article by profitconfidential.com