Weekly Newsletter December 23rd - December 29th

Current Events: Stocks slid last week and gave back solid progress made during the month of December as the heavily publicized fiscal cliff draws near. This after the U.S. markets made a steady rebound from a sharp October-November dip.

What to Look for This Week

The holiday season is in full bloom and with the NYSE and other popular exchanges closed on December 25th in observance of Christmas, there is little on the docket this week from an earnings and economic reports perspective to distract investors from the saga that is the fiscal cliff countdown.

News Affecting the Markets

Although President Obama and his family are spending the holiday in Hawaii, the House and Senate are due back in Washington on Thursday, after their Christmas break. All sides are publicly stating that they are willing to talk and do what is best for the American people, yet a comprise may not be reached in time as the fiscal cliff is now just a week away.

Smart Investing

Taxing a Retirement Plan - Now or Later? : Deciding which type of 401K plan you wish to open is a matter of preference. It should be decided based on how you are willing to save for your future. The most popular types of retirement accounts are the Traditional 401K and the Roth 401K. In a nutshell the main difference between these two types of accounts is in the way in which they are taxed. To determine which one the right one is for them many people ask the famous question “Do I want to eat my cake now, or later?” This question refers to the time value of money. We should all be aware that inflation and taxes affect the future value of the dollar. This is why when you are thinking about opening a 401K account you need to decide if you want more money now or later?

Earnings for the Week

Monday: No major announcements scheduled.

Tuesday: No major announcements scheduled.

Wednesday: No major announcements scheduled.

Thursday: No major announcements scheduled.

Friday: No major announcements scheduled.
* Earnings dates and times are subject to change

Economic Data this Week

Monday
No major announcements scheduled.

Tuesday
No major announcements scheduled.

Wednesday
MBA Mortgage Index @ 7:00 AM for 12/22 (Est. = n/a, Prior = n/a)
Case-Shiller 20-city Index @ 9:00 AM for October (Est. = 3.0% to 3.9%, Prior = 3.0%)

Thursday
Initial Claims @ 8:30 AM for 12/22 (Est. = 365K to 371K, Prior = 361K)
Continuing Claims @ 8:30 AM for 12/15 (Est. = 3200K, Prior = 3225K)
New Home Sales @ 10:00 AM for November (Est. = 379K to 390K, Prior = 368K)
Consumer Confidence @ 10:00 AM for December (Est. = 68.0 to 70.0, Prior = 73.7)
Natural Gas Inventories @ 10:30 AM for 12/22 (Est. = n/a, Prior = -82)

Friday
Chicago PMI @ 9:45 AM for December (Est. = 51.0, Prior = 50.4)
Pending Home Sales @ 10:00 AM for November (Est. = 1.0%, Prior = 5.2%)
Crude Inventories @ 11:00 AM for 12/21 (Est. = n/a, Prior = -0.964M)

Weekly Newsletter December 16th - December 22nd

Current Events: With the infamous fiscal cliff just two weeks away, the financial world looks to lawmakers to save the economy from a disaster. If an agreement is not made by leaders before the first of the New Year the U.S. economy will undoubtedly suffer and negatively impact the U.S. markets.

What to Look for This Week

Scattered throughout this week set to announce earnings are some popular household names such as FedEx, General Mills, Oracle, and Nike. Along with earnings, interest will surround the multitude of economic data on housing as investors gauge the health of the sector and its attempt to rebound. However, the major focus this week will be on Washington as investors seek progress from politicians on structuring a deal that will aid the U.S. in avoiding a fiscal cliff.

News Affecting the Markets

Japan's Nikkei Stock Average surpasses the 10,000 level for the first time in over 8 months. Japanese giants, Nissan, Cannon, Honda, and Sony have all witnessed strength as of late in large part due to a weakening yen which have lead many to expect further easing by the Bank of Japan in the near future.

Smart Investing

 Leveraged ETFs:  A leveraged ETF generally will invest in a variety of instruments to amplify the exposure to an underlying index. In addition to equities, leveraged ETFs may use derivatives to gain exposure. Futures allow investors to gain exposure to a benchmark without direct ownership. These products are standardized contracts between two parties that agree to buy or sell an underlying index at a future date. Leveraged funds are often used to help manage risks in other investments and allow investors to hedge their exposure to sectors they are overweight in. They are also often used to capture returns while eliminating market or sector exposure or to overweight a particular sector by using minimal amounts of cash. Remember, you can never lose more than your initial investment when using leveraged funds. This is in stark contrast to buying on margin or selling stocks short, a process that can cause investors to lose far more than their initial investment.

Earnings for the Week

Monday: No major announcements scheduled.

Tuesday: Jefferies Group Inc (JEF), Oracle Corp (ORCL) {after the close}

Wednesday: Accenture PLC (ACN) {after the close}, FedEx Corp (FDX), General Mills Inc (GIS), Jabil Circuit Inc (JBL) {after the close}, Navistar International Corp (NAV)

Thursday: Carmax Inc (KMX), Carnival Corp (CCL), ConAgra Foods Inc (CAG), Darden Restaurants Inc (DRI), Discover Financial Services (DFS), KB Home (KBH), Micron Technology Inc (MU), Nike Inc (NKE) {after the close}, Red Hat Inc (RHT), Rite Aid Corp (RAD), The Shaw Group Inc (SHAW)

Friday: Walgreen Co (WAG)

* Earnings dates and times are subject to change

Economic Data this Week

Monday
Empire Manufacturing @ 8:30 AM for December (Act. = -8.1, Est. = 2.0, Prior = -5.2)

Tuesday

NAHB Housing Market Index @ 10:00 AM for December (Act. = 47, Est. = 47, Prior = 45)

Wednesday

MBA Mortgage Index @ 7:00 AM for 12/15 (Est. = n/a, Prior = 6.2%)

Housing Starts @ 8:30 AM for November (Est. = 850K to 875K, Prior = 894K)

Building Permits @ 8:30 AM for November (Est. = 870K to 876K, Prior = 866K)

Crude Oil Inventories @ 10:30 AM for 12/15 (Est. = n/a, Prior = 0.843M)

Thursday

Initial Claims @ 8:30 AM for 12/15 (Est. = 345K to 365K, Prior = 343K)

Continuing Claims @ 8:30 AM for 12/08 (Est. = 3192K to 3200K, Prior = 3198K)
Existing Home Sales @ 10:00 AM for November (Est. = 4.90M, Prior = 4.79M)
Philadelphia Fed @  10:00 AM for December (Est. = -1.3 to 2.0, Prior = -10.7)
Leading Indicators @ 10:00 AM for November (Est. = -0.3% to 0.2%, Prior = 0.2%)
FHFA Housing Price Index @ 10:00 AM for October (Est. = n/a, Prior = 0.2%)
Natural Gas Inventories @ 10:30 AM for 12/15 (Est. = n/a, Prior = 2)

Friday
Personal Income @ 8:30 AM for November (Est. = 0.3%, Prior = 0.0%)
Personal Spending @ 8:30 AM for November (Est. = 0.3% to 0.4%, Prior = -0.2%)
Durable Orders @ 8:30 AM for November (Est. = -0.2% to 0.2%, Prior = 0.5%)
Michigan Sentiment @ 9:55 AM for December (Est. = 72.0 to 74.8, Prior = 74.5)

 

 

Weekly Newsletter December 9th - December 15th

Current Events: With hopes of a diverted fiscal cliff growing on Wall Street, the Dow Jones and S&P 500 reach levels not seen since Election Day. While it is just speculation, investors are growing confident that lawmakers will do what it takes to avoid a New Year catastrophe which would bring on widespread tax increases and spending cuts.

What to Look for This Week

Thursday's Retail Sales numbers are sure to catch the attention of many this time of the year as savvy investors seek to gauge the pulse of U.S. consumers this holiday season. The health of the American buying spirit will be on display and lead many to speculate as to what the rest of the winter season has in store.

News Affecting the Markets
The costly and unfruitful $182 billion U.S. government bailout of AIG appears to have come full circle as the U.S. Treasury announced its plans on Monday to sell the remaining 16% of its shares in a public offering. Many top financial companies, such as Goldman Sachs and J.P. Morgan, have been retained as join book-runners during the offering.

Smart Investing

A Word from the Wise of Value Investing: Warren Buffet states that any company that enjoys a sustainable competitive advantage is likely to invest a nominal amount into research and development and new plant and equipment. This would free up cash for other investing purposes such as expansion that would allow the business to increase its sales and profitability. The accessibility of cash is also likely to thwart the company from taking on debt and incurring the cost associated with servicing of debt. A company that enjoys a durable competitive advantage is likely to have high amounts of free cash flow which could be passed on to shareholders.

Earnings for the Week

Monday: No major announcements scheduled.

Tuesday: Dollar General Corp (DG)

Wednesday: Joy Global Inc (JOY)

Thursday: Adobe Systems Inc (ADBE) {after the close}, Ciena Corp (CIEN), Hovnanian Enterprises Inc (HOV), Pier 1 Imports Inc (PIR), Quiksilver Inc (ZQK), VeriFone Systems Inc (PAY)

Friday: No major announcements scheduled.
* Earnings dates and times are subject to change

Economic Data this Week

Monday
No scheduled announcements.

Tuesday
Trade Balance @ 8:30 AM for October (Est. = -$42.8B to -$43.0B, Prior = -$41.5B)
Wholesale Inventories @ 10:00 AM for October (Est. = 0.3% to 0.4%, Prior = 1.1%)

Wednesday
MBA Mortgage Index @ 7:00 AM for 12/08 (Est. = n/a, Prior = 4.5%)
Crude Oil Inventories @ 10:30 AM for 12/08 (Est. = n/a, Prior = -2.357M)
FOMC Rate Decision @ 12:30 PM for December (Est. = 0.25%, Prior = 0.25%)
Treasury Budget @ 2:00 PM for November (Est. = -$113.0B, Prior = -$137.3B)

Thursday
Initial Claims @ 8:30 AM for 12/08 (Est. = 375K, Prior = 370K)
Continuing Claims @ 8:30 AM for 12/01 (Est. = 3200K to 3250K, Prior = 3205K)
Retail Sales @ 8:30 AM for November (Est. = 0.4% to 0.6%, Prior = -0.3%)
PPI @ 8:30 AM for November (Est. = -0.5%, Prior = -0.2%)
Business Inventories @ 10:00 AM for October (Est. = 0.3% to 0.4%, Prior = 0.7%)

Friday
CPI @ 8:30 AM for November (Est. = -0.2%, Prior = 0.1%)
Industrial Production @ 9:15 AM for November (Est. = 0.3% to 0.5%, Prior = -0.4%)
Capacity Utilization @ 9:15 AM for November (Est. = 78.0%, Prior = 77.8%)

Weekly Newsletter December 2nd - December 8th

Current Events: A strong final two weeks of November has the U.S. markets flirting with a reversal from the negative trend which has weighed on all major equity indexes since the first week of October. However, with the fiscal cliff less than a month away true strength in the markets is difficult to develop as economic uncertainty remains.

What to Look for This Week

With multiple employment reports scheduled to be released this week investors will have a slew of data that can be used to gauge the health of the job market and the U.S. economy as a whole. Current estimates project a rise in the unemployment rate; however, in recent months the report has surprised analysts.

News Affecting the Markets

While House Speaker John Boehner and Treasury Secretary Timothy Geithner each making public statements Sunday solidifying their stances on the fiscal cliff on Sunday, most, including the Treasury Secretary, predict Republicans will accept higher tax rates on the top 2% of Americans to reach a budget deal before the end of the year deadline.

Smart Investing

Opening a Managed a Forex Account: Before deciding to open a managed forex account you must be realistic about the amount of "risk capital" you have to invest. Risk capital is referred to as the capital that you can afford to lose without any major impact on your lifestyle or growth of your money. For a number of reasons some forex investment funds will require that funds be sent directly to the bank accounts and while other Forex Managed Account providers allow you to invest directly with their broker. And the preferable one is that scenario that you invest directly with the broker which is giving you more control over your own funds. Allowing you to deposit or withdraw your funds as well as revoke the right of the money manager to trade your account. A solid manager needs to have money management skills, and disciplined trading is necessary. And it is wise to invest with a managed account program run by a team of professionals that give you a peace of mind.

Earnings for the Week

Monday: LDK Solar Co Ltd (LDK)

Tuesday: Autozone Inc (AZO), Big Lots Inc (BIG), Pandora Media Inc (P) {after the close}, Toll Brothers Inc (TOL)

Wednesday: Men's Wearhouse Inc (MW) {after the close}

Thursday: H & R Block Inc (HRB), Smithfield Foods Inc (SFD)

Friday: No major announcements scheduled.
* Earnings dates and times are subject to change

Economic Data this Week

Monday
ISM Index @ 10:00 AM for November (Est. = 50.0 to 51.2, Prior = 51.7)
Construction Spending @ 10:00 AM for October (Est. = 0.3% to 0.4%, Prior = 0.6%)
Auto Sales @ 2:00 PM for November (Est. = n/a, Prior = 5.2M)
Truck Sales @ 2:00 PM for November (Est. = n/a, Prior = 6.0M)

Tuesday
No scheduled announcements.

Wednesday
MBA Mortgage Index @ 7:00 AM for 12/01 (Est. = n/a, Prior = -0.9%)
ADP Unemployment Change @ 8:15 AM for November (Est. = 0.0% to 0.1%, Prior = 0.8%)
Factory Orders @ 10:00 AM for October (Est. = -0.1% to -0.5%, Prior = 4.8%)
ISM Services @ 10:00 AM for November (Est. = 53.0 to 53.7, Prior = 54.2)
Crude Oil Inventories @ 10:30 AM for 12/01 (Est. = n/a, Prior = -0.347M)

Thursday
Initial Claims @ 8:30 AM for 12/01 (Est. = 395K to 400K, Prior = 410K)
Continuing Claims @ 8:30 AM for 12/24 (Est. = 3350K to 3275K, Prior = 3287K)

Friday
Nonfarm Payrolls @ 8:30 AM for November (Est. = 50K to 120K, Prior = 184K)
Unemployment Rate @ 8:30 AM for November (Est. = 8.0% to 8.1%, Prior = 7.9%)
Michigan Sentiment @ 9:55 AM for December (Est. = 82.0 to 82.4, Prior = 82.7)
Consumer Credit @ 3:00 PM for October (Est. = $8.0B to $9.9B, Prior = $11.4B)