Earnings roundup
Qualcomm missed (31c vs. 47c-expected)
Allstate missed (97c vs. 135c-expected) a
Starbucks missed (15c vs. 17c-expected)
Lam Research missed (loss of -9c vs. loss of -5c-expected);
Ryland Group missed (loss of -140c vs. loss of -123c-expected)
Owens-Illinois beat (45c vs. 39c-expected)
Boston Scientific met expectations (13c)
USG missed (-132c vs. -49c-expected)
Boston Properties beat (138c vs. 135c-expected)
Continental Airlines beat (loss of -84c vs. loss of -86c-expected)
Eli Lilly beat (107c vs. 105c-expected)
Eastman Kodak missed (loss of -8c vs. 18c-expected)
AutoNation met (12c)
Ford missed (loss of -137c vs. loss of -124c-expected)
Colgate-Palmolive beat (100c vs. 98c-expected)
Black & Decker beat (97c vs. 69c-expected)
3M beat (97c vs. 93c-expected)
Occidental Petroleum beat (118c vs. 95c-expected)
Illinois Tool Works beat (54c vs. 48c-expected)
Royal Caribbean missed (1c vs. 7c-expected)
via Bloomberg
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January 29th, 2009 at 2:48 pm
Man bites Dog. Found Bag Of Cash Returned To Rightful Owner. Politician Spends Money Wisely. TARP On Target.
Analysts Don’t Lowball Earnings Estimates.
Call Me Home, Jesus, I’ve finally seen it all.
January 29th, 2009 at 3:01 pm
Auto Nation met
I’m sort of surprised by that. The CEO is on CNBC all the time, seems like he’s pretty smart, never owned or looked at the stock.
Doesn’t bill gates own a ton of Auto Nation?
January 29th, 2009 at 3:02 pm
Those analyst are always right on…so confusing how they missed these numbers?!?!?
Couldn’t be the same people who told clients to buy though all of last year? NAH
January 29th, 2009 at 3:06 pm
Not a very inspiring set of earnings data, especially when you consider how massaged are the estimates.
I think we are setting up for another bear move here. Lack of a bounce off 850 is bearish, and that would be exacerbated by a weak close here. If you add in the fact that we are overdue for a bull move by the $ then this move could get worse. Looking at Treasuries, the 5s and 10s are suddenly short-term oversold as of today, so people might be tempted into bonds tomorrow as a safety trade for EoW. The $ is rallying and that has been bearish for stocks as well in this market.
After reading AT the past few days and looking at the short-covering rally in banks I went very short yesterday, using FAZ and QID, although I still have a few miners and dividend stocks.
If I was all on the long side I would have my eyes on Monday afternoon right now, these moves are rarely a one-day trade, and there really is no reason to buy financials at this point (and many reasons to sell – look at insurance stocks today) until there are more details from Treasury. If we have a very weak GDP number then it seems likely that oil will sell off further, and since energy/materials have been leading, the market may well follow oil downwards.
NB – many institutional investors have gone into corporate bonds now. No reason to play in equities when you have inflation-free returns (temporarily). I would not expect volume to pick up until we see 800 again. Which I now think is odds on, if not before, then after the next NFP number next Friday morning.
January 29th, 2009 at 3:10 pm
Barry,
may not much matter…take for instance Black and Decker..
http://www.reuters.com/article/marketsNews/idESBNG43148820090129?rpc=44
UPDATE 2-Black & Decker sees weak 2009, to cut 1,200 jobs
Black and Decker down 20 per cent today
January 29th, 2009 at 3:17 pm
People with no jobs don’t spend too much money. Maybe they can count on their new employees in Communist China to start buying stuff. I wouldn’t hold my breath if I were them. They laid off the buyers and are now wondering what the hell is going on. Priceless.
January 29th, 2009 at 3:21 pm
Bruce,
Black and Decker, IMO should not be used as any sort of indicator on anything, first, that’s consumer/construction/housing related so of course it’s bad, second they are still in the midst of restructuring so I would not take that as any sort of surprise.
Sees a weak 2009…. lol
I see the sun coming up in the east tomorrow.
January 29th, 2009 at 3:35 pm
Funny how Borchers completely disappears as his predictions go south.
January 29th, 2009 at 3:36 pm
I smell a big weekend bailout of some sort coming late tomorrow or over the weekend.
January 29th, 2009 at 3:46 pm
Barry– might I suggest that you start a movement to ban the phrases “beat” and “missed” expectations throughout the financial world?
As we know, the estimates are gamed by the analysts and companies anyway and have no accuracy value either. In order for a “beat” or “miss” to be relevant, the expectations have to be honest. And we know that ain’t happenin’. Heck, with all the writeoffs and weird accounting, who knows what reported eps are anyway.
It is this sort of gaming the system mentality that has gotten us in this mess in the first place.
So I suggest you ban this commentary. Regards to all.
January 29th, 2009 at 3:46 pm
@Ben: you should buy FSLR then.. LOL. Seriously, I don’t see a bounce going into the weekend. Watch traders move into Treasuries tomorrow morning for a safety trade. I am staying short but if we do rally I am flat at SPX 880. I think AT said he would stay short to 905.
@ Jeff: I miss JB. My guess is he will be back with the bullish call at the bottom of the next downward move. He has actually been correct a number of times on the change of direction, but then he gets carried away…
Somewhere in California, Karen is watching the gold spot and smiling.
Obama just said “regulating Wall Street”, and that’s not bullish. I think he has been taking Tiny Tim out to the woodshed with regard to bonuses on the Street and the sloppy regulation that has been in place. I agree with him COMPLETELY but I don’t think the market will like this, or GDP tomorrow. SELL.
January 29th, 2009 at 3:46 pm
Jeff, maybe he just doesn’t have anything to say : ) i haven’t disappeared to your probable dismay. enjoying the day, actually.
January 29th, 2009 at 3:48 pm
LB, speak of the devil and she magically appears.
January 29th, 2009 at 3:52 pm
The San Clemente devil.
January 29th, 2009 at 3:53 pm
I hear you, karen. Just needling/twisting the knife a bit. Trying to draw him out. Was waiting to draw you out too. You were next. :-)
January 29th, 2009 at 3:57 pm
LB,
that’s funny, I’ll just watch the sun come up instead. Not a fan of the solar stocks.
I’m going to work over the weekend on re-picking my limit order on TBT again, I got out early this week with the expectation of Bernanke making me look real smart. Wrong on that one but made money so who cares.
I picked up a real nice trade in MELI recently that was fun.
Trying to find an entry point for SRS. I can’t figure that one out.
Loving my GLD
Waiting patiently for my time to buy UDN, probably in 2010. Can the dollar really survive.
Then maybe, if it all works out, I’ll move somehwere else.
January 29th, 2009 at 3:59 pm
Mannwich,
Want to try and name some specifics with that bailout call?? What has happened to those Sunday surprises, for a while there they were going on ever week or two.
January 29th, 2009 at 3:59 pm
@lb: A little OT: O needs to have the courage to not allow short term market gyrations dictate his policy decisions. He has to be able to take the heat from the shills on CNBC and other MSM outlets. That’s been a huge part of the problem to date. To hell with “what the market likes” over the short term and (call me naive) but do what’s right and pragmatic for once. If this country ultimately goes down the crapper, the markets are going down with it.
January 29th, 2009 at 3:59 pm
qqqq and spy filled gap from day before yesterday. thank you. we needed to do that sooner vs. later.
January 29th, 2009 at 4:00 pm
@ben22: Let me think about it. I do think something major is coming tomorrow or over the weekend, especially if GDP #’s are as horrific as we think they’ll be and the market tanks.
January 29th, 2009 at 4:01 pm
I am also expecting to see oil dip and that might be a good entry point for me to get long some oil stocks, I was looking at PetroBras but PBR A.
Sort of hard to buy here as it has run up about 70% since 11/21.
I’m on the road an awful lot for work and I’m still seeing a decline in traffic, since I drive I95 every day I can get a decent outlook on this and it’s still in decline, we haven’t even really had bad weather either.
January 29th, 2009 at 4:03 pm
Mannwich,
You and BR buddy. You guys still don’t get that Obama is just a politician, he’s not going to do what you want. I want him so badly to do well but I’ve given up HOPE on all of these Washington scumbags.
January 29th, 2009 at 4:03 pm
@ben22: I had PBR a while back but took a beating on it. Have been eyeing it thinking about a good time to get back in.
January 29th, 2009 at 4:04 pm
we basically just gave back yesterday, going to be tough to end up for Jan. guess that Jan indicator doesn’t look so hot right now, only solution in the past has been a war.
January 29th, 2009 at 4:06 pm
@ben22: I hear you. I get that he’s “just a politician”, believe me, but I really want sanity to return for the sake of this country. I’m quickly losing hope that he’ll do the right thing and fear that our political/corporate system in its current form is hopeless and needs a radical overhaul.
January 29th, 2009 at 4:06 pm
Mannwich,
Yes, I bet that GDP number is just awful tomorrow, and then I’ll have to get upset when I hear:
“worse than expected” wow am I sick of that pharse.
I like where your head is at though, would not be surprised by anything at this point.
I’m waiting for something to go down with GE. Something just doesn’t “feel” right there.
January 29th, 2009 at 4:07 pm
alright I’m gonna stop because it looks like we need to get a room!
take care all, see you Friday.
January 29th, 2009 at 4:10 pm
@ben22: GE could be that “big news” that I smell in the coming days. The smell of bailouts are in the air though. Just a gut feeling though. I just can’t see the feds allowing this market to go much lower without doing something major to prop it up once again. After all, we only seem to truly rally on bailout news. What other “good news” has there been lately?
Speaking of gut, off to the gym for some sweatin’ to the oldies. Now there’s something I can control a little!
January 29th, 2009 at 4:15 pm
I couldn’t help but think of one more investment idea
SLM A
better known as sallie mae preferreds.
I don’t see student loans ending.
January 29th, 2009 at 4:17 pm
Mannwich @ 3:59
“[Obama] has to be able to take the heat from the shills on CNBC … To hell with ‘what the market likes’ over the short term…”
Amen to that.
January 29th, 2009 at 4:33 pm
Question for you TA guys…
If you believe that a Wave 5 started on Jan 6 at the 944 level (S&P cash) would it make sense to characterize the entire move from 944 down to 804 on Jan 20 as the first subwave of this move (wave 1). From there I could see an a-b-c retracement as 804 to 842, 842 to 806, and 806 to 878, respectively (completed yesterday).
It would then follow that today’s was the beginning of a Wave 3 downward wave which could extend for at least a couple of weeks with potential targets below 600. If on the other hand this is udder nonsense then please carry on…nothing to see here.
January 29th, 2009 at 4:56 pm
@ Short Man: I am not a Waver but it seems clear from simple TA that taking out support at SPX 806 would probably induce forced selling as further deleveraging takes place. The London hedge funds are a total disaster area, by the way, and worry me a lot more than Greenwich. Anyway, we all know that liquidation must occur at some point to meet requests for redemptions, at least in those funds without gates. AT has a 660 target but given the reflationary stimulus, I would be a buyer of commodity stocks at 750, in case we never get to 660.
@ Ben: GE Capital, GMAC, HIG. All examples of leveraged corporate hedge funds that need to be unwound.
January 29th, 2009 at 5:21 pm
And Dead Hobo…I think your sentiment is just right…are we about to see this year most large corporations stop giving guidance of any sort? I’ve heard that bandied about on Kneale-vision…
Wouldn’t that make analysts’ jobs interesting?
January 29th, 2009 at 5:47 pm
good lord this silly game has got to just stop. beat miss beat miss beat miss beat miss. beat miss according to what? wall street analysts? nothing could be more absurd. why are there any wall street anlaysts anyway they are WORTHLESS. they serve zero economic purpose. they are simply positions created to make firms look like they are competent with ivy league mba’s. when will the public wake up and understand they are better managers of their own money than any schmuck on scum street. wall street is nearly burnt to the ground anyway let’s let it continue and then bulldoze it over so that no of this BS is ever spewed again
January 29th, 2009 at 5:48 pm
And in the midst of the carnage, this from Bloomberg:
“Dodd, a Connecticut Democrat who heads the Senate Banking Committee, vowed at a press conference at the Capitol to go beyond condemnation and seek a return of bonuses.
“I’m going to be urging — in fact not urging, demanding — that the Treasury Department figures out some way to get the money back,” Dodd said. “This is unacceptable.”
The senator said he will force executives whose companies received taxpayer aid to testify before his committee to explain their bonuses.
Former Salomon Brothers Inc. Chairman John Gutfreund dismissed Dodd’s comments, calling it “political posturing” in an interview with Bloomberg Television. “They are not going to repay all their bonuses,” said Gutfreund, 79.”
Johnny Guts-of-friends doesn’t get it. The gilded age is over. The politicians HAVE to corral some high level scapegoats. The elite can’t bullshit their way out of this one. There will be claw back AND some prison terms or the next congress will have only two parties represented, radical socialist democrats and 11 blue dog democrats. Elits aren’t stupid. They know when they need to cut their losses.
January 29th, 2009 at 5:52 pm
microcap is right. All the blather about “expectations” is shorthand for “pay us for our educated guesses”. We’re all kind of tired of paying people for happy faced horseshit.
January 29th, 2009 at 5:54 pm
Dodd, a Connecticut Democrat who heads the Senate Banking Committee, vowed at a press conference at the Capitol to go beyond condemnation and seek a return of bonuses.
“I’m going to be urging — in fact not urging, demanding — that the Treasury Department figures out some way to get the money back,” Dodd said. “This is unacceptable.”
The senator said he will force executives whose companies received taxpayer aid to testify before his committee to explain their bonuses.
Former Salomon Brothers Inc. Chairman John Gutfreund dismissed Dodd’s comments, calling it “political posturing” in an interview with Bloomberg Television. “They are not going to repay all their bonuses,” said Gutfreund, 79
Keep believing, Mr. Salomon Bro. Why don’t you go to a bridge tournament or something?
January 29th, 2009 at 5:56 pm
@ben22,
I think that the College Education is also an inflated asset bubble.
People are overbidding for tuition in the same way that people overbid for homes. 200k of debt financing to graduate and get a job @ 30k/year? And the price keeps going up faster than inflation? At some point the graduates are going to start defaulting in record numbers.
Yeah, it’s not dischargeable debt in bankruptcy, but if you’re not earning, you’re not paying!
January 29th, 2009 at 5:58 pm
@AGG
The analysts aren’t all bad. Whitney has done a good job. And I think Gene Munster falls into that category as well.
January 29th, 2009 at 6:00 pm
Barry,
Vermont state unemployment offices have 48 telephone lines. I just read in the Burlington Free Press that people requesting unemployment can’t get through and the head of the unemployment offices is going to hire 5 workers to take calls. The roof is falling in here at Vermont and it’s not from snow load.
January 29th, 2009 at 6:02 pm
Thisson,
True, they aren’t all bad but the cost of the services is, considering the modern day internet resources, not justified in my opinion.
January 29th, 2009 at 6:05 pm
We are having a debate at work over what currency will be used after the Chinese stop buying our bonds and the dollar (and other fiat money) is recognized by the masses as the worthless scrip it is.
Current options are:
1) Cans of Spam
2) Campbells Soup
3) Cigarettes
4) Bottles of Booze
5) Military Rations
6) Ammunition
7) Seeds
Any other ideas?
January 29th, 2009 at 6:40 pm
AGG,
Dodd, a Connecticut Democrat who heads the Senate Banking Committee, vowed at a press conference at the Capitol to go beyond condemnation and seek a return of bonuses.
“I’m going to be urging — in fact not urging, demanding — that the Treasury Department figures out some way to get the money back,” Dodd said. “This is unacceptable.”
The senator said he will force executives whose companies received taxpayer aid to testify before his committee to explain their bonuses.
**
Ooooohhh, hearings!! How scary is that? This reveals that Dodd and others of his ilk (from both parties) are part of the problem and not the solution.
What is unacceptable is Congress voting to shovel huge amounts of taxpayer money to prop up corporations that should be out of business. Not only that, what is additionally unacceptable is giving such money without appropriate conditions. Such conditions should include at a bare minimum:
* replace the board of directors for failing to supervise top management
* replace top management who led these companies to the brink of insolvency
* pay new top management government wages with the ability to earn bonuses only upon repayment of government money
* suspend dividends or at least limit them to a very nominal amount
January 29th, 2009 at 6:46 pm
Thisson,
You make a good point, I’ve been looking at this as a high risk bet, last year they lost about 100 million more than they made, I might take a shot at it however. As much as I agree with college being too expensive while most things are deflating some still aren’t
Food, Healthcare, College.
plus, part of this “stimulus” might help this along.
January 29th, 2009 at 6:47 pm
AGG,
That is going on in lots of states right now, I know PA and DE are having the same problems, I can only assume Ohio and Michigan, California, Florida and Nevada too.
January 29th, 2009 at 7:28 pm
John,
Of course Barney is being a hypocrite. That’s par for the course among politicians. Hodever, there is a very large fire under his ass right now that we have lit. I hope many of the reforms you mention come to pass. In the meantime, I just read this and it needs to be said: Stop the fucking war spending NOW!
The financial damage inflicted on Americans by their own government is as great as would be expected from foreign conquest. While Washington “protected” us from terrorists by fighting pointless wars abroad, the US economy collapsed.
How can President Obama even think about fighting wars half way around the world while California cannot pay its bills, while Americans are being turned out of their homes, while, as Business Week reports, retirees will work throughout their retirement (which assumes that there will be jobs), while careers are being destroyed and stores and factories shuttered.
Americans are facing tremendous unemployment and hardship. Obama doesn’t have another dollar to spend on Bush’s wars.
Taxpayers are busted. They cannot stand another day of being milked by the military-security complex. The US government is paying private mercenaries more by the day than the monthly checks it is providing to Social Security retirees.
This is insanity.
The banksters robbed us twice. First it was our home and stock values. Then the government rewarded the banksters for their misdeeds by bailing out the banksters, not their victims, and putting the cost on the taxpayers’ books.
The government has also robbed the taxpayers of $3 trillion dollars to fight its wars. About $600 billion are out of pocket costs, and the rest is on the taxpayers’ books.
When foreign creditors look at the debt piled on the taxpayers’ books, they don’t see a good credit risk.
Washington is so accustomed to ripping off the taxpayers for the benefit of special interests that the practice is now in the DNA. While bailouts are being piled upon bailouts, wars are being piled upon wars.
Before Obama gets in any deeper, he must ask his economic team where the money is coming from. When he finds out, he needs to tell the rest of us.
Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He is coauthor of The Tyranny of Good Intentions.He can be reached at: PaulCraigRoberts@yahoo.com
January 29th, 2009 at 7:29 pm
I agree with most of the conditions that John noted above – (except I like my dividends, they keep me off the ledge these days). Who do we have here to get this done for us?! Use your media pull, Barry!
January 29th, 2009 at 7:48 pm
Re: college education, someone somehow needs to create and maintain a giant database of average salaries of those with various degrees, to share with the college counselors and HS seniors across the country (and their parents) what the realistic ROI is on the ‘dream’ of going off to a liberal arts university.
My oldest is still 9 years away, but I admit to being secretly concerned about ending up a (unintentional) liar about pushing the typical ‘college = better life’ sentiments almost daily, as it relates to his academic and athletic pursuits. “Work on that fastball and math, kid, if you want the good life…” geez, I seriously wonder…..
January 29th, 2009 at 7:50 pm
“The US government is paying private mercenaries more by the day than the monthly checks it is providing to Social Security retirees”
Why do politicians NEVER mention this painful reality?
Hell, if it was just republicans, we could scapegoat them, but it’s democrats too. We need to refine our voting to put democrats and republicans and libertarians against war spending into congress. We need to make it illegal for PACs to collect money from a corporate entity. All PAC money must be from clearly identified individuals in a web site paid for by the government. Then we need to catch the bribers trying to get around this and make examples of them.
Remember, corporations don’ t lie, bribe, cheat, pollute or kill.
PEOPLE DO.
January 30th, 2009 at 7:04 am
AGG,
You know I actually didn’t know that but that’s sick.
I’m sick of hearing about no republicans voted for this stimulus b/c they wanted tax cuts. Look, whether you like the stimulus or not tax cuts are going to do the deal.
I can tell you as a biz owner if my taxes get cut I will
1. Not hire anyone new
2. Not spend the money
Further, if you look at the tax cut proposal what exactly will it do for anyone. They are talking about a 5% tax cut across the board. Now I don’t even know what that means, 5% of total Gross Income, 5% off each marginal bracket, ??? In any even a 5% tax cut across the board for a family trying to live off of 40k a year isn’t going to save them. Won’t stop them from foreclosure, won’t help them send kids to college etc etc.
January 30th, 2009 at 7:05 am
I meant to say tax cuts are NOT going to do the deal.