The Red Roadmasterâ€™s US Market Re-cap + Stock Talk â„˘
3 November 2009
Date Line: Hong Kong (SAR) China
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DJIA closed + 76.71 pts after being + 146 early on the day
The S&P 500 is up 53.2% since hitting a 12-yr low on March 9, 2009
Re-cap of the US Stock Market Action for the session ending 2 November 2009
US Stocks moved smartly North early on Monday on strong housing and manufacturing reports then waffled during the session. The strong Northside action Monday came after the Institute for Supply Management reported that manufacturing activity grew in October at the fastest pace since April 2006. The ISM index marked a 55.7, much better than the 53 expected making it the 3rd month running that the index came in above 50, the Key growth indicator. Next the National Association of Realtors said pending home sales increased for the 8th straight month in September. The index rose 6.1% from August to 110.1, the highest reading since December 2006 and more than 21% above Y 2008, 103.8 was expected. After the closing bell, tool maker Stanley Works said it will buy rival Black & Decker Corp in a US$3.46B stock deal. Black & Decker shares surged nearly 20% to US$56.57 in extended trade while Stanley Works added 2.9% to US$46.45. At the close the DJIA rose 76.71, or 0.8%, to 9,789.44, the S&P 500 rose 6.69, or 0.7%, to 1,042.88, the NAS rose 4.09, or 0.2%, to 2,049.20, and the Russell 2000 lost 0.37, or 0.4%, to close the session at 562.40.
Advancing stocks outpaced decliners on the NYSE, where the trade came in at 1.5B/shrs, compared with 1.7B/shrs last Friday. Advancing Sectors: Consumer Staples (+1.0%), Materials (+1.0%), Industrials (+1.0%), Consumer Discretionary (+0.9%), Financials (+0.8%), Health Care (+0.6%), Energy (+0.5%), Tech (+0.4%) Declining Sectors: Telecom (-0.4%), Utilities (-0.3%) Bond prices fell, the yield on the benchmark 10 yr T-Note rose to 3.43% from 3.39% late Friday. The US$ fell against most major currencies, driving commodity prices North. Crude Oil rose US$1.13 to settle at US$78.13 bbl, and Gold prices rose above US$1,060oz Monday on the pressured US$, thus enhancing the yellow metal's appeal as a hedge against a falling "Greenback." Goldâ€™s buying sentiment improved after the world's biggest Gold producer Barrick Gold and AngloGold Ashanti (covered yesterday in Stock Talk), the world's # 3 Gold miner, said they might buy back their hedge positions ahead of plan, such a move indicates the companies expect Gold prices to continue running North. Overseas: Britain's FTSE 100 rose 1.2%, Germany's DAX index added 0.3%, France's CAC-40 rose 0.9% and Japan's Nikkei lost 2.3%. Today, the US Federal Reserve is set to begin its 2 day FMOC policy meeting.
Alert: Australia Increases Benchmark Interest Rate to 3.5% nd
Australia raised its benchmark interest rate by a quarter percentage pt for the 2 time in 4 weeks, becoming the first nation to increase borrowing costs twice this year as the global economy recovers.
Stocks to Watch Today The Black & Decker Corporation (BDK), Citigroup, Inc. (C), Kraft Foods Inc. (KFT), Motorola (MOT), US Bancorp (USB), and Wal-Mart Stores, Inc (WMT).
The Black & Decker Corporation (BDK) Up-date 1 Last Look: July 27, 2009 November 3, 2009 Paul A. Ebeling, Jnr. Analyst Today, let’s look at The Black & Decker Corporation (BDK), one of the USA’s top makers of power tools and accessories from a Technical POV. The overall indications, after Monday’s (November 2, 2009) market action, are Neutral: in the near term Neutral, mid-term Neutral, and long term Bullish. The recent candlestick analysis is: Very Bullish.
**Chart by: http://www.stockta.com
Latest News: Toolmaker Deal Ends a 28 Yr Courtship http://www.nytimes.com/2009/11/03/business/03deal.html?partner=yahoofinance
Mondayâ€™s Market Action Close 47.34 + .12 Note: After Hours trading: 58.55
11.21 (23.68%) 7:59pm ET
There is a Bullish Harami on November 2, are three Gaps open up between July 15 and October 8, 2009 at 29.09/45.06, the near term resistance is 50.77, support at 46.89, and the 50 day (EMA) exponential moving average is 46.27. This is The Black & Decker Corporation (BDK): B&Dis one of the USAâ€™s top makers of power tools and accessories, produced mainly under the DEWALT and Black & Decker names. It also makes electric lawn and garden tools, plumbing products (Price Pfister), specialty fastening and assembly systems, security hardware (Kwikset), and cleaning and lighting products (Dustbuster, SnakeLight, Scumbuster). Black & Decker markets its products in more than 100 countries; its largest customers include Home Depot and Lowe's. The company purchased power products maker Vector Products in 2006 for US$160MM.
Competitive Landscape Demand depends heavily on the construction and building repair industries. The profitability of individual companies depends on marketing and efficient production. Large companies have economies of scale in purchasing and production. Small firms can compete by making specialty products. Hand tool and Cutlery Manufacture Industry Forecast The output of US handtool and cutlery manufacturing is forecast to grow at an annual compounded rate of 4% between 2008 and 2013. Data Sourced: December 2008 The Black & Decker Corporation (HQ) Nolan D. Archibald, Chairman, Chief Exec. Officer, President 701 East Joppa Road Towson, MD 21286 United States Phone: 410-716-3900 Fax: 410-716-2610 http://www.bdk.com
Citigroup, Inc. (C) Up-date 53
Last Look: October 6, 2009
November 3, 2009 Paul A. Ebeling, Jnr. Analyst Today letâ€™s look at Citigroup, Inc. (C), perhaps the largest financial services company in the world, from a Technical POV. The overall indications, after Mondayâ€™s (November 2, 2009) market action, are Neutral: in the near term Bearish, mid-term Bearish, and long term Neutral. The recent Candle Stick analysis is: Neutral.
**Chart by: http://www.stockta.com
Latest News: Can Citigroup Carry Its Own Weight? http://www.nytimes.com/2009/11/01/business/economy/01citi.html?partner=yahoofinance
Mondayâ€™s Market Action Close 3.99
There is a Homing Pigeon on October 27, and one Gap open up on August 5, 2009 at 3.25/3.29 the near term resistance is 4.13, support 3.91, and the 50 day (EMA) exponential moving average is 4.36. This is Citigroup, Inc. (C): Citi is perhaps the largest financial services firms on the planet, Citigroup, AKA Citi, has about 3,000 bank branches and consumer finance offices in the US and Canada, + more than 2,000 additional locations in a 100 other countries. Citi is the first US bank to come with more than US$1T in assets, Citi offers deposits and loans, mainly through Citibank, investment banking, brokerage, wealth management, alternative investments, and other financial services. Former CEO Chuck Prince resigned in 2007 as Citi deals with some $60 billion in write downs and losses on mortgage-related securities and other investments. Robert Rubin, Key Advisor/Director recently announced his resignation. The Competitive Landscape Demand for banking services is tied to economic activity and interest rates levels. The profitability of individual banks depends on marketing, efficient operations, and competent risk management. Large economies of scale exist in some segments of the industry, which has experienced consolidation. Smaller banks can compete successfully in segments where customer service or knowledge of the local market is more important. The industry is capital-intensive and highly automated: annual revenue per employee is about US$300,000. Banks and Credit Unions Industry Forecast
The output of US banks and credit unions growth forecast remains a question Industries Where Citigroup Competes Banking Money Center Banks (primary) Financial Services Asset Management Investment Banking Lending Citigroup, Inc. (HQ) Chief Exec. Officer, Director Vikram S. Pandit 399 Park Ave. New York, NY 10043 United States Phone: 212-559-1000 Toll Free: 800-285-3000 http://www.citigroup.com
Citigroup Subsidiaries Grupo Financiero Banamex, S.A. de C.V. Bank Handlowy w Warszawie S.A. Citi Commerce Solutions
Kraft Foods Inc. (KFT) Up-date 3
Last Look: September 8, 2009
November 2, 2009 Paul A. Ebeling, Jnr. Analyst Today let’s look at Kraft Foods Inc. (KFT), the USA’s #1 food company and 2 in the world (behind Nestlé), from a Technical POV. The overall indications, after Monday’s (November 2, 2009) market action is Neutral: in the near term Neutral, mid-term Neutral, and long term Neutral. The recent candle stick analysis is: Very Bearish.
**Chart by: http://www.stockta.com
Latest News: Kraft quarterly results could make a case to Cadbury http://finance.yahoo.com/news/Kraft-quarterly-results-could-rb-339711306.html?x=0&.v=1
Mondayâ€™s Market Action Close 27.64
There is a Hammer on November 2, and one Gap open down on September 8, 2009 at 27.86/26.92, the near term resistance is 27.79, support at 27.34, and the 50 day (EMA) exponential moving average is 26.85. This is Kraft Foods Inc. (KFT): The Company manufactures and markets packaged food products and grocery products worldwide. The company offers snacks, including cookies, crackers, salted snacks, and chocolate confectionary; beverages, including coffee, packaged juice drinks, and powdered beverages; cheese, including natural, process, and cream cheeses; and grocery, including spoonable and pourable dressings, condiments, and desserts. It also offers convenient meals, including primarily frozen pizza, packaged dinners, lunch combinations, and processed meats. Kraft Foods markets its products under various brand names, primarily including Kraft cheeses, dinners and dressings; Oscar Mayer meats; Philadelphia cream cheese; Maxwell House and Jacobs coffee; Nabisco cookies and crackers and its Oreo cookie brand; Milka chocolates; and LU biscuits. It sells its products to supermarket chains, wholesalers, super centers, club stores, mass merchandisers, distributors, convenience stores, gasoline stations, drug stores, value stores, and other retail food outlets.
Competitive Landscape Demand is related to eating trends and to the changing structure of the grocery industry. Profitability for individual companies is determined by efficiency of operations. Large companies have scale advantages in procurement, production, and distribution. Small companies can compete by offering specialty goods or superior local distribution services. Despite high automation, the low value of the product produces a fairly modest US$150,000 in annual revenue per employee for commercial bakers.
Bakeries Industry Forecast The output for US bakery and pasta products is forecast to grow at an annual compounded rate of 2 % between 2008 and 2013. Data Sourced: December 2008
Kraft Foods Inc. (HQ) Chairman and Chief Exec. Officer: Irene B. Rosenfeld Three Lakes Drive Northfield, IL 60093 United States Phone: 847-646-2000 Fax: 847-646-6005 http://www.kraft.com
Kraft Foods Subsidiaries Boca Foods Company
Motorola (MOT) Up-date 2
Last Look: October 29, 2009
November 3, 2009 Paul A. Ebeling, Jnr. Analyst Today, letâ€™s look at Motorola (MOT), a top choice for mobile phone users worldwide, from a Technical POV. The overall indications, after Mondayâ€™s (November 2, 2009) market action, are Neutral: in the near term Neutral, mid-term Bullish, and long term Neutral. The recent candlestick analysis is: Very Bullish
**Chart by: http://www.stockta.com
Latest News: Citigroup Analyst: Big on Motorola, Android http://seekingalpha.com/article/170644-citigroup-analyst-big-on-motorola-android?source=yahoo
Mondayâ€™s Market Action Close 9.03
There is a Hammer on November 2 and two Gaps open up between July 30, and October 29, 2009 at 6.77/8.46, the near term resistance is 9.34, support at 8.70, and the 50 day (EMA) exponential moving average is 8.13. This is Motorola (MOT): Motorola is still a top choice for mobile phone users worldwide despite flagging handset sales. The company is the #3 manufacturer of wireless telephone handsets (behind leaders Nokia and Samsung) and it also sells wireless network infrastructure equipment such as cellular transmission base stations and signal amplifiers. Motorola's home and broadcast network products include set-top boxes, digital video recorders, and network equipment used to enable video broadcasting, IP telephony, and high-def television. Its products for business and government customers consist mainly of wireless voice and broadband data systems used to build private networks and public safety communications systems.
Competitive Landscape The industry depends on purchases from businesses, telephone companies, cable companies, data communications providers, and TV and radio broadcasters. Profitability for individual companies is linked to technical innovation and the ability to secure high-volume contracts from large customers. Small companies can be successful if they make highly specialized products. There are large economies of scale in manufacturing standard products, but many products are specialized and produced in small manufacturing plants. Annual revenue per employee in a large plant varies from US$500,000 to US$1M. Telecommunications Equipment Manufacturers Industry Forecast The output of US communication equipment manufacturing is forecast to grow at an annual compounded rate of 2% between 2008 and 2013. Data Sourced: December 2008
Motorola Inc. (HQ) Gregory Q. Brown , Co-Chief Exec. Officer, Pres, Exec. Director, Co-Chairman of Exec. Committee and Chief Exec. Officer of Broadband Mobility Solutions 1303 East Algonquin Road Schaumburg, IL 60196 United States Phone: 847-576-5000 Fax: 847-576-5372 http://www.motorola.com
US Bancorp (USB) Up-date 1
Last Look: April 22, 2009
November 3, 2009 Paul A. Ebeling, Jnr. Analyst Today, letâ€™s look at US Bancorp (USB), the large regional US bank, from a Technical POV. The overall analysis after Mondayâ€™s (November 2, 2009) market action is Neutral: in the near term Neutral, midterm Neutral, and long term Bullish. The recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News: US Bancorp, SunTrust, BB&T Upgraded by Sandler O'Neill http://www.foxbusiness.com/story/markets/industries/finance/bancorp-suntrust-bbt-upgraded-sandleroneill/
Mondayâ€™s Market Action Close 23.84 + .62
There is a Homing Pigeon on October 27, and two Gaps open up between July 13 and October 14, 2009 at 16.79/23.17, the near term resistance is 24.62, support at 23.75 , and the 50 day (EMA) exponential moving average is 22.72. This is US Bancorp (USB): This US bank has approximately 2,800 locations and 5,000 branded ATMs in two dozen mid-western and western states. The bank holding company, one of the 10 largest in the country, owns U.S. Bank and other subsidiaries that provide consumer and commercial banking, as well as credit card and ATM processing, mutual funds, mortgage banking, brokerage, wealth management, equipment leasing, trust services, corporate payments, and insurance. In late 2008 U.S. Bancorp acquired the banking operations of the failed California-based banks Downey Savings & Loan and PFF Bank & Trust in an FDIC-assisted transaction.
Competitive Landscape Demand for banking services is closely tied to economic activity and the level of interest rates. The profitability of individual banks depends on marketing skills, efficient operations, and good risk management. Large economies of scale exist in some segments of the industry, which has encouraged industry consolidation. Smaller banks can compete successfully in segments where customer service or knowledge of the local market is more important. The industry is capital-intensive and highly automated: annual revenue per employee is close to US$300,000. Banks and Credit Unions Industry Forecast The output of US banks and credit unions is forecast to grow at an annual compounded rate of 1 % between 2008 and 2013. Data Sourced: December 2008
US Bancorp (HQ) Richard K. Davis, Chairman, President and CEO 800 Nicollet Mall Minneapolis, MN 55402 United States Phone: 651-466-3000 http://www.usbank.com
U.S. Bancorp Subsidiaries Elavon, Inc. FAF Advisors, Inc.
Wal-Mart Stores, Inc. (WMT) Up-date 19
Last Look: October 2, 2009
November 3, 2009 Paul A. Ebeling, Jnr. Analyst Today letâ€™s look at Wal-Mart Stores, Inc (WMT), the World's #1 retailer, from a Technical POV. The overall indications, after Mondayâ€™s (November 2, 2009) market action, are Neutral, in the near term Neutral, mid-term Bullish, and long term Neutral. The recent Candle Stick analysis is: Neutral
**Chart by: www.stockta.com
Latest News: Food the focus as Wal-Mart starts holiday giving http://www.reuters.com/article/marketsNews/idAFN0243651420091103?rpc=44
Monday’s Market Action Close 50.28
There is a Homing Pigeon on October 27, 2009 and no Gaps open up or down on the Chart, the near term resistance is 50.28, support at 50.10, and the 50 day (EMA) exponential moving average is 50.20. This is Wal-Mart Stores, Inc. (WMT): Wal-Mart Stores is an irresistible (or at least unavoidable) retail force that has yet to meet any immovable objects. Bigger than Europe's Carrefour, Tesco, and Metro AG combined, it is the world's #1 retailer, with more than 7,250 stores, including about 975 discount stores, 2,800 combination discount and grocery stores (Wal-Mart Supercenters in the US and ASDA in the UK), and 590 warehouse stores (SAM'S CLUB). About 55% of its stores are in the US, but Wal-Mart continues expanding internationally; it is the #1 retailer in Canada and Mexico and it has operations in Asia (where it owns a 95% stake in Japanese retailer SEIYU), Europe, and South America. Founder Sam Walton's heirs own about 40% of Wal-Mart. I have never been in a Wal-Mart Store, though I have been in Carreforur’s and Tesco.
The Competitive Landscape Demand depends mainly on the volume of car driving, which in turn depends on economic activity. The profitability of individual stores is closely linked to location and product mix. Large companies have advantages in buying gasoline at bulk prices, but small companies can compete effectively by having superior locations. Annual revenue per worker is close to US$300,000. Wal-Mart Stores, Inc. (HQ) Chairman, S. Robson (Rob) Walton 702 SW 8th St. Bentonville, AR 72716 United States Phone: 479-273-4000 Fax: 479-277-1830 http://www.walmartstores.com
Wal-Mart Subsidiaries ASDA Group Limited SAM'S CLUB Wal-Mart Brazil Disclaimer
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