The Red Roadmaster’s US Market Monthly Re-cap + Stock Talk ™
1 April 2010
Date Line: Hong Kong (SAR) China
You can now follow us on Twitter please go to http://twitter.com/EbelingHefferna and join in.
Red’s Bull Alert
: Strong March closes out a Strong Q-1 Y 2010, as the benchmark S&P
500 tallied up its 4th straight quarterly advance, and the biggest Q-1 gains in more than 10 yrs.
Re-cap of the US Stock Market Action for the session ending 31 March 2010 On the 1st Quarter: The S&P 500 is up 72.9% from its March 9, 2009 bottom. For Q-1, and for Y 2010 as well, the DJIA is up 4.1%, the S&P 500 is up 4.9%, and the leading NAS is up 5.7%. On the Month of March: the DJIA rose 5.1%, the S&P 500 gained 5.9% and the leading NAS tallied up a + 7.1% On the Day: US Stocks slipped on Wednesday on a 1-2 punch from ADP Employer Services data showing US private-sector employers cut some jobs in March + a separate report that showed US Midwest business activity expanded less than expected in March leading some investors to lock in profits in the strong performing sectors, such as consumer discretionary shares, which rose 10% + in Q-1. The DJIA slid 50.79 pts, or 0.47%, to close at 10,856.63, the S&P 500 lost 3.84 pts, or 0.33%, to close at 1,169.43, and the NAS tallied up a minus 12.73 pts, or 0.53%, to end the session at 2,397.96. From my POV I (including my mate Shayne Heffernan at LTN and lots of others too) expect Q-2 to get off on solid footing on the performance of the upcoming earnings season's results which will likely be stronger that expected. A legal ruling in U.S. oil giant Chevron's favor helped drive the DJIA component's stock up 0.7% to US$75.83, limiting the Dow's decline, and signaled players to buy energy-related shares. A jump in Crude Oil's price above US$83 bbl to its highest close since October 2008 helped the energy sector too. This Rally has inspired some investors to trim some of their stock bets (they will be back there is no other place for the money). Investors pulled US$926M from domestic stock funds in the week ending March 24, the first draw down since the week ended March 3, according to the Investment Company Institute.
Advancing Sectors: Energy (+0.4%), Financials (+0.2%) Declining Sectors: Consumer Discretionary (-0.8%), Tech (-0.6%), Industrials (-0.6%), Consumer Staples (-0.5%), Materials (-0.5%), Telecom (-0.5%), Utilities (-0.3%), Health Care (-0.3%) Volume and Breadth: About 8.47b/shrs traded on the NYSE, the AMEX and NAS, below last year's estimated daily average of 9.65b/shrs. Decliners beat advancers on the NYSE by 3 to 2, and on the NAS, about 8 stocks fell for each 5 that rose.
Market Indexes Technical Analysis Date
Stocks to Watch Today The ALLSTATE Corp. (ALL), Bank of Ireland (IRE), JDS Uniphase Corporation (JDSU), and Key Corporation (KEY)
The Allstate Corporation (ALL) Up-date 3
Last Look: December 21, 2009
April 1, 2010 Paul A. Ebeling, Jnr. Analyst
Today, let’s look at The ALLSTATE Corp. (ALL), the large US insurance company, from a Technical POV. The overall indications, after Wednesday’s (March 31) market action, are Bullish.: in the near term Very Bullish, mid-term Bullish, and long term Very Bullish. The recent candlestick analysis is: Very Bullish.
**Chart by: http://www.stockta.com
Latest News and Opinion: The Allstate Corporation Earnings Conference Call (Q1 2010) Scheduled to start Thu, Apr 29, 2010, 9:00 am Eastern http://biz.yahoo.com/cc/5/112145.html Wednesday’s Market Action Close
32.31 + .25
There is a Bullish Engulfing Candle on March 31 and one Gap open up on February 16 at 29.59/29.85, the near term resistance is NIL, support at 32.13, and the 50 day (EMA) exponential moving average is 31.09 3
This is The Allstate Corporation (ALL): the company engages in the personal property and casualty insurance business, as well as in the life insurance, retirement, and investment products business in the United States and Canada. It operates in two segments: Allstate Protection and Allstate Financial. The Allstate Protection segment sells private passenger auto and homeowner’s insurance under ‘Encompass’ and ‘Deerbrook’ brand names primarily through agencies. Allstate Financial segment provides life insurance, retirement and investment products, and voluntary accident and health insurance products to individual and institutional customers. Its principal individual products comprise deferred, immediate, and indexed fixed annuities; interest-sensitive, traditional, and variable life insurance; and voluntary accident and health insurance. This segment markets its products through multiple intermediary distribution channels, including agencies and financial specialists, independent agents, banks, brokerdealers, and specialized structured settlement brokers. The Allstate Financial segment also offers various banking products and services consisting of certificates of deposit, money market accounts, savings accounts, checking accounts, and agency loans. The Allstate Corporation was founded in 1931.
Competitive Landscape Demand is driven by demographics and commercial transactions. Demand is also driven by legal or financial requirements. Consumers are usually required by states to buy auto insurance and by lenders to buy homeowners insurance, for example. The profitability of individual companies depends on effective marketing and on the ability to accurately estimate future payments. Large companies have big economies of scale in administration and in access to capital, as well as advertising and marketing. Small companies can compete successfully by specializing in particular products or industries. Average annual revenue per worker is around US$400,000, the industry is not labor-intensive. Insurance Carriers Industry Forecast The output of US insurance, which is an indicator for insurance carriers, is forecast to grow at an annual compounded rate of 1% between 2008 and 2013. Data Sourced: December 2009
Allstate Corp. (HQ) Thomas J. Wilson II, Chairman, Chief Exec. Officer and President,
2775 Sanders Road Northbrook, IL 60062 United States Phone: 847-402-5000 Fax: 847-402-2351
Bank of Ireland (IRE) Up-date 2
Last Look June 8, 2009
April 1, 2010 Paul A. Ebeling, Jnr. Analyst 4
Today letâ€™s have a look at Bank of Ireland (IRE), the troubled Irish Bank, from a Technical POV. The overall analysis after Wednesdayâ€™s (March 31) market action is Neutral: in the near term Neutral, midterm Bullish, and long term Neutral. The recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News and Opinion: Today's Big Gainers: IRE, MTG, PMI
http://www.forbes.com/2010/03/31/todays-big-gainers-ire-mtg-pmi-marketnewsvideo.html? partner=yahootix Wednesday Market Action Close 8.90
There are 2 Gaps open up between March 4 and 31, 2010 at 5.67/8.21 , the near term resistance is 9.95 and support at 7.61 and the 50 day (EMA) exponential moving average is 7.34. This is Bank of Ireland (IRE): Bank of Ireland Group is a diversified Financial Services Group with market leading positions in chosen domestic markets and niche status in other selected markets. Headquarters in Dublin, profit generation is well distributed between Republic of Ireland (55%), UK (32%) and the Rest 5
of the World (13%). IRE has a significant residential mortgage book of 44% of assets and 26% in property and construction lending. Only 4% of their book is dedicated to consumer lending. Deposit growth is up 19% from 2007 and remains one the most important theme’s of all money centers. Competitive Landscape European banking sector is in similar if not worst duress than that of the US. Controlling risk-weighted asset growth has become a challenge. The common theme of all money centers throughout the world is to strengthen capital base and drive up deposit growth. Building capital resources is a key management priority. Performance in this sector will be judged by management’s ability to utilize a wide range of options to achieve these goals.
Bank of Ireland (IRE) Chairman and Chief Executive Officer; Mark V Hurd Lower Baggot Street Dublin 2 Ireland Phone: 1-661-5933 Fax: 1-661-5671 http://www.hp.com
JDS Uniphase Corporation (JDSU) Up-date 5
Last Look: December 7, 2009
April 1, 2010 Paul A. Ebeling, Jnr. Analyst Today, let’s look at JDS Uniphase Corporation (JDSU), suppliers of network monitoring and test instruments, from a Technical POV. The overall indications, after Wednesday’s (March 31) market action, are Very Bullish: in the near term Very Bullish, mid-term Very Bullish, and long term Bullish. The recent Candle Stick analysis is: Very Bearish.
**Chart by: http://www.stockta.com
Latest News and Opinion: Your First Move For Thursday April 1st Pete Najarian thinks JDS Uniphase [JDSU 12.52) 0.53 (+4.42%)
] is a buy.
Wednesdayâ€™s Market Action Close 12.52
There is a DOJI on Marche 30 and 5 Gaps open up between November 6 , 2009 and March 25, 2010 at 6.14/11.40, the near term resistance is NIL, support at 12.01, and the 50 day (EMA) exponential moving average is 10.39. This is JDS Uniphase Corporation (JDSU): Through a series of acquisitions, primarily suppliers of network monitoring and test instruments, the company reorganized into three main businesses. Communications Test & Measurement consists of JDSU's test and measurement instruments acquisitions. Optical Communications makes components, modules, and equipment used to build fiberoptic telecommunications, data, and cable television networks. Advanced Optical Technologies contains JDSU's Flex Products and Custom Optics businesses. JDSU sells to customers in the communications, commercial, consumer, and military markets.
The Competitive Landscape 7
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$1MM. 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.
JDS Uniphase Corporation (HQ) Chairman Martin A. (Marty) Kaplan 430 North McCarthy Boulevard Milpitas, CA 95035 United States Phone: 408-546-5000 Fax: 408 546-4300 http://www.jdsu.comt JDS Uniphase Subsidiaries
American Bank Note Holographics, Inc. da Vinci Systems, LLC
Key Corporation (KEY) Up-date 4
Last Look: January 28, 2010
April 1, 2010 Paul A. Ebeling, Jnr. Analyst Today letâ€™s look at Key Corporation (KEY), a US financial services Giant, from a Technical POV. The overall analysis after Wednesdayâ€™s (March 31) market action is Bullish: in the near term Bullish midterm Bullish, and long term Very Bullish. The recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News and Opinion: KeyBank keeps branching out in WNY http://buffalo.bizjournals.com/buffalo/stories/2010/03/29/daily34.html?ana=yfcpc Wednesdayâ€™s Market Action
There are no Gaps up or down on the Chart, the near term resistance is 7.79, support 7.40, and the 50 day (EMA) exponential moving average is 7.24. This is Key Corporation: Key Corp is a US Financial services giant that focuses on relationship banking and retail operations, flagship subsidiary KeyBank operates more than 950 branches (KeyCenters) in more than 12 states in the USA. Its operations are divided into two groups: community banking offers local banking services including deposits, loans, and financial planning, while national banking provides real estate capital, equipment financing, and capital markets services to large corporate clients. Non-bank subsidiaries offer insurance, brokerage, investment banking, and credit card processing for small businesses.
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.
Industries Where KeyCorp Competes
Superregional Banking (primary) Key Corporation (HQ) Chairman, President, and CEO Henry L. Meyer III 127 Public Sq. Cleveland, OH 44114-1306 United States Phone: 216-689-6300 Fax: 216-689-0519 Toll Free: 800-539-6070
KeyCorp Subsidiaries Key Equipment Finance Disclaimer DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE OR IN OUR NEWSLETTERS. Red Roadmaster is not registered as a securities broker-dealer or an investment advisor either within the US Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. The information contained on our website or in any of our newsletters should be viewed as commercial advertisement and is not intended to be investment advice. Any information found on our website, or in any of our newsletters is not provided to any particular individual with a view toward their individual circumstances. The information contained on our website, and in any newsletter we distribute, is not an offer to buy or sell securities. We distribute opinions, comments, and information free of charge exclusively to individuals who wish to receive them.
Our newsletter and website have been prepared for informational purposes only and are not intended to be used as a complete source of information on any particular company. An individual should never invest in the securities of any of the companies’ profiled based solely on information contained in our report. Individuals should assume that all information contained on our website or in one of our newsletters about profiled companies is not trustworthy unless verified by their own independent research.
Any individual who chooses to invest in any securities should do so with caution. Investing in securities is speculative and carries a high degree of risk; you may lose some or all of the money that is invested. Always research your own investments and consult with a registered investment adviser or licensed stock broker before investing.
Information contained in the Redroadmaster Stock Talk report will contain “forward looking statements” as defined under section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Subscribers are cautioned not to place undue reliance upon these forward looking statements. These forward looking statements are subject to a number of known and unknown risks and uncertainties outside of our control that could cause actual operations or results to differ materially from those anticipated. Factors that could affect performance include, but are not limited to, those factors that are discussed in each profiled company’s most recent reports or registration statements filed with the SEC. You should consider these factors in evaluating the forward looking statements included in the report and not place undue reliance upon such statements.
Red Roadmaster is committed to providing factual information on the companies that are profiled. However, we do not provide any assurance as to the accuracy or completeness of the information provided, including information regarding a profiled company’s plans or ability to effect any planned or proposed actions. We have no first-hand knowledge of any profiled company’s operations and therefore cannot comment on their capabilities, intent, resources, nor experience and we make no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company and related sources which we believe to be reliable. To the fullest extent of the law, we will not be liable to any person or entity for the quality, accuracy, completeness, reliability, or timeliness of the information provided in this report, or for any direct, indirect, consequential, incidental, special or punitive damages that may arise out of the use of information we provide to any person or entity (including, but not limited to, lost profits, loss opportunities, trading losses, and damages that may result from any inaccuracy or incompleteness of this information). We encourage you to invest carefully and read investment information available at the websites of the SEC at http://www.sec.gov and FINRA at http://www.finra.org
Paul Ebeling on The ALLSTATE Corp. (ALL), Bank of Ireland (IRE), JDS Uniphase Corporation (JDSU), and Key Corporation (KEY)