Weekly Market Review Letter, 22 December 2008
The Week Ahead: The markets finished mixed last week despite a government bailout of two of the three auto giants. With a short trading week ahead, all relevant data will be released inside of two days. Tuesday brings the final Q3 GDP report, new and existing home sales, and the Consumer Sentiment from the University of Michigan. Wednesday is a shortened trading day ahead of the holiday as personal income numbers, durable goods, and a jobless claims report are to be contended with.
Stocks to Watch: Weyerhaeuser Co. (WY) shares dropped abruptly as the company warned that Q4 will be 58% below Q3 levels do to the weak housing market. It also cut its quarterly dividend but will repurchase up to $250 million of its stock. Gardner Denver (GDI), maker of compressors etc. sees reduced Q4 earnings and plans a workforce cut of 9%, but the stock recovered strongly off its low. Darden Restaurants (DRI) has now more than doubled since November 21 as there sales rose 9.6% in Q2 but was also downgraded by S&P.
Special Note: As 2008 comes to a close, an interesting note from Bloomberg shows that dividends are being cut at the fastest rate in over fifty years because of the worsening recession. Conserving cash is becoming a broader theme by dividend paying companies. With the US T-bill yield and fed funds rate near zero, it would seem that interest rates are at very long term lows relative to the 10 year T-Bond. The dollars recent sudden downspout may be hinting that all the government bailouts is making some bond investors nervous.
Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.
Click here to open an account.
NobleTrading Direct Access Trading
email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com
Stocks to Watch: Weyerhaeuser Co. (WY) shares dropped abruptly as the company warned that Q4 will be 58% below Q3 levels do to the weak housing market. It also cut its quarterly dividend but will repurchase up to $250 million of its stock. Gardner Denver (GDI), maker of compressors etc. sees reduced Q4 earnings and plans a workforce cut of 9%, but the stock recovered strongly off its low. Darden Restaurants (DRI) has now more than doubled since November 21 as there sales rose 9.6% in Q2 but was also downgraded by S&P.
Special Note: As 2008 comes to a close, an interesting note from Bloomberg shows that dividends are being cut at the fastest rate in over fifty years because of the worsening recession. Conserving cash is becoming a broader theme by dividend paying companies. With the US T-bill yield and fed funds rate near zero, it would seem that interest rates are at very long term lows relative to the 10 year T-Bond. The dollars recent sudden downspout may be hinting that all the government bailouts is making some bond investors nervous.
Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.
Click here to open an account.
NobleTrading Direct Access Trading
email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com
posted by NobleTrading at
7:59 AM
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