Replies to post #96131 on Biotech Values

[DewDiligence]

Here’s one poster who is clearly bullish: http://investorshub.advfn.com/boards/profile.asp?user=168652 . Check out the last dozen or so posts :- )

[DewDiligence]

Stocks Bounce Back from 3-Day Drop

http://online.wsj.com/article/SB10001424052748704852004575258042121799342.html

›MAY 21, 2010, 4:41 P.M. ET
By PETER A. MCKAY

Stocks solidified their gains heading into the closing bell as investors showed some willingness to put sidelined cash back to work, though many remained cautious about the outlook for Europe's financial system.

The Dow Jones Industrial Average was up 125.38 points, or more than 1.3%, at 10193.39, thanks in part to a flurry of buying in the last half-hour of trading. Though the session's gains were welcome, the average nevertheless snapped a two-week winning streak, off 4% for this week. The average is now down 9% from its 2010 high.

The S&P 500 rose 1.5%, led by a 3.6% jump in its financial sector following the Senate's approval of the biggest overhaul of the financial system since the 1930s. J.P. Morgan Chase rose 5.9%, Bank of America rose 4.5%, and Goldman Sachs Group rose 3.3%.

While the bill would set up new regulatory bodies and restrict the actions of financial firms, many traders have been looking forward to its passage in the short term to remove the uncertainty that came along with the months-long legislative debate over what the reforms might entail [similar to what happened with some healthcare stocks when ObamaCare was finally enacted].

"As long as people feel like they know what the rules are, they feel like they can position themselves to make money," said trader Peter McCorry, of Keefe, Bruyette & Woods. "It's the possibility that the rules might change in the middle of the game that scares people."

Fears about Europe's credit crisis also ebbed, though most traders and analysts say they will keep a close eye on the region in the weeks ahead, with volatility likely as the euro-zone works to stabilize its most heavily indebted members.

The recently battered euro recovered some ground, trading at $1.2576, up from $1.2511 late Thursday. The U.S. Dollar Index slipped 0.2%.

Helping to attract some buyers to the euro, both the lower and upper houses of Germany's parliament approved the country's contribution to the €750 billion ($938.33 billion) aid package from the European Union and International Monetary Fund bailout.

Stephen A. Lieber, chief investment officer of Alpine Mutual Funds, said the stock market's euro-fueled struggles lately should eventually prove to be a buying opportunity, though he's taking a cautious approach for now.

"It's certainly not a situation where you can just jump in with both feet and figure we've gotten the correction out of the way," said Mr. Lieber. "But if you can find the right types of companies, yes, there could be some opportunities that work for the long term. We're discussing some ideas along those lines now."

Commodities firmed after several days of steep slides. Copper, known as an economic barometer, edged upwards, helping to push the broad Dow Jones-UBS Commodity Index up 0.3%. Crude-oil prices gave back early gains but remained above the key $70 a barrel level.

Investors noted that the recent slump in commodities may now be helping the market back up as lower oil and metals prices helped reduce the inflationary pressure on China.

"Commodities have just taken a shellacking here over the past few weeks," said Keith Hembre, chief economist and chief investment strategist at American Funds of Minneapolis. "Some of what had been holding the markets back were fears of more pervasive tightening in China and some of those inflationary pressures have been eased a bit." That "removes the fear of a harder landing in China, which would be a risk to the markets more broadly on a global basis," he said.

Materials, which often trade lower when fears of monetary tightening in China escalate, gained. Freeport-McMoRan Copper & Gold rose 5.3%, while Titanium Metals gained 5.5% and United States Steel rose 3.1%. [The three mining companies I follow had big up moves: CLF and VALE +7%, BHP/BBL +6%.]

The flight toward safer assets ebbed. Treasurys prices edged lower, pushing the 10-year yield to 3.231%.‹

[DewDiligence]

Stocks Surge in Second-Best Day of 2010

http://online.wsj.com/article/SB10001424052748704269204575270003727602386.html

›By PETER A. MCKAY And KRISTINA PETERSON
MAY 27, 2010, 6:01 P.M. ET

Investors embraced risk again throughout the financial markets, pushing stocks to their second-best day of the year and boosting the euro and commodities. Oil had its best one-day gain since last September.

The rally was sparked by a promise by China not to unload European debt and austerity moves in Spain, but was also driven by the perception that the market had overshot and the U.S. economy remains relatively healthy.

"We're having a nice little tug-of-war between some pretty solid economic fundamentals, great corporate fundamentals [in the U.S.] and all these world issues with effects that investors think might spread," said Jeff Layman, chief investment officer at BKD Wealth Advisors. The market's recent volatility has spooked retail investors, in particular, he said.

The Dow Jones Industrial Average snapped a three-day losing streak, surging 284.54 points, or 2.9%, to 10258.99, down 6.8% for May, with one trading day to go. The blue-chip measure recaptured 10000 after it had closed below it Wednesday for the first time since early February.

As May draws to a close, however, there is little consensus on Wall Street that the good times can continue. The month saw the first major 10% correction in the U.S. stock market since a bull run began more than a year ago, and participants are expecting that Europe will need a long stretch of time to recover fully from its recent credit crisis.

The Nasdaq Composite Index rose 3.7% to 2277.68, down 7.5% for May. The Standard & Poor's 500-stock index rose 3.3% to 1103.06, above the 1090 level it struggled to top in the previous session. The broad measure has tumbled 7.1% in May.

Analysts said the rally was also helped along by end-of-month buying, with some money managers looking to grab stocks on the cheap before sending statements to clients.

"A lot of the intensity of end-of-month trading lately has moved to the penultimate day of the month," said strategist Bill King, of M. Ramsey King Securities in Burr Ridge, Ill. "The institutions are frowning a little more on trading on the very last day."

Investors' renewed appetite for risk pushed prices of oil and other raw materials higher.

Crude oil rose $3.04 or 4.25% to $74.55. The Dow Jones-UBS Commodity Index gained 1.9%. The 10-year Treasury note slipped 1-1/32 to yield 3.340%.‹

[bladerunner1717]

Toward a double-dip recession?



Robert Reich Former Secretary of Labor, Professor at Berkeley
Posted: June 4, 2010 10:17 AM



Why We're Falling Into a Double-Dip Recession

We're falling into a double-dip recession.

The Labor Department reports this morning that the private sector added a measly 41,000 net new jobs in May. But at least 100,000 new jobs are needed every month just to keep up with population growth.

In other words, the labor market continues to deteriorate.

The average length of unemployment continues to rise -- now up to 34.4 weeks (up from 33 weeks in April). That's another record.

More Americans are too discouraged to look for a job than last year at this time (1.1 million in May, an increase of 291,000 from a year earlier).

Of the small number of jobs created by the private sector in May, many came from temporary help services.

Which is one reason why the median wage continues to drop.

Why are we having such a hard time getting free of the Great Recession? Because consumers, who constitute 70 percent of the economy, don't have the dough. They can't any longer treat their homes as ATMs, as they did before the Great Recession.

Businesses won't rehire if there's not enough demand for their goods and services.

The only reason the economy isn't in a double-dip recession already is because of three temporary boosts: the federal stimulus (of which 75 percent has been spent), near-zero interest rates (which can't continue much longer without igniting speculative bubbles), and replacements (consumers have had to replace worn-out cars and appliances, and businesses had to replace worn-down inventories). Oh, and, yes, all those Census workers (who will be out on their ears in a month or so).

But all these boosts will end soon. Then we're in the dip.

Retail sales are already down.

So what's the answer? In the short term, more stimulus -- especially extended unemployment benefits and aid to state and local governments that are whacking schools and social services because they can't run deficits.

But the deficit crazies in the Senate, who can't seem to differentiate between short-term stimulus (necessary) and long-term debt (bad) last week shot it down.

In the longer term, we need a new New Deal that will bolster America's floundering middle class. Expand the Earned Income Tax Credit and extend it up through the middle class. Finance that extension through higher marginal income taxes on the wealthy, who have never had it so good.

This post originally appeared at RobertReich.org


Bladerunner

[DewDiligence]

The way S&P500 sector weightings have changed since the bear market low in Mar 2009 can be construed as bullish for healthcare and energy stocks and bearish for financials. Below are the sector weightings and how they have changed:

  
                  S&P 500 Sector Weightings 
  
                               Absolute  Relative 
              Mar2009  Current  Change   Change 
 Healthcare    16.1%    11.8%    -4.3%   -27% 
 Energy        14.3%    11.0%    -3.3%   -23% 
 Financial      8.9%    16.3%    +7.4%   +83%

These numbers can be interpreted in various ways, of course. My interpretation is that the healthcare and energy weightings have become too low and will increase in due course. Despite the fact that the financial sector had a much higher weighting at the bull market high a few years ago than it does now, I expect its weighting to decline (although not to the Mar 2009 level). JMHO, FWIW

Source: #msg-51362839

[DewDiligence]

[OT]—Steel Production Is a Proxy for the Global Economy



Source: VALE’s 2Q10 CC slides.

[DewDiligence]

[OT] Port-of-LA logs best container traffic since 2008:

#msg-53310057

The economy may be doing better than some investor think.

[DewDiligence]

Another bullish data point on the global economy…

http://www.bloomberg.com/news/2010-09-29/british-airways-accelerates-return-of-jumbos-as-travel-rebounds.html

›British Airways Accelerates Return of Jumbo Jets After Traveling Rebounds

By Steve Rothwell - Sep 29, 2010

British Airways Plc will return to service two of the eight Boeing Co. 747 jumbo jets it grounded during the recession as demand for travel rebounds faster than the company had anticipated.

The 350-seat 747-400s have been retrieved from storage and are undergoing maintenance checks, with one to be reinstated at the end of January and the other a few weeks later, Chief Executive Officer Willie Walsh said today in an interview.

British Airways is among carriers that responded to the slump by idling jetliners near Victorville on the southern edge of the Mojave Desert in California, where the dry conditions hamper corrosion. The retrieval of the 747s reflects an outlook for demand that’s “more positive” than before, Walsh said.

“In some cases we’re just putting capacity back in where we had taken it out, but we are also looking at new destinations and will probably make some announcement in relation to that in the near future,” the CEO said on the sidelines of the MRO Europe aviation maintenance conference in London.

One of the 747s will be used instead of a Boeing 777 for flights from the U.K. capital’s Heathrow airport to Dallas, freeing up the smaller plane to operate a seventh daily flight to New York John F. Kennedy International Airport, as disclosed in August, British Airways spokesman James von der Fecht said.

“The second 747 is expected to be introduced into our summer 2011 schedule, but the destination it will serve hasn’t yet been decided,” he said.

Jumbo Fleet

British Airways has 49 Boeing 747s in its fleet, including the eight grounded, which are used for long-haul services to cities including Los Angeles, Johannesburg and Sydney.

Wide-body planes accounted for about 25 percent of the 200 aircraft retrieved from storage in May and June as carriers sought to tap rising demand for long-haul trips and a leap in cargo shipments. The number of 747s recalled in June exceeded those mothballed for the first time since January 2009, data compiled by aviation consultant Ascend Worldwide Ltd. shows.

Walsh said in the interview that he is “optimistic about the outlook for 2011,” with British Airways poised to begin services to Cancun in Mexico in November before adding Tokyo Haneda in February and Buenos Aires in March.

Europe’s third-biggest carrier is lifting winter capacity about 7 percent from a year earlier but says it will only add seats where it can do so without depressing prices.

Etc.‹