Lombardi: Stock Market Commentary & Forecasts, Financial & Economic Analysis Since 1986

Posts Tagged ‘NASDAQ’

Stock Market Update: Selling
Capitulation in Place

By for Profit Confidential

Stocks plummeted over three percent at the open on Thursday, as the selling capitulation held despite several up days due largely to the oversold technical condition. My investment guidance is to stay on the sidelines and wait for a base to form before entering into new positions. High frequency trading, specifically on the short side, could make the selling worse, as we have seen in the past. The stock market is dangerous.

Dunkin’ Brands’ IPO — a
Slam-dunk Investment?

By for Profit Confidential

In a much-anticipated initial public offering (IPO), Dunkin’ Brands (NYSE/DNKN) was set to debut on the New York Stock Exchange yesterday. The company owns two big-name franchises — Dunkin’ Donuts and Baskin Robbins — and could be much sought after.

The Dow, S&P 500 & NASDAQ: Why It’s Time to Ignore Them

By for Profit Confidential

Why It’s Time to Ignore the Dow, S&P 500 and NASDAQ indices.Everyone knows that the stock market likes to bet on the future. It’s possible we’ll get a very good second-quarter earnings season without much change in the main stock market indices. This is a market that’s just plain unsure of itself.

Sentiment would improve if the sovereign debt issue were more under control. This is an issue that must be addressed, because global capital markets will no longer let it ride. Accordingly, we could be in for a slow growth period for quite a few years. Institutional investors have this view and it certainly is tempering the desire to buy stocks.

The key index that I follow is the Dow Jones Transportation Average. This index made a solid recovery after tempting the 5,000 mark. It’s trading right around an all-time high and has shown amazing consistency in its performance since the market low in early 2009. We’re about to get the numbers from the big railroad companies and this will be an important indicator for investors. Railroad stocks were some of the best-performing stocks over the last year. Since May, they’ve mostly been in consolidation mode, as sentiment in the broader market weakened. In previous earnings reports, the railroad companies were quite positive about load factors, freight pricing and future demand. If these stocks are to accelerate from current levels, they will have to beat current guidance going into 2012.

We’ve seen quite a bit of yield buying lately, as investors have been migrating towards higher-dividend-paying stocks in order to generate some more consistent returns. This is a trend that is likely to stay with us due to the fact … Read More

PepsiCo Blows Away Cisco Systems on the Stock Market—Who Would’ve Bet on That?

By for Profit Confidential

In this market, the best-performing stocks are large-cap, dividend-paying stocks whose businesses have been around for a very long time. The laggard is the technology sector…and you can see this in the underperformance of the NASDAQ compared to the Dow. While it may seem surprising, there’s absolutely nothing unusual with a company like PepsiCo, Inc. (NYSE/PEP) trading only three points away from its 52-week high and yielding three percent, while Cisco Systems, Inc. (NASDAQ/CSCO) trades 11 points down from its 52-week high and yields 1.6%. This is representative of the current economy and the maturity of the current business cycle. For me, I’d rather own PEP and CSCO any day of the week.

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