Wednesday, August 3, 2011

Losing streak for stocks ends

Dow had fallen over 1K from its peak earlier this year, but buying in the PM brought it back into the black (at least for today). Dow ended with a 29 gain, advancers slightly ahead of decliners & NAZ added 23. Banks also recovered earlier losses, but the Financial Index chart still looks dreary. Tech stocks led today's limited rally.

S&P 500 Financials Sector Index

Value	194.03
Change	1.01 (0.5%)

MLPs & REITs pared losses in the PM, but it was a bad day. The 350 support continues to hold for the MLP index & the REIT rebounded to only down 1+ at 231 (off 20 from recent highs). Junk bond funds were higher, tagging along with strength in the Treasuries. Treasuries finally saw selling after a tremendous rise since Jul 25 when the yield on the 10 year Treasury was over 3%. Oil was weak on nervousness about economies slipping into another recession. Gold continues red hot but today it digested recent gains.

Alerian MLP Index

Value	358.78
Change	-2.74 (-0.8%)

Treasury yields:

U.S. 3-month	0.005%
U.S. 2-year	0.328%
U.S. 10-year	2.594%

CLU11.NYM

...Crude Oil Sep 11

...91.72

...

2.07

(2.2%)

Click for the latest market update:

Photo: Yahoo

Q4 net income at Clorox, a Dividend Aristocrat, dipped 1% as rising commodity costs took a toll. CLX said it plans to raise prices again soon & maintained its earnings outlook for the new fiscal year in line with what it previously forecast. CLX expects commodity costs to rise $140-$150M from FY2011, lower than an earlier forecast of $160-$170M. The company is also dealing with takeover bids from Carl Icahn. Clorox had EPS of $1.26 in Q4, compared with $1.20 last year & ahead of adjusted EPS of $1.19 expected. The company bought back $655M of its stock in FY2011, helping to boost EPS. CLX spent more on advertising to support new products & build brand awareness. Revenue rose 4% to $1.48B & had its biggest revenue gain overseas (9% due to favorable foreign currency exchange rates & higher prices). CLX anticipates EPS of $4-$4.10, with revenue up 1-3% in its new fiscal year. The stock fell 1.41 to $68.88.

Clorox 4Q net income dips on increasing costsAP

Clorox Company (The) (CLX)

Photo: Yahoo

Time Warner Q2 income increased 14%, its fastest revenue growth in nearly 4 years, beating forecasts & was bolstered by improved advertising sales. But ad revenue growth wasn't a blowout, rising just 8%. TWX tweaked its profit outlook only slightly higher even after "Harry Potter and the Deathly Hallows: Part II" sold more than $1B worldwide since its Jul release. EPS grew to 59¢ from 49¢ last year. Excluding special items, EPS was 60¢, above the 55¢ expected. Revenue grew 10% to $7B, beating expectations of $6.8B. TWX guided adjusted EPS for 2011 should grow by "at least low teens" percentages from $2.41 last year. Analysts had expected EPS to grow 14½% this year to $2.76. The stock fell 43¢.

Time Warner Profit Beats Estimates on Cable

Time Warner Inc. (TWX)

Markets rebounded in the PM on hopes the Federal Reserve will come up with QE3. Of course that flies in the face of the debt ceiling agreements signed yesterday about reducing federal deficits. JC Penney (JCP) will lay off 440 at a warehouse, another reminder the economy is not repairing as was expected by so many. Last Dec, analysts were falling all over themselves revising growth targets upward for 2011. Today Dow finished 200 above its lows, but not sure what that tells us other than oversold markets will eventually attract buyers. The news coming out of DC is not going to get better & the economic statistics look to be drab with the big jobs report coming on Fri.