Futures this morning are mixed as gold and oil are pretty much flat and the US market indices are all just around breakeven with some red and some green. Everything now depends upon the central bankers this week and nearly all the pressure has been removed from the US Fed members to that of the Europeans. It is a bit disconcerting to put all of our faith in the Europeans, but based off of their talk last week they have indicated to the US Fed that there will be no action needed on their part as Europe is ready to finally do the heavy lifting to fix their own problem. So investors should look for the US Fed to position themselves for future action and expect the Europeans to finally bring a bazooka instead of a water gun to this fight.
There will be no economic news today, but we could see a carry through from Friday's action leading up to tomorrow's economic news. Remember that both the US Fed and the Europeans meet this week, first up will be the US Fed.
Looking at Asian markets we see markets are higher:
All Ordinaries - up 0.77%
Shanghai Composite - down 0.89%
Nikkei 225 - up 0.80%
NZSE 50 - up 0.50%
Seoul Composite - up 0.80%
In Europe markets are higher:
CAC 40 - up 0.86%
DAX - up 0.95%
FTSE 100 - up 0.57%
OSE - up 0.44%
Shares in Sprint (S) continued to rise after last week's earnings report as the company received a few upgrades following the news with increased price targets and improved outlooks. The company's net income numbers missed but revenue exceeded expectations, which all has to do with the iPhone - readers should note that the same issues cropped up when others introduced the iPhone to their customers. In Friday's trading shares rose $0.26 (6.42%) to close at $4.31/share on volume of 170 million shares. These numbers reinforce our thinking on the stock and the shares are poised to head higher.
Friday saw shares in Expedia (EXPE) rise $9.19 (20.11%) to close at $54.90/share as 17.5 million shares were traded. The company exceeded analysts' estimates for net income, even when you took one time charges out of the numbers. It was an impressive quarter which saw an uptick almost across the board with the only real laggard being the airline ticket business. The company's quarter can be attributed to growth in Europe, Asia and the hotel segment.
We saw Sirius XM (SIRI) gap up well above our $2.10 range in trading on Friday as shares rose $0.06 (2.61%) to close at $2.16/share. Volume was strong with 68.7 million shares traded and all of this looks quite good heading into earnings. Although we have no position here, the remaining shares we have recommended readers keep we would now recommend that they sell. Shares have been on a tear and we were still bullish at the $1.80s and it has been a nice ride in this horrible market, so gains are to be taken. It is our opinion that we will have some better places to put capital to work in the coming weeks, so that is why we are removing this recommendation this morning.
Coinstar (CSTR) turned in a pretty disappointed earnings report, and shares were taken lower as a result. Volume increased to 9.4 million shares traded as they fell $8.06 (13.61%) to close at $51.16/share. Looking at the company's results revenues rose over 20%, but that was still not enough to push the top line number over what analysts had expected. Although revenues were missed investors saw what has become a trend in the market recently with the net income numbers exceeding expectations. This quarter disappointed, however, investors do need to look towards the future as the company will be increasing their offerings via their kiosks and the joint venture they are creating with Verizon. That should provide a boost moving forward.
Probably the biggest disappointment was Green Dot (GDOT) and shares got "taken to the woodshed" as they say down south. Shares fell $14.26 (61.15%) to close at $9.06/share on volume of 18.4 million shares after the prepaid card provider said that competition is heating up and that the company would be tightening the company's risk controls and lowered its guidance moving forward due to all of these factors. The company expects increased competition from other card companies, but worse also from the very retailers which currently sell the company's cards. It is obvious why shares got hammered on Friday, and moving forward there will be serious headwinds if the competition that the company foresees materializes.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.