Entering text into the input field will update the search result below

Can The Bulls Break On Through?

Apr. 25, 2011 8:51 AM ET
David Moenning profile picture
David Moenning's Blog
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Portfolio Strategy, ETF investing, Long/Short Equity

Seeking Alpha Analyst Since 2009

David Moenning is founder and Chief Investment Officer at Heritage Capital Research, a Registered Investment Advisor. Heritage is an independent, privately owned, investment management firm located in the Denver area. Mr. Moenning has more than 33 years of portfolio management experience and focuses on a risk-managed approach to capital markets via modernized portfolio development and dynamic adaptation to ever-changing macro environments. Most recently Chief Investment Officer for a $1.3 billion RIA firm.

Daily State of the Markets 
Monday Morning - April 25, 2011

Publishing Note: Dave has an early commitment this morning, but we've got you covered on the important news, happenings, and market-drivers.

Stocks managed to advance for a third straight day on Thursday on the back of another batch of better-than-expected earnings from the tech sector and another decline in the dollar. Although not all the news was positive on the day, the DJIA finished at a fresh new high for the current bull market cycle while the S&P 500, NASDAQ, Midcaps and Smallcaps are closing in on new highs as well.

While the day finished in a bullish mode, it should be noted that the economic calendar was not a contributing factor. First, the Weekly Jobless Claims came in above 400K for a second straight week. Next, the Philly Fed Index which is designed to indicate the state of the economy in the Philadelphia Fed district, took a surprising tumble. The general activity index came in at a reading of just 18.5, which was well below March's reading of 43.4. And finally, while no one expects to see strong data out of the housing market, the FHFA House Price Index also was short of expectations.

However, with the dollar breaking to new multi-year lows and high profile tech companies continuing to beat expectations, traders were able to keep implementing the "risk trade" on Thursday. As we've detailed recently, a falling dollar means the selling of the greenback and the buying of stocks, commodities and emerging markets.

On a chart basis, it is important to note that the S&P 500 and NASDAQ have not (yet?) followed the DJIA to new highs. From a technical perspective, this means that there continues to be overhead resistance visible on the charts. However, if the indices are able to close above the resistance zone, it is a safe bet that short-covering and additional technical buying will likely come in.

In closing, traders and investors will want to watch the dollar (because the greenback is rapidly becoming oversold), the 1343 level on the S&P 500, and continue to listen for the "message" out of the earnings parade. And with the Fed Meeting, which will include Ben Bernanke's first post-FOMC meeting conference call, on tap, it should be an interesting week.

Turning to this morning... Things are fairly quiet in the early going. European markets as well as some of the major Asian markets are closed in observance of the Easter holiday.

On the Economic front... There are no economic reports to review before the opening bell. However, we will get the data on New Home Sales at 10:00 am eastern time.

Pre-Game Indicators

Here are the Pre-Market indicators we review each morning before the opening bell...


  • Major Foreign Markets:
    • Australia: Closed
    • Shanghai: -1.51%
    • Hong Kong: Closed
    • Japan: -0.11%
    • France: Closed
    • Germany: Closed
    • London: Closed

  • Crude Oil Futures: +$0.48 to $112.77
  • Gold: +$8.80 to $1512.60
  • Dollar: lower against the Yen and Euro, higher vs. Pound
  • 10-Year Bond Yield: Currently trading at 3.379%
  • Stocks Futures Ahead of Open in U.S. (relative to fair value):
    • S&P 500: -0.53
    • Dow Jones Industrial Average: +2
    • NASDAQ Composite: +4.20


Wall Street Research Summary

  • Covanta (CVA) - BAC/ML
  • Travelzoo (TZOO) - Benchmark
  • Polycom (PLCM) - BMO Capital
  • Eaton (ETN) - Estimates and target increased at Citi
  • VF Corp (VFC) - Cowen
  • Marriott (MAR) - FBR Capital
  • BB&T Corp (BBT) - Goldman Sachs
  • SunTrust Banks (STI) - Oppenheimer
  • Brocade (BRCD) - RW Baird
  • General Electric (GE) - Sterne, Agee
  • Johnson & Johnson (JNJ) - Wells Fargo



  • First Horizon (FHN) - BAC/ML
  • Nucor (NUE) - CIBC World Markets
  • Weatherford (WFT) - Estimates cut at Citi
  • Warner Music Group (WMG) - Citi
  • Valero (VLO) - Citi
  • BB&T Banks (BBT) - Oppenheimer


    Long positions in stocks mentioned: none

    Earnings Before The Bell



    Johnson Controls JCI $0.56 $0.55
    Kimberly Clark CMB $1.09 $1.17
    Radio Shack RSH $0.35 $0.35

    For more "top stock" portfolios and research, visit TopStockPortfolios.com


    The opinions and forecasts expressed herein are those of Mr. David Moenning and may not actually come to pass. Mr. Moenning’s opinions and viewpoints regarding the future of the markets should not be construed as recommendations. The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of TopStockPortfolios and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. Stocks should always consult an investment professional before making any investment.

    Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.

    The analysis provided is based on both technical and fundamental research and is provided “as is” without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

    The information contained in this report is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also President and majority shareholder of Heritage Capital Management, Inc. (HCM) a Chicago-based money management firm. HCM is registered with the U.S. Securities and Exchange Commission as an investment adviser. HCM also serves as a sub-advisor to other investment advisory firms. Ridge is a publisher and has not registered as an investment adviser. Neither HCM nor Ridge is registered as a broker-dealer.

    Employees and affiliates of HCM and Ridge may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Editors will indicate whether they or HCM has a position in stocks or other securities mentioned in any publication. The disclosures will be accurate as of the time of publication and may change thereafter without notice.

    Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.