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Five Stock Market Charts Bears Have Been Waiting For

Bear market edit As the bull market tries to enter its fifth year, many are wondering if it still has legs - but a handful of stock market charts warn there's high risk of a coming sell off.

In fact, a recent report from Credit Suisse Group AG (NYSE ADR: CS) outlined 10 technical factors that show the market is at its most risk-on level since just before the stock market crash that began in 2007's third quarter.

"Many of our tactical indicators point to a consolidation phase in the equity markets, in the near-term," Credit Suisse Global Equity Strategist Andrew Garthwaite said in a note to clients.

For a closer look at this bearish forecast, check out these five stock market charts pointing to a pullback.

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The Best and Worst Stocks of 2012

As we prepare to invest in the New Year, we can learn from the five best and worst performing stocks of 2012 in the Standard & Poor's 500 Index.

While any investor would have loved to know this list a year ago, it's a good guide for 2013. Several of the factors that drove these share prices up and down in 2012 haven't changed.

The best stocks were led by signs of a recovery in housing, a slight return of consumer confidence, and the U.S. Federal Reserve's unprecedented monetary easing measures.

"The sector leaders are what one would expect with the [Fed] policy and with continued monetary injections into the economy this year through bond purchases," Peter Jankovskis, co-chief investment officer at Oakbrook Investments LLC, told The Wall Street Journal. "By pumping money into the economy the Fed boosts consumer confidence-and spending-which one would expect to boost consumer and financial shares."

While the leaders' success was tied to central bank actions, the biggest losers simply stumbled from their lack of innovation, inept management, and failed business models.

Best Stocks of 2012

Here are the best performing stocks in the S&P 500 for 2012:

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Three Stocks to Buy in Next Year's Most Promising Sectors

Whatever 2013 brings for the markets, there will be plenty of quality stocks to buy - if you know where to look.

Overall, the markets are expected to have another positive year.

A survey of 10 top financial strategists by Barron's projects the Standard & Poor's 500 will close at 1,562 in 2013, a 10% gain from current levels. (By the way, last year's picks outpaced the broader index by 6%.)

That would follow modest gains in 2012 of 13.5% for the S&P 500 and 8% for the Dow Jones Industrial Average.

For next year, Wall Street's top guns predict certain sectors of the market - technology, industrials, and energy - will lead the charge higher. Companies in more defensive sectors like consumer staples, telecoms, and utilities, will be laggards.

So let's take a closer look at three stocks to buy from among these favored sectors that should be an excellent place for your money in 2013.

Stocks to Buy in 2013: Cheap Tech

Tech stocks are hugely profitable and as a group currently carry a forward P/E ratio of about 11.

That's cheap versus historical levels.

Tech is also a bellwether for when companies start to invest capital.

"When we get an upturn in capital expenditures, it will show up in tech first," Barclays' Barry Knapp told Barron's.

One stock to buy that has a rock solid balance sheet and a mountain of cash is Cisco Systems Inc. (Nasdaq: CSCO).

Once the world's most valuable company with a market cap of $500 billion, Cisco's shares sank sharply when the tech bubble burst in 2000.

And the stock is still dirt cheap, trading around $20 a share, roughly 10 times next year's earnings. Plus, the company is sitting on more than $48 billion in cash, worth about $9 a share.

With a dominant market share of 60%, CSCO is the de facto choice in the switching market.

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Stock Market Today Fades Along with Chances of Fiscal Cliff Deal

The stock market today tumbled after chances of a fiscal cliff deal looked unlikely.

The stage was set Thursday night when a vote on Republican House Speaker John Boehner's Plan B, a fiscal cliff compromise to be presented to U.S. President Barack Obama, never even made it to vote among fellow Republicans. When word came of the setback, all major overnight future indexes sharply dropped.

When markets opened Friday, the slide continued. Shortly after noon, the Dow Jones Industrial Average slumped 176 points, the Standard & Poor's 500 Index dropped 20 points and the Nasdaq was lower by 43.

Investors appear to be bracing for the worst with just 10 days left before America falls over the cliff, with a deal is nowhere in sight.

Stocks on the Move Today

Shares of Research in Motion (Nasdaq: RIMM) rang lower Friday, sinking almost 20% in mid-afternoon trading.

RIM reported third-quarter earnings after the close Thursday that showed the BlackBerry maker swung to profitability, but lost about one million subscribers in the quarter. It marked the first time membership has fallen. The real test, analysts say, comes next quarter following the much anticipated release of the company's new Smartphone, the BlackBerry 10.

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ICE-NYSE Deal Signals Major Change in Future of Trading

Intercontinental Exchange (NYSE: ICE) announced Thursday it will acquire NYSE Euronext (NYSE: NYX) for $8.2 billion in cash and shares. What does it mean?
Keith Fitz-Gerald weighed in.

Stock Market Today: Biggest Winners and Losers

The stock market today rallied for a second session on hopes lawmakers in Washington will ink a fiscal cliff deal before year's end.

In afternoon trading Tuesday all three major index were sharply higher. The Dow Jones Industrial Average soared some 90 points by 2:30 p.m., the Standard & Poor's 500 Index climbed 11, and the Nasdaq jumped 33. That followed Monday's gains of 100.38 points, 16.78 points and 39.27 points, respectively.

With few economic releases scheduled for Tuesday, investors' focus was pinned on Washington. House Speaker John Boehner, R-OH, and U.S. President Barack Obama continued to haggle over a fiscal cliff deal, with the president making a counter offer late Monday.

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Stock Market Today: U.S. Markets Flat; Focus Shifts to Europe

The stock market today opened quietly in the United States as investors prepared for a very busy week ahead.

Just after the opening bell on Wall Street, all three major indexes were flat.

As Barron's noted, the average daily volume on the NYSE last week fell to 3.3 billion shares, compared with 5.5 billion that changed hands during the same period in 2009, when we were slowly emerging from the Great Recession.

The "fiscal cliff," which could drain $607 billion from the U.S. economy through tax increases and spending cuts, dominated U.S. news and moved markets.

But the fiscal cliff, along with the $16.4 trillion national debt and the growing federal deficit, took a back seat Monday as the focus shifted to Europe.

Anxious market participants kept a wary eye on Italy after Prime Minister Mario Monti announced he is resigning, citing a loss of support in Parliament. Italian bonds plummeted with the yield on the 10-year rising the most since August.

French, Belgian and Austrian 10-years dropped to euro-era lows, and Spain's debt also declined.

Bucking the trend was Greece, where bonds gained after the ailing country pushed further out the deadline for buying back some of its mountainous debt.

Elwin de Groot, a senior economist at Rabobank Nederland in Utrecht, Netherlands, told Bloomberg News: "We are seeing a selloff but I wouldn't call it a panic yet. The auction this week could be an interesting litmus test for investors. This has also created uncertainty for
Europe-wide policymaking."

Italy's deep-rooted economic troubles and political drift have been taken too lightly, a bevy of analysts warned.

As Nomura Securities' Silvio Peruzzo wrote in a note to clients, "Markets have grown too complacent about Italy, in our view."

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Stock Market Today: Gauging the Fiscal Cliff Effect

U.S. markets were mixed and relatively quiet Monday as investors digested the weekend news that fiscal cliff talks had failed to lead to a deal - possibly even derailing earlier progress.

Just before 2 p.m. on Wall Street, the Dow Jones Industrial Average was down 26 points, and the Standard & Poor's 500 Index and Nasdaq were both treading slightly lower.

On the economic calendar to kick-off the busy week were reports on October construction spending, November manufacturing and auto sales.

What's Moving the Stock Market Today

  • Manufacturing Data
Data released Monday from the Institute for Supply Management revealed the U.S. manufacturing sector dipped back into contraction in November. Businesses reined in spending and curbed expansion projects while they anxiously await the looming blows from the fiscal cliff.

The ISM's manufacturing purchasers' index fell unexpectedly last month to 49.5 from 51.7 in October, marking the lowest reading since July 2009. Forecasts were for a reading of 51.5. A reading above 50 suggests expanding activity. Monday's reports gave no such hints.

According to economists surveyed by Dow Jones Newswire, demand has slowed in the second half of 2012. The culprit is the imminent fiscal cliff.

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Stock Market Today: Fiscal Cliff Fears Can’t Stop This 160% Gainer

The stock market today opened flat before turning negative as negotiations on the fiscal cliff have not progressed, outweighing Greece's new deal concerning its debt.

  • Greece Close to Massive Bailout- Late Monday the International Monetary Fund, Eurozone finance ministers, and Greece came to an agreement that drastically eases the terms regarding Greece's repayment of debt and sets the stage for a third bailout. The deal lowers interest rates for bailout loans, suspends interest payments for a decade, pushes the deadline back for final repayments until the 2040s, and initiates a bond buyback program. Greece is also now on the brink of receiving a $44.7 billion loan beginning Dec. 13. "The big challenge now is to implement the decisions," Greek Finance Minister Yannis Stournaras said. "Greece has huge potential." The agreed upon measures aim to bring Greece's debt-to-GDP ratio down to 124% by 2020 from the projected level of 190% in 2014. The deal was accomplished by installing unprecedented measures such as carefully monitoring how Greece spends the debt, keeping an account strictly for debt servicing, and insisting that Greece completes the bond buyback before receiving more aid. "Euro-zone countries have put their money where their mouth is," Carsten Brzeski, an economist at ING Group NV in Brussels told Bloomberg News. "However, it is clearly not a carte blanche for Greece but rather a very tight leash."
  • Fiscal Cliff Talks Resume- Congress returned from its Thanksgiving recess and the fiscal cliff will be at the forefront of discussions this week. After last week's short burst of optimism there has not been any further progress on a deficit reduction deal. But for now consumers seem unfazed by the whole debacle, as today the consumer confidence index reached levels not seen since February 2008. The onset of higher taxes coupled with deep spending cuts was thought to lower consumer confidence, but instead consumers spent a record amount of money through Black Friday and Cyber Monday. The consumer confidence gauge interestingly showed expectations for six months from now, when we could be off the fiscal cliff, unexpectedly rose. The percentage of respondents expecting more jobs to be available in six months rose to its highest level since February 2011, and the percentage expecting to buy a home in the next six months hit a new all-time high. "The consumer is in a better place than several years ago," Michael Gapen, a New York-based senior U.S. economist at Barclays PLC (NYSE ADR: BCS), told Bloomberg. "A lot of the numbers are improving, whether it is household balance sheets or the state of the housing market or employment."
While the market is trying to turn positive, here is one stock surging on a medical breakthrough, another soaring on a settlement with Google Inc. (Nasdaq: GOOG), and a third that is up after announcing a special dividend.

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Stock Market Today: Why We'll Continue to "Drift Sideways"

The stock market today opened higher before falling once again as fiscal cliff concerns continue to weigh on investors' minds.

  • Stocks continue to slide- After Cisco Systems Inc. (Nasdaq: CSCO) reported its fiscal first-quarter earnings the markets started the day positive, but quickly turned red. One week after the election, fiscal cliff concerns continue to mount as the president and Congress meet later this week to hopefully negotiate a deal. So far no progress has been made on the debt reduction talks and until that happens don't expect the markets to change course. "We will continue to drift sideways until we see some progress on the fiscal cliff negotiations," Peter Jankovskis, co-chief investment officer for Oakbrook Investments told Bloomberg News in a phone interview.
A major reason for the post-election sell-off is the prospect of higher taxes next year, and yesterday U.S. President Barack Obama made it clear his agenda on that issue has not changed.

  • President calls for $1.6 trillion more in revenue- When President Obama meets with congressional leaders on Friday he will ask for double the amount of revenue that was discussed at budget talks in 2011. On Tuesday, the president met with union leaders and other liberal groups and stated he will now seek $1.6 trillion in additional revenue over the next decade. That will be accomplished partially through higher tax rates, something Republicans have not yet said they would agree to. But Republicans have offered to accept extra revenue if Democrats can agree to making structural changes to entitlement programs. "New revenue must be tied to genuine entitlement changes," Senate Minority Leader Mitch McConnell, R-KY, said Tuesday. "Republicans are offering bipartisan solutions and now it's the president's turn. He needs to bring his party to the table." An agreement, which included $800 billion of extra revenue, between House Speaker John Boehner, R-OH, and President Obama failed when the President asked for $1.2 trillion in additional revenue. That deal would have lowered the deficit by $4 trillion over ten years, and now President Obama is seeking $1.6 trillion, a number much higher than Republicans will likely agree to.

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Why the Dow Fell Yesterday

Concerns over how politicians will handle the fiscal cliff was the biggest driver behind why the Dow fell yesterday, tumbling more than 300 points in its biggest loss this year.

Political worries were exacerbated by worse than expected monthly sales from McDonald's Corp. (NYSE: MCD) and fears that Apple Inc. (Nasdaq: AAPL) had entered a bear market.

The fiscal cliff continued to dominate investor sentiment today as both Republicans and Democrats expressed their intentions of working together to find a solution to the impending crisis but failed to offer any concrete evidence of their willingness to budge from long-held positions.

Afraid that Republicans and Democrats will not compromise, even when the stakes are high, investors are bailing out. It is too close to the end of the year-too close to bonus time-to be a hero now.

In his victory speech following his re-election on Tuesday, U.S. President Barack Obama said that he is "looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together."

Senate minority leader Republican Mitch McConnell said, "To the extent [the President] wants to move to the political center, which is where the work gets done in a divided government, we'll be there to meet him halfway."

Jim Manley, a former aide to Senate majority leader Democrat Harry Reid, hoped that President Obama would become more personally involved in the negotiations on the resolution of the fiscal cliff.

"He's simply going to have to take a more active and forceful role," Manley told Bloomberg News. "He never got involved in the nitty-gritty of the legislative process. In light of the hyper-partisanship that still surrounds Capitol Hill, he's going to have to change, and he's going to have to take more of a lead in breaking the logjam."

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NYSE Closed: First Two-Day Weather Shutdown Since 1888 Tests Trading Floor

The fact that the New York Stock Exchange (NYSE) closed for two consecutive days on Monday and Tuesday due to Hurricane Sandy marks the first two-day, weather-related trading suspension in 124 years.

As of this writing, the storm surge from Hurricane Sandy has forced the shutdown of the power plant that serves Lower Manhattan. News reports of two explosions at the power plant may mean that the restoration of power may be further delayed.

This week's two-day NYSE closure for Hurricane Sandy is unprecedented, delivering something we haven't seen since 1888.

Between March 11 and March 14 that year, The Great Blizzard of 1888 raged along the U.S. east coast from Maine to Maryland. Twenty-two inches of snow fell on New York City propelled by 40 mile-per-hour winds.

There were no subways at that time. Roads and rail transportation, even within Manhattan, were paralyzed for days. Pole-mounted telegraph wires were felled by the heavy snow. 200 people froze to death in New York City for lack of coal, which could not be moved through the snowbound streets.

Traders could not get to the floor of the Exchange and downed telegraph wires meant that stock tickers were useless. Prices could not be disseminated beyond the floor of the Exchange except by runners making their way through the clogged streets. Under these conditions, the NYSE closed on Monday and Tuesday March 12-13, 1888.

Snow is the most common cause of weather-related closures on the NYSE but the Exchange has been closed for hurricanes before.

On Monday, August 9, 1976, the NYSE floor closed one hour early due to an approaching hurricane. On Friday, Sept. 27, 1985, the NYSE closed because of Hurricane Gloria.

But there have been other instances in which the NYSE closed.

1914: War Panic Means NYSE Closed

The board of the New York Stock Exchange watched nervously as Europe hurtled toward war in the summer of 1914 following the assassination of Austrian archduke Franz Ferdinand on June 28.

On July 30, Germany mobilized its army in preparation for the invasion of Belgium and France. Even though France did not immediately respond, the NYSE board decided to close the market indefinitely beginning on Friday, July 31, 1914.

It was only on Nov. 28, 1914 that trading in bonds resumed on the NYSE and, even then, there were price restrictions in place. Trading in a limited number of shares was allowed beginning on Dec. 12 and trading in all shares was reopened on Dec. 15 but with price restrictions. Price restrictions on equity trading were finally lifted on April 1, 1915-a full eight months after the NYSE closed its doors in panic the previous summer.

It was quickly recognized that closing the markets during one of the most cataclysmic events in modern history was a huge mistake that should not be repeated. It was resolved that the NYSE should never again close for two consecutive trading days.

This principle has been violated only a handful of times over the past 97 years and it is the main reason why the NYSE is always open for a half day of trading on the Friday after Thanksgiving.

While two-day closures are extremely rare, there has been only one NYSE closure longer than two days since the debacle of 1914.

That was the four-day closure from Tuesday, Sept. 11 through Friday, Sept. 14, 2001, following the terrorist attacks on the World Trade Center.

The NYSE-a five-minute walk from the World Trade Center-was choked with debris from the collapse of the twin towers. In addition, communications were disrupted by damage to a major telephone switching center in the neighborhood and had to be rerouted.

Given the devastation in Lower Manhattan in the wake of the terrorist attacks, it is nothing short of amazing that trading was able to resume as quickly as it did, on the Monday following the attack.

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Stock Market Today: Is this 9% Gainer a Recession-Proof Winner?

The stock market today opened lower as investors enter the third-quarter earnings season feeling very pessimistic. Alcoa's report yesterday and Chevron's announcement today only intensified this sentiment, but there is one stock that is proving to be a winner.

  • Alcoa Inc. (NYSE: AA) reports a loss to start earnings season- Alcoa reported a net loss of $143 million, or 13 cents a share for the third quarter, a reversal of last year's third-quarter profits of $172 million, or 15 cents a share. Sales fell as well, dropping 9.2% to $5.83 billion from $6.42 billion. Alcoa, the largest U.S. aluminum producer, was hurt by declining demand and aluminum prices that are 20% lower than a year ago. The company now expects aluminum demand will rise 6% this year, lower than the 7% forecast made in July. The silver lining for Alcoa is that the numbers weren't as bad as expected. Excluding environmental and legal charges the company posted a profit of 3 cents per share, ahead of Wall Street's estimate to break even. Even though sales fell they too beat projections. "The global economy is clearly slowing," Lloyd O'Carroll, a Richmond, Virginia-based analyst for Davenport & Co., told Bloomberg News yesterday. "That's what the IMF said today and so I think what Alcoa is doing is consistent with that." AA stock was down almost 4% as of noon.
  • Chevron Corp (NYSE: CVX) announces 3Q results will stumble- Chevron said on Tuesday that it expects third-quarter earnings to be "substantially lower" than its second-quarter results. The San Ramon, CA-based company cited lower production and a lower price of oil for the decline in profits. For the months of July and August the average price of a barrel of oil in the U.S. was $95.44 compared to $103.91 in the April-June quarter. Last quarter the company earned $7.2 billion, or $3.66 per share and analysts expect net income of $6.2 billion, or $3.08 per share for the third quarter. Chevron, the second-largest U.S. energy company by market value, will release full third-quarter results on Nov. 2. CVX stock is down 3.5% as of noon.
Finally, this stock is looking like it can withstand weakening growth in 2013.

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Stock Market Today: Jobs Are Good, But this Stock is Better

The stock market today opened higher after the unemployment rate unexpectedly dropped. The Dow Jones was up 60 points, or 0.45%, and the S&P 500 was up 6.40 points, or 0.44% in early trading.

The jobs report seems to have jumpstarted markets today, but one stock has been hot all week and doesn't need manipulated reports to boost it higher.

Here's a breakdown of today's news and a stock you need to know about.

  • Unemployment falls for right reasons this month- The Labor Department reported today that 114,000 jobs were added in September, in line with expectations. The surprising news is that unemployment declined three percentage points to 7.8%, marking the first time since January 2009, President Obama's first month in office, that unemployment is below 8%. Unlike last month where the rate ticked down due to more workers dropping out of the labor force, this month's decline was a result of more jobs added in prior months and a surge in part-time workers. The August and July reports were collectively revised upward a total of 86,000 jobs and around 582,000 workers accepted a part-time role. After the revisions 146,000 jobs were added on average over the last three months, significantly better than the second quarter average of 67,000. Both candidates will try to spin September's report and analyze the numbers to their advantage as October's jobs report comes out just days before the election. "The September jobs report will frame the economic debate and could prove critical to the election outcome," Carl Riccadonna, senior U.S. economist at Deutsche Bank AG (NSYE: DB), told The Wall Street Journal ahead of Friday's release.
  • Earnings season about to kick off- Believe it or not next week starts the third quarter earnings season as Alcoa Inc. (NSYE: AA) announces its earnings after markets close on Tuesday. Investors have been waiting to see if a poor earnings season could reverse the rally we've had over the past few months. Analysts expect the majority of earnings to be weak after many companies have already lowered their outlooks.
Now here's one stock to avoid and one big winner:

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Check Out What's Fueling Gains in the Stock Market Today

The stock market today opened higher on mixed labor reports as investors await tomorrow's September jobs report.

The market was also lifted by encouraging comments from European Central Bank President Mario Draghi on the fiscal health of Spain. Speaking at his regular monthly news conference Draghi stated the ECB is ready to buy bonds when necessary and that the ECB will not lower its record low 0.75% refinancing rate.

Here are today's other major stories:

  • Don't expect a great September jobs report- There are a few mixed labor reports to digest a day before last month's unemployment and nonfarm payroll numbers are released. Automatic Data Processing (ADP) yesterday reported the economy added 162,000 private-sector jobs in September. This was better than projections for 140,000 new jobs but much slower than last month's downwardly-revised figure of 189,000 jobs. Investors monitor ADP's numbers for clues on what the government might report, but ADP does not include public sector jobs and is not a great indicator of Friday's Labor Department's report. The Labor Department reported today that 367,000 initial jobless claims were filed last week, slightly higher than expected. The less volatile four-week moving average remained unchanged at 375,000. "The trend is still looking fairly stable. The labor market is improving but it is not really gathering direction for better or worse, it is still just plodding along," 4CAST economist Sean Incremona told Reuters. One more piece of data to look at is layoffs from outplacement firm Challenger, Gray & Christmas. It said U.S.-based employers announced plans to cut 33,816 jobs in September, down 71% from a year earlier. On average economists expect tomorrow's report to show 113,000 jobs were added in September and that unemployment ticked back up to 8.2%.

  • Factory orders decline by most in 3 years- The Commerce Department reported that factory orders fell 5.2% in August after rising 2.8% in July. The decline was fueled by a 102% plunge in demand for commercial aircraft which led to a previously reported 13.2% drop in durable goods. Overall the 5.2% decline from a month earlier was expected by economists but continues the trend of a slowdown in manufacturing activity. One positive is that orders for business equipment and software, often considered a gauge of business confidence and investment plans, rose 1.1%. "These data indicate that the recent softness in manufacturing activity and capital spending is likely to continue, at least for several more months," Steven Wood, president of Insight Economics LLC in Danville, California, said in a note to clients.

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