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Sharpen Your Pencil – And Put These Three Stocks on Your "Shopping List"

Ask any of our gurus for advice on how to survive a stock-market sell-off – or even a whipsaw period like the one we’re navigating now – and you’ll get a surprising answer.

Keep a shopping list ready, they’ll tell you…

  • U.S. Stocks

  • This Stock Market Sell-Off Will Bring a Great Opportunity to Buy 20140205KFG

    The stock market sell-off has made for a rough start to 2014 - and February could bring more of the same.

    The S&P 500 Index fell by 3.56% in January, its worst monthly drop since May 2012, and was off to its worst start in February since 1933. The Dow Jones Industrial Average plunged more than 300 points on Monday, Feb. 3, and had its worst start since 1982. And the Nasdaq Composite Index started the month down 106 points, or 2.61%.

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  • Today's Stock Market News and Earnings Calendar

    Today's stock market news, Feb. 5, 2014:

    Yesterday, the Dow Jones Industrial Average rose 0.5% to close at 15,445. The Nasdaq ticked upward 0.8% to 4,031, while the S&P 500 increased 0.75% to 1,755.

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  • Stock Market Selloff: Should Investors Be Worried? 02032014Shah

    The Dow Jones Industrial Average plunged 326 points today, while the S&P 500 dipped 40 points and the Nasdaq dropped 107. In 2014, the Dow is down 7.3%, the S&P 500 5.8%, and the Nasdaq 4.3%.

    Money Morning's Chief Investment Strategist Keith Fitz-Gerald joined FOX Business' "Varney & Co." today (Monday) to answer today's biggest question: Should investors be worried about this stock market selloff?

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  • Best Stocks to Buy Now: A Money Morning Weekly Roundup What are today's best investments?

    Best investments for the week ending Jan. 31, 2014: A sharp sell-off in emerging markets, disappointing earnings from several key companies, and further tapering from the U.S. Federal Reserve left markets reeling last week.

    Despite the nosedive, investors still have plenty of opportunities for profit. Money Morning keeps readers current on the best stocks to buy now and the best investing moves to make for any market conditions.

    Here's what we covered last week:
  • Stock Market Today: Dow Jones Industrial Average Gets Hammered Stocks down

    Stock Market Today, Feb. 3: U.S. stocks closed down Monday after a rough trading session on the heels of a disappointing report on U.S. manufacturing and ahead of a busy week for economic indicators.

    The Dow Jones Industrial Average closed down 326.05 points, or 2.1%, at 15,372.80 points; the S&P 500 Index closed down 2.28%, or 40.7 points, at 1,741.89; and the Nasdaq Composite Index closed down 2.61%, or 106.92 points at 3,996.96.

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  • Today's Stock Market News and Earnings Calendar

    Today's stock market news, Feb. 3: U.S. markets slumped on Friday and posted their worst month since May 2012.

    The Dow Jones Industrial Average tumbled 4.88% in January. Last week, mixed earnings from retail and tech giants collided with renewed concerns about emerging markets and production declines in China.

    With our eye on the Opening Bell, here are five stories to watch this morning.

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  • Stock Market Today: Dow Jones Industrial Average Ends January in the Red Stocks down

    Stock market today, Jan. 31: U.S. stocks closed down Friday, wrapping up a rough January and the worst month in trading in over a year as several corporate earnings weighed on the market.

    All three major indices closed in the red. The Dow Jones Industrial Average closed down 0.94%, or 150 points, at 15,699 points. The S&P 500 closed down 0.65%, or 11.6 points, at 1,783 points, and the Nasdaq Composite Index fell 0.47%, or 19 points, to close at 4,104 points.

    Energy futures closed down today. Light sweet crude oil for March delivery closed $0.74 to settle at $97.49 per barrel. Heating oil for March delivery closed down 1.0% at $3.00 per gallon, and natural gas lost 1.36%, or $0.07, to close at $4.94 per million BTUs.

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  • Today's Stock Market News: The Biggest Stories and Earnings to Watch

    Today's Biggest Stock Market News, Jan. 29:

    Five Stories for This Morning

    • The State of Our Union is Expensive: U.S. President Barack Obama gave his fifth State of the Union address last night. During the speech, he demanded a guaranteed retirement plan for American workers, immigration reform, tax reform, gun control, and economic opportunity for all. The White House even announced it will back a congressional Democratic plan to increase the federal wage to $10.10 over three years, and then index it to inflation.
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  • 2014 State of the Union Address: Nine Ideas You'll Hear Tonight and Why They Matter

    SOTU 2014: U.S. President Barack Obama will deliver his fifth State of the Union address tonight, which means tomorrow most media outlets will graph and "wordcloud" his most used buzzwords like "jobs," "invest," and "innovate."

    Instead of waiting until after the SOTU, we put together the nine phrases you're likely to hear tonight - as well as why President Obama needs to address them.

    Here's your outline of State of the Union 2014:

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  • Frank Holmes: Trying to Stop a Bull Market Has Risks Bull

    U.S. stocks have been on a tear. The S&P 500 Index has climbed a surprising 23% so far this year, as a global synchronized recovery takes shape and funds flow back to equities.

    As I often say, investors take risks when they try to stop a bull run, and plenty of data suggest you might regret taking that action this year.

    Consider the optimistic views from Joshua Brown, i.e. The Reformed Broker, as we have "all the rocket fuel we need for an explosion." There's no election, no war in Syria, and no taper talk. Banks are highly capitalized, stocks around the world are cheap and hedge funds' short positions are the highest since January, says Brown.

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  • The Big Banks On Trial, Again It looks like the big banks aren't out of the woods from past indiscretions yet.

    Just this week the most powerful court in Europe has accused 13 major global financial institutions (many US based) of colluding back in the heady days that led up to the 2008 financial reckoning.

    But that's only the tip of this high-end iceberg...

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  • Eurozone Debt Crisis: Why U.S. Investors Still Can't Relax Currency euro paper

    After nearly four years, billions in bailouts and increasingly strict austerity measures, not only is the Eurozone debt crisis no closer to resolution, but the attempts to solve it are pushing the region deeper into recession.

    According to Eurostat, the Gross Domestic Product (GDP) for the 17-nation Eurozone plunged 0.6% in the final quarter of 2012, a steeper drop than the 0.4% economists had expected and the worst decline since 2009.

    It's the third consecutive GDP decline for the Eurozone, reaffirming that the area is mired in a recession that started with the 2008 financial crisis and has been exacerbated by the ongoing Eurozone debt crisis.

    For all of 2012, the Eurozone economy shrank 0.5%, while the U.S. economy grew 2.2%. Even the GDP of beleaguered Japan increased 1.9%.

    Most ominously, the GDP decline of the Eurozone's largest and strongest economy, Germany, mirrored that of the region as a whole, falling 0.6%.

    Long one of the few bright spots, Germany is slowly getting dragged down by its weak neighbors, which include Italy, Spain, Greece and even France.

    The bad GDP news also belies the sunny assessments recently delivered by many economists and EU leaders.

    "These are horrible numbers, it's a widespread contraction, which does not match this positive picture of stabilization and positive contagion," Carsten Brzeski from ING told the BBC.

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  • U.S. Stocks 2012: Will Third-Quarter Earnings Kill Rally? When Alcoa Inc. (NYSE: AA) reports third quarter numbers after the close Tuesday, the Dow bellwether will unofficially kick-off the final earnings season of 2012, giving U.S. stocks a chance to continue their rally.

    Numbers from Alcoa, which supplies the global economy with a plethora of materials used for everything from soda cans to airplane parts, are closely watched. A dismal report from the company is predicted to set the stage for rather glum spate of third quarter reports.

    The world's largest aluminum maker is expected to report a profit of a penny a share, compared to 15 cents a share earned in the same quarter a year ago. Sales are expected to fall 14% to $5.6 billon.

    A strong focus will be on its overseas growth. China's troubling slowing growth coupled with the Eurozone's recession is expected to be a notable drag on international revenue for global firms like Alcoa and Yum! Brands Inc. (NYSE: YUM), which also reports Tuesday after the bell.

    "Any evidence they're expecting improvement globally would be good," Mark Luschini, chief investment strategist at Janney Montgomery Scott told MarketWatch.

    Scores of economists have increasingly warned that earnings for the second to last quarter of 2012 will be weak at best. The big question is just how weak, and how big an impact the glum results will have on markets through the end of 2012.

    Here's what to expect from third-quarter earnings reports.

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  • U.S. Stocks 2012: Five High-Value Stocks at Bargain Prices Everyone likes getting a bargain, and investors are no exception - but finding cheap U.S. stocks that also offer huge profit potential is no easy task.

    Picking stocks with low prices is not enough. Thanks to the market's May swoon and seven-for-eight losing streak earlier this month, there's no shortage of low-priced U.S. stocks in 2012. But many of those are destined to chug along forever with low prices - or go bust altogether.

    At the same time, some U.S. stocks priced at $100-plus per share could be considered bargains.

    The key in both cases, of course, is value.

    Only by comparing a stock's price to its underlying value can you decide whether it's a "bargain."

    Unfortunately, it's not quite as easy as it sounds. There are almost as many definitions of "value" as there are securities analysts.

    However, most agree on the following fundamental measures of intrinsic worth:

    • The stock has a low price/earnings (P/E) ratio relative to other companies in its industry segment or the market as a whole.

    • The P/E ratio is below the stock's own average P/E over the past 10 years or so.
    • The company's earnings history is stable - i.e., the low P/E is not due to unusual capital gains or some other one-time revenue event.

    • The company's earnings have increased for the past three years on stable or rising cash flow.
    • The stock is selling at a price below book value - i.e., the company's tangible assets are worth more than the value of the outstanding common stock.

    • The company has little or no debt - and, if there is debt, it is rated "A" or better.
    • The current low stock price is not the result of a sharp drop in operating margins, management shake-ups or some kind of financial scandal.

    • In spite of its solid fundamentals, the stock price is lagging others in the same industry segment.
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  • U.S. Stocks: Applied Materials (Nasdaq: AMAT) To Cash in On Mobile Growth Rising demand for chips in 2013 should give a much-needed boost to this U.S. stock.

    I'm talking about the flagging stock of semiconductor equipment manufacturer Applied Materials (Nasdaq: AMAT).

    Investors have been down on AMAT lately.

    Applied Materials lowered its guidance for the year just last week, acknowledging concerns over a decline in technology spending. Such worries had already dinged the stock, which had fallen from a 2012 high of $13.21 on Feb. 16 to about $11 July 09.

    Since the company announced its profits for the year would come in at 15 to 20 cents per share lower than previous projections, AMAT has slumped further to around $10.39.

    But given the company's financial strength, solid position in its market and signs of a turnaround in chip demand for 2013, this pullback could represent a buying opportunity.

    "[Applied Materials] is the biggest player in the industry, and it's got a deep and well-established economic moat," writes Jonas Elmerraji of The Street. "That means that once the semiconductor waiting game is over, AMAT should be able to deliver impressive numbers once again."

    Santa Clara, CA-based Applied Materials makes most of its money from selling semiconductor chip-making equipment to foundries like Intel Corp. (Nasdaq: INTC) and Taiwan Semiconductor Manufacturing Co. (NYSE ADR: TSM).

    Those companies sell chips to the companies that make the computer, tablets, smartphones and other electronic gear, such as Apple Inc. (Nasdaq: AAPL), Hewlett-Packard Co. (NYSE: HPQ) and Samsung Electronics Co. (PINK: SSNLF).

    Applied Materials also sells equipment for the manufacturing of solar panels and LCDs, though both of those divisions are significantly smaller than the semiconductor division. Still, the troubles of the solar industry over the past year also have stung AMAT.

    But as often happens, it's when things look most glum that investors need to pay closer attention.

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