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Wednesday's "Earnings Beat" Makes This The Perfect "Bad-Market" Tech Stock

In last week’s Private Briefing report Our Experts Show You the Stocks to Pick in a ‘Stock-Picker’s Market’,” Money Map Press Chief Investment Strategist Keith Fitz-Gerald identified SanDisk Corp.(NasdaqGS: SNDK) as one of three stocks to buy in the face of the stock market sell-off.

  • Jon D. Markman

  • Why Investors Must Keep an Eye on Spain Greece is not the big story of Europe anymore - just a smoke screen.

    The big story is Spain and the United Kingdom, and the news is getting worse.

    In the past week, Spanish officials acknowledged to reporters that the country's banks and companies were having difficulty obtaining credit. The credible website EuroIntelligence reported that Spain is now effectively cut off from international capital markets, which is a major new development.

  • Four Factors to Consider Before Determining Your Long-Term View on U.S. Stocks Stocks rose worldwide over the past week -- ranging from +2% in U.S. big caps to +6% ingold -- as investors swelled with sudden courage in response to positive reports on Chinese economy and glimmers of hope that European governments can get their financial houses in order.

    The week's results erased four weeks of losses, including the despairing session that ensued on June 7 after a disappointing report on U.S. employment. Meanwhile, the result of the past 35 trading days, or seven calendar weeks, are still largely negative, ranging from a loss of 5.5% for U.S. stocks and -8.5% for Europe. Only gold stocks have eluded the smoke monster, rising 7% in the span.

    The variation in one-week and one-month results illustrate perfectly how investors are showing that they arehopeful but unconvincedthat recent strength in gross domestic product (GDP) growth and corporate income advances are sustainable, and therefore won't buy stocks heavily until prices are so cheap that they discount worst-case scenarios. In other words, they want a high risk premium before buying -- sort of like demanding a 72-month warranty before buying an expensive car.

    To read about the four factors you should consider before investing click here.

  • Hungary is the Latest European Domino to Fall As if Greece, Spain and Portugal were not enough of a concern for the European financial system, another villain has emerged from behind the curtains: Hungary.

    A new government swept into office in late May and the ruling party leader declared the country had little chance of avoiding a Greek-style credit crisis because the former government had been cooking the books.

    A spokesman for Prime Minister Viktor Orban said it was not an exaggeration to talk about the potential for default.

  • Stock Market Stuck as Investors Demand Risk Premium for Buying Stocks rose worldwide over the past week by 2% to 5%, swelling with sudden courage after positive economic reports from China and shaking off some worsening news in the United States about retail sales and jobs.

    Yet results in the past month are still heavily negative, ranging from -5.5% for U.S. stocks and -8.5% for Europe. China has suddenly become the most buoyant region, up 1.5% in the past month.

    The variation in one-week and one-month results illustrate perfectly how investors are showing that they are hopeful but unconvinced that recent strength in GDP growth and corporate income advances are sustainable, and therefore won't buy stocks heavily until prices are so cheap that they discount worst-case scenarios. They want a high risk premium, in other words, before buying -- sort of like demanding a 72-month warranty before buying an expensive car.

    Click Here to Find Out How the Risk Premium is Holding Back Stocks...

  • Why U.S. Stocks Will Rise Above Weak Growth in Global Markets After another lousy week, it's official: Global markets have suffered the worst late-spring setback since 1940 -- a May-June period when the Germans invaded the Netherlands, then marched into Paris, and Italy declared war on France and Great Britain. Just like that, seven decades ago, World War II was on, and markets went into freefall.

    If stocks are as good at anticipating global calamity this time as they were in that horrible spring 70 years ago, we may be in for a terrible second half.

    It's a bitter irony that so many of those old enmities are flaring up again on the Continent at this critical time. The European Union was created two decades ago at behest of the former Allies to prevent the Continent from sliding into armed conflict again, and the euro currency was later launched to cement the new political relationship.

    But many centuries of deep-seated distrust are hard to negate with diplomacy and idealistic optimism, and now we see Europeans back at each others' throats in a flurry of recriminations over who is to blame for outrageous deficits, debts and defaults in the Eurozone -- and more importantly, who should pay for them.

    To read about how Europe's turmoil could affect the U.S. economy, click here. Read More...
  • Two Big Reasons to Believe the U.S. Stock Market Will Bounce Back There's been a lot of cheerless news coming out of Europe lately, and that's taken a toll on the U.S. stock market. But I want to take this opportunity to offer up some positive points and remind investors that it's still too early to declare the bull-market dead, and even more premature to fret over a new bear market beginning.

    There are two key considerations that support a continued rise in U.S. stocks:

    To find out why it's too early to give up on stocks, read on... Read More...
  • Will Extreme Volatility Actually Stabilize the Markets? Stocks tumbled across the board last week like a pair of dice rumbling around a craps table, rocked by extreme volatility. Just when it looked like they were rolling up the unnerving loss of the critical 200-day average on Thursday, bulls' returned to the fray and pushed the major indexes just barely back into safe territory.

    But is the market really safe? It's currently at the bottom of its multi-week range, so this is the time to get bullish again if you think the range will remain in force. The S&P 500 Index actually touched its February 2010 low on Friday before rebounding, which will give all the range-traders a green light.

    Click Here to Find Out What Last Week's Extreme Volatility Means for the Markets...

  • A Broad-Based U.S. Recovery is Strengthening the Global Economy Against Europe's Turmoil Stocks scattered across the capital markets last week like the unwanted children of a terrible divorce, as a blunted rally following a global margin call put a hex on every sector and most commodities - but a U.S. recovery marched on.

    So far in the ten sessions of May, the Dow Jones Industrial Averageis down 3.6%, theNasdaq100is -4.7%, the S&P SmallCap600is -3.1% and overseas large-caps are down 8.6%.

    That's a whole lot of falling, and for what reason? The headlines tell us that investors freaked out over Greek debt, fear of a contagion effect on Spain, speculation that U.S. earnings have peaked, and worry that the great global capital machine will soon seize up for lack of customers and credit.

    But headlines don't always tell the whole story.

    To take a closer look at why the markets are down, click here.

  • The Real Story Behind Last Week's Stock-Market Panic Thursday's U.S. stock market trading session qualified as a genuine stock-market "panic." They're rare, fortunately, so they're memorable.

    You can say you were there.

    According to the volume analysts at Lowry Research Corp., this stock market panic was on par with the mini crash of October 1989, when the Dow Jones Industrial Average plunged 6.9% in a single day. But it wasn't on par with the famed session of October 1987, when the Dow plunged 22.6% in a day.

    For an in-depth analysis of last week's U.S. stock market panic, please read on...

  • European Debt Crisis Raises Caution Flags But U.S. Economy Won't Be Derailed Stocks somersaulted into the red early last week in the wake of European debt downgrades, rising revulsion over the prospect of a bailout of Athens and a broad re-pricing of risk. Breadth was negative, the number of new highs shrank and number of new lows swelled. Financials tumbled and retailers stumbled. Caution flags are rising.

    Click Here to Read More on how European Debt Will Affect the Markets

  • Here's Why U.S. Stocks May be Headed Higher U.S. stocks were back up to their old tricks last week, as volatility waned and financial, industrial and retail stocks waxed. It was a week in which risk was in fashion - until Friday, when the U.S. Securities and Exchange Commission (SEC) hammered Goldman Sachs Group Inc. (NYSE: GS) with fraud charges related to the subprime-mortgage crisis. With that, playing defense was considered offensive.

    Leading the way forward were companies that are the ultimate in beta and hopefulness - such as beaten-down bond insurer Ambac Financial Group Inc. (NYSE: ABK), which rose 60%, beaten-down car parts maker American Axle & Manufacturing Holdings Inc. (NYSE: AXL), up 10%, beaten-up retailer Tuesday Morning Corp. (Nasdaq: TUES), up 24%; and beaten shoemaker Crocs (Nasdaq: CROX), up 20%. We're not talking, here, about investors who last year bought the shares of companies that were left for dead; these stocks might actually be worth something in an economic turnaround.

  • Foreign Markets Outshine U.S. on Investors' Increasing Appetite for Risk U.S. stocks carved out one of their patented half-percent advances last week -- a little sloppy, to be sure, yet not bad at all considering their very overbought condition.

    The stars of the global capital show this month, though, have been markets in China and Europe, as they shook off their multi-month torpor to score big wins. With a scorching 6% advance in the past two weeks, ishares FTSE Xinhua China 25 Index(NYSE: FXI) nosed up to log a +5.5% gain for the year after being negative for three months. And theishares S&P Europe 350Index (NYSE: IEV) rose 1%, putting it at flat for the year after malingering below zero.

    Click Here to Read more on which foreign markets are moving higher...

  • Why the Outlook for U.S. Stocks Could be Much Better Than You Think Could the U.S. bull market actually be for real?

    That's the question investors have been asking since U.S. stocks essentially bounced off of their March 2009 post-crash lows - only to be launched into one of the strongest rallies in U.S. market history.

    More than a year later, U.S. investors still don't know what to believe - or what to expect, says Jon D. Markman, a market commentator and best-selling author who is also a Money Morning contributing writer. The most recent sentiment poll by the American Association of Individual Investors, or AAII, showed that only 41% of investors are bullish. Cash flows at mutual funds that invest in U.S. stocks are telling a similar story, with a $5.1 billion monthly outflow, Markman says the most recent data shows.

  • Why the Bulls Can Stand Strong at Home and Overseas Stocks enjoyed another plus week, closing one of the better Marches of the past 80 years. It seems like ages since volatility has been this low, and there have been many complaints about complacency and listlessness. Yet those concerns may be misplaced if indeed we are enjoying the second leg of a normal bull cycle. Low volatility in a bearish phase does suggest complacency, to be sure, but in a bullish phase it serves more to keep expectations in check.

  • Fastest Recovery Ever Could Push Corporate Profits to Record Highs in 2010  Sometimes we get a little carried away talking about esoteric subjects like bulls, bears, supply, demand, moving averages and the like. But if you just want to focus on something real, then look at corporate profits. When they're rising from a low, that's good; when they're flat-lining or declining, that's bad. Pretty simple.

    Much of the rally of the past year has been in anticipation of a profit recovery. And now that recovery is actually coming in a bit better than bulls expected, which is why they are able to elbow bears so effectively. ISI Group now figures that corporate profits will clock in at +38.8% for the first quarter (year over year) of 2010, then +42.4% in the second quarter, +36.8% in the third quarter and then +30% in the fourth quarter (against harder comparisons). That would put profits in 2010 up a record 36.1% overall.

    To read more about how corporate earnings will shape the market click here.