Wang’s Happy Trading

Submitted By Optiondragon

Led Zeppelin - Black Dog (Music Video)

From Briefing.com

Periodicals Wrap-Up for Thursday, June 26th
WALL STREET JOURNAL: Anheuser-Busch (BUD) is going to turn down InBev’s unsolicited $46.35B takeover offer and that may come before week’s end, the Wall Street Journal reported. InBev is then expected to pursue a hostile takeover and Anheuser will say the offer undervalues the company. Instead, Anheuser will attempt to boost its share price by selling non-core assets such as its theme parks…The Wall Street Journal also reported that Belgian-Dutch financial firm Fortis NV (FORSY), in a move to increase its solvency, will attempt to raise $12.54B, and will also cancel its interim dividend and sell some assets…According to people familiar with the situation, the Wall Street Journal reported that JP Morgan Chase (JPM) reportedly dropped out of the bidding for General Electric’s (GE) $30B credit-card business. The sources said Citigroup (C), Bank of America (BAC) and Capital One (COF) are not expected to submit bids, as a result of charge-offs and rising delinquencies in their own credit card portfolios…FINANCIAL TIMES: The Financial Times reported that the London Stock Exchange, in a joint venture with Lehman Brothers (LEH), unveiled a pan-European equities trading platform to fight rivals that are hurting its market share…

JP Morgan Chase may be on the prowl for another big-bank buy-NY Post
According to people familiar with the matter, JP Morgan (JPM) is on the hunt for another big-buy bank, despite recently acquiring Bear Stearns. Sources say of particular interest to JP Morgan are SunTrust (STI) and Washington Mutual (WM). In order of appeal, JP Morgan’s wish list also includes PNC Bank, Wachovia Bank (WB) and US Bancorp (USB). It remains unclear if formal discussions are currently underway. Others considering tie-ups may include Wells Fargo (WFC), PNC Bank and US Bancorp.

Pre-Market Movers: Ahead of the Bell
The session is going to be a very busy one. As we expected, the week is going to be very back-end loaded in terms of activity. Futures are down sharply following further trouble in the financial sector with Goldman Sachs estimating that Citigroup (C) may need to take a further large write-down. The firm also took down broker estimates across the board, downgrading the sector to attractive. With that, Citigroup (C) is trading down (-4.24%) on heavy volume. Several of the large banks and brokers are following suit with Merrill Lynch (MER) down (-3.24%), Lehman (LEH) down (-3,11%), JP Morgan Chase (JPM) down (-2.4%), Bank of America (BAC) down (-2.1%) and Wachovia (WB) down (-2.07%). Goldman Sachs (GS) is also trading down (-2.04%) following a downgrade to Market Perform at Wachovia Capital Markets. Turning to post-earnings results from last night, Research in Motion (RIMM) is trading down (-8.88%) after reporting a penny miss on Q1 last night after the close combined with a lower Q2 estimate. JMP Securities downgraded the shares to Market Perform and Citigroup took down its price target to $160 from $165. Oracle (ORCL) is trading down (-3.75%) after the company reported better than expected Q1 results last night after the close. The company cautioned that growth going forward would be slower than in the past. One bright spot this morning is Bed Bath & Beyond (BBBY), trading up +6.6% following a much better than expected earnings report after the regular session yesterday, with raised guidance for Q2. Broker opinion on the name was mixed with Piper Jaffray reiterating a Sell and Oppenheimer & Co recommending long-term investors buy on any weakness.

U.S equity futures continue to point to a lower open; GDP growth met expectation
Stock futures are still pointing to a much lower open. The GDP for the first quarter showed growth at an annualized rate of 1.0% equal to expectations. The reading comes a day after the Federal Reserve met and said that inflation was a growing concern, signaling the end of rate cuts and the suggestion of a holding pattern to see what develops. Traders are already betting on a rate increase as early as the end of the summer with many saying the Fed could wait until after the election.

RIMM: Buyers on weakness; target raised to $165@PACS
PacCrest says they got the pullback they expected with the expectations now reset. They believe operating margins are unlikely to recover soon, but that RIMM is a leader in the accelerating smart phone market and sub growth outlook is encouraging with new products coming. PacCrest raised their target to $165 from $136 and maintain an Outperform rating.

BRCM initiated with an Outperform, target $36@RBCM
RBC Capital expects BRCM’s multiple to expand as the company demonstrates a resumption of growth.

AKAM: Recommend buying in front of Q2 earnings report@PACS
PacCrest believes the fundamentals remain solid for AKAM and expects Q2 revenue, EPS and subscriber metrics to be solid. They see the both the near and long-term outlooks as strong with relatively stable pricing. PacCrest reiterates their Outperform rating and $45 target.

Research in Motion-RIMM: Shares defended, reiterate Buy@MLCO
Merrill recommends buying RIMM for the 2H08 product ramp. Target $170.

RIMM: Would view weakness as a buying opportunity@OPCO
After RIMM reported results for its Q1 that Oppenheimer views as solid, but provided lower than expected guidance for its Q2, the firm notes that the company’s operational spending is increasing. However, the firm expects the increased spending to result in greater market share for RIMM, resulting in enhanced operating leverage. The firm maintained their Otuperform rating.

Semiconductors: Positive on chip stocks due to stable business trends@FBRC
With the momentum of AAPL’s 3G iPhone product cycle continuing to accelerate, the impact for their chip suppliers, BRCM/OP and MRVL/OP, is positive. In the 3Q, FBRC believes this will translate into an additional 3% sequential growth for BRCM and 2% extra sequential growth for MRVL. The firm thinks with business trends being stable or better, normal inventories and attractive chip valuation multiples, the chip stocks are ready to outperform the broader market with their preferred, favorite long ideas being MRVL, ONNN, FCS, MSCC, BRCM, IRF, SLAB and ATML.

Albermarle-ALB removed from Conviction Buy List; maintain Buy@GSCO
Note that MON was added to the list.

V: See several opportunities for company to raise prices@WCHV
Wachovia believes Visa can charge customers for previously free products, and they think the company can raise its fees on banks in some markets. The firm believes the company is on track to meet or exceed their estimates, and Wachovia reiterated their Outperform rating.

MON target raised to $160 from $145, maintain Buy@BOFA
Banc of America believes their thesis intact following MON’s quarter and would buy shares on the weakness.

Merrill Lynch-MER: Estimates reduced on further writedowns@BERN
Bernstein lowered Q2 and FY EPS estimates for Merrill as it now expects $3.5B in total writedowns for the company. The firm lowered its Q2 EPS estimate to (93c) from 82c. Shares are Market Perform rated. Target $45.

ACI upgraded to Buy from Add@LYON
Calyon upgraded ACI, BTU, and FCL citing higher coal forecasts. ACI price target to $100 from $71.
FCL price target to $119 from $74. BTU price target to $115 from $88.

MON added to Conviction Buy List; maintain Buy@GSCO
Target $155.

Citigroup-C added to Conviction Sell List@GSCO
Goldman added Citigroup to their Conviction Sell List as they expect additional write-downs of $8.9B in Q2 and see the potential for additional capital raises. Goldman lowered their target price on Citigroup shares to $16 and recommends a pair trade of long Morgan Stanley (MS), short Citigroup.

U.S. Brokers sector downgraded to Neutral from Attractive@GSCO
Goldman downgraded U.S. Brokers since they can not find a catalyst to move the group significantly higher over the next few months given the continued deterioration in fundamentals. Goldman added Citigroup (C) to their Conviction Sell List and recommends a pair trade of long Morgan Stanley (MS), short Citigroup.

Fast Money position recap- First Moves: Joe likes FCX, Guy likes T, Karen likes MSFT, Pete likes NOK.
Najarian Owns (AAPL), (ANR), (CHK), (NOK), (NVDA), (ORCL), (TSO), (XLF), (XTO), Najarian Owns (YHOO) Calls, (MYGN) Calls, (RIMM) Calls, (SLB) Calls, (UBS) Calls; Finerman Owns (GS); Finerman’s Firm Owns (AXP), (MSFT), (PZN), (SUN), (TSO), (VLO), (KALU), (CYBX); Finerman’s Firm And Finerman Own (C) And (C) Leaps; Finerman’s Firm Owns SPX Index Puts; Finerman’s Firm Is Short (IYR), (IJR), (MDY), (IWM), (SPY); Karen Finerman’s Partner In Her Hedge Fund Is On The Board Of Cyberonics; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Terranova Owns (BNI), (CME), (FXC), (LUV), (GOOG), (INTC), (IYT), (XLF), (SU), (YHOO),  (FCX).

The Fed meeting was a non event and we are now back to battering the financials as GS came out with negative broker/bank remarks this morning. The commodity trade is poised to resume upward. Long plays should be in the same areas of strength as before but against a possibly weaker declining market environment. SDS, SKF, FXP, DXD, QID are “long” ideas to watch, coal, ferts, metals, miners, energy, USO. Oil looks to break into ATH territory.
Great Luck and great trading!