Wang’s Happy Trading

Submitted By Optiondragon

Jason Mraz - I’m Yours

From Briefing.com

Periodicals Wrap-Up for Monday, July 14th
WALL STREET JOURNAL: The Wall Street Journal reported that worries are deepening among regulators, executives and consumers about the U.S. banking industry following the federal government’s seizure of IndyMac Bank (IMB)…According to a person familiar with the situation, the Wall Street Journal reported that Banco Santander (STD) is nearing an agreement to buy Alliance & Leicester for around $2.38B…NEW YORK TIMES: Yahoo! (YHOO) chairman Roy Bostock called Microsoft’s (MSFT) proposal “ludicrous”. Bostock said that “while this type of erratic and unpredictable behavior is consistent with what we have come to expect from Microsoft, we will not be bludgeoned into a transaction that is not in the best interests of our stockholders.” Yahoo reaffirmed that it is open to a sale of the company for $33 a share, the New York Times reported…CNET: CNet reported that the price of the Xbox 360 Pro model with a 20GB hard drive was cut by Microsoft to $299 from $349. The company also introduced introduced a 60GB model to go on sale in the U.S. and Canada in August for $349…

SEC to open probe on rumor mongering-AP
Spurred by the storm of inaccurate information around firms in the news. The SEC has opened an investigation into the spreading of false information to manipulate stock prices. SEC Chairman Cox said that the investigation is aimed at “ensuring that investors continue to get reliable, accurate information about public companies in the marketplace.”

Bailed-out IndyMac will open Monday as IndyMac Federal Bank-The Daily Telegraph
After being seized by the federal government on Friday, The regulatory Office of Thrift Supervision announced it had placed the California based IndyMac Bank (IMB), with a worth of approximately $32B, under the control of the Federal Deposit Insurance Corporation.

Weekly additions to the Investors Business Daily-100
The following are additions to the Investors Business Daily- 100 list for the week of July 11: Sociedad Quimica y Minera (SQM), Companhia Siderugica National (SID), Ezcorp (EZPW), Hill International (HIL), Wabtec (WAB), AZZ Inc (AZZ), Concur Technologies (CNQR), Kansas City Southern (KSU), Apple Inc (AAPL), NVE Corporation (NVEC), Sun Hydraulics (SNHY), Airgas (ARG), Amedisys (AMED), Mantech International (MANT), Synutra International (SYUT), ITC Holdings (ITC), Altra Holding (AIMC), Mesabi Trust (MSB), Celanese Corp. (CE), BMC Software (BMC), Psychiatric Solutions (PSYS)

Weekly subtractions from the Investor’s Business Daily-100
The following are subtractions from the Investors Business Daily-100 list for the week of July 11 : Murphy Oil (MUR), Jinpan International (JST), Apache Corp. (APA), Research In Motion (RIMM), Yamana Gold (AUY), Noble Corp. (NE), Permian Basin Royalty Trust (PBT), Weatherford International (WFT), Petroleo Bras (PBR.A), Cybersource Corp. (CYBS), Williams Companies (WMB), Cameron Internationsl (CAM), Hornbeck Offshore Services (HOS), Nexen Inc.(NXY),Canadian Natural Resources (CNQ), Devon Energy Corp (DVN), Superior Energy Services (SPN), Gulf Island Fabrication (GIFI), Halliburton (HAL), True Religion Apparel (TRLG), Credicorp (BAP) :

SEC to crack down on the spreading of false rumors-WSJ
Under pressure for not doing enough, the SEC is going after individuals and firms who spread false rumors that affect markets, reports the Wall Street Journal. The SEC timed its announcement to warn traders before the Asian markets opened.

Cleveland Cliffs-CLF estimates raised on higher iron ore & coking prices@MSCO
Shares are Equal Weight rated.

CLF announces expansions at mines
Cleveland-Cliffs announced that its Board of Directors has approved a capital project at its Empire and Tilden mines in Michigan’s Upper Peninsula. The project, which requires approximately $290 million of incremental capital investment, is expected to allow the Empire Mine to produce at three million tons annually through 2017 and increase Tilden Mine production by more than two million tons annually. This incremental production is expected to result in total equity production of over 23 million tons annually for the Company’s North American Iron Ore business segment. Cliffs said its Empire Mine was previously projected to exhaust reserves in early 2011. As part of the capacity expansion, Cliffs will also mine additional ore from its Tilden Mine, located adjacent to Empire, and process it utilizing extra processing capacity at Empire. Utilization of this capacity will enable Tilden to increase production to more than 10 million tons annually. Tilden Mine currently has an annual rated capacity of nearly eight million tons, with an expected mine life exceeding 30 years.

FRE option prices up prior to Treasury support
FRE is recently at $10.60 in pre-open trading, above its close of $7.55. Treasury Secretary Henry Paulson pledged the U.S. federal government is behind FNM and FRE. Smith Barney maintains its Buy on FNM. FRE July 7.5 straddle is priced at $3.45, August 7.5 straddle closed at $6.90 according to Track Data, suggesting larger price movement.

FNM option prices up prior to Treasury support
FNM is recently trading at $14.18 in pre-open trading, above its close of $10.25. Treasury Secretary Henry Paulson pledged the U.S. federal government is behind FNM and FRE. Smith Barney maintains its Buy on FNM. Smith Barney say’s “we see the recent sell-off as a crises of confidence, rather than an indication of significant fundamental change.” FNM July 10 straddle is priced at $4.75. FNM August 9 straddle is priced at $7.30 according to Track Data, suggesting turbulent price movement.

CSIQ backs FY09 view
Based on market forecasts, customer orders and supply contracts, CSI reiterates its full-year 2009 forecast and expects to deliver 500-550MW of solar modules including both its high-efficiency regular module products and lower-cost e-Modules.
CSIQ on track to meet or exceed FY08 revenue guidance
Sees FY08 revenue at least $750M-$870M vs. consensus of $849.16M.
CSIQ reports preliminary Q2 revenue $210M-$214M
CSIQ had seen Q2 revenue $185M-$190M. Consensus is $186.62M.

U.S. equity futures continue to point to a higher open
U.S. equity futures continue to point to a higher open. Just as last week when Fannie Mae (FNM) and Freddie Mac (FRE) dominated market news and dictated how the markets would move, the two companies are again in the forefront. This time the news is positive and that has buyers lining up to at least start the day.

WMI offers to acquire Republic Services-RSG for $34/share in cash
Waste Management, Inc. announced that it has made a proposal to the Board of Directors of Republic Services, Inc. to acquire all of Republic’s outstanding common stock for $34.00 per share in cash. Waste Management’s proposal represents a premium of approximately 22% over the closing price of Republic stock on July 11, 2008, the last trading day prior to public disclosure of Waste Management’s proposal.

Semiconductors/Semi Equipment: Chip stocks offer compelling risk/reward@FBRC
Despite recent channel checks having softened slightly in the past month, FBRC finds demand better than anticipated with reasonable inventories and chip stock valuations extremely attractive. BARD advises buying aggressively shares of MRVL, ONNN, FCS, NSM, MSCC, IRF and SLAB while selling BRCM seems appropriate as it hasn’t won the GPS chip for the iPhone 3G.

ZION downgraded to Sell from Neutral@GSCO
Goldman downgraded ZION citing construction and land exposure and weak balance sheet. Target to $21 from $39.

CRME announces positive Phase 2b results for Vernakalant
Cardiome announced positive clinical results from its 90-day Phase 2b study of vernakalant (oral). The final analysis demonstrated statistically significant efficacy for the patient group receiving 500mg b.i.d. of vernakalant (oral) as compared to placebo. The safety data from the final analysis also shows that vernakalant (oral) was well-tolerated in the atrial fibrillation population studied.

BRCM: Teardown shows Content in 3G iPhone more than doubles@PIPR
Piper’s teardown of the iPhone 3G indicates BRCM should generate approximately $5.25 in revenue per 3G iPhone sold, which is slightly more than double the content the company was awarded for the 2.5G version. Piper reiterates a Buy rating on BRCM shares.

AAPL: Believe 3G demand was high throughout the weekend@PIPR
Piper believes high iPhone 3G demand throughout the weekend offsets the activation delays. The firm estimates AAPL sold 380k iPhone 3G units worldwide on Friday and Saturday vs. 270k units at the launch of the original iPhone. Piper continues to expect AAPL will sell 4.1M iPhone 3Gs by the September 2008 quarter. Shares remain Buy rated.

Pre-Market Movers: Ahead of the Bell
We are putting this story out much earlier than usual as the pre-market is already extremely active with a large number of issues moving. In summary, anything that was hit to the downside by concerns over Fannie Mae (FNM) and Freddie Mac (FRE) on Friday is rallying hard as the Treasury pulled back from earlier remarks and has put together what amounts to a defacto rescue package for the two companies and a “put” for the stocks. With that FNM has already turned over a million shares and FRE is at the half-million mark. The gains are every bit as spectacular as the Friday intraday losses with FNM up +31% and FRE up +23%. We would expect the gains today to be every bit as irrational as the losses over the prior session. One proviso will be watching the auctions for the debt offerings the companies are floating as poor results will quickly undo anything positive on the equity side. Brokers such as Lehman (LEH), up +13.1% and most major banking stocks are trading to the upside such as Wachovia (WB), up +5%, JP Morgan Chase (JPM) up +3.13% and Bank of America (BAC), up +3.36%. Financials are clearly going to be the focus today with most other issues trailing to the side. It is possible we may see a delayed news impact for stocks in other sectors as the markets digest the news in the financials. Homebuilders, which have been decimated, are likely to get a pop of size today but have yet to trade as of this writing.

CRK: Estimates increased for Haynesville activity@CSTI
After the company’s recent conference presentation and definitive outline of their drilling timeline, Collins Stewart raised their 2009 EPS estimate to $4.31 from $3.90. They rate CRK a Buy with $113 target.

iPhone Supplier update: Less positive on BRCM; As expected for MRVL & LLTC@FBRC
Friedman Billings said the new iPhone 3G tear-down unexpectedly shows that BRCM is not supplying the GPS chip, which was expected, but is providing the touchscreen controller. The firm believes BRCM could see some profit taking near-term and retrace to the $25 level. As expected, the firm said MRVL is selling the WiFi chip and LLTC is selling the battery/USB charger.

View recent sell-off in Fannie Mae, Freddie Mac as overdone@SBSH
Citigroup does not think Fannie Mae (FNM) and Freddie Mac (FRE) are under near-term pressure to raise capital and believes the recent sell-off is a “crisis of confidence,” rather than an indication of significant fundamental change. The firm reiterates Buy ratings on both stocks.

National Oilwell Varco-NOV upgraded to Buy from Neutral@BOFA
Banc of America upgraded shares to reflect accelerating orders for new rigs and potential upside from the Grant Prideco acquisition. The firm raised their target to $107 from $78.

Apple-AAPL: Weekend checks suggest iPhone 3G not sold out in U.S.@SOLE
Soleil’s checks on Friday and Saturday found the iPhone 3G was not entirely sold out but the firm points out that based on news reports from around the world, the iPhone was largely sold out in the 21 other counties. Soleil thinks shares could see near-term pressure with the launch catalyst behind the company, but believes the wider launch of APPL into the mobile phone provides another core leg of the long-term growth story. Shares remain Buy rated.

Solarfun Power-SOLF and Schuco enter into 47 MW sales contract
Solarfun Power Holdings Co., Ltd. announced that one of its wholly owned subsidiaries has entered into a 47.0 MW sales contract with Schuco International KG, a leading PV system provider in Europe.

Range Resources-RRC issues update on Marcellus Shale
John Pinkerton, Range’s Chairman and CEO, said, “With more than 100 wells drilled in the Marcellus Shale, including 20 horizontal wells, we are extremely pleased with our progress to date. We believe we have developed a solid understanding of the play’s technical aspects and are moving from the testing phase to the development stage. Given our 1.4 million acre leasehold position, the Marcellus play holds enormous potential for Range and its shareholders. Importantly, the Marcellus play has the potential to be a very large economic stimulus to the states involved and provide a domestic, cleaner and less expensive alternative to foreign oil.”

MRVL: Checks indicate risk to RIMM business@AMTR
Am Tech’s supply chain checks suggest that Freescale (FSL) has won the baseband processor slot on an upcoming BlackBerry handset, and they now believe 30%-50% of MRVL’s business with Research in Motion (RIMM), or $120M-200M on an annualized basis, is at risk. However, Am Tech thinks MRVL’s strong technology and aggressive price points should allow it to remain a key supplier to RIMM. Shares remain Buy rated.

S&P 500-SPX: Pivot Points
The following are the pivot points for the S&P 500 (SPX). Pivot High: 1248.320, Pivot Low: 1217.050. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.

Jim Cramer’s “Mad Money”
Cramer last recommendation in his week long bullish call on healthcare, was CR Bard (BCR). In addition to new products to help prevent hernias and new catheters for its surgical supply business, BCR is introducing new devices to help prevent hospital contracted infections. Cramer noted that Bard now derives 10% to 15% of its sales from these new, “sexier” medical devices. With a 14% long-term growth rate, Cramer said get in now ahead of big money managers. SPECULATION FRIDAY: Cramer reviewed the consolidation in chemical stocks with the acquisition announced earlier this week by Dow Chemical (DOW) of Rohm & Haas (ROH). In that vein, he recommended PPG Industries (PPG) as a next possible takeover target. With a 3.8% dividend yield, Cramer said PPG is the safest way to speculate on a takeover. PPG shares are down 13% since just May 30, making it the perfect entry point, he said. Cramer praised the company’s strong management and said they are committed to increasing shareholder value. Cramer said PPG is a safer stock than investors might think since 53% of its sales are overseas. Cramer said PPG and its peers are incredibly cheap. If PPG were given a more realistic multiple, he said the stock should be worth $81 a share. Next, Cramer rolled out his own game plan to deal with Fannie Mae (FNM) and Freddie Mac (FRE) crisis. He said the administration should guarantee all debt from both companies by taking 20% of the companies in warrants. He predicted the mortgage market would rally under this plan, which he said is not a bailout, with liquidity flowing back into the system. Furthermore, his plan could lower mortgage rates, stop the decline in housing and send bank stocks from bear to bull. Looking at next week’s earnings reports: (MON) Genentech (DNA) he says buy half a position before the company reports, and the other half after. (TUE) bullish on both Eaton (ETN) and Johnson & Johnson (JNJ), calling Johnson “probably best story of the week.” Intel (INTC), Cramer is no fan of the shares. VF Corp (VFC) he would consider as they already indicated better-than-expected earnings. (WED) YUM Brands (YUM) he’d be a buyer ahead of the Olympics, but would wait until after earnings are announced. (THUR) bullish on Coca-Cola (KO) and might consider JP Morgan (JPM) ahead of its earnings, but only if the markets get hit earlier in the week. Lastly, Cramer said he’s bearish on Advanced Micro Devices (AMD), International Business Machines (IBM), Microsoft (MSFT) and Merrill Lynch (MER), all of which report on Thursday. NATURAL GAS: Cramer welcomed Katie McGinty, Pennsylvania’s secretary of environmental protection, to discuss the state of oil and natural gas drilling, particularly in her state’s oil shale regions. McGinty said that there are adequate water treatment facilities in place to handle the waste needs of increased drilling. Asked about the recent decline in coal output, McGinty said the shortfall has nothing to do with a shortage of coal, but rather simple supply and demand pricing. Cramer continued to support the oil and natural gas drillers. LIGHTNING ROUND: (Bullish) no stocks. (Bearish) RNWK; CLR; RF; BABY; CIEN and SWKS.

Fast Money position recap- First moves: Guy likes JNJ, Karen likes PDE, Pete likes MCD.
Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Macke Owns (INTC), (USO), (WMT), (MSFT); Najarian Owns (AAPL), (CHK), (TSO), (XLF); Najarian Owns (FNM) And (FNM) Puts; Najarian Owns (LEH) And (LEH) Puts; Najarian Owns (RIMM) Calls, (SLB) Calls, (YHOO) Calls, (CSCO) Calls; Finerman Owns (GS); Finerman’s Firm And Finerman Own (PDE); Finerman’s Firm Owns (MSFT), (SUN), (TSO), (VLO), (GE), (MO); Finerman’s Firm Is Long SPX Index Puts; Finerman’s Firm And Finerman Own (C) And (C) Leaps; Finerman’s Firm Is Short (BIG), (RTH), (IJR), (MDY), (SPY), (IWM); Finerman’s Firm Owns (TGT) Calls.

The market is acting positive to the FNM and FRE news with the government. Let’s see how it holds throughout the day. The recent problems have been a crisis in confidence and have made buyers skeptical. I am hoping that this news today will help form a meaningful bottom to the massively oversold market. The financials should lead the market. Positives out of the solar sector from CSIQ and the SOLF contract should help that sector. AAPL factual data of better than expected sales of the iPhone 3G should help tech. I’m letting the market range for the first couple hours to see how this rally will be treated. Pick plays with a high probability of success, have focus and patience. Plan the trade and trade the plan. Great trading and Great Luck!