Stocks posted mild declines on all of the major averages Wednesday, as investors turned cautious. The initial read on 4^th Quarter GDP indicated the first decline since the recession, and the Fed statement also confirmed a slowdown had occurred during the period, and that the monthly QE and Zero Interest Rate Policy, or  ZIRP,  would continue.

Overnight, Asian markets finished mixed, with Japan and Shanghai up modestly, Hong Kong, India, and Singapore down. European markets are all trading in the red at this hour, with Spain down over 2%. U.S. futures are slightly in the red, indicating a downward bias heading into the trading day.

A deluge of economic data is due out this morning; the Weekly Unemployment Claims numbers, Personal Income & Spending for December, Personal Consumption Expenditures for December, Employment Cost Index for Q4, and the Chicago PMI Index for January. These reads will likely affect the market mood going into the open.

None of my stocks have received any upgrades / downgrades so far this morning.   

ConocoPhillips (COP) reported yesterday after the close that Q4 EPS was $1.43, beating by a penny. Q4 production from continuing operations was up 1.8% Y/Y.

Per Monday’s post, several of my stocks are scheduled to report today. I will recap these in the next posting, time to publish and get ready for the day’s action.

JT

Stocks mostly gained on Tuesday, with the Dow Industrials and the S & P 500 posting modest gains, and the NASDAQ recovering to break even, after an early drop. Asian markets posted gains across the board, over 2% in Japan. European markets, by contrast, are trading in the red across the board at the moment, except for Britain, which is showing a small gain. U.S. futures are flat, but with a positive bias.

Upgrades / downgrades that have come out this morning on my stocks are:

Potlatch (PCH) was downgraded from Neutral to UnderPerform at DA Davidson.

ExxonMobil (XOM) was downgraded from OutPerform to Neutral at Macquarie.

Norfolk Southern (NSC) was upgraded from Neutral to OverWeight at Atlantic Equities. 

Additional earnings reports from my stocks that have come out since my last posting are:

Before the open Tuesday, Nucor (NUE) reported Q4 EPS of $0.43, beating by thirteen cents. Revenue was $4.45B, down 7% Y/Y, missing by $0.1B.

This morning, three more reports came out:

Roche Holdings (RHHBY) reported net profit up 2.4% to 9.77B francs ($10.6B). Core EPS was up +11% to 13.62 vs consensus of 13.60. Earnings were helped by weakening of the Swiss franc vs the dollar and the yen. An annual dividend of 7.35 francs/share was declared, up from 6.80 francs a year ago.

Northrop Grumman (NOC) reported Q4 EPS of $2.06, beating by $0.31. Revenue was $6.47B, beating by $0.14B.

Southern Co (SO) reported Q4 EPS of $0.44, beating by four cents. Revenue of $3.70B, up 7% Y/Y, missed by $0.88B.

There are a couple of notable economic reports scheduled to come out today, the ADP Employment Changes, 4^th Quarter GDP numbers, and also the Fed meeting will conclude, with an announcement at 2:15 PM.

The rally has caught me a little by surprise. Fortunately, I closed most of my covered calls a month or so ago when we had the last downturn, and the only one still on is a stock I want to sell. I’m holding on the stocks I have, but not buying more at these prices. It could be a slow couple of months for a value investor. Most pundits have caught the fever, and are predicting that stocks will continue to advance.

JT  

The week started out Monday with a somewhat lackluster session. The blue chip averages, i.e. the Dow Industrials and the S and P 500, ended up slightly below where they began, while the NASDAQ posted a slight gain, as Apple turned in a positive day for a change. A disappointing reading on Pending Home Sales may indicate that the recovery of the housing market may not be as robust as some pundits have stated.

Overnight, Asian markets ended mixed, with Japan and Shanghai up, India, Hong Kong, and Singapore down. European markets are mostly trading down at this hour, with Britain the best of the lot, not in a loss position, just at the zero line.

Economic releases on tap are the Case-Shiller 20 City Index for November, which is a read on the state of housing, and Consumer Confidence for January. Neither is likely to be market-moving. U.S. futures are trending negative at the moment, with about two hours to go before the open.

Upgrades / downgrades out this morning on my stocks are scarce, with only one to report, which is that Unilever (UN) was downgraded from Buy to Hold at Jeffries, likely due to valuation.

Earnings that have come out so far this week on my stocks are:

Gladstone Investment (GAIN) reported after the close Monday that FQ3 EPS was $0.15, in-line with estimates.

Potlatch (PCH) reported this morning that Q4 EPS was $0.34, beating by two cents. Revenue was $143.3M, beating by $8.79M.

Pfizer (PFE) reported Q4 EPS of $0.47, beating by three cents. Revenue of $15.1B beat by $0.7B.

NextEra Energy (NEE) reported Q4 EPS of $1.02, beating by six cents. Revenue was $3.37B, missing by $1.29B.

Nucor (NUE) has not reported as yet, although results are expected today.

Eaton (ETN), originally expected yesterday, has moved their report to 2/5/2013.

American Electric Power (AEP), expected yesterday, per E*Trade, has not reported as yet.

I see also in the news that the management shake-up at Diebold (DBD) is continuing, as the vice-president of Global Operations has stepped down.

Time to post and get ready for the day.

JT

Friday was another win for the bulls. The Dow Jones Industrials and the S&P 500 are both within spitting distance of their 2007 highs, which were reached just before the sub-prime mortgage crisis began to appear in the headlines. The NASDAQ is already beyond those level, but still somewhat shy of the heights reached during the Internet bubble of 2000. By any measure, we have a frothy market.

Overnight, Asian markets finished mixed, with Japan down, India flat, and Shanghai, Hong Kong, and Singapore up. European markets are also mixed at this hour, with Britain, France, and Italy up, Germany and Spain down. U.S. futures are slightly positive, with nearly two hours to go to the open.

A few of my stocks have received upgrades / downgrades so far this morning:

Buckeye Partners LP (BLP) was downgraded from Buy to Neutral at Goldman.

Plains All American Pipeline LP (PAA) was downgraded from OutPerform to Market Perform at Wells Fargo.

Norfolk Southern (NSC) was upgraded from Hold to Buy at Jeffries.

Realty Income (O) was upgraded from Market Perform to OutPerform at Wells Fargo. 

Stocks I track going ex-dividend this week are:

1/29/2013

Alliant Energy (LNT), yield 4.10%.

Conagra Foods (CAG), yield 3.09%.

Enterprise Products partners LP (EPD), yield 4.74%.

Kinder Morgan Inc (KMI), yield 3.97%.

Kinder Morgan Energy Partners LP (KMP), yield 5.80%.

ONEOK Partners LP (OKS), yield 4.75%.

Prospect Capital (PSEC), yield 11.62%. PSEC pays monthly.

1/30/2013

Realty Income (O), yield 4.99%. O pays monthly.

Pfizer (PFE), yield 3.56%.

Norfolk Southern (NSC), yield 2.87%.

Plains All American Pipeline (PAA), yield 4.36%.

Williams Partners LP (WPZ), yield 6.57%.

1/31/2013

Southern Co (SO), yield 4.41%.

Moving on to earnings, there is a lot happening, as we move into the peak of earnings season.

First, I missed that AT&T (T) reported on Thursday, after the close. T reported Q4 EPS of $0.44, missing by two cents. Revenue was $32.58B, up 0.2% Y/Y, beating by $360M. The firm also reported that $4.4B in stock buybacks occurred. Guidance for 2013 was provided, with 2%+ consolidated revenue growth expected, and EPS growth in the "upper-single digits or higher," and free cash flow of $14B+.

Now, looking ahead, earnings on my stocks will be coming out every day this week. Reports anticipated, by day, are:

1/28/2013

American Electric Power (AEP) earnings, which were expected Friday, will now be reported before the open on 1/28/2013.

Eaton (ETN), before the open.

Gladstone Investment Corp (GAIN). Timing not announced.

1/29/2013

NextEra Energy (NEE), before the open.

Pfizer (PFE), before the open.

Nucor Corp (NUE), before the open.

Potlatch (PCH), before the open.

1/30/2013

ConocoPhillips (COP), after market hours.

Northrop Grumman (NOC), before the open.

Southern Co (SO), before the open.

Medical Properties Trust (MPW), before the open.

1/31/2013

Colgate Palmolive (CL), before the open.

Altria Group (MO), before the open.

United Parcel Service (UPS), before the open.

Amerigas Partners LP (APU), before the open.

Enterprise Products Partners LP (EPD), before the open.

NuStar Energy LP (NS), before the open. I will be watching this one.

2/1/2013

Chevron (CVX), before the open.

Merck (MRK), before the open.

Exxon Mobil (XOM), before the open.

Things should heat up this week, between earnings and a lot of economic data, including the closely-watched monthly Payroll report on Friday. My article on Diebold (DBD) has generated a couple of additional comments. The entire experience, re:Diebold, has been very educational for me.

Time to start a new week.

JT

Even though it is the first posting for Monday, 1/28/2013, I am going ahead and posting the initial draft on the Saturday before, which contains the bulk of the usual Monday posting. One reason I am doing so is that I will be traveling next week, and I may run into technical difficulties keeping up with the usual schedule. I will repeat the post, barring technical issues, on Monday, updated with information that only comes available on the market day.

Friday was another win for the bulls. The Dow Jones Industrials and the S&P 500 are both within spitting distance of their 2007 highs, which were reached just before the sub-prime mortgage crisis began to appear in the headlines. The NASDAQ is already beyond those level, but still somewhat shy of the heights reached during the Internet bubble of 2000. By any measure, we have a frothy market.

Stocks I track going ex-dividend this week are:

1/29/2013

Alliant Energy (LNT), yield 4.10%.

Conagra Foods (CAG), yield 3.09%.

Enterprise Products partners LP (EPD), yield 4.74%.

Kinder Morgan Inc (KMI), yield 3.97%.

Kinder Morgan Energy Partners LP (KMP), yield 5.80%.

ONEOK Partners LP (OKS), yield 4.75%.

Prospect Capital (PSEC), yield 11.62%. PSEC pays monthly.

1/30/2013

Realty Income (O), yield 4.99%. O pays monthly.

Pfizer (PFE), yield 3.56%.

Norfolk Southern (NSC), yield 2.87%.

Plains All American Pipeline (PAA), yield 4.36%.

Williams Partners LP (WPZ), yield 6.57%.

1/31/2013

Southern Co (SO), yield 4.41%.

Moving on to earnings, there is a lot happening, as we move into the peak of earnings season.

First, I missed that AT&T (T) reported on Thursday, after the close. T reported Q4 EPS of $0.44, missing by two cents. Revenue was $32.58B, up 0.2% Y/Y, beating by $360M. The firm also reported that $4.4B in stock buybacks occurred. Guidance for 2013 was provided, with 2%+ consolidated revenue growth expected, and EPS growth in the "upper-single digits or higher," and free cash flow of $14B+.

Now, looking ahead, earnings on my stocks will be coming out every day this week. Reports anticipated, by day, are:

1/28/2013

American Electric Power (AEP) earnings, which were expected Friday, will now be reported before the open on 1/28/2013.

Eaton (ETN), before the open.

Gladstone Investment Corp (GAIN). Timing not announced.

1/29/2013

NextEra Energy (NEE), before the open.

Pfizer (PFE), before the open.

Nucor Corp (NUE), before the open.

Potlatch (PCH), before the open.

1/30/2013

ConocoPhillips (COP), after market hours.

Northrop Grumman (NOC), before the open.

Southern Co (SO), before the open.

Medical Properties Trust (MPW), before the open.

1/31/2013

Colgate Palmolive (CL), before the open.

Altria Group (MO), before the open.

United Parcel Service (UPS), before the open.

Amerigas Partners LP (APU), before the open.

Enterprise Products Partners LP (EPD), before the open.

NuStar Energy LP (NS), before the open. I will be watching this one.

2/1/2013

Chevron (CVX), before the open.

Merck (MRK), before the open.

Exxon Mobil (XOM), before the open.

Things should heat up this week, between earnings and a lot of economic data, including the closely-watched monthly Payroll report on Friday.

JT

The blue-chip indexes continued to rise Thursday, at a subdued pace, while the NASDAQ, weighted down by a huge sell off in Apple, posted a decline. Overnight, Japan rose nearly 3%, while India rose nearly 1%. Singapore managed to post a decent gain as well, while Shanghai and Hong Kong generated modest declines. European markets are all trading in the green at this hour, which is at the half way point in the European market day.

The only economic release on tap for today is New Home Sales, to be out at 10:00 AM.

U.S. futures are currently indicating a positive start to trade here, with nearly two hours to go to the opening bell.

Only a couple of analyst actions to report so far today on my stocks:

Medtronic (MDT) was downgraded from Buy to Hold at Wunderlich.

BioMed Realty (BMR) was initiated with a Neutral rating at Goldman. This is a REIT recommended by the Morningstar Dividend Investor, that I will be adding to my Tier2 list.

Moving on to earnings, after the bell Thursday Microsoft (MSFT) reported FQ2 EPS of $0.76, beating by a  penny. Revenue was $21.46B, up +3% Y/Y, but still missing estimates by $70M. FY13 operating expense guidance in the range $30.3B-$30.9B was reaffirmed. One article I read stated that Windows 8 helped sales, but not by as much as the executive suite would have liked.

As for today, earnings are scheduled to be reported before the bell by three of my stocks, Procter & Gamble (PG), Kimberly Clark (KMB), and American Electric Power (AEP).

PG reported FQ2 EPS of $1.22, beating by eleven cents. Revenue was $22.2B, up 3% Y/Y, beating by $0.32B. It appears that the recovery of PG is continuing.

KMB reported Q4 EPS of $1.37, beating by two cents. Revenue of $5.3B, up 3% Y/Y, beat by $0.11B. .

AEP has not hit the tape as yet, I will post AEP results Monday.

My new article on Diebold (DBD) came out on Seeking Alpha about mid-morning on Thursday. Unfortunately, a number of announcements from the Company came out earlier in the day, which managed to crater the stock, which declined over 10%. A link to the article is available under the Published Articles selection from the home page. The essence of the news is that earnings for the final quarter and full year 2012 will be worse than projected, and that a management shake-up has occurred, with a search for a new CEO under way. See my Update comment posted after the article for details. As for my chastened ego, I will repeat what I stated in a reply comment to one of my readers, as a recap of the situation:

This is the first time I have written about a stock and then had negative developments come out almost immediately afterward. Actually, I caught the news before publication, but instead of pulling back the article, I prepared the update instead, which I posted as soon as SA published the article. I said to myself, let's let the chips fall, and see where we go from here. The whole scenario will probably prove to be more instructive to investors than if the bad news had not come out. This is the real world, where bad things sometimes happen, even if one has done due diligence. Speaking of same, as the article reads, I did not have that much of a comfort level with DBD -- it was only attractive as a possible value stock in a frothy market. I probably should have listened more to my inner voice -- perhaps I was over-confident after some good (short-term, at least) calls on PG, ETN, and EMR. (See my articles on these for what I'm referring to.) One thing is certain, any time you get over-confident, the market will resolve the problem for you.

Overall, the commenters were very fair and sympathetic. As I alluded to above, there is probably more to learn about investing from this type of experience than from a positive one. I just hope my next few moves don’t teach me much of anything!

One final clarification regarding Diebold, which is not on any of my lists of possible stocks. My entry into DBD is now an “off the reservation” speculation on my part. I was going to add DBD to my Tier2 list when I submitted the article, but now, after what happened yesterday, DBD is not a stock I can recommend as an investment, and put on my Tier1 or Tier2 lists, and the yield is not high enough to be on my Tier3 list of high yield, high risk stocks. 

TGIF.

JT

Stocks were mostly flat or declining on Wednesday, but the general public probably thinks otherwise, since a huge rise by IBM caused the Dow Industrials average, which is the market as far as the public is concerned, to post a modest gain. That’s the problem with a stock average that only has 30 components. Then again, the NASDAQ average has many more components than 30, and yet is still heavily influenced by Apple (AAPL), as will be seen today with the firm’s disappointing results reported after the close yesterday.

Asian markets finished mixed, with Japan and Singapore up, Shanghai, Hong Kong, and India down. Europe is trading mostly in the red at this hour by modest margins, with Britain being an exception, showing a small rise.

Economic releases for the day are the Weekly Unemployment numbers, due out at 8:30 AM, and the December reading on the Index of Leading Indicators, due out at 10:00 AM. U.S. futures are mixed, with the large-cap Dow and S&P flat to slightly positive, and the NASDAQ negative, due to Apple being down 9% in pre-market trade.

Upgrades / downgrades / initiations of coverage on my stocks so far today are as follows:

Colgate Palmolive (CL) was initiated at OutPerform at Credit Suisse.

Kimberly Clark (KMB) was initiated at UnderPerform at Credit Suisse.

Procter & Gamble (PG) was initiated at Neutral at Credit Suisse.

Emerson Electric (EMR) was upgraded from Hold to Buy at Deutsche Bank.      

Several of my stocks have reported earnings in the past day or two:

Norfolk Southern (NSC) reported after the close Tuesday that Q4 EPS was $1.3, beating by a penny. Revenue was $2.7B, down 4% Y/Y, but still beating by $0.04B.

Novartis AG (NVS) reported Q4 EPS of $1.27, stating that it may not be comparable to consensus of $1.31. Revenue was $14.8B, flat Y/Y. The annual dividend, to be announced soon, is expected to be at a 2% increase from the prior year. Coming from Switzerland, the announcement came out around 3:00 AM Wednesday morning New York time.

McDonald's (MCD) reported Wednesday morning that Q4 EPS was $1.38, beating by four cents. Revenue was $6.95B, up 2% Y/Y, beating by $0.06B.

3M Co (MMM) reported this morning that Q4 EPS was $1.41, in-line with estimates.  Revenue was $7.4B, up 4.2% Y/Y, beating by $0.22B.

Raytheon (RTN), also reporting this morning, stated that Q4 EPS was $1.6, beating by three cents. Revenue was $6.43B, beating by $0.02B.

Today may see a pull-back in the market, not only because of Apple, but because it is just time for one.

JT

After struggling a bit in the early going, stocks managed to post yet another day of gains on Tuesday, as trade resumed after the three day weekend. Overnight, Asian markets posted mixed results, as Japan and Hong Kong posted declines, Japan over 2%, while Shanghai, India, and Singapore posted gains. European markets are mostly trading in the red at this hour, with only Britain and Germany holding on to small gains. U.S. futures are pointing towards a negative start for the day, as the latest band aid for the U.S. fiscal situation, to push off the debt ceiling showdown for another few months, comes up for an uncertain vote in Congress.

Economic news scheduled for today is light, with only the FHFA Housing Index for November on tap, due out at 9:00 AM.

Only two upgrades / downgrades on my stocks to report this AM:

Verizon (VZ) was upgraded from Hold to Buy at Canaccord.

Novartis (NVS) was upgraded from Neutral to Buy at Citigroup.

I am taking a look at starting a position in Diebold (DBD). I have a new article in the works on the firm, which I will hopefully get published on Seeking Alpha this week. My research has uncovered some unpleasant truths about the firm, but I have to counter that with the history of 50 years plus of regular dividend payments. Stay tuned!

JT

After meandering around during the morning hours, stocks caught a bid after lunch, and rose steadily throughout the rest of the day, with all of the major averages ending at or near their post-financial-crisis highs. In fact, the averages are not too far away from the nominal all-time highs set in the fall of 2007, before the wheels came off the economic wagon. I say nominal, meaning the numbers I was comparing have not been adjusted for inflation. A few things have come up in price a wee bit since 2007, such as health insurance premiums for an individual health insurance policy, up around 250% in my case. But, heck, look how much cheaper laptop computers are these days. Unfortunately, I buy the former every month, and the latter every 5 to 8 years. And with Obama-Care, I am dreading the next increase. But I digress – getting back to stocks, buying today at current prices in most cases guarantees that one will not do well with the investment, unless you believe that prices will keep on rising for a very long time to come. And in fact, prices may keep rising for awhile yet. It is a very trying time indeed for a value investor.

Overnight, Asian markets ended mostly in the red, with only Hong Kong presenting a positive number. European markets are mixed at this hour, with Italy up, Britain flat, and Germany, France, and Spain in the red. U.S. futures are flat at this moment, with over an hour to go to the open.

The only economic release scheduled for today is Existing Home Sales, due out at 10:00 AM. Barring an unexpected collapse from the steadily improving picture for real estate, I don’t anticipate a market-moving announcement.

Many analysts apparently took the weekend off, as none of my stocks have received any upgrades / downgrades so far today.

Only one stock on my lists goes ex-dividend this week, Colgate Palmolive (CL), on 1/22/2013, yield 2.28%. Come to think of it, that’s today, so it is already too late to buy CL and get the dividend. It is just as well, because CL is a prime example of a stellar performing dividend stock being bid up to unbelievable levels, such is the hunger among investors for quality dividend-paying stocks. Closing Friday at $109.01, not far from the all-time high of $110.97 reached intraday on 10/17/2012, the well-under 3% yield is none too enticing, and CL bought at these levels is very likely to be “under water” upon the next market decline. If you look at my Tier1 list for CL, you won’t find it just yet. CL and several others were dropped from my list some time ago because of over-valuation. Now that everything is over-valued, I am in the process of bringing some of the highest-quality names back onto my lists, even though they will have buy-under prices that are unlikely to be reached anytime soon. For example, my maximum buy level for CL was $75 when it was dropped. I will accept reality and raise some of these buy prices when I come out with my updated lists sometime during this 1^st quarter of 2013, but they will still be somewhat below the market, barring a significant market swoon.       

Earnings season gets into a higher gear this week, with the following tentative reporting dates and times scheduled for stocks on my lists:

01/22/2013      

Johnson & Johnson (JNJ), before the open. The results have already come out, with JNJ reporting Q4 EPS of $1.19, beating by two cents. Revenue of $17.6B, up 8% Y/Y, nevertheless missed estimates by $.07B. Shares are down slightly in the pre-market trade.

Verizon (VZ), before the open. These results are likewise already out, with Q4 EPS of $0.38 missing by $0.13. Revenue of $30B, up 5.7% Y/Y, beat by $.25B.

Norfolk Southern (NSC), after the close.

01/23/2013

McDonalds (MCD), before the open.

Novartis (NVS), at 08:00 EST, per the firm’s website events calendar. I am assuming this is AM, although I’m not sure what time it will be in Switzerland then. The announcement will come from the company headquarters in Basel, Switzerland.

01/24/2013

3M Co (MMM), before the open.

Raytheon (RTN), before the open.

Eaton (ETN), before the open.

Microsoft (MSFT), after the close.

AT&T (T), after the close.

01/25/2013

Kimberly Clark (KMB), before the open.

Procter & Gamble (PG), before the open.

American Electric Power (AEP), before the open.

Now is a good time to research stocks and fine-tune a list of candidates, and then hold off on buys until a market slide provides better prices. Also, I am holding off on sells as well, even though I am sitting on gains that in more normal times I would be taking, since my cash levels are already too high, and I do not want to suffer any further decline in dividend income. Oh, the lamentations of a value investor – a life of continual pain and disappointment. Come to think of it, that sounds like real life in other spheres as well!

JT

After marking time for the past three days, stocks came alive on Thursday to post healthy gains on all of the major averages. A couple of pundits have reiterated the old Wall Street adage, “never short a dull market”, which certainly applied this week. Overnight, Asian markets were universally positive, with Japan gaining nearly 3%, and Shanghai and Hong Kong each gaining over 1%. European markets are positive as well at the moment in Britain, France, and Spain, although not by large margins, and Italy and Germany are trading in the red.

The only economic release scheduled for today is the monthly University of Michigan Sentiment Index, due out just before 10:00 AM.

The mood should be positive as we begin the day, based on the bellwether stock General Electric (GE) pre-market earnings release. GE reported Q4 EPS of $0.44, beating consensus by a penny. Has Jack Welch returned? Beating by a penny was a hallmark of his reign. Anyway, to continue, revenue was $39.3B, beating by $0.59B.

With nearly two hours before the start of trade, U.S. futures are actually slightly negative, in spite of GE’s results. But that will likely change as we move closer to the open.

Only one upgrade / downgrade has come out so far today on my stocks, at this early point in the day:

Waste Management (WM) was upgraded from UnderPerform to Neutral at Wedbush, with a new price target of $34. Uh, fellows, WM closed Wednesday at $35.27. Don’t you think that perhaps it might UnderPerform from here if it is only worth $34?

If stocks can hold yesterday’s gains into the close today, I will take that as a win and declare victory, for this week at least.

JT

Stocks finished mixed Wednesday, with the Dow Industrials and the New York Composite finishing with modest losses, largely due to Boeing being down over 2%, and the NASDAQ and S & P 500 finishing up slightly, while the small cap Russell 2000 finished with a fractional loss. The economic data came in about as expected, with no major market-moving deviations.

Overnight, Asian markets finished mixed, with Japan and India up, Shanghai, Hong Kong, and Singapore down. European markets are mostly positive at this half-way point in their trading day, with only Germany showing a small decline. Economic news on tap for today includes the weekly reading on Claims for Unemployment, Housing Starts and Building Permits for December, and the Philadelphia Fed Business Activity Index. U.S. futures are slightly positive, with about an hour and a half to go before the start of trade. 

Boeing (BA) has been in the cross-hairs, as problems continue with their new Dreamliner, with the stock taking a big hit in recent trade. More positively, the big banks continue to post strong results, with Bank of America (BAC), Huntington Bancshares (HBAN), Fifth Third Bancorp (FITB), and BB&T (BBT) all reporting better than expected earnings. Intel (INTC) reports today after the close, a report that will be closely scrutinized for clues as to the prospects for recovery of the tech bellwether.    

Upgrades / downgrades on my stocks that have come out so far today are:

Mercury General (MCY) was upgraded from Neutral to OutPerform at Macquarie.  

Medtronic (MDT) was upgraded from Neutral to OutPerform at Credit Suisse.

Cisco Systems (CSCO) was downgraded from Neutral to UnderWeight at JP Morgan.

Earnings have come out on two of my stocks:

Kinder Morgan Energy Partners (KMP) reported after the bell Wednesday that Q4 EPS was $0.61, missing consensus estimates by six cents. Revenue was $2.51B, up 30.5% Y/Y, beating by $0.06B.

Kinder Morgan Inc (KMI) reported as well after the close Wednesday that Q4 EPS was $0.32, missing by two cents. Revenue was $3.08B, beating by $0.06B.

Both firms announced increased payouts as well, causing shares to rise in after-market trade late Wednesday.

As usual, there are several cross-currents affecting the market mood, and it is hard to tell which way the day will go. I guess the best policy is to be ready for anything, and take advantage of any opportunities that arise. That is my plan. I’m watching over 100 stocks, with buy and sell targets defined. If targets are hit, I will take action. If not, I will take a siesta.

JT

Stocks managed to post minor gains across most of the major averages, with the exception of the NASDAQ, which posted a small decline because of the influence of Apple (AAPL), which has been selling off lately. Overnight, Asian markets mostly posted losses, over 2% for the Nikkei, and nearly 1% for the Sensex. Only Singapore, of the five major Asian bourses, showed a gain, of less than 0.5%. European markets are all trading in the red at this hour, led by Italy, with a decline exceeding 1%.

Today we have a flood of economic data coming out. The December CPI at 8:30 AM, then Net Long-Term TIC flows for November at 9:00 AM, Industrial Production and Capacity Utilization for December at 9:15 AM, the NAHB Housing Index for January at 10:00 AM, the usual weekly Oil Inventories at 10:30 AM, and finally, the Fed Beige Book for January at 2:00 PM. The market will likely react to these reports, plus a couple of major financial firms will report, led by Goldman (GS) and JP Morgan (JPM). U.S. futures are indicating a negative start to the trading day is in store.  

Upgrades / downgrades on my stocks that have come out recently are:

Digital Realty (DLR) was initiated yesterday at OutPerform by RW Baird.

Energy Transfer Equity (ETE) was downgraded from OutPerform to Neutral at RW Baird.

Inergy (NRGY) was downgraded from OutPerform to Neutral at RW Baird.

Plains All American (PAA) was downgraded from OutPerform to Neutral at RW Baird.

Medical Properties trust (MPW) was upgraded from UnderWeight to Neutral at JP Morgan.

Kimco Realty (KIM) was downgraded from OverWeight to Neutral at JP Morgan.

Health Care REIT (HCN) was downgraded from OverWeight to Neutral at JP Morgan.

Kellogg (K) was downgraded from Neutral to UnderPerform at Credit Suisse.

Vodafone (VOD) was downgraded from Buy to Hold at Deutsche Bank.

Today we may see a pick up in volume and volatility from the low levels of recent trading days.

JT

Stocks logged about as lackluster of a session as possible Monday. With no economic releases coming out and earnings pending, investors and traders apparently saw no reason to take action. No TICK readings at even the lowest volatility levels that I track, a positive or negative 750, occurred. The averages finished about where they started, although the Dow Industrials did manage to eke out a 19 point gain, pushing the venerable average above 13500. Before anyone gets excited about this, note that 19 points is only a 0.14% gain on that stock average.

Overnight, Asian markets finished mixed, with Japan, Shanghai, and India up, Hong Kong and Singapore down. European markets are all trading in the red at this hour. Economic releases resume today, with Retail Sales, PPI, and the Empire Manufacturing Index already out. Results were up 0.2%, flat, and negative 7.8, respectively, all reflective of uninspiring economic performance. The only data point remaining for today is Business Inventories, due out at 10:00 AM.

Moving on to upgrades / downgrades out this morning, I have only come across one on stocks I track. Ares Capital (ARCC) was downgraded from OverWeight to Neutral at JP Morgan, citing valuation. With an $18 price target, the BDC is at full value.

There is a lot of news flow about the debt ceiling limit being breached soon, with Repugnats and Demagogues predictably staking out hard-core, uncompromising, diametrically-opposed positions. While I try to avoid politics on this blog, it is necessary for all market players to be aware of this potential clash, and the possible effect on the market, so as to not be blind-sided when all heck breaks loose. And indeed, it may, if the scenario we saw the last time this situation occurred repeats. All indications are that it very well could be worse this time. It appears that stocks are not going anywhere until this threat recedes. If I was from another planet and could watch it unfold with no personal concerns, it would be great entertainment. Unfortunately, although my spouse sometimes wonders, I am from this planet and I will be affected by whatever happens, as will all of us.

JT

Just a quick update to alert followers of this blog that I have a new series of articles out on Seeking Alpha on the subject of Stocks, Options, and Taxes. The articles are tagged as Parts I through VI, for a total of six articles. While they have been coming out at a measured pace for a couple of weeks now, I decided I would wait until they are all available before posting to my own website. Go to the main menu selection Published Articles for the complete title of each article and the detailed topic presented, plus links. 

As the series points out, there are a lot of arcane rules to be observed imposed by the IRS when it comes to stock and option trading. Plus, there are new forms and procedures required by the IRS to improve tax compliance. Anyone actively trading and / investing needs to be aware of the information summarized in these articles.

JT

Stocks ended the day Friday mostly flat, with a small gain on the Dow Industrials and the NASDAQ, a fractional loss on the New York Composite, and flat on the S & P 500 and the small-cap Russell 2000. All of these averages posted a gain for the week, however.

Overnight, Asian markets rallied on all bourses except Singapore, which posted a small decline. European markets likewise are mostly in the green at this hour, with Italy being an exception, posting a small decline. U.S. futures are flat to slightly negative, with an hour and a half to go to the open.

While there are no economic releases scheduled for today, Fed Chairman Bernanke will be speaking just after the close at the University of Michigan, and several major banks will be reporting later on this week. All will be eagerly awaited by investors.

A few upgrades / downgrades of interest this morning are:

Cisco Systems (CSCO) was upgraded from Neutral to Outperform at Robert W. Baird.

CSCO was also upgraded from Market Perform to OutPerform at William Blair.

Norfolk Southern (NSC) was upgraded from Hold to Buy at Deutsche Bank.

Nucor (NUE) was upgraded from Hold to Buy at KeyBanc.

Verizon (VZ) was downgraded from Buy to Neutral at UBS.

Only two of my stocks will be going ex-dividend this week:

Proctor and Gamble (PG), 1/16/2013, yield 3.25%.

Main Street Capital (MAIN), 1/16/2013, yield 5.67%. MAIN pays monthly.

Earnings season begins for my stocks this week, with three companies scheduled to report:

Kinder Morgan Energy Partners LP (KMP), 1/16/2013, after market hours.

Intel (INTC), 1/17/2013, after market hours.

General Electric (GE), 1/18/2013, before the open.

Things should get more interesting this week, as earnings season picks up steam.

JT

Stocks rallied on Thursday, nearing the recent highs once again. Asian markets finished mixed, with Japan up, India flat, and the rest down, led by Shanghai, down 1.78%. European markets are mostly trading down at this hour, with only Spain in the green. The main economic releases for today have already come out. The November Trade Balance was a little worse than expected, at a negative $48.7B. Export and Import prices for December were down slightly, but not as much as predicted. U.S. futures are flat as the open approaches.

Several upgrades / downgrades of interest have come out this morning:

Eaton Corp (ETN) was downgraded from Buy to Neutral at Buckingham, based on valuation.

3M Co (MMM) was downgraded from Neutral to UnderWeight at JP Morgan. MMM is another stellar but over-priced stock I will be adding back onto my Tier1 list.

DrPepper Snapple Group (DPS) was downgraded from OutPerform to Market Perform at Bernstein.

Molson Coors (TAP) had coverage initiated at Buy at Nomura.

General Mills (GIS) was downgraded from Neutral to Sell at Goldman.

J.M. Smucker (SJM) was downgraded from Buy to Neutral at Goldman.

The market is open, time to post.

JT

Stocks managed a positive day Wednesday, with all of the major averages posting gains. Overnight, Asian markets likewise posted gains in most cases. European markets are mixed at this moment, with Britain and Germany modestly positive, France and Spain modestly negative, and Italy up substantially, nearly 1%.

A few upgrades / downgrades of interest have come out this morning:

Coca-Cola (KO) was downgraded from Buy to Hold at Argus.

Norfolk Southern (NSC) was downgraded from OutPerform to Market Perform at Raymond James.

NSC was also downgraded by Goldman, from Buy to Neutral.

Ventas (VTR) was downgraded from Neutral to UnderPerform at Macquarie.

The weekly report of Claims for Unemployment came in about as expected, at 371K. U.S. futures are indicating a positive start for trading today.

JT

Tuesday was a mirror image of Monday, with all of the major averages posting modest declines on low volatility. Alcoa (AA) started off earnings season with a better than expected report after the close, perhaps the reason for the mood seemingly a little better today. U.S. futures are mildly positive. Asian markets turned in mixed results, with Japan, Hong Kong, and Singapore up, Shanghai flat, and India down. European markets are trading in the green at this hour, some just barely so, others by a good margin.  

Several upgrades / downgrades on my stocks have come out this morning:

Entergy (ETR) was downgraded from Hold to Trim at Tudor Pickering. Trim?  That is a new one for me. Get out the hedge clippers and trim that position if you own it, according to the new rating.

Mercury General (MCY) was upgraded from Sell to Hold at Stifel Nicolaus. Not exactly a ringing endorsement, but it still counts as an upgrade.

McDonalds (MCD) was downgraded from OutPerform to Market Perform at Raymond James. Actually, MCD is not on my lists just now. I dropped it and a few other stellar firms because the prices were so high I despaired of them ever being buyable. I plan to add these stocks to my lists once again soon, since right now everything is too high. My buy prices will still be way under where they are trading, unless a 2008-style swoon occurs.

Exterran Partners LP (EXLP) was upgraded from Neutral to OutPerform at Credit Suisse.

Amerigas LP (APU) was downgraded from Neutral to UnderPerform at Credit Suisse.

Boardwalk Pipeline LP (BWP) was downgraded from OutPerform to Neutral at Credit Suisse.

Maybe today things will get more interesting.

JT

I was up and at it bright and early this morning, but unfortunately, my Internet service provider was not. Anyway, better late than never.

The first full week of trading for 2013 began with a somewhat lackluster session Monday, with low volatility and modest declines across all of the major stock averages. Overnight, Asian markets mostly finished with losses, except for India, which managed a small advance. European markets, now nearly done, are mixed, with Britain and Germany in the red, the others in the green, but not by much either way.

The only economic release scheduled for today is Consumer Credit, due out this afternoon. U.S. markets are posting modest losses at this point in the trading day.

The analysts are back on the job following the holidays, with a number of the stocks I follow receiving upgrades / downgrades since yesterday’s posting. First, coming out during the day Monday, were the following;

Hercules Technology Growth Capital (HTGC) was upgraded from Hold to Buy at Stifel Nicolaus.

Northrop Grumman (NOC) was upgraded from UnderPerform to Sector Perform at RBC Capital Markets.

Royal Dutch Shell (RDS.B) was upgraded from Market Perform to Market OutPerform at Howard Weil.

Statoil (STO) was downgraded from Market OutPerform to Market Perform by Howard Weil.

NextEra Energy (NEE) was upgraded from Neutral to Buy at ISI Group.

Intel (INTC) was upgraded from Neutral to Buy at Lazard Capital.     

Then, today we have a few more:

Triangle Capital (TCAP) was downgraded from Strong Buy to OutPerform at Raymond James.

Westar Energy (WR) was downgraded from Buy to Neutral at Citigroup.

Molson Coors (TAP) was initiated at Neutral by ISI Group.

Northrop Grumman (NOC) was downgraded from Neutral to UnderWeight at JP Morgan.

Raytheon (RTN) was downgraded from OverWeight to Neutral at JP Morgan.

Just past midday, stocks have so far posted declines on all of the major averages. The gains from the big rally day less than just one week ago will eventually be given back if these modest declines continue. That and more will be required before I can be tempted to buy anything.

JT  

Stocks managed to post modest gains on Friday, with all of the major stock averages finishing in the green. What was impressive about the week just ended was that the gains from the huge rally on Wednesday have held, so far at least.

Overnight, Asian markets took a breather, mostly posting declines. Shanghai was an exception, posting a modest gain. European markets are all trading in the red at this hour.

There are no economic releases scheduled for today. In fact, it will be a slow week for economic data until Friday, with November Consumer Credit on Tuesday being the only release before then, other than the usual weekly releases. On Friday, we will see the November Trade Balance figures, December Export and Import Prices, and the Treasury Budget for December.

None of my stocks have received any upgrades / downgrades so far today.

Only a few of my stocks will be going ex-dividend this week:

General Mills (GIS). 01/08/2012, yield 3.16%.

Universal Corp (UVV), 01/10/2012, yield 3.85%.

Consolidated Communications (CNSL), 01/11/2012, yield 9.27%.

Fifth Street Finance (FSC), 01/11/2012, yield 10.60%. FSC pays monthly.

None of my stocks are scheduled to report earnings this week. Earnings season begins officially as Alcoa (AA) reports 4^th Quarter results on Tuesday, January 8^th. As we move on towards the end of the month, a stream of earnings reports will start to come out, growing into a deluge as we move into February, not subsiding until after March. For most firms this next cycle will be the annual reporting cycle, with more commentary and guidance than the quarterly reporting usually offers. Companies will probably be conservative with projections, considering Europe, the U.S. debt issue, and potential slowdowns in the BRIC countries. 

I expect a slow start to the first full week of trading since before Christmas. I’m sure the pace will be picking up as we move along, however, with earnings serving as a catalyst for some market movement later on this month.

JT

Stocks never were able to get any traction on Thursday, as might be expected on the day after a huge relief rally. Still, with all of the major averages posting only minor declines, the gains from the rally are mostly intact. Asian markets gained in Japan, Shanghai, and India, led by Japan, up nearly 3%. Singapore ended flat, while Hong Kong posted a modest decline. European markets are selling off mildly at this hour. U.S. futures are flat, as traders await the December Jobs Report.

In addition to the Jobs Report, the ISM Services Index and Factory Orders will also be coming out today. Only one upgrade/downgrade has come out so far today on my stocks, as Johnson & Johnson (JNJ) was upgraded from Hold to Buy at Deutsche Bank.

With a significant dose of economic data scheduled for today, we may see a little more movement than yesterday’s sleepy session. I had been looking forward to some buy opportunities early in the New Year, but the relief rally caused all the candidates I was considering to move out of range.

JT   

The anticipated relief rally occurred as predicted, as all of the major averages posted significant gains. I have not seen anything to confirm this, but I believe it was the largest one day advance seen since 2008, when huge moves up and down occurred regularly as the financial crisis unfolded. At any rate, it was the largest one day move up that has been seen for quite some time. Now, the question is, was it a one day outlier, or the start of a new advance? Most pundits believe it was the former, as nothing of lasting significance was accomplished, and the issues are unresolved.

Asian markets continued to post gains across the board overnight, but not so in Europe, as all of the major bourses are posting declines at this hour. Employment and the lack thereof  will be the focus today, with Challenger Job Cuts, ADP Employment Changes, and the usual Thursday update on Claims for Unemployment are all scheduled to be announced. Also, the latest Fed minutes from the last meeting are scheduled for release. Sometimes I see the Fed meetings and announcements as reminiscent of the Texas Railroad Commission’s (TRRC) allowables reporting. The latter used to be a matter of great impact on the oil markets and the economy, as the TRRC determined how much oil the state would allow the well operators to produce. Finally, after months and months of 100%, the TRRC announced that there would be no further allowables announcements, that production capacity had declined such that operators could produce all they wanted going forward. Maybe the Fed will do something similar, by announcing that they have loosened monetary policy as much as possible, and that there will be no further announcements, just assume that ZIRP continues from now on. I doubt if that will occur, but it seems like it would save everyone time and money if it did.

A quick scan of upgrades/downgrades that have come out this morning revealed two that are of interest, as far as my stocks are concerned:

Triangle Capital (TCAP) was downgraded from Buy to Neutral by Davenport.   

Cisco Systems (CSCO) was upgraded from Sector Perform to OutPerform at RBC Capital.

The futures are negative at this moment, suggesting some stock buyers may be having second thoughts regarding yesterday’s huge rally. Today will be interesting, no doubt, as the insignificance of the political deal as announced becomes apparent.

JT.

Stocks rebounded strongly in a robust New Year’s Eve session after sinking during the prior session, apparently in the belief that some type of deal would get done and the fiscal cliff, or at least some of it, would be avoided. At least, that is the way it appeared to be shaping up Monday.

Wednesday morning, as the news spread about the last-minute deal being approved, Asian and European markets reacted with sizzling rallies, and U.S. futures are indicating the markets here will do likewise, at least at the open. The deal did not include any spending cuts, only provided for a two month delay in sequestration, extended unemployment benefits yet again, and ended the tax holiday on the employee portion of Social Security contributions. The bill passed the House with a majority of Republicans voting against it. In more normal times, the Speaker, who comes from the majority party, would never have allowed a bill opposed by a majority of the party’s members to come up for a vote. But Speaker Boehner had previously committed to allowing the Senate-approved bill to come up for a straight up-or-down vote, which he did. It was basically a Democratic victory, a typical “kick-the-can-down-the-road” non-solution to our fiscal problems. But the markets are grateful that at least something got done. I believe the euphoria will prove to be short-lived, but I may take advantage of it while it lasts to sell something.

The analysts are back at work, with a number of upgrades and downgrades out this morning. Still, only one has come out so far on my stocks, as Alliant Energy (LNT) was downgraded from OutPerform to Market Perform at Wells Fargo.

I neglected to present my usual list of stocks on my lists scheduled to go ex-dividend or report earnings during the upcoming week. Possibly I overlooked this update because it was nearly non-existent. Only one of my stocks is going ex-dividend this week, Sysco (SYY), on 01/02/2013, yielding 3.54%. None of my stocks will be reporting this week.

It appears that 2013 will begin with a robust relief rally. My advice is to enjoy it while it lasts.

JT