Week in Review

DJIA +43.85 (+0.33%) to 13,435.21; S&P 500 +7.10 (+0.49%) to 1,466.47; NASDAQ +1.09 (+0.04%) to 3,101.66

Hopefully slow and steady will win the race when it comes to the Jobs market.  Adding another 155K non-farm jobs  was just a tick above analysts expectations and the revised Unemployment rate for November to 7.8% held into December. The market started the morning somewhat choppy while seemingly digest the morning’s economic data and then started a near uninterrupted climb closing near highs of the day.

Supervalu (SVU) gapped higher and closed up over 13.5% on a Wall Street Journal report that private equity firm Cerberus Capital is close to a deal for SVU.

Another stock of the day was Acme Packet (APKT) which received an upgrade to Buy at Stifel Nicolaus along with a $27 price target.  Looks like APKT could target $25 next which might then end the short term rally as it coincides with previous levels and is then close to the target set for anyone in the stock due to Stifel.  Otherwise, APKT has been a beaten name down from over $80 in just 2011 so if they can turn it around this could be a name that provides opportunity in the future.  You can see analyst comments for the day or view the archive from the Upgrades/Downgrades section.

A group in focus today, the fertilizers, closed higher after some positive news and report.  Mosiac (MOS) closed up over 3% on earnings that beat analysts estimates on the bottom line while revenues were slightly light.  Citi came out advising that MOS’s results could be negative for Potash (POT) but that didn’t stop POT from gaining over 1.5%.  Also gaining on the news was Agrium Inc. (AGU), up 1.6% and CF Industries Holdings (CF), up over 2%.

Despite the rally today there were names on the downside.  Finish Line (FINL) closed down over 8% after reporting earnings estimates inline but then guided lower for Q4 and 2012.  Along with the disappointing news, analysts piled on with downgrades later in the day.  Also on the downside was Accuray (ARAY) which lost over 20% on a negative pre-announcement of their Q2 earnings.

Week in Review:

There was some small economic news out today that was better than expected but the rally and optimism was on the headlines that congress was close to a fiscal cliff deal.  Duff & Phelps (DUF) which agreed to be purchased for $665.5 million in cash or $15.55 per share by a group of private equity companies including The Carlyle Group (CG).  The Upgrades/Downgrades section kept me busy this week after virtually nothing the previous week.  One of those to note was Intel (INTC).  INTC was reiterated as a Top Pick at Wells Fargo siting growth in x86 servers and their believe INTC can increase share in mobile processors.  INTC was a beaten name in 2012.  Technically speaking, INTC does not interest me yet but i a name on my radar.  I was looking for lower prices but will pay higher if a tempting pattern develops.

Tuesday was closed in observance of New Years day.

The majority of Wednesday’s gains were made on the open resulting from the market’s elation on a fiscal cliff deal.  I noted that I would like to think that this is the last time we focus on Washington but unfortunately I feel it is not (don’t we have Debt talks coming and we saved spending cuts until then???).  Otherwise Wednesday’s rally was on better than average volume and the fact that Small caps and Tech lead shows broad and strong.  Two names we have posted about and liked technically saw nice gains on Wednesday.  First, Zipcar (ZIP) saw a near 50% gain on news that Avis Budget (CAR) agreed to acquire ZIP for $12.25 per share in cash.  Second, US Steel (X) moving over 8% today on a Credit Suisse upgrade and $30 price target.

Thursday’s action was a textbook consolidation day after a strong rally.  We anticipated this in our Wednesday nightly update.  Ultimately how long and how deep we consolidate will be best tracked each day watching the Price, Volume and technical action.  Thursday had retailers in focus reporting same-store sales.  On the upside we saw Ross Stores (ROST) and TJX Companies (TJX) gain over 7 and 3% respectively.  Notable names to the downside were Limited Brands (LTD) losing slightly over 6% on disappointing December same-store sales and Family Dollar (FDO) which not only reported disappointing December same-store sales but reported earnings and revenues below analysts estimates and to put a cherry on top guided below analysts estimates for the coming quarter.  FDO lost over 11% on Thursday.  Also moving on Thursday was solar stocks.  The catalyst was with SunPower Corporation (SPWR) and the news that MidAmerican, Solar (owned by Warren Buffet) purchased  two solar projects from SPWR for $2.5 billion that reportedly will create the largest permitted solar photovoltaic power development in the world.  In additional to that news, Lazard upgraded SPWR to Buy with an $11 Price Target.

As always you can visit the Event’s Calendar for the release of economic data, scheduled meetings and other news that could move the market.  Also in that section are Dividends and Splits.

Major averages 5 day results:

Dow Jones Industrial:

S&P 500:

Nasdaq:

The S&P 500 has 1474 (the recent highs) in its sights but Friday’s rally left me feeling that more consolidation is needed before a more prolonged move.  Otherwise any move could start to throw off red flags and become extended which could then prompt a larger retracement.  As far as medium or longer term swing traders are concerned, there is really nothing screaming “sell” here and the bias must remain to the upside as it gas been since mid-November.  I want to see the SPY remain above the recent $140 lows as to not break the trend f higher highs and higher lows.