Tag - AMEX:GHM

Dow 10,000 is less than 100 points away this morning. Who'd a thunk it? Just 6 months ago, when the Dow closed at 6,547 on March 9, it seemed as though the world was coming to an end.

You might have thought I had gone off the deep end when my Daily Profit from March 9, 2009 hit your inbox with the headline "Upside for Stocks?" And the following day, March 10, I even included a list of stocks you might have considered buying for the rally that was starting. Since then, Graham Corp (AMEX:GHM) has rallied 90% and SXC Health Solutions (Nasdaq:SXCI) is up 162%.

You might still think I'm a little nuts calling for the Dow to hit 10,500 before this year is over. But with money still cheap, economic data still improving and stock valuations that are reasonable if forward earnings estimates prove accurate, that there may be more upside isn't a crazy idea...

Stocks were up today in reversing the downward trend from the week with leadership from financials and healthcare. Most notably blue chips JPMorgan Chase & Co. (NYSE:JP), Goldman Sachs (NYSE:GS), Pfizer (NYSE:PFE), and Merck (NYSE:MRK) were up. Rounding out the leaders in financial were Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC).

The Dow ended the day's trading session up 0.69% to close at 8,555 while the Nasdaq declined 0.02% and the S&P 500 saw gains, closing at 918, up 0.84%.

Small-cap bellwether Russell 2000 Index, representing the 2,000 largest small-cap stocks, closed up 0.36% to 509.

Leading small cap gainers reflected the broader push top leaders in financials including National Penn Bancshares (Nasdaq:NPBC) up 31.4%; American Capital (Nasdaq:ACAS) up 27.1%. Other gainers include Myriad Pharmaceuticals (Nasdaq:MYRXV) up 15.7%; Nelnet (NYSE:NNI) up 30.5%; and Talbots (NYSE:TLB) up 16%.

Small-cap decliners were lead by Liz Claiborne (NYSE:LIZ) down 25.9%, on forecasts of larger than expected losses. The company gave no indication for the larger losses other than the message from all apparel companies that consumers are cutting back on what they consider nonessential purchases. Liz Claiborne reported a loss of 37 cents per share in the first quarter, excluding one-time items. Analysts had forecast 33 cent loss per share for the second quarter. No guidance was provided by the company as to what the revised forecast might be. This played into investor concerns as sellers look to unload shares as reflected in higher than normal volume.

In other news concerning Liz Claiborne, the company announced yesterday that it intends to offer $75 million in convertible senior note due 2014. It is the company's intention to use the proceeds to pay down a portion of borrowings under an amended credit facility. 

*****10 banks have paid back $68 billion in TARP loans. Including some smaller banks that have already repaid loans, the total is now over $70 billion. Even though the repaid money was raised from secondary stock offerings, which dilute shareholder value, it's still something of a positive sign, I suppose.

Now, what's going to happen to the money? Will it sit in the TARP fund? Will it be used to back other loans to small businesses?

This is an inflation issue. The money supply has increased by around $1 trillion in the last year (much of the bailout "funds" have been loan and asset guarantees that haven't increased the money supply, yet). It's the Fed's job to contract the money supply to keep price inflation in check.

This is the problem with creating money - you have to be willing to "uncreate" it at some point. With unemployment as high as it is, inflation is not yet a concern. But that will change eventually, and the Fed will have to have the resolve to contract the money supply when the economy starts showing signs of life.

As we've seen in the past, an economy that gets hooked on liquidity is very hard to wean. I personally have my doubts as to whether this Fed will be able to avoid the Greenspan legacy of allowing asset bubbles to form. So we want to be ready to profit form whatever asset bubbles arise in the future.

This is one of the topics we'll be discussing in next Wednesday's Video Conference. It's titled Inflation Busters: Discover the Stocks to Grow and Protect Your Wealth and will air on Wednesday, June 24 at 6:00 P.M. It's free to attend, you can sign up HERE

*****Stocks are trying to put an end to the sell-off that started with Monday's big decline. The S&P 500 is within a few points of its 200-day moving average. It's also less than 20 points from its 50-day moving average.

One of the simplest trend following systems focuses on the crossover of the 50-day and 200-day MA. When the 50-day MA crosses above the 200-day MA, it signals a trend change from bear to bull. When the 50-day MA falls below the 200-day MA, it signals a change from bull to bear.

So, the current trading is very significant to technical traders. The S&P 500 is flirting with a major buy signal. It should be noted that the Nasdaq flashed the moving average crossover buy signal a few days ago. I would view the moving average crossover on the S&P to be confirmation of the Nasdaq signal.

*****Jason Cimpl, technical analyst at TradeMaster Daily Stock Alerts, isn't waiting. He's expecting a strong bounce and recommended 3 upside positions to his readers yesterday. One of them, the Direxion Technology Bull (NYSE:TYH), is a leveraged ETF that seeks triple the daily gains on the Russell 1000 Technology Index. That trade finished the day with a 3% gain.

Don't forget the new Daily Profit feature - Jason will give us another video chart analysis session tomorrow. In last Friday's edition he pretty much nailed this week's trading so I can't wait to see what he has to say about next week.
 
*****I'm itching to recommend a new stock to Daily Profit readers. We did pretty well with Graham Corp (AMEX:GHM) and Hovnanian (NYSE:HOV) earlier in this rally. 

I can't say I feel comfortable recommending Molecular Insight Pharmaceutical (Nasdaq:MIPI), but the story that came out yesterday is pretty darned interesting. The biotech announced that it can both detect and treat prostate cancer with its imaging agent, Trofex. And instead of the usual 5 tests including MRI and ultrasound, Molecular Insight can collect the necessary data for diagnosis within 2 hours of the Trofex injection.

The stock was up 42% to $6.24 yesterday. Of course, like most small biotechs, Molecular Insight is burning through cash like a teenager at the mall. But if this technology is viable, the stock will go a lot higher than $6.24.

Just thought you'd like to know…talk to you tomorrow.

 

 

Investors saw lots of red in today’s trading session as regional manufacturing data suggested that economy is not picking up as much as had been hoped. Most economists had expected gains in the New York Fed’s manufacturing index but were instead treated to numbers indicating that the factory sector shrank at a more severe rate than expected.

A stronger U.S. dollar pulled oil below $70 away from its eight month high.

As of press time, 3:30 P.M. Eastern, the Dow was down -194.75 to 8,604.50; the Nasdaq was down -46.29 to 1,812.51, and the S&P 500 was down -23.25 at 922.96.

The Russell 2000 Index, comprised of the top 2,000 small-cap stocks, was down 16.77 at 510.06.

Bucking the downward trend today was pharma and financials. Two of the top percentage gainers were JazzPharma (Nasdaq:JAZZ) up 69.7% on positive news about it fibromyalgia drug and MAP Pharma (Nasdaq:MAPP) up 11.89%. MAPP has been on a tear since late May when it shot up to $11.39 from $3.15.

Other small-caps showing leadership today include QEP (Nasdaq:QEPC) up 39.07%, Tongxin Intl (Nasdaq:TXICU) up 24.75%, and two financials, American Capital (Nasdaq:ACAS) up 14.67% and New Century Bancorp (Nasdaq:NCBC) up 14.83%.

Small-cap decliners were lead by Oil-Dri Corp. of America (NYSE:ODC) down 23.24% following Friday’s news that it will lose its largest customer in the cat litter retail segment. Other leading decliners include Virgin Mobile USA (NYSE:VM) down 16.98%, book retailer Borders Group (NYSE:BGP) down 13.16%, and Integrated Electrical Services (Nasdaq:IESC) down 17.64%.

*****Summer doesn’t officially start for a few more days. Tell that to the parents who are now getting their kids off to camp or getting ready for vacation. For the standard two-income household, living easy in summertime is just a memory.

Including today, we have just 12 more trading days until the end of June and the end of the second quarter. I suspect we will have seen the highs for stock prices by then. That is, if we haven’t seen them already.

Oil backed off recent highs on Friday. And that’s likely to continue. Oil was too cheap at $33 a barrel. But $73 is too high, at least for now while much of the developed world is still mired in an economic downturn. We know demand is still weak. And we know there are looming supply issues when demand picks back up. However, the issue right now is the economy.

*****Oil has been rallying as the news cycle has been relentlessly optimistic about an imminent economic recovery. In fact, many leading economists expect U.S. GDP to actually grow in the third quarter.

Oil stocks that we’ve been following have been on a tear the market bottom, including Graham Corp. (AMEX:GHM) up 81%; Brigham Exploration (Nasdaq:BEXP) up 239%; Gulfport Energy Corp. (Nasdaq:GPOR) up 326%. Even the majors like ExxonMobil (NYSE:XOM), Chevron (NYSE:CVX), BP (NYSE:BP), and ConocoPhillips (NYSE:COP) are bringing investors some decent returns, though not as great as small-cap stocks in the same sector.

Investors have bought the rumor of economic recovery. We’ll see how they respond to the news. I’ll be watching oil as the leading indicator for economic expectations.

Right now, it seems like stock prices have priced in a modest recovery. And if investors perceive that there’s not much upside left for stock prices, it would makes sense to trim exposure, take profits, or however you want to put it.

*****We’ve seen anecdotal evidence that investors are moving funds out of the stocks that have led the market higher. Technology has been having trouble making headway. And we’ve seen strength in healthcare and consumer staple stocks. Plus, the Volatility Index (VIX), which measures the cost of put options (which rise in value as stocks or indices fall, thereby giving investors downside protection) has been on the rise.

This suggests that investors are preparing for a downside move for stock prices, or, at the very least, protecting gains they have made.

*****On Mondays, I’m going to start offering a look at the economic data coming out during the week ahead. This week is a bit unusual as all the economic data is out on Tuesday. Tomorrow we get Housing Starts, Building Permits and the Producer Price Index (PPI).

Of course, consumers will focus on the housing numbers. But I’d expect any numbers will be interpreted with optimism. Investors seem to understand that the bottoming process for the housing market will be volatile and that wild swings in the data should be expected.

In my opinion, the PPI is the one to watch. The U.S. dollar rallied a bit last week, but there’s no doubt that massive Treasury bond sales have investors worried about a weaker dollar the potential for inflation to pick up. Add to that improving retail sales numbers, helped by higher gasoline prices, and you have the potential for a higher-than-expected PPI reading. Needless to say, that would not be good for stocks.

I’ll talk to you tomorrow.

Ian Wyatt

P.S. You’ll recall from Friday’s issue we start sharing charting analysis from TradeMaster’s technical analyst, Jason Cimpl. If you didn’t have a chance to catch, here’s the link. You’ll get his take on this week’s market direction. Since this is a new feature for Daily Profit I’d greatly appreciate receiving any feedback from you on it.

All major indices were trading down for much of today's session with the Nasdaq leading the losses by shedding 0.19% to close at 1,858.80. In late trading the Dow closed at 8,799.26 for a modest gain of 0.32% and the S&P 500 closed up 0.14% to finish the day at 946.21.

The Russell 2000, the widely followed index of the largest 2,000 small cap stocks, closed down today at 524.32 losing 0.33%.

Leading the small-cap gainers today was Savient Pharmaceuticals (Nasdaq:SVNT) up 56% to close at $9.26 on news that the Food and Drug Administration said that the firm's gout treatment drug, Krystexxa, works. Based in East Brunswick, NJ, Savient makes specialty biopharmaceuticals as was founded in 1980.

Other small-cap leading gainers include WSP Holdings (NYSE:WH) up 24.5%; Independent Bank Corporation (Nasdaq:IBCPO) up 22.4%; and AC Moore Arts & Crafts (Nasdaq:ACMR) up 16.4%.

Small-cap decliners were lead by Hawaii-based Hoku Scientific (Nasdaq:HOKU) down 30.3% to close at $3.05. Hoku, a raw materials provider for the solar industry, announced that it may be unable to fund its operations over the next year and stated that it will not provide guidance for fiscal year 2010.

The other small-cap stocks posting big share price drops include iPCS (Nasdaq:IPCS) down 21.6%; P&F Industries (Nasdaq:PFIN) down 19.9%; and one of Wednesday's big gainers, Corel (Nasdaq:CREL), which slid 18.4%.

*****Its worse in Europe than here in the U.S. Industrial production dropped 1.9% in a particularly cruel April, nearly double the 1% drop that was expected. First quarter GDP was also down 2.5% for the 16 Euro-zone countries.

The recession there seems far from over, and Europe's weakness might be contagious because it should act as a stark reminder just how tenuous global economic recovery is.

*****Oil prices may have just hit their blow-off highs above $72 yesterday. As you know, I was early to the oil stock party. My SmallCapInvestor PRO readers took a 142% gain on one stock, Gulfport Energy (Nasdaq:GPOR), and we're holding +60% on another. And of course, if you've been following closely over the past six months you know that I've been in and out of Graham (AMEX:GHM) several times.

Now, it's getting late and I suspect the party might be ending, at least for a brief pause. I'm not calling for oil prices to crash. And the $33 a barrel price we saw back in February may never be seen again. But oil stocks, and stocks in general, are due for a pullback.

The 2nd Quarter ends June 30. And it would be reasonable to expect institutional investors to lock in some gains. I'm sure they are using put options to do some hedging, which helps explain the recent rise in volatility. But I also won't be surprised to see some outright selling. And it might have started with yesterday's afternoon drop for the indices.

The Dow Industrials were up well over 100 points in the early afternoon, but couldn't hold it as a late wave of selling left it with a gain of just 30. That's the opposite pattern of what we've seen for much of this rally. Institutional investors have been buying late in the day, supporting prices and leaving stocks with daily gains.

Institutional activity usually occurs at the beginning and end of the trading day, so this is something to keep an eye on.

*****Brazil, Russia, China and India contribute 15% to global GDP, but they have 42% of the world's currency reserves. And they may be on the verge of throwing their liquidity weight around.

Bloomberg reports that these countries will hold their first summit next week, and it's widely expected that they will announce that they are increasing their holdings of IMF bonds. Yes, that comes at the expense of U.S. bond holdings.

Apparently, fears of rising deficits and the potential inflation from an expanded money supply in the U.S. are driving them to diversify a bit.

Investors should take note. While the U.S. muddles through, and Europe continues to be mired in recession, the BRIC countries (Brazil, Russia, India and China) are the only countries in the world that can support their economies without taking on debt.

Chinese stocks are the ones I'm bullish on right now. If there is a slight pullback later this month, then Chinese stocks will suffer the least and more importantly, present great buying opportunities before the next leg up. To get my top Chinese selections, click HERE.

*****Finally, as I announced yesterday, TradeMaster Daily Stock Alerts technical analyst Jason Cimpl has graciously agreed to give us a weekly forecast for the stock market. You can access his video analysis and commentary HERE.

Stocks are in the red today after new data did little to bolster investors’ spirits that the economy is slowly getting better.

At 2:51 pm ET, the Russell 2000 (NYSE:IWM) is down 1.43%, while the Dow is down 1.10% and the S&P 500 is down 1.44%.

Today the Labor Department said consumer prices in April were flat, as economists predicted, while New York-area manufacturing activity and industrial production contracted less than economists expected. Investors remain cautious ahead of several reports out next week on housing.

Small caps bucking the decline today include BioCryst Pharmaceuticals (Nasdaq:BCRX), up 30% after reporting encouraging results from its Phase II lymphoma trial, and Fuqi International (Nasdaq:FUQI), 20% higher following strong first-quarter results.

******You know over the course of the past few months I’ve not held Wall Street or the banking executives in high regard. I hold them almost — that’s almost — singularly accountable for our current recession (Uncle Sam and private citizens who borrowed too much are to blame as well), but the government is beginning to really stick its nose too far. For example, today’s headlines (those not about whether Nancy Pelosi knew about torture and when she knew it) are consumed with government pushing itself on private industry, most notably with the pressure on Bank of America (NYSE:BAC) to change its board.

Granted, “regime change” is a necessity for most of the companies receiving TARP money. After all, they’re the ones who got us into this mess. But shouldn’t it be shareholders forcing the issue? You saw how they forced Ken Lewis of Bank of America to give up his role as chairman. This was done at the shareholder level, not by some bureaucrats in a windowless office overlooking the National Mall.

But for many Beltway insiders this isn’t enough. Someone’s got . . .

Despite opening lower this morning, small caps have shrugged off bad unemployment data and are trading higher this afternoon.

At 2:36 pm ET, the Russell 2000 (NYSE:IWM) is up 2.78% at 484.96, while the Dow is up 0.92% and the S&P 500 is up 1.42%.

Although stocks are higher today, they are still down sharply for the week, no thanks to new data out. Today the Labor Department reported that more workers filed last week for benefits than anticipated. New claims jumped to 637,000, much more than what was forecasted. The overall number of people seeking unemployment benefits grew faster than expected, increasing to 6.6 million, while continuing claims hit a 15th straight weekly record.

Small caps on the rise today include Gildan Activewear Inc. (NYSE:GIL), up 21% after announcing second-quarter results, and Forest City Enterprises (NYSE:FCY), up 18% after guiding in line.

*****The selling got serious yesterday. But once again, as TradeMaster technical analyst Jason Cimpl forecast, the dip was a buying opportunity. Stocks are up this morning as if nothing happened…

But of course, something did happen. Cracks in the rally are beginning to show. And economic data is starting to weaken. Consider this morning’s Producer Price Index (PPI). This popular measure of inflation on the wholesale level came in stronger than expected. Prices for food are ticking upward.

No doubt the Fed is relieved to see a little strength in prices, as overall, prices have dropped 3.7% over the last 12 months. The only thing that scares the Fed more than inflation is deflation.

My question is: at what point do rising prices motivate the Fed to start sopping up the flood of liquidity it has released over the last eight months? Clearly, there will have to be stronger signs of recovery, but with the potential for full employment numbers to be higher than they’ve historically been, I can’t help but be . . .

Small caps are lower today following a drop in U.S. exports in March and multiple stock offerings across the board that doused enthusiasm.

At 2:04 pm ET, the Russell 2000 (NYSE:IWM) is down 2.46%, while the Dow is down 0.26% and the S&P 500 has fallen 0.97%.

New data out today showed that the U.S. trade gap widened in March for the first time in eight months and exports fell 2.4%, weighing on the market.

Small caps bucking the trend today include STEC, Inc. (Nasdaq:STEC), up 31% after reporting operating results, while small-cap Chinese seller of mobile phone ringtones and games Hurray! Holding Co., Ltd. (Nasdaq:HRAY) is up 28% on speculation that Shanda Interactive, China’s biggest online games provider, may acquire the company.

*****Oil is above $60 a barrel. Investors are buying on the expectation that the end of the recession is in sight. And hopefully, Daily Profit readers are benefiting via my recommendation of oil services company Graham Corp. (AMEX:GHM). Graham is breaking above $15 a share today. It’s now up 65% for those who have been following me for a while.

Of course, oil stocks are up on expectations. A dose of reality comes from the housing market today. It’s reported that home prices fell in 134 of the 152 metropolitan areas the National Association of Realtors tracks during the 1st quarter.

Sounds bad, but there is a silver lining. The number of homes sold more than doubled in Nevada, rose 81% in California and 50% in Arizona. These states were among the hottest real estate markets during the housing bubble, and they suffered mightily when the bubble popped. That homes are selling is far more important than the price they are selling for. Housing inventory must get turned over for the economy to improve.

*****Nobel prize winning economist Paul Krugman isn’t convinced the recession is nearing an end. He doesn’t believe economic fundamentals support the recent rally and warns that recent economic data could breed “a dangerous complacency.”

The fear, of course, is that we will have the proverbial “double dip” of recession once government stimulus money (and patience) runs out. Like in the housing market, first time buyers are assisted by an $8,000 credit. That will boost

Small caps are up nearly 3% this afternoon after the government reported this morning that fewer jobs were lost in April than expected.

At 2:06 pm ET, the Russell 2000 (NYSE:IWM) is up 2.81% at 506.81, while the Dow is up 1.56% and the S&P 500 is up 1.85%.

Employers cut 539,000 jobs last month. That is a big improvement from a revised 699,000 job losses in March and less than the loss of 610,000 jobs analysts had been expecting. Also, the federal government reported that 10 of the 19 largest U.S. banks must raise about $75 billion in new capital, which is less than some had feared.

Small caps on the rise today include MedQuist Inc. (Nasdaq:MEDQ), up 64% after announcing first-quarter 2009 results, and Huntington Bancshares Inc. (Nasdaq:HBAN), 36% higher after completing a $120 million stock issue. Fuel Systems Solutions (Nasdaq:FSYS) is also up 40% today after posting a Q1 net profit, while VNUS Medical Technologies (Nasdaq:VNUS) has popped 35% after news broke that Covidien Ltd. will be acquiring the small cap.

*****The headline reads “Bank Stress Tests Lifts Clouds of Uncertainty.” And bank stocks are rallying. Regional bank Fifth Third Bancorp (Nasdaq:FITB) is up 40% in the early going on the news that it needs to raise $1.1 billion.

In total, the government’s stress tests recommended that banks raise $75 billion to withstand further potential losses. I’m not sure how to reconcile the stress tests results with the IMF report on bank losses that was released in April.

In that report, the IMF said that total losses for banks and financial institutions would hit $4 trillion. The U.S. share of that is $1.6 trillion, of which $510 billion has already been written off. That leaves another $550 billion in write-offs . . .

Geokinetics Inc. (Nasdaq:GOK), Fuel Systems Solutions Inc. (Nasdaq:FSYS) and VNUS Medical Technologies Inc. (Nasdaq:VNUS) are among the biggest percentage gainers in Friday's trading among companies with market capitalizations under $1 billion.

Also included among the results: MGIC Investment Corp. (Nasdaq:MTG), LMI Aerospace Inc. (Nasdaq:LMIA), Rosetta Resources  Inc. (Nasdaq:ROSE), Graham Corp. (Nasdaq:GHM), Central Pacific Financial Corp. (Nasdaq:CPF) and American Reprographics Co. (Nasdaq:ARP).

Stocks are rallying during Monday trading, boosted by surprise increases in pending home sales and construction spending.

At 3:03 pm ET, the Russell 2000 (NYSE:IWM) is up 2.73% at 500.27, while the Dow is up 2.17% and the S&P 500 is up 2.61%.

Today the National Association of Realtors said its index of pending sales for previously occupied homes rose 3.2% to 84.6. Also out today was data from the Commerce Department that showed construction spending rose 0.3% -- the best showing since last September.

Small-cap natural gas company Crosstex Energy Inc. (Nasdaq:XTXI) is up 64% this afternoon amid rising natural gas prices and a rally in energy and commodities sectors. Meanwhile, small-cap footwear manufacturer Crocs, Inc. (Nasdaq:CROX) is climbing nearly 40% higher today on heavy volume ahead of its earnings release on Thursday.

*****Last week, the Baltimore Sun laid off 61 employees. I heard that a couple reporters were actually called on the phone while they were sitting in the press box covering an Orioles game and told they were no longer Sun reporters.

It’s no secret that the newspaper biz has gotten tough. The Sun’s parent, the Tribune Company, filed for bankruptcy protection in December of 2008 after its chairman, Sam Zell, took the company private. Analysts knew he was loading too much debt on the company, but the decline in advertising revenues at newspaper . . .

Stocks are higher this afternoon despite mixed data on manufacturing and lackluster earnings reports.

At 2:34 pm ET, the Russell 2000 (NYSE:IWM) is up 0.31% at 489.08, while the Dow is up 0.32% and the S&P 500 is up 0.5%.

New data out today showed the manufacturing industry contracted slower in April than in March, but the government said orders to U.S. factories in March fell more than expected. Also, disappointing earnings from large-cap benchmark MasterCard Inc. and two major insurance companies also weighed on the market.

In small-cap stock news, beverage producer Cott Corp. (NYSE:COT) is up over 77% today on heavy volume after the company posted strong quarterly results this morning. The small-cap company is the world's largest maker of private-label soft drinks. Year-to-date, the company is up a whopping 184%.

*****On Wednesday, the Taiwan stock market posted its biggest gain in 17 years after China Mobile (NYSE:CHL) bought 12% of Taiwanese telecom Far EasTone. The deal was worth $529 million, but the ramifications are much bigger.

That’s because China and Taiwan just signed trade deals that allow Chinese institutional investors to buy Taiwanese stocks for the first time in 60 years.

China Mobile is a state-run company. That Taiwan has allowed it to buy into one of Taiwan’s largest telecom companies represents a dramatic shift in China-Taiwanese relations. And this new relationship could prove to be an economic powerhouse in the making.

*****The latest manufacturing data from China is showing improvement. That’s in part due to China’s stimulus efforts, which are more direct and immediate . . .

News that Chrysler will be filing bankruptcy is causing stocks to seesaw through Thursday afternoon.

At 2:35 pm ET, the Russell 2000 (NYSE:IWM) is up 0.28%, while the Dow is up 0.25% and the S&P 500 is up 0.32%.

Small caps flying high today include Bare Escentuals (Nasdq:BARE), up 42% after its Q1 results topped the Street’s view. Also higher are Orexigen Therapeutics (Nasdaq:OREX), up 44% on heavy volume, and Green Mountain Coffee Roasters (Nasdaq:GMCR), up 37% after the small cap boosted its FY sales and EPS view.

On the downside, Build-A-Bear Workshop, Inc. (NYSE:BBW) is 20% lower today after posting a Q1 loss, and small-cap Oshkosh Corporation (NYSE:OSK) has falledn 19% after projecting a loss for 2009 and suspending its dividend.

******Bank of America (NYSE:BAC) shareholders voted to remove Ken Lewis as chairman of the board. But he remains CEO, at least for a little while. As much as I railed against Lewis, I must acknowledge that he is a something of a victim.

Now, don’t get me wrong. I have no sympathy for the CEOs who over-leveraged and mismanaged their companies during Wall Street’s greed bonanza. And Lewis was right there with the rest of them.

But when it comes to the Merrill Lynch acquisition and the surrounding events, it’s pretty clear that Fed Chief Ben Bernanke and former Treasury Secretary Paulson hung him out to dry. In other words, I believe Lewis’ assertion that Bernanke and Paulson strong-armed him into the Merrill acquisition and encouraged him to keep his mouth shut about Merrill’s $15 billion fourth-quarter loss.

The one question – and this gets right to the heart of the matter – is why did Lewis play ball? He had to know that his shareholders would be irate. And that’s the point – CEOs ultimately work for their shareholders. And bank CEOs for the most. . .

Orient Express Hotels Ltd. (Nasdaq:OEH), Greenbrier Companies Inc. (Nasdaq:GBX) and UAL Corp. (Nasdaq:UAUA) are among the biggest percentage losers in Monday's trading among companies with market capitalizations under $1 billion.

Also included among the results:Graham Corp. (Nasdaq:GHM), M I Homes Inc. (Nasdaq:MHO), Heartland Financial USA Inc. (Nasdaq:HTLF), XenoPort Inc. (Nasdaq:XNPT) and Central Pacific Financial Corp. (Nasdaq:CPF).

Stocks are trading lower today as investors prepare for key company earnings later in the week and brace for a potential bankruptcy filing from General Motors.

At 12:36 pm ET, the Russell 2000 (NYSE:IWM) is down 7.71, or 1.65%, at 460.49. The Dow is down 0.92% and the S&P 500 is down 0.46%.

Key banks, which kicked off a rally in early March when several institutions said they were profitable in the first two months of the year, will report quarterly earnings this week. Asian markets also gained more ground Monday as Japan's new $150 billion stimulus plan and upbeat news about Chinese bank lending boosted hopes for recovery in the region's major economies.

Small caps on the rise this afternoon include AgFeed Industries (Nasdaq:FEED), up 31% on heavy volume, while Rosetta Genomics (Nasdaq:ROSG) is up nearly 20% after signing a license and collaboration agreement with Prometheus Laboratories.

*****Thank you, Wells Fargo. The S&P 500 ramped nearly 4% on Friday as Wells Fargo said it expects its first-quarter earnings to be nearly double what analysts were expecting. And it wasn’t even Wells Fargo’s earnings day – the company pre-announced earnings that will be released on April 22. These days, if you have something to crow about, you do it. ASAP.

Financials have been at the forefront of the current rally, and that’s as it should be. Any good rally has to have the financials out in front. Of course, the financials are moving off such low levels that even huge percentage gains, like the 12% Citigroup was up or the 31% Wells Fargo jumped, are barely a drop in the weighted index bucket. 

Still, stocks are up and that’s good. 

*****There is some concern that Wells Fargo’s earnings surprise is more about accounting than an actual uptick in business. Some are saying that Wells Fargo’s loss reserves (money it sets aside to account for future losses) are too low, . . .

Stocks are extending losses seen Monday as earnings week kicks off on a low note.

At 11:52 am ET, the Russell 2000 (NYSE:IWM) is down 7.3, or 1.63%, at 440.26, while the Dow is down 2.05% at 7,812.73 and the S&P 500 is down 1.75% at 820.82.

Aluminum giant Alcoa will kick off earnings season Tuesday after the close of the market. The company is expected to report a loss and set the tone for dismal results to come. Financial stocks helped push the market lower Monday, and are likely to remain under pressure in the coming days as investors brace for more losses.

But not everyone was in the red today. Small-cap restaurant chain Benihana Inc. (Nasdaq:BNHN) is up 9% after reporting an increase in total and comparable sales for Q4 and full year 2009, while First Niagara Financial Group (Nasdaq:FNFG) is up 13% on news the small cap will buy 57 branches from a unit of PNC Financial. Also rising today is biopharmaceutical company Oncothyreon Inc. (Nasdaq:ONTY), 14% higher on heavier-than-average volume.

******I sure hope SCI Daily readers bought some shares of Graham Corp. (AMEX:GHM) when I suggested it in the March 19 edition. Graham closed at $9.33 that day. Today, it’s pushing $11 a share for a 16% gain.

Graham is exactly the type of stock I love. It’s in an important sector (oil services), it has a pristine balance sheet with virtually no debt, it generates plenty of cash and it has a solid backlog.

Graham is rallying now because it is announcing new orders — $6 million worth in the last week. That may not sound like much, but when you’re doing around $100 million a year, $6 million is significant.

Among other things, Graham helps oil refiners retrofit their equipment so it can handle heavy or “sour” crude, like what comes from oil sands production. Oils sands production is more expensive than the oil we get from OPEC. Oil sands companies are break even with oil in the $50 range.

Graham hit $54 a share when oil prices were hitting their highs. Oil sands production was ramping up and refiners were investing to accommodate that supply. But when oil prices dropped, investors thought Graham’s business would drop. It has, but not as much as expected.

Now that oil prices have found some stability in the $50 range as expectations . . .

Stocks are higher Thursday afternoon, bolstered by fresh economic and corporate data.

At 12:21 pm ET, the Russell 2000 (NYSE:IWM) is up 10.18, or 2.39%, at 436.70, while the Dow is up 1.28% at 7,849.37 and the S&P 500 is up 1.34% at 824.76.

Investor sentiment was buoyed after Treasury Secretary Timothy Geithner unveiled a financial system plan before the House Financial Services Committee today to outline the Obama administration's proposal for extensive overhaul of financial regulations.

Small caps climbing higher today include Republic Airways Holdings (Nasdaq:RJET), which is up almost 40% on higher-than-average volume.

******Former Czech Prime Minister and European Union President Topolanek called the U.S. economic stimulus plan “a road to Hell.” He claims the Fed, Treasury and Administration of repeating the mistakes of the 1930s that sent the United States into the Great Depression.

Also attacked were the stimulus bill’s supposedly “protectionist” policies.

Now, as much as we may criticize our government’s plans, I’m a little defensive when we get flak from an E.U. president. Especially one that just lost a no-confidence vote and was removed from power in his own country. You know what they say about people in glass houses.

Topolanek no longer speaks for his own country. And apparently, he doesn’t speak for the E.U., either. European leaders were out in force trying to minimize the damage their Union president’s comments may have caused.

*****Final GDP numbers from Q4 2008 are in, and they’re essentially in line with the preliminary estimates. That’s being taken as good news in the stock market, index futures rallied on the news.

The economy shrank at a 6.3% annualized rate. The preliminary number was 6.2%. Economists are expecting Q1 2009 GDP to be in the range minus 5% to 6%. That’s something of an improvement and should be bad news as long as . . .

Stocks are climbing higher during Wednesday trading on a new government reports that February brought increases in demand for big-ticket manufactured goods and higher sales of new homes.

At 1:44 pm ET, the Russell 2000 (NYSE:IWM) is up 3.89, or 0.93%, at 420.67, while the Dow is up 0.40% at 7,690.63 and the S&P 500 is up 0.12% at 807.20.

Orders at U.S. factories for cars, airplanes, household appliances, furniture and other large goods rose 3.4% last month, much better than analysts' predictions of a drop of 2%.

New home sales rose 4.7% in February to a seasonally adjusted annual rate of 337,000. The month was still the worst on records dating to 1963, but economists were expecting February sales to fall to a pace of 300,000 units.

Small caps on the move today include ARYx Therapeutics (Nasdaq:ARYX), up over 20% ahead of fourth-quarter and year-end 2008 results scheduled to be released on Thursday at 8 am ET.

******Yesterday, I suggested that this rally was unlikely to retrace much ground and give buyers an attractive entry point. I went on to recommend a position in homebuilder Hovnanian Enterprises (NYSE:HOV).

Well, today stocks are pushing higher and Hovnanian is up 20% from yesterday’s closing price of $1.52.

Graham Corp. (AMEX:GHM) is pushing higher, too. It’s up 7% today and 13% since last Thursday’s recommendation.

If you bought either stock, I’d love to hear from you. Drop me . . .

Stocks navigated choppy trading Tuesday afternoon, following nearly two weeks of consistent gains.

At 1:55 pm ET, the Russell 2000 (NYSE:IWM) is down 8.48, or 1.96%, at 425.54, while the Dow is down 0.29% at 7,753.08 and the S&P 500 is down 0.60% at 817.97.

Investors watched as Fed Chairman Ben Bernanke and Treasury Secretary Timothy Geithner testified in Congress today over bonuses at AIG. Geithner asked Congress for greater power to safely dismantle giant financial companies such as AIG that pose risks to the economy.

Oil is hovering around $52 per barrel, and has risen more than 30% this month.

******497? What, the Dow Industrials can’t crack 500 points?

I’m kidding, of course. That was some impressive rally. The biggest one-day rally since October 28, 2008. And on the heels of Geithner’s re-hashing of Paulson’s bank bailout plan, too.

In Monday’s Small-Cap Daily, I wrote that most economists thought Geithner’s Public-Private Investment Program was an important step in freeing up our banking system to start lending. The smattering of opinion that was available Sunday night seemed to be positive.

By Monday morning, it was decidedly negative. Here’s a quote from Paul Krugman from the NY Times:

“…the real problem with [Geithner’s] plan is that it won’t work. Yes, troubled assets may be somewhat undervalued. But the fact is that financial executives literally bet their banks on the belief that there was no housing bubble, and the related belief that unprecedented levels of household debt were no problem. They lost that bet. And no amount of financial hocus-pocus — for that is what the Geithner plan amounts to — will change that fact.”

His views are shared by other notable economists including John Galbraith and Mark Zandi.

But analysts and strategists are saying that the Public-Private Investment Program, as it’s apparently called, could work. Or at least it will help. PIMCO’s Bill . . .

Stocks are lower Friday as investors seemed unmoved by Fed Chairman Ben Bernanke’s call today for banking supervisors to pay “close attention” to compensation practices as they examine the soundness of financial institutions.

At 3:00 pm ET, the Russell 2000 (NYSE:IWM) is down 2.68% at 402.20, while the Dow is down 1.48% at 7,291.36, and the S&P 500 is down 1.82% at 769.77.

Small caps on the move today include Books-A-Million, Inc. (Nasdaq:BAMM), up 25% after declaring a dividend and reporting fourth-quarter and year-end results. Home retailer Kirkland’s, Inc. (Nasdaq:KIRK) is up 12% after providing revenue guidance and reporting Q4 results, and VIVUS, Inc. (Nasdaq:VVUS) is up over 11% following new data on its obesity drug.

*****Oil prices have moved over $50 a barrel. There are a few factors at work here. OPEC’s cut production. Of course, that’s been ongoing, and OPEC’s moves have done little to prop up prices as demand around the globe falls.

Crude started moving higher after the recent stock market rally began. Bernanke was out, attempting to soothe investors with his “Recovery in 09” campaign. And if there is to be an economic recovery, oil demand will rise. That’s as direct a relationship as there is in the financial markets.

Oil rallied again after Bernanke announced that the Fed would buy over $1 trillion in various kinds of debt. The market thinks the Fed’s move will help. We know, . . .

Stocks turned lower during Thursday trading after a new jobless claims report released today cast a pall on a rally that began days ago.

At 12:13 pm ET, the Russell 2000 (NYSE:IWM) is down 3.37, or 0.81%, at 414.26, while the Dow is down 1.12%, at 7,402.71, and S&P 500 is down 0.99% at 786.51.

Stocks opened higher this morning on lingering investor enthusiasm over Wednesday’s news that the Fed is planning to pump $1 trillion into the economy. The good news failed to last long though as new jobless claims data this morning showed a higher-than-expected drop of 646,000, while continuing claims set a new record.

Small caps making double-digit gains this afternoon include dry-bulk shipper DryShips (Nasdaq:DRYS), which is up 22% after announcing a $630 million three-year contract from Petrobras. Energy companies are also rising today as oil is climbing back above $50 per barrel. James River Coal (Nasdaq:JRCC) is up 19% on lower-than-average volume, while Rex Energy Corp. (Nasdaq:REXX) is up over 27%.

Rambo Bernanke

On Wednesday, the FOMC voted unanimously to buy over $1 trillion dollars in U.S. Treasury bills, corporate bonds, mortgages and consumer debt.

Chief economist at Bank of New York Mellon Corp. called it a “Rambo Fed” move in a Bloomberg interview.

Bonds immediately rallied, with the 10-year note putting in the biggest one-day gain since 1962. Stocks rallied, too, which is a bit unusual. Bond and stock prices tend to move in opposite directions. When stocks appear risky, money goes into the safe haven of bonds, and vice versa. But these are strange times, and with the Fed taking unprecedented steps to ward off deflation and get lending moving again, it’s not that surprising that some old relationships are being tested.

Bernanke’s intent is clear – he wants to make sure interest rates stay low. Overnight interest rates are already zero. Any more easing and the Fed . . .

Stocks are holding their ground through Tuesday trading as financial and homebuilder stocks stayed firm following a positive housing starts report.

At 1:49 pm ET, the Russell 2000 (NYSE:IWM) is up 9.37, or 2.43%, at 395.73, while the Dow is up 1.29% at 7,309.76, and the S&P 500 is up 1.83% at 767.68.

This morning the Commerce Department reported that construction of new homes and apartments jumped 22.2% from January to a seasonally adjusted annual rate of 583,000 units. Economists were expecting construction to drop to a pace of around 450,000 units.

Small cap on the move today include Star Bulk (Nasdaq:SBLK), up 20% as the company’s Q4 net soars on bigger fleet. SkillSoft Public Limited Company (Nasdaq:SKIL) is also 24% higher today following a Q4 earnings boost.

Universally Reviled

I have never seen a company more determined to make itself universally reviled than AIG. It truly boggles the mind that anyone at AIG, especially those in the financial products division that lost $62 billion on credit default swaps in the fourth quarter alone, could think they should receive a bonus.

I don’t care what the contract says — if you’re party to losing $62 billion in a three-month span, you get no reward. Sorry. And if you even have to ask if bonuses can be paid with bailout money that’s keeping your business going, your moral compass is seriously out of whack.

And it doesn’t end with the bonuses. Of the $170 billion American taxpayers have dumped into the bottomless pit that is AIG, $106 billion was paid out in settlement for the credit default swaps that AIG guaranteed.

$11.92 billion to France’s SocGen, $11.8 billion to Deustche bank and $12 billion to Paulson’s own Goldman Sachs. Well, isn’t that nice. We’ve paid off foreign banks, and our former Treasury Secretary made sure his alma mater got its payoff, too.

This is dirty business. And if Paulson knew the extent of Goldman’s exposure to AIG, and it’s impossible to think he didn’t, he needs to be called to . . .

Stocks opened in the green and are continuing their positive trot through midday, buoyed by Tuesday’s news that beleaguered Citigroup (NYSE:C) is operating at a profit.

At 12:27 pm ET, the Russell 2000 (NYSE:IWM) was up 1.39, or 0.38%, at 369.14, while the Dow was up 0.02% at 6,927.77, and the S&P 500 was up 0.22% at 721.18.

Like Tuesday, financial stocks are leading the markets higher today on the Citigroup news, while tech stocks are also seeing a boost after large-cap benchmark Hewlett-Packard’s rating was upgraded.

While the market seems to be in recovery mode, don’t relax just yet. Analysts are warning that the rally will be short-lived and that there remain deep problems etched within the banking industry.

Small-cap stocks trending upward today include On Assignment, Inc. (Nasdaq:ASGN), 23% higher on lower-than-average volume, and YRC Worldwide Inc. (Nasdaq:YRCW), which is 11% higher despite making Moody’s “Bottom Rung List.” Axsys Technologies (Nasdaq:AXYS), a manufacturer of defense surveillance and imaging systems, is up 34% after the small cap put itself up for sale in an auction that drew a first round of bids earlier this week.

Global Markets Up …

Finally, early strength for stocks on Tuesday didn’t turn to weakness. In fact, . . .

Stocks are flying high at midday today on news that Citigroup (NYSE:C) reported it was profitable for the first two months of 2009.

At 1:27 pm ET, the Russell 2000 (NYSE:IWM) is up 19.94, or 5.81%, to 363.20. The Dow is up 4.27% to 6,826.77, and the S&P 500 is up 5.06% to 710.76.

Also helping stocks make large moves today was news that Congressman Barney Frank, chairman of the House financial services committee, said he expects the restoration of a rule that makes it harder to bet that a share's price will fall. Investors were encouraged by Frank's comments.

Financial stocks are in rally mode today following statements made by U.S. Treasury Secretary Timothy Geithner on Monday that the United States has taken more economic action in recent weeks than most countries have in years to ease strife.

Small caps seeing double-digit gains today include Gaylord Entertainment Company (NYSE:GET), up 33% after a proxy deal, and AM Castle (NYSE:CAS), which topped Q4 views and declared a $0.06 per share dividend, sending shares 42% higher.

Stocks up strong

Once again, early strength for stocks yesterday quickly turned to weakness. There is a battle going on between the bears and the bulls. Despite all time lows for consumer sentiment, there is a growing number of analysts and market strategists who believe a rally is at hand.

We’ve been seeing signs of a rally for a couple weeks now. That’s why . . .

Stock market news, commentary and analysis from Chief Investment Strategist Ian Wyatt.

Stocks extended losses during midday trading today, pushed down by poor housing data and by lackluster comments from Fed Chairman Ben Bernanke.

At 12:01 pm ET, the Russell 2000 (NYSE:IWM) was down 6.17, or 1.68%, at 361.63, while the S&P 500 is down 0.79% to 695.25 and the Dow is still below 7,000, currently down 0.46% at 6,732.23.

According to new data released by the National Association of Realtors this morning, the number of homebuyers purchasing existing homes fell 7.7% to a new low of 80.4 in January. Economists were predicting a January reading of 85.1.

Also this morning, Bernanke reiterated to Congress that any semblance of economic recovery hinges on the U.S. government’s ability to stabilize ailing financial markets. The comments did little to soothe investor fears.

Small caps seeing solid rises today included Bruker Corporation (Nasdaq:BRKR), up over 6% after releasing Q4 2008 results and issuing FY 2009 revenue guidance above analysts’ predictions. Also Southern Community Financial Corp. (Nasdaq:SCMF) is up 20% on very light volume, and Einstein Noah Restaurant Group (Nasdaq:BAGL) is up 18% after its Q4 EPS beat the Street.

On the downside, ICT Group careened 23% after rejecting Aegis’ acquisition offer.

Lending Profits

It is a strange sight to see the Dow Industrials trading at 6,700. That’s still a level from 1997. And it still indicates that people don’t want to own stocks. At this point, it seems to be as much about available capital for investment as a willingness to invest.

Valuations are low, the Dow is trading with a P/E of around 20. But that’s still not as low as it’s been during past recessions.

Still, it might be helpful to add some flavor to the current P/E ratio of the Dow. Consider that Citigroup and Bank of America don’t have earnings. Neither do Ford, GM, Alcoa. It’s safe to say that earnings at JP Morgan, American Express, . . .

Stocks were sharply lower at midday on news this morning that small-cap insurer American International Group Inc. (NYSE:AIG) posted the largest quarterly loss in U.S. corporate history, down $61.7 billion in Q4.

At noon the Russell 2000 (NYSE:IWM) was down 15.25, or nearly 4%, at 373.77, while the S&P 500 was down 3.66% to 708.15, and the Dow was down 3.25% to a staggering 6,833.54 — the first time the index has dipped below 7,000 in 11 years.

Myriad data reports out today showed personal spending rose about 0.6% in January and incomes rose 0.4%, while construction spending fell 3.3%, or more than twice as much as analysts predicted. Even though manufacturing contracted in February for the thirteenth straight month, the pace was slower than expected.

Small caps bucking the downward trend this morning included business service outsourcer ICT Group, Inc. (Nasdaq:ICTG), up nearly 70% after Aegis Limited made an acquisition proposal to ICT’s board. FGX International Holdings Limited (Nasdaq:FGXI) is seeing an 18% uptick following a strong sales and earning release late last week, and Noven Pharmaceuticals is up 10% ahead of its scheduled earnings release on Thursday.

On the downside, Ship Finance International (NYSE:SFL) is down over 23% after reporting a Q4 loss last week.

A Caveman could do it

*****Warren Buffett’s annual report for Berkshire Hathaway was released over the weekend. His letter to his shareholders is one of the most widely read investment documents there is. Buffett’s down home charm, inviting sense of humor and investment savvy are always a great read...

Ticketmaster Entertainment Inc. (Nasdaq:TKTM), Mentor Graphics Corp. (Nasdaq:MENT) and DryShips Inc. (Nasdaq:DRYS) are among the new 52-week lows in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Clean Energy Fuels Corp. (Nasdaq:CLNE), Crosstex Energy LP (Nasdaq:XTEX), Crosstex Energy Inc. (Nasdaq:XTXI), Graham Corp. (Nasdaq:GHM), Epicor Software Corp. (Nasdaq:EPIC) and Park-Ohio Holdings Corp. (Nasdaq:PKOH).

NN Inc. (Nasdaq:NNBR), Graham Corp. (Nasdaq:GHM) and TNS Inc. (Nasdaq:TNS) are among the biggest percentage losers in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: iPCS Inc. (Nasdaq:IPCS), Sauer Danfoss Inc. (Nasdaq:SHS), Kenexa Corp. (Nasdaq:KNXA), Sun Hydraulics Corp. (Nasdaq:SNHY), Orient Express Hotels Ltd. (Nasdaq:OEH) and Headwaters Inc. (Nasdaq:HW).

Here are the biggest percentage losers among small caps:

Graham Corp (Nasdaq:GHM), Innophos Holdings Inc (Nasdaq:IPHS) and Luminex Corp (Nasdaq:LMNX) are among the new 52-week highs in Friday's trading among companies with market capitalizations under $1 billion.

Also included among the results: LTC Properties (Nasdaq:LTC), Emergent BioSolutions Inc (Nasdaq:EBS), PharMerica Corp (Nasdaq:PMC), Ness Technologies Inc (Nasdaq:NSTC), Met-Pro Corp (Nasdaq:MPR) and iGate Corp (Nasdaq:IGTE).

Here are the new 52-week highs among small caps:

American Ecology Corp (Nasdaq:ECOL), Allos Therapeutics Inc (Nasdaq:ALTH) and Merit Medical Systems Inc (Nasdaq:MMSI) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

Graham Corp (Nasdaq:GHM), Merit Medical Systems Inc (Nasdaq:MMSI) and PC-Tel Inc (Nasdaq:PCTI) are among the new 52-week highs in Monday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

ArcSight Inc (Nasdaq:ARST), Westwood Holdings Group Inc (Nasdaq:WHG) and PC-Tel Inc (Nasdaq:PCTI) are among the new 52-week highs in Friday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

Excel Technology Inc (Nasdaq:XLTC), CAI International Inc (Nasdaq:CAP) and PC-Tel Inc (Nasdaq:PCTI) are among the new 52-week highs in Thursday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

Royale Energy Inc (Nasdaq:ROYL), HKN Inc (Nasdaq:HKN) and Northern Oil and Gas Inc (Nasdaq:NOG) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Acorda Therapeutics Inc (Nasdaq:ACOR), TTM Technologies Inc (Nasdaq:TTMI) and Graham Corp (Nasdaq:GHM) are also among the new 52-week highs.

Here are the new 52-week highs among small caps:

Graham Corp. (AMEX:GHM) CEO James Lines said strong bookings and a robust order backlog prompted the maker of vacuum and heat transfer equipment to increase its 2009 revenue outlook.

“Our positive outlook for the next few years has been constant due to the continued anticipated strength from refining and petrochemical markets,” Lines said.

In an announcement released before Friday’s opening, Graham said it expects fiscal 2009 year-over-year revenue growth of between 15% and 20%, which would translate to a range of $99.4 million to $103.7 million. The Batavia, N.Y.-based firm’s previous revenue growth estimate was a range of 10% to 15%. During fiscal 2008, Graham’s revenue totaled $86.4 million. Wall Street expects $84.8 million in fiscal 2009.

The chief executive said an important indicator of growth in the primary markets Graham serves is the growth in the order backlogs of key engineering procurement and construction contracting companies.

“There has been a very good correlation for the backlog of the [engineering procurement contractors] and our bookings and backlog,” Lines said. “Our activity with these contractors continues to be high and they too are forecasting growth during the next couple years.”

Graham is the amount of price quotes requested also correlates well to bookings, revenue and backlog, Lines said.

“The level of our quotation activity continues to increase and from that, we expect there to be growth from current-year bookings and revenue growth for fiscal 2010,” Lines said. “The value of our trailing 12-month quotation activity is up 30% from 12 months ago. I consider this to be the best barometer for assessing the likelihood of near-term growth.”

Graham is working at identifying new business opportunities throughout the . . .

Small-cap stocks edged slightly lower shortly after a brief opening bid, pulled down by profit-taking from short-term traders who caught this week’s surge to the highest prices since January. Still, the market managed to dodge several data landmines this morning, as a batch of economic figures were basically in line with expectations. At 10:03 a.m. ET, the Russell 2000 (NYSE:IWM) was down 2, or 0.27%, at 743.55.

The Chicago Purchasing Manager’s Survey came in at 49.1, which was above the forecast at 48.5. Although the reading was slightly above expectations, it had only a muted impact on stock prices as the number was still below 50 for the fourth consecutive month.

Also, the Michigan sentiment survey came in at 59.8, just slightly above the forecast of 59.5, but still at 28-year lows.

Before the opening, the personal income headline figure and the core PCE deflator both were in line with analyst projections, which supported both stocks and bonds in pre-opening activity. The core PCE is considered to be the Federal Reserve’s preferred inflation gauge, and the moderation in the number should allay some inflation fears that have stoked up lately.

Tech stocks were expected to get a lift today from positive earnings news from Dell Inc. (Nasdaq:DELL) and Marvell Technology Group (Nasdaq:MRVL), both of which were seeing impressive  percentage gains this morning after topping earnings estimates overnight. In the financial sector, American Insurance Group (NYSE:AIG) was up 3.3% early after Morgan Stanley upgraded the insurer. Although good news dominated the market so far today, there were some sour notes to be found for large caps, including J. Crew Group (NYSE:JCG), which was off about 20% after reducing guidance and being downgraded by Citigroup.

Month-end window dressing could be a factor in the markets again today, and there could also be a push from some fund managers who are under invested . . .

After declining in morning trading, small-cap stocks began a rally around 10 a.m. ET, surging to more than 729. Better-than-expected earnings from several small-cap companies helped to act as a catalyst for the market rally. At 1:24 p.m. ET, the Russell 2000 (NYSE:IWM) was up 5.60, or 0.77%, at 729.95.

Despite the rally, several bearish indicators gave investors pause early in the session. Federal Reserve Chairman Ben Bernanke said late Monday that increasing home foreclosures might harm the economy. Adding to investors’ concerns was mortgage firm Fannie Mae’s (NYSE:FNM) reported a $2.2 billion loss on credit-associated costs, which enabled the company to post a wider-than-expected quarterly loss of $2.5 billion. Swiss banking giant UBS AG (NYSE:UBS) reported early Tuesday that it will cut 5,500 employees and sell $15 billion in risky debt to BlackRock, Inc. (NYSE:BLK) at 25% off its face value.

Among sectors, the big losers include airlines, water utilities, fabricated plastic and rubber materials producers and personal services firms. On the flip side, companies associated with oil and gas operations, coal, motion picture services, gold and silver were gaining ground.

Some of the firms that have broken out in Tuesday’s trading include China Finance Online Co. (Nasdaq:JRJC), which broke through $23 resistance and is now up about 9% at $23.94. After experiencing a sell-off at $56.75, vacuum and . . .

The Russell 2000 (NYSE:IWM) managed a small rise on news of mixed economic reports. The small-cap index climbed 1.30 points, or 0.18%, to 713.57, its fourth consecutive rise. The Dow Jones Industrial Average added 20.20 points, or 0.16%, to 12,626.03.

On a year-to-date basis, the Russell 2000 has shed 6.85%, while the Dow is down 4.82% and the S&P 500 has retreated 6.75%.

Small-cap stocks spent the morning in negative territory on news before the opening that jobless claims for the week ended March 29 unexpectedly increased 38,000 to 407,000, according to the U.S. Labor Department. That’s the highest level in more than two years and a sign that economic growth has stalled.

The small-cap index recovered and almost touched the flat line at about 10 a.m. ET on news that the U.S. service sector contracted less than expected in March.

But stocks quickly lost their footing again, falling to a session low of nearly 706 at 11 a.m. ET, before beginning a slow climb upward. The bullish sentiment, which . . .

Isramco, Inc. (Nasdaq:ISRL), USEC Inc. (NYSE:USU) and Graham Corp. (AMEX:GHM) are among the biggest percentage gainers in Thursday's trading among companies with market capitalizations under $750 million.

BioMimetic Therapeutics, Inc. (Nasdaq:BMTI), Rand Logistics Inc. (Nasdaq:RLOGU) and China Technology Development Group Corp. (Nasdaq:CTDC) are also among the top small-cap percentage gainers.

Here are Thursday's biggest percentage gainers among small caps:

Shares of Graham Corp. (AMEX:GHM) spiked in morning trading after the vacuum systems and heat exchangers manufacturer said this morning that it booked record orders for its fiscal fourth quarter and said it remains optimistic about the outlook for its end markets and bookings pipeline. As a result of its latest robust quarter and new outlook, the New York-based firm raised its revenue guidance for both fiscal 2008 and 2009.

Shares leapt 21%, or $7.48, to $43.48 at 10:31 a.m. ET. For detailed price information and recent news stories about Graham, click GHM.   

Trading at just over $90 per barrel, the price of crude oil has skyrocketed more than 60% over the course of the past year and benefited major oil drillers such as Transocean Inc. (NYSE: RIG), Diamond Offshore Drilling, Inc. (NYSE: DO) and Noble Corporation (NYSE: NE), which have all seen stock prices rise along with the trend.

Investing in these oil exploration companies is not the only way an investor can play this boom, though. Graham Corporation (AMEX: GHM), based in Batavia, N.Y., is one of many companies that have been cashing in on the strength of the energy sector. Fresh off of 2007 where the company saw its stock price surge an astonishing 297%, Graham now wields a market cap of $169 million.

The company, founded in 1941 in upstate New York, started out with its production efforts focused primarily on producing surface condensers and heat exchangers for the U.S. Navy in World War II. It was after the war that the company made its push into the commercial market.

Today the company designs and builds vacuum and heat transfer equipment that is utilized in a wide array of industries. The key industries that the company serves include the chemical, petroleum refining and electric power generating industries. Graham’s products are used to produce everything from gasoline and electrical power to fertilizers and processed foods.

Graham has come a long way since 1941 and its transition into the commercial market has been a notable success. In 2008, the company is looking to continue where it left off in 2007. It has already rang in the new year with a $3.7 million oil refinery order that was locked up at the beginning of January. The company will be installing an injector system for a refinery that is being reconfigured to process synthetic crude oil. 

The Russell 2000 (NYSE: IWM) led the pack with the major U.S. indices posting solid gains as investors disregarded mixed earnings news and a decline in housing. The small-cap index added 13.79 points, or 2%, to 702.39. The Dow Jones Industrial Average (INDU) climbed 176.72 points, or 1.45%, to 12,383.89.

On a year-to-date basis, the Russell 2000 has let go 8.31%, while the Dow has let go 6.64% and the S&P 500 has shed 7.79%.

Small-cap stocks began the week with a strong showing despite beginning the session in negative territory following mixed earnings news from major corporate players.

McDonald’s Corp. (NYSE: MCD) reported that sales at restaurants open at least 13 months were unchanged in December, disappointing analysts expecting a rise.

“While severe winter weather throughout the month and softer consumer spending resulted in December U.S. comparable sales being flat, we remain confident in our U.S. business,” said CEO Jim Skinner in a statement.

The result brought out the bears, as consumer spending comprises about 70% of gross domestic product and a decline will surely be bad news for the economy. Previously, retailers had also reported weak December sales, raising the fear that American consumers are pulling back.

However, the fast food chain operator also announced that its net income for the three months ended Dec. 31 increased to $1.27 billion, or $1.06 per share, compared with $1.24 billion, or $1 per share, a year earlier.

Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:


• Landry’s Restaurants, Inc. (LNY), up 23% on news that CEO Tilman Fertitta has offered to buy out the company for $379.4 million in cash.
• Acorda Therapeutics, Inc. (ACOR), up 22% on news of a positive drug trial.
• Advanta Corp. (ADVNB), up 18%.


• Rediff.com India Ltd. (REDF), down 18% on news of a decline in third-quarter earnings.
• Ceragon Networks Ltd. (CRNT), down 18% despite news that it swung to a fourth-quarter profit.
• Graham Corp. (GHM), down 17% despite news that its fiscal 2008 revenue will come in near the top end of its projection for between $80 million and $85 million.

The Russell 2000 (NYSE: IWM) closed in negative territory as investors digested news of economic reports. The small-cap index fell 8.54 points, or 1.13%, to 745.01. The Dow Jones Industrial Average (INDU) added 12.76 points, or 0.10%, to 13,056.72.

Small-cap stocks opened the session in positive territory but lost steam during the second half of trading and fell into the red.

The bullish pre-market mood was due to a report by Automatic Data Processing, Inc. (NYSE: ADP), which claimed that U.S. nonfarm private employment increased 40,000 in December. The provider of business outsourcing solutions attributed the rise to small- and medium-sized businesses, which added 75,000 jobs while larger companies cut 35,000.

The December figure was larger than forecasted but is almost three times below the average for three-month period from September through November.

A slowdown in employment growth is consistent with a slowdown in economic growth.

Breaking down the numbers, employment in the service-providing sector was up, while the goods-producing sector suffered its thirteenth consecutive monthly decline and manufacturing employment fell for the eighteenth consecutive month.

In other employment news, U.S. Labor Department reported that jobless claims for the week ended Dec. 29 fell 21,000 to 336,000 from the previous week’s upwardly revised figure of 357,000.

However, many consider the government’s statistics to be imprecise due to the distorting effects of the Christmas holiday, which decreased the time laid-off workers have to file for benefits.

The Russell 2000 (NYSE: IWM) is down after opening with modest gains as investors reacted to upbeat earnings news.

At 10:41 a.m. ET, the small-cap index was down 1.34 points, or 0.16%, to 820.05. The Dow Jones Industrial Average (INDU) had added 33.08 points, or 0.24%, to 13,839.78.

There is nothing major being released on the economic front today, so all eyes are focused on the latest corporate earnings.

Verizon Communications Inc. (NYSE: VZ), the second largest U.S. telecommunications company, announced before the opening that revenue for the third-quarter increased 5.8% to $23.8 billion from $22.5 billion a year earlier. However, net income declined by 34% to $1.27 billion, compared with $1.92 billion during the third quarter of 2006.

Computer maker Dell Inc. (Nasdaq: DELL) also contributed to the bullish sentiment when it said that it would consider making more acquisitions. Round Rock, Texas-based Dell has acquired five companies in the past two years.

The Russell 2000 opened in positive territory, but unexpectedly fell after about 10:15 a.m. ET.

Among small-cap companies, Gehl Co. (Nasdaq: GEHL) is down on news that the maker of compact construction equipment reported a decline in third-quarter income. Meanwhile, North American Galvanizing & Coatings (Nasdaq: NGA) is gaining ground on news before the start of trading that third-quarter profit more than doubled.

The Russell 2000 (NYSE: IWM) and the other major U.S. indices raced ahead today on news of solid earnings from big players. The small-cap index added 15.28 points, or 1.90%, to 821.39. The Dow Jones Industrial Average (INDU) gained 134.78 points, or 0.99%, to 13,806.70.

On a year-to-date basis, the Russell 2000 has increased 4.31%, while the Dow has added 10.68% and the S&P 500 has gained 8.38%.

Futures were pointing up and trading began in the green following news that Microsoft Corp. (Nasdaq: MSFT) increased its first-quarter net income 23% to $4.29 billion, or $0.45 per share, above the $0.39 per share projected by analysts. The rise was due to a whooping 87% growth in the company’s entertainment and devices segment, primarily due to strong sales of its video game “Halo.”
 
Adding to the upbeat pre-market sentiment was Countrywide Financial Corp. (NYSE: CFC), the largest mortgage lender in the United States, which said that it will return to profitability in the fourth quarter after losing money in the third quarter due to the meltdown in the subprime mortgage sector.

The bulls took control of trading out of the gate and kept their feet to the pedal throughout the session. With positive earnings news grabbing the headlines, the bears decided to sleep.

But there was some negative news, coming in the form of a larger-than-expected drop in October consumer confidence. The Reuters/University of Michigan final sentiment index fell to a reading of 80.9, the lowest level in more than a year. Economists were expecting to see a decline to a level of 82 from 83.4 in September.

Triad Guaranty Inc. (Nasdaq: TGIC), Graham Corp. (AMEX: GHM) and US BioEnergy Corp. (Nasdaq: USBE) are among the biggest percentage gainers in Friday's trading among companies with market capitalizations under $750 million.

Here are today's biggest percentage gainers:

The Russell 2000 (NYSE: IWM) is posting gains midway though the session, buoyed by earnings news. At 1:34 p.m. ET, the small-cap index had added 8.66 points, or 1.07%, to 814.77. The Dow Jones Industrial Average (INDU) was up 78.12 points, or 0.57%, to 13,750.04.

Trading began on a bullish note as investors responded to news that Microsoft Corp.’s (Nasdaq: MSFT) first-quarter earnings beat Wall Street’s projections. The Redmond, Wash.-based company posted a stunning 87% growth in its entertainment and devices segment, primarily due to strong sales of its video game “Halo.”

Meanwhile, Countrywide Financial Corp. (NYSE: CFC), the largest mortgage lender in the United States, said that it will return to profitability in the fourth quarter and outpace projections after taking a hit in the third quarter due to the meltdown in the subprime mortgage sector this summer.

In small-cap news, industrial products maker Graham Corp. (AMEX: GHM) increased its quarterly profit seven-fold, while Gulf Island Fabrication, Inc. (Nasdaq: GIFI) stumbled after missing analysts’ third-quarter profit expectations.

Elsewhere, the U.S. dollar has fallen to another all-time low against the euro. One greenback can now be exchanged for 0.695 of the currency adopted by 13 countries in the 27-member European Union. This morning the dollar was at 0.698 euros.

The weak dollar is contributing to another rise in the price of oil, which is denominated in the U.S. currency. A barrel of oil now costs $90.99, up $0.53. Earlier in the day the price of oil was closer to $92 a barrel.

Shares of Graham Corp. (AMEX: GHM) a new 52-week high today after the manufacturer and seller of vacuum and heat transfer equipment posted a blockbuster second quarter for fiscal 2008.

Shares of Graham rose 15.13%, or $6.90, to $52.50 at 12:32 p.m. ET. Shares of Graham have been trading in the range of $12.67 to $50 for the past 52 weeks.

For the three months ended Sept. 30, the Batavia, NY.-based company recorded net income of $4.4 million, or $1.10 per diluted share, substantially above the sole analyst’s estimate of $0.42 per share, as surveyed by Thomson Financial. For the second quarter last year the small cap booked net income of $0.563 million, or $0.14 per diluted share.

Revenue climbed 45% to $23.1 million, from $15.9 million in the second quarter of fiscal 2007. An analyst polled by Thomson Financial had forecasted sales of $19.9 million.

The small cap said it enjoyed continued strong demand for ejector systems in the global refinery market, particularly for North American refinery capacity expansions and revamps to handle changing crude feedstock supplies.

Domestic sales accounted for 67% of the total sales in the second quarter, compared with 41% in the prior year’s second quarter, while export sales contributed 33% of second quarter total sales.

Going forward, Graham is guiding for revenues in the range of $80 million to $85 million for the full fiscal year 2008. For the remainder of fiscal 2008, the small cap said it expects gross margins, on average, to be closer to 35%.

The Russell 2000 (NYSE: IWM) is the top performer as the major U.S. indices rise on news of upbeat earnings.

At 10:25 a.m. ET, the small-cap index had gained 9.11 points, or 1.13%, to 815.22. The Dow Jones Industrial Average (INDU) was up 94.78 points, or 0.69%, to 13,766.70.

The small-cap futures were pointing north following news that Microsoft Corp. (Nasdaq: MSFT) reported after Thursday’s close that its first-quarter earnings beat analysts’ expectations, mainly due to strong sales of the videogame “Halo.”  The Redmond, Wash.-based also raised its outlook for the full fiscal year.

Contributing to the upbeat sentiment is Countrywide Financial Corp. (NYSE: CFC), the largest mortgage lender in the United States, which announced that it will return to profitability in the fourth quarter and beat Wall Street’s expectations. The New York-based company also reported a third-quarter net loss, its first in a quarter century, due to the meltdown in the subprime mortgage sector this summer.

Among small-cap companies, Callidus Software Inc. (Nasdaq: CALD) has been left behind after reporting a wider-than-expected third-quarter net loss.

In economic news, U.S. consumer confidence tumbled more-than-expected. The Reuters/University of Michigan final sentiment index fell in October to a reading of 80.9, the lowest level in more than a year. Economists were expecting to see a decline to a level of 82. The index was at 83.4 in September.