Tag - NBBC

Stocks traded in a generally upward pattern today after a few dips before and after 10:00 A.M. for the indexes. As noted below, stocks were propelled by good news and a resolution to the sentencing of Bernard Madoff, the former trader accused of defrauding investors of tens of billions of dollars.

Notably the VIX, the Chicago Board of Trade Exchange Volatility Index, was down 2.4% today. The VIX is commonly used as a gauge of investor concern about future volatility as reflected as a benchmark for U.S. stock options. It measures the costs of utilizing options contracts as insurance against declines in the S&P 500.

The Dow Jones Industrial Average closed to day at 8,529, up just over one percent. The Nasdaq was up 5.8 points to close at 1,844 and the S&P 500 Index closed at 927, representing an 8.3 point gain.

The Russell 2000, an index representing the 2,000 largest small cap stocks, was the stand-out from the crowd, closing down 2.34 points to end the day at 511.

Gainers in the small-cap space were lead by Crown Crafts (Nasdaq:CRWS) up 45%; NewBridge Bancorp (Nasdaq:NBBC) up 33%; Craftmade Intl (Nasdaq:CRFT) up 34%; and EuroBancshares (Nasdaq:EUBK) up 27%.

Declining small-caps were lead by Cardium Therapeutics (AMEX:CXM) down 31%. Cardium had been one of Friday's big leaders, but gave up some of those gains after a Monday morning opening down 50 cents from the Friday close; others include Park Bankcorp (Nasdaq:PFED) down 29%; Community Shores Bank Corp. (Nasdaq:CSHB) down 27%; and Anchor BanCorp Wisconsin (Nasdaq:ABCW) also down 27%.

*****The positive headlines are everywhere this morning. On Bloomberg alone, we read that the worst is over for Treasury bonds, factory output improved in Japan for the second straight month and home values in England remained stable for the second straight month.  

It's enough to make you think that there's an economic recovery underway… 
Of course, the best news of all would be some price stability for homes here in the U.S. It appears that we're close to that point. 

 *****The rally that began on March 10 was largely about economic recovery. Or maybe it's more accurate to say that the rally began as investors surmised that the economy wasn't getting worse and that a complete financial meltdown had been averted.  

But in the ultimate irony, now that we are about to start the 3rd Quarter, you know, the quarter where actual growth is expected to return to the U.S. economy, traders are starting to question valuations, especially in the commodity space.  

Bloomberg reports that commodities rose 14% in the 2nd Quarter (April-June). Now, many expect prices for some commodities to fall by as much as 30%. That's because producers have expanded supply and investors have bought with little regard for fundamentals.  

*****Now as you know, I have been bullish on commodities, especially oil. But that doesn't mean that prices will make a one-way move higher. Commodities are called "cyclical" for a reason.

In the good economic times prices rise as production expands to meet demand. Once supply and demand reach some level of parity, prices start to drop and producers reel in production.  

The phrase "buy low, sell high" describes commodity investing to a tee. I've advised my SmallCapInvestor PRO readers to take some gains in oil stocks, but we'll be looking to buy back at some point this summer, because any price correction for oil and other commodities is all but certain to be brief.

*****Now let's have a look at the economic calendar this week. Remember, the 4th of July is on Saturday this year meaning the Federal government and the markets will be closed on Friday the 3rd. Many will treat this day as a holiday, including yours truly.  

Tomorrow, June 30th, we get Consumer Confidence, The Chicago PMI manufacturing survey and the Case-Schiller home price index for April.  

Clearly, the home price index is the big one. Expectations are that home prices fell another 18% in April. Any improvement will be bullish, as home prices area integral to economic health. 

Wednesday, July 1, we get construction spending, the ISM Index, truck and auto sales, pending home sales and oil inventories.  

Then, on Thursday, July 2, we get factory orders, initial unemployment claims, factory orders, average workweek (a measure of productivity), and the big one - non-farm payrolls. 

Of course, it's possible for payrolls and jobless claims to expand at the same time. Traders will look to non-farm payrolls as an indication that businesses expect better times ahead.   

*****If you missed Jason Cimpl's video chart analysis on Friday, you missed a great discussion about a potential head-and-shoulders pattern playing out on the Russell 3000. Here's the LINK again if you want to watch it. (Or go to trademasterstocks.com/videoreport/) 

That's it for today.

P.S. Over the weekend I sent investors some information on dividend stocks and how to use them to shore up your retirement funds (whether you're already retired or it's still some years away). I'm following with my Top Stock Insights service. In case you missed it, you can get that information HERE.

Stocks were poised to open lower today and but for a brief few minutes in early trade they generally lived up to the prediction. The Dow shaved 34 points to close at 8,439. The S&P 500 sank 1.5 points to 919, while the Nasdaq closed up 9 points to end the day at 1,838.

Stocks in the Russell 2000 Index, a composite of the 2,000 largest small-cap stocks, bucked the downward trend for the index to close at 513, up 0.78%.

While there was good news about a very modest increase in spending rates, investors seemed most concerned about the boost to the U.S. savings rate to 6.9 percent, up from 5.6 percent in April and significantly up from rates below 1 percent for the period 2005 through 2007. While this could bode well for the longer term economic health of the U.S. economy many analysts see it merely as a side effect to consumer concerns about layoffs, cutbacks, and furloughs.

The increase in the savings rate has come at the expense of consumer spending, which accounts for roughly 70 percent of the U.S. economy. Indeed, many retailers have been battered over the past several quarters as Americans concerned they may receive a pink slip any day shut their wallets to defer spending and switch to lower cost brands for necessities.

Among the stand-outs in retailing are Wal-Mart (NYSE:WMT), Target (NYSE:TGT), and Costco (NYSE:COST). Despite more consumers turning to discount retailers, both WMT and COST have seen year to date share price declines. TGT shares are up nearly 20% for the year.

Despite the modest increase in household spending, retailers are girding for continued earnings pressures as American families prepare for unemployment to reach 10% later this year, up from the current 9.4%.

Leading small-cap gainers today was Zion Oil & Gas (AMEX:ZN) up 76%. Zion runs as a development stage oil and gas exploration firm. Based in Dallas, Texas, the firm holds exploration licenses for onshore development in Israel.

Other small-cap leaders included Cardium Therapeutics (AMEX:CXM) up 48%; Schmitt Industries (Nasdaq:SMIT) up 45%; and Caraco Pharmaceutical Laboratories (AMEX:CPD) up 35%.

Decliners were lead by Design Within Reach (Nasdaq: DWRI), a San Francisco-based furniture store, down 41% after announcing that it expects to delist from the Nasdaq on July 16 with trading ceasing July 6. DWRI has had trouble keeping its share price above $1.00 (a key Nasdaq requirement) for most of 2009 and has indicated that it does not have the working capital to meet the Nasdaq's requirements for staying listed.

Besides DWRI, small-cap price decliners were lead by NewBridge Bancorp (Nasdaq:NBBC) down 37%; Cano Petroleum (AMEX:CFW) down 25%; and Cumulus Media (Nasdaq:CMLS), also down 25%.

Yesterday, the Fed scaled back two of its liquidity-providing programs and announced it would let a third one expire on July 1, 2009.  

Each program was designed to provide liquidity to securities dealers and money-market funds that couldn't raise funds in the capital markets. The Fed noted that none of the programs were used anywhere close to capacity. And the improving economy and loosening of credit markets has made the programs less necessary. 

Investors took this as good news because it suggests the economy and financial system is starting to stand on its own. It's also good news because it shows the Fed is willing to be somewhat proactive in shutting off liquidity.  

To me, this is more important. 

*****In one form or another, the U.S. government has made (read:created) something like $11 trillion available to fight this recession. (I'm not sure anyone knows the exact number.) The government has been widely praised for its response to the financial crisis. Its moves are credited with averting a more serious problem.  

But that's only half the job, and it's the easy half, at that. I expect many of you have seen how a toddler reacts when it's time to give up the pacifier. Kicking and screaming is an understatement. And that's exactly how it will happen when the Fed really starts taking away the liquidity pacifier for good.  

Alan Greenspan never had the stones to give the U.S. economy the tough love it needed. And Wall Street became a spoiled bunch of delinquents.  

Will Bernanke have what it takes to guide the U.S. economy from dependent child to responsible adult? We'll see. And we better hope so, because I suspect the stakes are even higher this time around…  

*****While the U.S. is creating debt to support its economy, China is using its currency surplus to secure raw materials. I mentioned yesterday that China's state-run oil company Sinopec (NYSE:SNP) is trying to acquire an oil exploration company for $7.2 billion. And it wasn't that long ago that China tried to take a $19 billion stake in mining giant Rio Tinto (NYSE:RTP).  

When you're an investor, you have to be worried about opportunity cost. That's the cost of profits that you could have made, if your investment capital wasn't tied up in under-performing or illiquid assets.  

Right now, and probably into the future, the U.S. will be suffering opportunity cost as so much of our resources are tied up in simply supporting our economy. 

*****Case in point: Iraq. Iraq is one the verge of opening the deal-making process for international oil companies to upgrade Iraq's oil fields. This promises to be a very convoluted process - the Kurds and Parliament want input and the current oil minister appears ready to bypass them both.  

All Iraqis realize how important oil, and oil revenue, is to their future, and they're all fighting to get a piece of the action and avoid the exploitive situation that occurred before Saddam Hussein kicked Big Oil out of Iraq. 

For this reason, the proposed development contracts are not guaranteed. There is the risk that a subsequent Iraq government could nullify them and there would be no recourse.  

The risks are high enough that Exxon-Mobil (NYSE:XOM) isn't even sure yet if it will enter the bidding process. But I'll bet you dollars to doughnuts that Sinopec's parent company, China National Petroleum & Chemical Corp. will be bidding.  
Now, obviously, the recession has nothing to do with Exxon's uncertainty. But for China's state-run oil companies, national interests are sometimes more important than profits. And that can be a good thing.

*****Now, here's Jason Cimpl's video analysis of this week's action and look ahead to next week. So far he's batting a thousand. You can view the video HERE or go directly to trademasterstocks.com/videoreport. 

 

Fairpoint Communications Inc. (Nasdaq:FRP), Isle of Capri Casinos Inc. (Nasdaq:ISLE) and KVH Industries Inc. (Nasdaq:KVHI) are among the biggest percentage losers in Friday's trading among companies with market capitalizations under $1 billion.

Also included among the results: AtriCure Inc. (Nasdaq:ATRC), Nexxus Lighting Inc. (Nasdaq:NEXS), Investors Title Co. (Nasdaq:ITIC), NewBridge Bancorp (Nasdaq:NBBC), Brookfield Homes Corp. (Nasdaq:BHS) and Providence Service Corp. (Nasdaq:PRSC).

Here are the biggest percentage losers among small caps:

Isramco Inc. (Nasdaq:ISRL), Silicon Graphics Inc. (Nasdaq:SGIC) and Targanta Therapeutics Corp. (Nasdaq:TARG) are among the biggest percentage gainers in Friday's trading among companies with market capitalizations under $1 billion.

Also included among the results: John B  San Filippo & Son (Nasdaq:JBSS), OmniVision Technologies Inc. (Nasdaq:OVTI), NuStar GP Holdings LLC. (Nasdaq:NSH), Nashua Corp. (Nasdaq:NSHA), MAKO Surgical Corp. (Nasdaq:MAKO) and NewBridge Bancorp (Nasdaq:NBBC).

Here are the biggest percentage gainers among small caps:

NewBridge Bancorp (Nasdaq:NBBC), Strattec Security Corp. (Nasdaq:STRT) and Elron Electronic Industries Ltd. (Nasdaq:ELRN) are among the new 52-week lows in Thursday's trading among companies with market capitalizations under $1 billion.

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

Transcat Inc (Nasdaq:TRNS), FreightCar America Inc (Nasdaq:RAIL) and Charlotte Russe Holding Inc (Nasdaq:CHIC) are among the biggest percentage losers in Monday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Libbey Inc (Nasdaq:LBY), First California Financial Group Inc (Nasdaq:FCAL), Ames National Corp (Nasdaq:ATLO), NewBridge Bancorp (Nasdaq:NBBC), Lydall Inc (Nasdaq:LDL) and Nam Tai Electronics Inc (Nasdaq:NTE).

Here are the biggest percentage losers among small caps:

Bank holding company NewBridge Bancorp (Nasdaq:NBBC) is off 16% today after reporting after Friday’s close its second quarter earnings had dropped. For the quarter ended June 30, the North Carolina-based company posted net income of $0.26 million, or $0.02 per share, compared with $1.7 million, or $0.20 per share, for the same period a year earlier.

The company said weakness in the economy was the primary cause for its lower results. Because of this, NewBridge announced it would be cutting its quarterly cash dividend to $0.05 per share from $0.17 per share. The dividend is payable on Oct. 15 to shareholders of record on Oct. 1.

At 11:17 a.m. ET, shares are at $7.07, down $1.37 from Friday’s close. Trading volume is at about 26,000 shares, well above the average of 19,000.