Tag - Indm

Early morning weakness in the markets was made up during the afternoon trading hours. The Dow closed just slightly down at 8,497 for a loss of 0.09%. The Nasdaq was up 0.66% for a close of 1,808 and the S&P 500 lost 0.14% to close today at 910.

Small-cap stock investors were rewarded with a 0.65% gain on the Russell 2000 index, a composition of the 2,000 largest small-cap stocks, that closed at 507 today.

Pharma continued it's leadership position in small-caps with Molecular Insight Pharmaceuticals (Nasdaq:MIPI) up 41.3% today as money continues to move into healthcare stocks. Blue Chip pharma stocks followed their upward trajectory, though not nearly as much as small-caps put in, with Abbot Laboratories (NYSE:ABT) up 2.7%, Merck (NYSE:MRK) moved up 1.5%, and Johnson and Johnson (NYSE:JNJ) posted a 1.2% gain.

The other small-cap leader in pharma was Savient (Nasdaq:SVNT) up 35.5% after receiving the recommendation from a panel of arthritis experts who suggested the Food and Drug Administration approved Savient's new gout drug. By a vote of 14 to 1 the panel recommended that the firm's drug, KRYSTEXXA, be granted marketing approval by the FDA. The action date for the FDA's decision is currently set for August 1, 2009.

Other small-cap gainers for today include Alvarion (Nasdaq:ALVR) up 18.3% on news of its $100 million contract with Open Range Communications; Cayman Islands based United America Indemnity (Nasdaq:INDM), a provider of property and casualty insurance products, up 16.4%; and Connecticut based MTM Technologies (Nasdaq:MTM), up 42.8%.

Decliners were lead by Star Scientific (Nasdaq:STSI) which shed 73% off it's opening price to close today at $1.13. Star lost its patent suit against No. 2 cigarette maker RJ Reynolds Tobacco, a unit of Reynolds American (NYSE:RAI). It alleged that RJ Reynolds had infringed in its patents related to the way of growing and treating tobacco plants to prevent nitrosamines from forming. It's believed that in reducing nitrosamines that the cancer-causing agents in tobacco can be significantly reduced. The jury ruled not only that the patents were invalid, but that they should not have been issues. Star said it would seek a new trial or appeal to the U.S. Court of Appeals.

Other small-cap decliners were lead by financials including National Penn Bancshares (Nasdaq:NPBC) down 23.2%; First Financial Service Corp. (Nasdaq:FFKY) down 18.5%; and Provident Community Bancshares (Nasdaq:PCBS) down 16.4%. Larger capitalization bank shares were not immune to the sell-off in financials with Bank of America (NYSE:BAC), Citigroup (NYSE:C), and Wells Fargo (NYSE:WFC) all declining today.

*****On Monday, an influential bank analyst raised his price target for Bank of America (NYSE:BAC) to $19. That implies a 40% jump for BAC. Curiously, this particular analyst didn't cite any improvements to the business or strength in the bank's balance sheet. Rather, he based his analysis on improving investor sentiment.

I don't know about you, but I'm not running out and buying a stock - especially a bank stock - just because investors feel better. No, I'm going to need to see actual evidence that conditions for banks are improving before I wade into those murky waters.

So far, the improvements we've seen in bank fundamentals have been based on accounting changes and government stimulus for the housing market. These measures don't fix the problem; they simply make the symptoms look better.

*****To underscore this point, S&P just cut its ratings on 22 banks because of the potential for further weakening in the sector. The S&P analyst had this to say:

"We believe the banking industry is undergoing a structural transformation that may include radical changes with permanent repercussions…Financial institutions are now shedding balance sheet risk and altering funding profiles and strategies for the marketplace's new reality. Such a transition period justifies lower ratings as industry players implement changes."

Bank of America was not among the banks whose outlook was cut by S&P. And I don't care. So long as the sector is weak and the economy is struggling I'm not going anywhere near banks stocks, improved investor sentiment or not.

*****I know Cold War politics are long over, and that Russia and the U.S. are no longer vying for supremacy, but I still can't help thinking "In your face, Russia" when I read that dollar denominated bonds sold by Russia, China and Brazil performed far better than bonds denominated in those countries own currency.

Russian and Brazilian bonds lost money. China's yuan denominated bonds posted small gains. In every case, dollar denominated bonds made money.

It should be obvious that the BRIC countries (Brazil, Russia, India and China) demand that the world's reserve currency should be manipulated to weaken the influence of the dollar is pure politickin'. Or in the words of a currency strategist quoted by Bloomberg, "It's not up to politicians to determine which currency will be the world reserve currency…In the end the market decides it."

In this case, it should be apparent that the market has spoken.

*****So I won't buy their debt, but I will buy Chinese stocks. Yesterday,   SmallCapInvestor PRO added another Chinese stock to the portfolio. China's one of the few countries in the world that's posting any growth. And investors should absolutely own some Chinese stocks right now. If you want to find out what we're holding in SmallCapInvestor PRO just click HERE.

Small-cap stocks stormed higher in the final 45 minutes of trading, shooting higher on optimism for a big weekend announcement out of G7 finance leaders. The comeback move was likely heightened by oversold conditions ahead of the weekend. Until the late rally, stocks remained in collapse mode for most of Friday as investors pulled money out of equities fearing a prolonged recession amid the global credit crisis. The Russell 2000 (NYSE:IWM) gained 23.28, or 4.66% to 522.48, shooting nearly 12% off an intraday trough that marked the lowest point since August 2003. In what will be forever remembered as a historic week for the stock market, small-caps still shed 96.92, or 15.6% in an unprecedented collapse this week. For the year, the Russell is now down 31.7%, while the Dow is off 36.2% and the S&P 500 is down 38.7%. Small caps are now down 39% from the 2007 record highs, and at the lows today were fast approaching typical declines in the 50% range seen in previous recessions over the last 40 years.

From a charting and index perspective, the late recovery move in stocks today was paced by small caps, which was an encouraging sign. Small caps have been underperforming on the way down in this collapse after over performing their large-cap brethren for years on the way up. If small caps start to show a leadership role in the coming days, it could be a sign that a bottom, or at least stabilization is nearby. All that said, one could argue that it would have been surprising to see the stock market NOT have an oversold bounce ahead of the weekend with the potential promise of a G7 finance statement in the works, so there will still be a desire next week for the market to show that today’s recovery has traction.

This week’s collapse gained momentum despite dramatic moves by central bankers around the world to unclog credit lines. For the first time since the recession gripped the nation in the shadow of the 9/11 attacks seven years ago, central bankers gift wrapped a coordinated rate cut for the market, with the United States, United Kingdom, Eurozone, Swiss, Canadian, Swedish and Chinese authorities . . .

Digi International Inc. (Nasdaq:DGII), LCA-Vision Inc. (Nasdaq:LCAV) and G&K Services, Inc. (Nasdaq:GKSR) were among the new 52-week lows established during Tuesday's trading among companies with market capitalizations or values under $750 million.

RadiSys Corp. (Nasdaq:RSYS), United America Indemnity, Ltd. (Nasdaq:INDM) and Escalade, Inc. (Nasdaq:ESCA) were also among the 52-week small-cap lows.

Here are Tuesday's 52-week small-cap lows:

Small-cap stocks edged lower Tuesday, with the Russell 2000 (NYSE:IWM) sinking 6.44, or 0.89%, to 718.93. Small caps had plenty of good news to embrace Tuesday, but a wave of sloppy earnings and cautious profit-taking from longs ahead of Wednesday’s FOMC announcement kept the buyers at bay. Small caps noticeably underperformed relative to the Dow and S&P 500, which is a caution signal for the market heading toward huge economic calendar event risk the rest of the week.

Losses were limited by a firm U.S. dollar, which pushed about 0.6% higher versus the euro, rising to the highest point in three weeks. The firm greenback played a role in a sharp retreat in crude oil prices, which tumbled 2.5% in the shadow of yesterday’s record high level. Retail, transportation and airline stocks received a boost from the pullback in energy prices. The commodity spectrum in general was lower Tuesday, with the Commodity Research Bureau Index of commodity prices down 1.8%, pulled lower by the slide in energy and also by a corrective dip in grains a day after corn prices hit record levels.

Within broad market sectors, food retail stocks were up 5%, airlines up 3% and education services were up almost 3%. Meanwhile, fertilizer shares were down 8%, metals and mining were down almost 5%, and agricultural products were down about 4%.

The stock market has been on an impressive upside push since March lows, with the Russell rising about 12%, the Dow up 9.5% and the S&P 500 up about 10%. Given the solid return generated for bulls lucky enough to have caught this brush higher, it’s . . .