Tag - Wpte

Stocks generally continued their upward trajectory and extended the rally today. The Dow closed up 33.63 points today to finish at 9,320.19; the Nasdaq finished up 2.70 points at 2,011.31; and the S&P 500 held over 1,000 to finished 1,005.61, up 2.98 points.

The Russell 2000 index finished up 4.38 point at 570.16.
 

Leading small-cap price gainers include Xerium Technologies (NYSE:XRM), up 33%; Georgia Gulf Corporation (NYSE:GGC) up 45%; Central Pacific Financial (NYSE:CPF) up 32%; and YRC Worldwide (Nasdaq:YRCW) up 30%.

Declining small-caps include WPT Enterprises (Nasdaq:WPTE) down 26%; The Phoenix Company (NYSE:PNX) down 19%; and Mellanox Technologies (Nasdaq:MLNX) down 17%.

*****Oil prices are slightly lower this morning. That should mean stocks will trade lower today as well. And while many are saying the fundamentals of this economic recovery do not support current prices for stocks or oil, I wouldn't get too excited about an imminent trade-worthy decline.

More likely, we will see any dip get bought by the bulls. And I doubt any dip will last for more than two days…

*****Sometimes, the financial markets can be very simpleminded--even downright dumb. And I believe now is one of those times. The federal government has committed to pouring as much cash into the economy as is necessary to keep prices from falling too much. And that may be all we need to know.

After all, banks can make money when they have the ability to borrow at 0.5% interest. They can make more money in fees when the government is sponsoring mortgage loan modifications. And when the government forced banks to raise more capital by selling stock, Goldman Sachs (NYSE:GS) may have made as much as $1 billion in profit from fees associated with secondary offerings.

Car companies and banks can make money from the Cash for Clunkers programs. Auto sales rose 13% in June, helped by this program. Heck, Ford (NYSE:F) posted its first rise in sales since 2007!

*****Some estimate that 40% of the world's wealth was lost in the wake of Lehman's collapse and the financial crisis. The only way to get that money back is to earn it. But companies aren't really earning money the old-fashioned way -- government policies are focused on allowing companies to do just that.

Sure, it's a form of trickle down economics. And while the long-term success may be questionable as there are always unintended consequences, make no mistake about the effect on the short-term. Assets are being reflated. Home values, stock prices, commodities - all can be expected to move higher.

*****Thanks to everyone who has sent in submissions for The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks T-shirt contest. In case you don't know, my first book is coming out on September 14, 2009. As part of the marketing plan for my book, The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks, I'm holding a T-shirt contest. I want you to be the one who comes with the slogan for The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks T-shirt. 

Submissions have already been posted to the Small Cap Investor Facebook page and we're holding this contest open for just a little longer to get your idea. Post your submission on the Small Cap Investor page on Facebook

Small Cap Investor page on Facebook  send it to tshirt@smallcapinvestor.com. We're keeping this open until Sunday, August 9th.

Everyone who submits a T-shirt slogan will get a 30-day, 100% complimentary trial to my SmallCapInvestor PRO advisory service. The winner gets a one-year subscription to ALL of my advisory and trading services ($2,680 value), plus a signed copy of the book and three t-shirts. Voting on the slogan will begin shortly after the 9th.

*****The Managed America video conference is coming up next Monday, August 10 at 6:00 P.M. We'll cover the game plan for making profits in an America with sustained high unemployment, weak growth, weak banks, higher taxes, and excess government regulation. You don't want to miss this. It's free to attend and you can register HERE.

Ian Wyatt

Editor

Daily Profit

P.S. Tomorrow is NewsletterAdvisors.com Wednesday where we interview one of the country's top investment experts. We're fortunate to have Carla Pasternak of High-Yield Investing and High-Yield International, two of the leading publications for dividend and income investments. Don't miss tomorrow's edition of Daily Profit with our in-depth interview with Carla.

Labopharm Inc. (Nasdaq: DDSS) said it received a second approvable letter from the U.S. Food and Drug Administration, which said the company has not shown the efficacy of its once-a-day formulation for tramadol. Tramadol is an analgesic for the treatment of moderate to severe pain. The FDA letter said the statistical methods used by Labopharm in clinical trials did not sufficiently address missing data about subjects who dropped out. Labopharm, based in Laval, Canada, said it seeks to talk with the FDA as soon as possible to find out the best way to address the issue and to move forward toward final approval. Shares of Labopharm were down $3.01, or 48%, to $3.30 in after-hours trading.

Other small caps making news in after-hours trading:

CRA International (Nasdaq: CRAI), a management consulting company, said results for the second quarter ended May 11 would be below expectations, and it lowered guidance for full fiscal 2007. The Boston, Mass.-based company now expects 2007 revenue growth in the 10% to 12% range and earnings per share growth of 12% to 17% above 2006. For the second quarter, CRA International said preliminary results showed revenue would be about $88 million, compared with $84 million in the same quarter last year; analysts had expected $96.79 million. Net income is expected at $0.53 per share, including a net tax benefit, compared with $0.55 the previous year and forecasts for $0.64. Shares of CRA International were down $8.89, or 17%, at $44.00 in after-hours trading.