Sunday, February 6, 2011

Itz Week End Review 2-6-11

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With most investors concerns on Egypt's uprising this past week, Friday saw things calm down somewhat. BLS reported Non-Farm Payrolls, the headline number came in with a gain of only +36,000 jobs instead of the consensus estimates of +146,000. The unemployment rate fell sharply to 9.0% but not because a lot more people found jobs, Itz prefers to focus in on the U-6 number, which although lower still hovers around the 16% level. Earnings are winding down in the upcoming week, the big fish will be Cisco, be interesting to hear CEO Chambers comments and outlook?
Crude Oil garnered the most attention, but really has been rallying since June 2010. Itz Pix holding Suncor (SU) reported Q4 earnings this past week, the beat estimates and have managed to bring down their debt, all positives. The stock broke through long time resistance of $40, testing $43 and retreating as oil declined Friday. >>LINK

Crude oil prices sold off Friday -$1.42 on expectations that Mubarak would leave Egypt. At one point on Friday he was rumored to be resigning and leaving Egypt to live in Montenegro. The problem with Mubarak stepping down and leaving Egypt is how to keep the fortune he amassed as president of Egypt for 30 years. News that Gamal Mubarak, Hosni Mubarak's son, resigned from the leadership of Egypt's ruling party on Saturday and vowed not to run for election in September. The Egyptian protesters want Mubarak to leave immediately, although he has vowed to stay until the end of his term in September. Most believe that he is planning and arranging his departure both political and financially I'm sure. Bottom line is Mubaraks days are numbered and although some see an orderly transition of power, most I suspect, fear a chaotic and unfavorable outcome for Egypt's future.
CNBC's Sharon Epperson discusses the day's activity in the commodities markets, and looks ahead to where oil, gold and other commodities could be headed next week.

Rumors circulating this weekend that the newly appointed Vice President, Omar Suleiman, survived an assassination attempt last week but two of his bodyguards were killed. Along with a  gas pipeline from Egypt that delivers gas to Jordan and Israel exploded suspiciously on Saturday. As I type plans are for Egypt's business owners to reopen their businesses on Sunday. Banks will also open. The stock market thinks it will open on Monday. Lets see how things play out in the next several days.

Insight on commodities, with Dennis Gartman, The Gartman Letter.

The S&P500 came close to testing August '08 highs, the trend continues to be higher, especially with low volatility, as per the $VIX. Investors continue to 'buy the dips'
In a speech at the National Press Club this past week, Federal Reserve Chairman Ben Bernanke said that the Fed expects the economy to improve this year and inflation to remain low despite the jump in commodity prices and that the central bank will stick to its efforts to spur the economy. Chairman Bernanke basically indicated in his speech that he considers unemployment to be the bigger problem than inflation and that the Fed will continue to focus on that. Don't Fight The Fed!

Slightly disappointing jobs data contributing to mixed trading, with Craig Columbus, Advanced Equities Asset Management, and Phil Roth, Miller Tabak & Co.

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