Monster Tuesday!
filed in My Investments on Mar.10, 2009
What a day with some major rallies in play on Tuesday! It was not possible to get virtually into any stock and pulling out a profit.
Quickly, Tuesday I snagged 1000 shares on the open market for (BAC) at $4.25 and sold them for $4.75. A part of me wanted to hold this until later (with after hours prices currently pushing the stock well above $5/share!) but am glad to have made some cash today. Quick cash for that matter!
Total profit on (BAC) = $500.
Another stock that got into today for a really fast play was (C) which was mainly the catalyst in this market rally today. It was a semi-risky play with its 40% gap up price, but I got into (C) with 2000 shares at $1.29/share and got out without any greed in my head during the rally at $1.40/sahre.
Total profit on (C) = $220
Total profit for Tuesday, with roughly 3 hrs of what you may call “work” was $720. Not a bad day if you ask me!
So what were the factors for Tuesdays rally? And is this a sign of more to come?? Here is the Tuesday re-cap:
In the news:
The news from Citigroup Inc. was surprising, and for a change, upbeat. The struggling bank was profitable through the first two months of the year, Chief Executive Vikram Pandit told employees in a letter. And it’s having its best quarter since late summer 2007 — the last time it posted a profit. Link. With many people expecting devistating results on the markets, its certainly hopeful that (C) will not be the only group to announce better than expected times for the first few months of this year.
on Tuesday set the base price for its Insight hybrid at 10 percent below the market-leading Prius hybrid made by larger rival Toyota Motor Corp. Honda said the 2010 Insight would start at $19,800, making it the first hybrid to sell in the U.S. market below $20,000. The 2009 model Prius starts at $22,000. This could certainly rally Honda stock prices up again after hurting on the Asian side to the overall slump in auto sales. Toyota now has the ball in its court and it a matter of time before Toyota pulls out its guns for a price war maybe. Link.
AT&T Inc. said Tuesday it will add nearly 3,000 jobs this year and invest between $17 billion and $18 billion to drive growth by enhancing wireless and broadband networks to provide more coverage. Link.
Here is CNBC with its article on a possible worsening market again. It seems like whenever a rally forms, CNBC has to come out with some grim news. Their timing is always suspect. While Wall Street enjoys its relief rally Tuesday, stocks face looming danger from a familiar foe: tightening of credit. Several metrics that market analysts use to gauge the availability of credit have been signaling trouble in recent days, throwing up a caution flag that tougher times could lie ahead for the availability of cash. Link.
*Read this article if you value your money and investments* For months investors have been whispering cautiously about a market bottom. It’s certainly the trillion dollar question – and one that can only be answered with confidence in hindsight.But you need that information now — so for insights we turn to Jeff DeGraaf, ISI Head Of Technical Analysis Research. He’s the #1 analyst in his field as ranked by Institutional Investor magazine.Here’s a summary of DeGraaf’s analysis.First DeGraaf explains that we need a 35% rally just to get back to the 200-day moving average. Looking at a chart of the S&P 500 from 1929-1934, he says not since 1931 has the S&P been so far from its 200-moving day average. DeGraaf interprets the pattern to mean the market is extremely oversold. Link. Normally, I hate CNBC and its team of quack soap opera comic commentators, but this DeGraaf interview has some good points. Link.
Also, I did mention that (GE) had further to fall and it seems like more people are split on that call than before. There still is no real information on the large financial arm of GE regardless of the market rally and assurances from (C). Although it a person is long term on (GE) an entry in the current range is defiantly produce a gain at some point in the position. Its just a matter of how long you want to hold the position. If this stock dips on any sell off (which must happen with its monster rally), I will up my entry price from the sub $5 to a low $7 and if need by, average down my position if the price falls again.
Finally, Asian share markets were set Wednesday to track – though perhaps only partially – a rally on Wall Street, with sentiment improving further for beaten-down financial stocks. “The fundamental backdrop is still worsening, but markets are looking for any source of good news right now,” said analysts at Brown Brothers Harriman. Already Australia’s S&P/ASX 200 was up 2.0%, with New Zealand’s NZX-50 up 1.7%. Traders were calling Japan’s Nikkei 225 to head towards 7300, from its close Tuesday at 7054.98, with some calling South Korea’s Kospi Composite to gain 30-40 points. Link.
For Wednesday, I will be watching the financial stocks, its been a great March so far and want to continue my short term plays in this sector. Watch for peaks and valleys in this market and buy in when you see a common support price.
Happy Investing!
Aman, MBA
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