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Rally was a weak one, but I found one good sign
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I certainly do not think that today's rally gave any indication of which way we are going in this year end market. I might be right and a contrarian rally is beginning (I sure hope so, my portfolio is pretty weak right now.), but there needs to be consistent follow-through for several days before we will know. The doubt about the FED cutting rates in Dec. will probably blunt any rally before then, but only time will tell. One thing about today's rally that was encouraging was the mid-afternoon drop started again and the market held the rally and extended it to the close. The opposite could have happened and we might have seen a total reversal with the market dropping by the close. That has been the more common pattern during this correction. If we get some follow-through later this week, things might indeed be looking up as we close out the year. I will be adding ARO (another retailer, boy am I a glutten for punishment) and T for tomorrow's action. I did some personal research on "Black Friday" and found that ARO (Aeropostal) seemed to do very well and the lines were long and consistent. The manager said that she thought they were "up about 15% compared to last year". I also noted that the prices at ARO were much higher than in past years and the discounts really only brought the price back to where they were a year or so ago at full price. This indicates margins might not be trashed like at other retailers. Finally, they did have a pretty good third quarter and the stock has been up ever since. All of these factors make ARO a buy given it's better short-term prospects. T is simply a great stock that got trashed in this recent pullback. I will be more than happy to buy T at the market and look for it to go up a minimum of 10-15% by year end. Dividend is pretty sweet as well. Regards, DocA | ||
Comments (2)
Dr. Anthony,
I strongly suspect the Market will be Bi-modal,
withthe strong getting Stronger and the weak getting Weaker. The general Average or Indexes might bounce around - sometimes with high beta volatility. Dump the Losers, Ride the winners. It will all sort itself out by January effect time - as earnings pre-announcements start coming out, etc. Keep your ears to the ground, your eyes to the prize and not betwixt me and the Door - or face getting Krushed in the Stampede.
This is a Stock Pickers Market - for sure.
Jim, be nimble, Jim, be Quick - High Jump over the burning Japanese CandleSticks.
Due Respects,Dr Doom & Gloom - NOT!
Posted by don ferk | November 27, 2007 11:53 PM
wow, just looked at t, what was that doing down there?, yeah that seems like maybe some sort of market pullback overreaction. largest wireless carrier Plus iphone activations too, hmm...i don't think people are giving up there cellphones even if the economy weakens.
but y get into retailing even though its christmas? 4thqtrgdp supposed to be slowing, but do you see a shift to that sector now? shouldnt we ride the winners like donny said, like materials and energy and such..
Posted by d l | December 2, 2007 4:56 PM