The Market Update
Weekend Reading
Paul Kedrosky
06/03/07 - 04:56 PM EDT
Good Sunday morning, and welcome to Weekend Reading. As always,
here are some articles and papers worth reading. First, however, a
look back at the week that just finished, and a look forward to the
week ahead.
The major U.S. indices were up last week. The Dow Jones Industrial
Average advanced 1.2%, the S&P 500 index gained 1.4%
and the Nasdaq Composite added an impressive 2.2%.
Economic data generally came in better than expected, with more job
creation and lower inflation than had been forecast. The result,
alongside the usual list of acquisitions and the like, was a market
that climbed higher.
Looking forward to next week, it seems reasonable to think the market will climb higher still. I'm not the first to say this, but the old adage to "sell in May and go away" seems itself to have gone away, with the market looking like it will advance in June. There is no single factor at work here, and some of the usual sectors, like
tech, aren't sharing in the rally the way they usually do, but absent any unexpected news, or nervousness about the foiled terrorist attacks at New York's JFK airport, higher numbers seem in the offing.
Turning to economic indicators, on Monday we will see a report on
April U.S. factory orders, which are forecast to be up slightly but below the March figure. On Tuesday we will see the Institute for Supply Management's report on May service sector-activity, and it is expected to be down a shade. Later in the week we will see the Challenger layoffs report, as well as retail industry May sales
figures on Thursday.
As for earnings, there is very little going on. Two companies
worth watching are ADC Telecommunications- Four people, including a former member of Guyana's parliament, charged in plot to blow up JFK airport. (Reuters)
- A Chinese monetary tightening could lead to a global depression. (Street Insight)
- Exxon Mobil's(XOM Quote) spending on exploration is only 60% of what it was in 1981, on an inflation-adjusted basis. (Time)
- European economic growth outpaces U.S., led by investment. (Bloomberg)
- Surprise drop in U.S. crude oil stocks drives up gasoline prices. (Oil & Gas Journal)
- Barron's picks General Electric(GE Quote), pans Abbott Labs(ABT Quote) and carries a bearish interview with the savvy Steve Leuthold. (Barron's)
- Fewer DVR users skip ads than previously thought. (Advertising Age)
- Build your own hedge funds with ProShares ultra-short ETFs. (Forbes)
- Companies are increasingly fighting back against activist funds. (CFO)
- Baidu(BIDU Quote) is planning to take on Google(GOOG Quote) in Europe. (Telegraph)
- The myth of the Great American Savings Myth. (Paul Kasriel)
- The near-term outlook is good for U.S. economy, but major challenges remain. (Organisation for Economic Co-operation and Development)
- GlaxoSmithKline(GSK Quote) alleged to have tried to quash one doctor's criticism of controversial new drug. (The New York Times)
- Microsoft's(MSFT Quote) Vista no better than XP when it comes to viruses and malware. (CRN)
- Africa's oil dreams: With discoveries increasing, what is the outlook for oil? (Time)
- Research: The demise of investment-banking partnerships. (Journal of Finance)
- VMware's upcoming IPO getting increasing attention. (Fortune)
- How Nintendo's Wii took over the gaming world. (Fortune)
- Wal-Mart(WMT Quote) CEO Lee Scott coming under increasing pressure (Fortune)
- Lazard biotech analyst Joel Sendek is the "Weird Al" of Wall Street. (Fortune)
- Carl Icahn as the hottest investor in America. (Fortune)
- Alan Greenspan's upcoming book Age of Turbulence is getting some early promotion and promises revelations. (BusinessWeek)
- Personal genetics' impact on medicine. (Forbes)
- Daniel Altman's new book, Connected: 24 Hours in the Global Economy, is getting good reviews. (The New York Times)
- Programmers salaries being bid up again in Silicon Valley. (Siliconvalley.com)
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