This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stock Under $10 that he thinks could potentially double or triple in the next 6 to 12-months. See what he's trading today with a 14-day FREE pass.

The Daily Dose: Blood, Sweat, Tears

Stocks in this article: CMGPAYXADPCTASPEP

Even the preliminary estimates for headline payrolls of 215,000 to 230,000 backup, the claims induced hopium. However, shares of what I often reference as "payrolls predictor stocks", names such as ADP (ADP), Paychex (PAYX), and Cintas (CTAS), have lagged the Dow Jones Industrial Average in the past five sessions. This is despite the low level of claims held in storage and generally reassuring snapshots on employment in various confidence/manufacturing surveys.

This doesn't make me feel warm and fuzzy inside going into the August employment report on an absolute basis (meaning, absent a bunch of dot-connecting, which I will explain). Who I do believe at this particular juncture, Mr. Market or government data compiler lifer?

The answer matters a great deal as the August employment report will sway those voting FOMC members regarding:

  1. A full scale taper, headlined by $10 billion in bond purchases a month;
  2. Taper light of $5 billion in bond purchases a month;
  3. The mixed taper, with mortgages being tapered first;
  4. No taper, a continued adherence to the Bank of Japan model.

Thanks to government bond-buying, sugar prices are at a five-year high. Could be the reason why Coca-Cola (KO) and Pepsi (PEP) are down 4.79% and 6.90%, respectively in the past month? Or, is it consumer spending weakness related? I am inclined to think it is consumer spending-related as the earnings report from Campbell's (CPB) on Thursday whispered this to me: "we had to promote more quarter over quarter or our numbers would have missed consensus spreadsheets, sad but true bro."

The bottom fell out of J.C. Penney (JCP) shares on Thursday evening, hitting my firm's $12.00 price target. Is this move an indication that J.C. Penney is not partaking in the ramp being experienced in the malls prior to back to school? That would be beyond troubling as J.C. Penney is currently giving the store away -- and that includes the online store -- as a means to drive traffic and to squeeze fast cash from merchandise inventories). If so, the stock will be below $10.00 before you can say, "Ron Johnson had a creepy smile."

Jeff Gundlach is still not short shares of Chipotle (CMG), but he remains no fan. I talked to the company earlier this month (rating: sell) and could offer this insight: if the stock fails to hold the Aug. 27 intra-day low of $398.00, it's the market beginning to price in a P&L hit in first half 2014 from investments to offer non-GMO menu items. Although I was left with the sense from the call that Chipotle's enhanced marketing initiatives have re-ignited traffic, and tame inflation in key ingredients helps the cost line, transitioning portions of a menu will be costly and unwelcome to a stock priced for perfection.

At the time of publication, Sozzi had no positions in any stocks mentioned.

Brian Sozzi is the CEO and Chief Equities Strategist of Belus Capital Advisors. He is responsible for developing and managing an equities portfolio of mid- and large-cap positions, in addition to leading the firm's digital content initiatives. He is also a personal finance columnist for Men's Health magazine.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Our Tweets

Brokerage Partners

Top Rated Stocks Top Rated Funds Top Rated ETFs