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1. Best Buy (BBY) Earnings Need to Deliver
By Alan Farley
9:17 a.m. EDT
reports earnings before the bell on Tuesday. The electronics giant was a top first-quarter performer, leading the retail sector higher after the March low. The uptrend stalled out following the March 26 earnings release, with the stock making absolutely no progress in the last three months.
It's been hovering the 200-day moving average through this period, pointing to major indecision after the strong recovery bounce. Tomorrow's earnings are complicated by Best Buy's refusal to provide monthly same store sales data, so analyst estimates on the quarterly results could be highly inaccurate.
Given all the uncertainty, I can't see any justification, technically or otherwise, for traders to hold positions in either direction into the earnings report. It will be easier after the release, because a rally over $42 would support a continued uptrend to $48 while a breakdown under $34.50 could trigger a selloff to $30.
By Adam Feuerstein
10:38 a.m. EDT
The biotech rumor mill is aflutter this morning about
canceling an entire day of meetings with European investors at the last minute. The company has reportedly gone radio silent, leading to speculation that some sort of deal might be in the works.
Might Genzyme be buying someone?
? I'm totally guessing but so is everyone else.
By Marc Chandler
10:39 a.m. EDT
Expect a further 25-basis-point rate cute from Turkey tomorrow, bringing the main base rate to 9% and cumulative easing to 775 basis points. Accompanying remarks may be of more interest than the actual decision.
Survey evidence has shown some improvement, particularly in the PMI index, yet core indicators remain negative with industrial production at -18.5% year over year and 15.8% unemployment. 2009 GDP is expected to contract 5.1%, followed by 1.5% growth in 2010. Whist inflation is decelerating, as May CPI cooled to 5.2% year over year from 10% in December.
The lira has underperformed other EMEA currencies. Look for stabilization within 1.5-1.6 range, and little market impact tomorrow.
4. New Comcast Bonds
By Tom Graff
12:28 p.m. EDT
is selling 10-year and 30-year bonds today, it looks like they will price around +200, slightly wider than the original talk, which was "high 100s." That's not a good sign for post-issuance performance. Ironically, when I put in an order for a new issue, I want to hear that it's being priced tighter, because that indicates post-issuance demand.
Meanwhile, last week's large deals are mixed.
remains about 30 basis points tighter than issue price, whereas
is unchanged to slightly wider.
Hearing very large new issue volume will come this week, maybe as much as $15 billion. It will be very telling if the stock market has a rough week at the same time the bond market tries to digest large corporate issuance. We've been hearing there is tons of cash waiting to pour into corporates. This might be a test.
5. Health Care Reform
By Tim Melvin
12:55 p.m. EDT
I am listening to the health care reform speech right now and feel like a child whose daddy just promised them ice cream and a pony. There is no way to accomplish all the goals being set out by the administration. To insure everybody is going to cost billions. Who is going to take on the risk of the uninsured? Will it be the government directlym or will it be forced onto existing insurance companies and providers on the specific terms? Neither is very appetizing from an investor's point of view.
This uncertainty around the final form of reform makes me very wary of stocks like
that have large exposure to health care services.
I am far from an expert on health care so would love to hear the thoughts of those who have deeper knowledge than I.
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This article was written by a staff member of RealMoney.com.