This merger came about when MS bought a controlling stake in the brokerage/research firm formerly owned by Citigroup. The SB group was a combination of independent Smith Barney and the old Salomon Brothers. Smith Barney is a wealth management juggernaut that boasts a wide network of quality research; Salomon the once giant bond manager in which Warren Buffett had owned a significant stake.
On Tuesday morning, this research team
2009 and 2010 earnings for the
. This could be a major catalyst if we see market participants starting to buy.
To me, the new firm is the most powerful on Wall Street, bar none. MS had a unique way of providing research but really buttered its bread from the underwriting side. This combined group has extensive reach and powerful appeal, not to mention the wealth management side of the business.
Case in point is a recent upgrade of
two weeks ago, which was sitting at $120 at the time. The price target was well north of there, and since then, Apple has enjoyed a nice 20-point ride for about 10 days. Coincidence with the worldwide developers conference and new iPhone? Perhaps, but maybe it's just good timing by MS. There are a few other instances as well, but it should be known that when this firm gets involved with a name, it should be considered carefully for a trade.
Bob Lang is a senior analyst and portfolio manager at
. He manages subscription services for the firm and writes timely articles about markets, trends and the economy. Lang's articles can be viewed on numerous sites on the Internet. Together with renowned market timer Price Headley, Lang has helped build his supported products into a winning class. He participates in a coaching forum for advanced traders in which he teaches his unique style of trading.