'RealMoney' Radio Recap: IPO Torrents of Summer

Filling in for Jim Cramer, Aaron Task tells listeners that the flood of new issues could damp market action for a while.
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Oil prices are getting the blame for keeping a lid on the market, but Aaron Task told

RealMoney Radio

listeners not to forget good old supply and demand.

Subbing for the vacationing Jim Cramer, Task pointed out that Wall Street has been flooded with new issues of late. And part of the market's problem in heading higher has been its inability to digest all those shares, he said.

"These past two weeks have been the biggest since 2001," said Task, co-executive editor of

TheStreet.com

. "All this new stock coming to market is something to keep an eye on."

Task consulted Charles Biderman, CEO of the fund flow tracking service TrimTabs.com, to get his opinion on all the new IPOs hitting the market. Biderman correctly turned bullish in April after watching a step-up in fund flows. However, he has recently turned neutral on the market in response to all the new issues flooding the market, notably the high-profile Chinese Internet IPO

Baidu.com

(BIDU) - Get Report

.

"It's a good economic sign that companies are going public and raising money," said Task. "At its very basic level, that's what the stock market is designed to do, and there was a time not too long ago when the IPO window was shut. But you have to wonder if the market can keep up with the pace of new issuance coming from Wall Street."

Task reminded listeners that all this new issue activity is taking place around one-year anniversary of

Google's

(GOOG) - Get Report

IPO, which has proven to be a huge success even after a much criticized start. Another historical note, this summer is also the 10-year anniversary of the Netscape IPO, which is credited with kicking off the whole internet era.

Those anniversaries bring up some important comparisons in investors' minds. "Will Baidu be the next great Internet IPO success like

Yahoo!

(YHOO)

or

eBay

(EBAY) - Get Report

?" asked Task. "Or will it bust like Internet-era tragedy

Pets.com

?"

Tech Talk

Richard Suttmeier, a technical strategist and

RealMoney.com

contributor, was Task's special guest today. Suttmeier said there were a few red flags facing the market, including higher oil, a lower dollar and rising gold. Suttmeier said that he was not increasing his equity positions and that he had started hedging, or shorting, his tech positions because of increased risk in the market.

Suttmeier said the selloff in

Cisco

(CSCO) - Get Report

shares was unwarranted considering CEO John Chambers' guidance. Suttmeier said he is still bullish on the company and would be buying shares now that the stock is trading below $18.

Suttmeier said

Microsoft

(MSFT) - Get Report

, which has been rallying recently, is a good long-term hold. "I would not say it has broken out yet, but if you get another leg to the tech rally, then it should perform quite well," he said.

If

Dell

(DELL) - Get Report

produces good earnings later Thurday, that could also kick off a tech rally, said Suttmeier.

Callers Chime In

A caller wondered what's going to happen to

Intel

(INTC) - Get Report

now that it has been downgraded by Goldman Sachs.

Task said the stock looks fine fundamentally but may be taking a break. "If you are a long-term holder, Intel is perfectly safe here," Task said.

Suttmeier said it is up to 20% undervalued here. "A lot of time when a stock is trading at highs into earnings, it will sell off," said Suttmeier, who suggested buying shares on this pullback.

Another caller asked about

Rocky Mountain Chocolate

(RMCF) - Get Report

. Task said that the shares may be having trouble due to Wall Street souring on the franchise business model after

Krispy Kreme's

(KKD)

problems. Suttmeier said it may be stuck in a trading range.

They both said that

Hansen Natural

(HANS)

may be risky after its huge run, what with tough competitors such as

Coke

(KO) - Get Report

and

Pepsi

(PEP) - Get Report

.

Special Bonus Guest

Will Gabrielski, editor for

TheStreet.com's

Stocks Under $10, called in late in the program to further warn investors about energy provider

Calpine

(CPN)

. Gabrielski said that the company will have problems paying interest on its mammoth $17.4 billion in debt.

Gabrielski said investors should sell the stock if they own it, as the company continues to bleed cash.

"The CEO has managed to pull rabbits out of a hat, but how many assets can you sell before its affects your ability to create earnings?" he wondered.

Aaron L. Task is the co-executive editor of TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to

atask@thestreet.com.