Retailers Upbeat in the First Week of the New Year
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Wall Street started the New Year with a rally after a report showed manufacturing activity is picking up, with the weak dollar propelling commodity prices and stocks. The rest of the week, however, was mostly flat as the release of last month's Federal Reserve minutes reflected a belief that a slow recovery will keep the U.S. labor market weak and consumer prices lower. Thursday, the Labor Department released a report that said there were 434,000 initial jobless claims filed in the week ending Jan. 2, up 1,000 from the previous week's report.
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We are starting the New Year with a look at the technology sector. If you invested in "the four horsemen" of technology in 2009 (Amazon, Google, Apple, Research-in-Motion), you made some money. We are betting that all four will make money again this year and our Bullish pick is our favorite. Our first Bearish pick for 2010 is a home builder that has started the year with high volatility. Investors that like risk might be thinking this is a good place to make some fast cash, but there are 3 real reasons to think that the housing market will have a let down in the first half of this year. |
 Apple (AAPL) - It was a good year for tech companies in 2009 and it looks like 2010 will be no different. So investors trying to figure out where to put their money, who will be the next Apple. Well, we think Apple will be the next Apple. Our first pick for 2010, is the technology leader of the last ten years. They do have new products coming out, but it’s their applications that will be the engine that pushes this train. 3 billion applications have been downloaded to iPhones this week. That’s only iPhones, take a moment to digest that number.
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 KB Home (KBH) - KBH shares fell more than 3% early Tuesday as pending home sales dropped 16%, according to a National Association of Realtors index, but that’s not the end of the bad news for this home builder. There are 3 other reasons to be down on Homebuilders right now: (1) The Obama administration extended the tax credit for home builders in November but that is set to run out and will most likely not be renewed, (2) Interest rates are going to rise and lastly, (3) Foreclosures aren't going away. Reports are that we are still only seeing the tip of the iceberg with the foreclosure problem and the rate of restructuring for homeowners in trouble is lower than expect.
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