Market Rally slowed as Unemployment Numbers Rise
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The unemployment numbers rose this week as 551,000 initial jobless claims filed in the week ending Sept. 26, up 17,000 from the previous week, according to a Labor Department weekly report. The unexpected unemployment numbers combined with weaker than expected reports on manufacturing renewed worries about the pace of the economic recovery, and sent the markets down on Thursday. The Dow Jones dropped 165 points, the S&P 500 lost 23 points and the NASDAQ shed 56 points. In housing news, homebuyers signed more sales contracts last month than in any other month this year, according to an industry report released this week.
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The stock market rally got a wake up call this week from some employment news that shows what investors are afraid of - the economy will not have a robust recovery without a recovery in the job market. Whether this will signal the end of the surge as we get into the shopping season or not, as smart common sense investors we focus our Bullish pick on good company fundamentals and a solid dividend yield. Hedging against a pullback or prolonged volatility in the financial markets. Our Bearish pick is a leader in its category, and that distinction alone, in a time where it needs to hit a home run with its much-anticipated newest product, seems like a disappointment with serious implications. |
 Pfizer (PFE) - We like the Wyeth acquisition. It will probably be a while before the stock rises as investors wait and see how the merger plays out, but the pipeline of drugs and products that Pfizer acquires will prove it to be a smart move in the long run. We keep hearing that the aging baby-boomer population will be a big market for companies like this and it’s true, but Pfizer pays a nice dividend to help you wait. It can also be said that this can be a pandemic-flu play, and you really can’t say is that the stock price is overvalued either, especially when you look at the other players in this sector
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 Garmin (GRMN) - Garmin’s profit and market share have been under attack from smart-phones for about 2 years now. Garmin’s solution is the Nuviphone G60, a navigation device that also works as a phone. The problem is that a navigation service on a smart-phone makes sense and most are either free or at a small monthly fee. The Garmin Nuviphone looks more like a GPS device that acts as a mediocre phone. Another problem is that Garmin chose AT&T to sell their new phone, which puts it on the same shelves as the Iphone. Tom Tom, a top competitor in the navigation space has developed a navigation app that makes the Iphone a formidable navigation tool at a lower cost.
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