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October 21
The Technology That Will Replace 148 Billion Barrels of Oil
By Horacio Marquez
Contributing Editor
Money Morning
Not many investors noticed in September 2008 when Warren Buffet took a 10% stake in Hong Kong-based battery maker BYD Co. Ltd. for $230 million.
They should be noticing now.
Shares in BYD, which also makes cell phones and automobiles, have quintupled in a little more than 12 months, meaning that Buffet's investment is now worth more than $1.5 billion.
But Buffet's interest in this little-known Chinese stock isn't the main story here. In fact, the investing icon is simply focusing a bright spotlight on an industry that could serve as a major profit play for years to come.
The real story here is battery power, a technology market that's heating up in a big way. Just the market for rechargeable batteries is expected to zoom from $36 billion in 2008 to $51 billion in 2013.
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Why Is Wall Street Buying this Tiny Oil Stock - But Not Telling Investors?
Goldman Sachs and Barclays are building huge positions in a tiny oil company right now. But they won't disclose the details of their investment to the media - or even their own clients! Why? Their target is a microcap company that's discovered 40 billion barrels of oil, worth $2.8 trillion!
It's just days away from bringing this mother lode to market. By investing ahead of the event, these banks could pocket 46 times their money. This report reveals what they're up to.
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Hot Stocks: How the "Beta Chase" Could Spark a Major Breakout for Exxon
By Jon D. Markman
Contributing Writer
Money Morning
The shares of energy-sector heavyweight ExxonMobil Corp. (NYSE: XOM) could return to their highs for the year – a run of 10% or better – thanks to a bull-market event that I like to describe as the "beta chase."
Large-cap stocks rose quite a bit more than their small-cap brethren last week, leading me to believe that we're witnessing a shift in the balance of power between them. It would certainly fit our theory of what's likely to happen over the rest of this year, because fund managers who need to buy stocks in a hurry cannot mess around with small caps: They are too hard to purchase without moving their price.
I believed that money managers who found that their performance was trailing the market would opt to buy large-cap technology stocks: They're among the easiest to purchase and to justify from a growth perspective.
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Investment News Briefs
With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.
Apple Stock Hits 52-Week High; Buffet: Wall Street Pay Needs "Downside"; Housing Starts Rise, Producer Prices Fall; Obama Administration to Unveil New Small Business Assistance; Coke Profit Flat, Revenue Misses Estimates; Caterpillar Lifts 2010 Forecast; Oil Steps Back After Breaking $80; Pfizer Profit Up Despite Earnings Decline; Airlines Still Struggling to Take Off - Shares of Apple Inc. (Nasdaq: AAPL) hit a 52-week high of $201.75 yesterday (Tuesday) after the company posted its highest-ever quarterly profit. Apple stock settled at $198.76, up 4.69%. The iPhone maker saw its profit balloon to $1.67 billion, or $1.82 per diluted share on revenue of $9.87 billion. Analysts polled by Bloomberg News were expecting a profit of $1.43 per share and revenue of $9.22 billion. Apple sold 7.4 million iPhones in the quarter and 3 million Macintosh computers in the quarter, gains of 7% and 17% respectively over the same period last year. Sales of its iPod media players continue to erode, falling 8% due to cannibalization from the iPhone, which also plays music and video.
- Billionaire investor Warren Buffett said Wall Street pay needs a "downside" when profits deteriorate. "You have to put in something where there is downside to people who really mess up large institutions," Buffett said in an interview with Cathy Baron Tamraz, chief executive officer of Berkshire Hathaway Inc. (NYSE: BRK.A,BRK.B) division Business Wire. "Too many people have walked away from the troubles they have created for society, not just for their own institution, and they have walked away rich." Wall Street bonuses in 2009 may rise 40% to $26 billion, according to estimates by compensation consultant Johnson Associates Inc. Buffet makes $100,000 per year as Berkshire's CEO.
- Housing starts in the United States rose 0.5% to an annual rate of 590,000 units in September, up from August's revised 587,000, the Commerce Department said. Meanwhile, the producer price index (PPI), which measures prices received by farms, factories and refineries, fell by 0.6% last month after rising 1.7% in August, the Labor Department said. Analysts were expecting prices to be flat. "The expectations are for a very tepid economic recovery," John Canally, an economist and investment strategist at LPL Financial told Reuters. "The recovery is firmly in place, but I don't think consumers are going to recognize this until we see job growth."
- U.S President Barack Obama is expected to unveil new initiatives today (Wednesday) with the goal of increasing credit to small businesses, an administration official told The Wall Street Journal. Among the moves to be announced is an increase in caps on existing Small Business Administration (SBA) loans and making it easier for small banks to access funds from the Troubled Asset Relief Program (TARP). Several community banks have complained the Bush and Obama administrations moved swiftly to bail out large banks but made it harder for smaller banks to qualify. Nearly 100 banks have failed so far this year, all of which are small- to medium-sized lenders.
- The Coca-Cola Co. (NYSE: KO) blamed a weak economy after it missed analysts' revenue estimates for its third quarter. The soft drink maker's revenue fell to $8.04 billion, missing Thomson Reuters Corp. (NYSE: TRI) analysts' estimates of $8.11 billion. Coca-Cola's net income was $1.90 billion, or 81 cents per share, roughly flat from last year's profit of $1.89 billion or 81 cents per share. "We expect the consumer to continue facing economic uncertainties into 2010 and for consumer sentiment to recover slowly," Chief Executive Officer Muhtar Kent said. The company repurchased $241 million of its stock, and intends to repurchase up to $1 billion of stock by the end of the year, it said. Shares of the company closed at $54.07, down 1.31%.
- Shares of Caterpillar Inc. (NYSE: CAT) yesterday (Tuesday) rose 3.04% after to close at $59.61 after the company raised its 2010 sales forecast. Sales will climb 10% to 25% from their 2009 midpoint, the company said. "We are seeing encouraging signs that indicate a recovery may be under way," said Chief Executive Officer Jim Owens.
- Crude oil for November delivery yesterday (Tuesday) fell 52 cents, or 0.7%, to settle at $79.09 a barrel on the New York Mercantile Exchange (NYMEX). Prices rose as much as 0.6% to $80.05 a barrel earlier in the day – breaking $80 for the first time in more than since Oct. 14, 2008. Futures are up 77% this year.
- Drug maker Pfizer Inc. (NYSE: PFE) yesterday (Tuesday) posted a 26% increase in third-quarter profit as cost cuts made up for a decline in sales. Net income at the company rose to $2.88 billion, or 43 cents a share, from $2.28 billion, or 34 cents a share, a year earlier. Sales fell 3%, to $11.62 billion, from $11.97 billion.
- Airline passenger revenue plummeted 19% year-over-year in September, according to the Air Transport Association. However, that decline was largely the result of lower fares, as passenger volume slipped just 2% during the month. "The demand for air travel remains weak," ATA Chief Executive James May, said in a statement. "While other sectors may be seeing signs that the economy is getting back on track, the airline industry has faced challenges in its effort to generate revenue."
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The Mad Rush for the 3rd Element
Mineral rushes are the stuff of legend...
Gold rush miners making millions in months...ordinary farmers becoming instant oil tycoons... Solitary uranium prospectors claiming million-dollar stakes...
But the mad rush for the 3rd element could dwarf all this. Its price doubled in one year... tripled in three years... and is expected to increase 40-fold!
The U.S. government alone has invested $28 billion to make sure the 3rd element becomes this country's dominant energy source.
And now, Horacio Marquez has found an easy way to play this "mad rush" and potentially turn every $10,000 into $294,000. Just click here to read Horacio's report.
10/20/2009
Toyota Launches New Model at Home, Plans Expansion into Korean Market
10/20/2009
Tax on Foreign Investment Won't Dent Brazil's Currency
10/19/2009
Bernanke: Asian Consumer Spending, Cutting U.S. Deficit Are Keys to Avoiding Trade Imbalances
Feature
A new, universal currency backed by solid gold
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October 20
| Housing Starts (09/09) |
| PPI (09/09) | | October 21 | Fed Beige Book | October 22
| Initial Jobless Claims (10/17) | | Leading Eco. Indicators (09/09) | | October 23 | Existing Home Sales (09/09) | Worth Considering
The Just-Released Formula for Predicting High-Yield Winners
Buy, Sell, or Hold?
by Horacio Márquez
Insights on Income
by Martin Hutchinson
Inside Wall Street?
by Shah Gilani
When and How the U.S. Economy Will Recover
Three Big Reasons Oil Prices Will Rally Back Big Time
Alternative Energy
Asia
Commodities
Europe
Global Markets
Gold/Precious Metals
Oil
Real Estate
Technology
U.S. Economy
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