Week of June 20th:

Big news this week: New federal funds rate comes out in the United States on Wednesday. Expected to be between 0 to 0.25% change. I don't expect it to change much. The rate is already very low however the Feds might want to keep money flowing between banks to avoid another Lehman Brothers crisis where the banks stop lending to each other. It is still way to early to worry about controlling inflation so rate will not go up, this will also panic the markets. Rates should stay where there are.  Friday durable goods orders and GDP numbers come out. Look for these to either fall short or surpass expectation. If either of these happen the markets should react appropriately. GDP growth is expected to be at 1.9% and I think the economy is in a faster recovery mode than 2%. The dollar is strong, Japan is rebuilding and housing starts were higher than expected.

Now stocks to watch for,
The biannual Paris Air Show took place over the weekend where Boeing (BA $74.16) preview the longest plane every to fly the 747-8. It still seats less than its rival Airbus (EAD.PA $21.44) A380 but it is more fuel efficient and today that is starting to matter more. Boeing was the clear winner at the show. It filled out new orders for the new 747 as well as orders for the brand new 787 Dreamliner, which will start flying commercially this fall. After Airbus has been stealing the market for the last 3 years it looks like Boeing will own the next few with their fuel efficient fleet. I would recommend Boeing and sell Airbus.

With the Greek Debt Crisis still not begin solved the markets are not going to be bullish this week. However for those of you in the United States, stocks and the dollar should fair better than their European counterparts. I do not have and specifics but look for American manufacturing companies that buy a lot of their raw materials overseas. The strong dollar should help them purchase more goods for the same about of money as they did last quarter. I like US Steel (X $41.07) this week on that news.


 

Week of June 6th

Recap of last week. My picks were WY up SI up and PKN down and I am excited to report I was three for three. Also I was especially excited when MSNBC's Jim Craemer endorsed WY on his show Mad Money, good to see Jim is taking tips from my blog.

For the week of June 6th to the 10th.

Employment data came out last week for the month of May and it wasn't great. Unemployment ticked up to 9.1% and the economy added 54,000 jobs. I think the cause for the rise in unemployment has to be more people entering the search for jobs again. This is good news if you look at it like more people expect the economy to be improving and more jobs to become available. This week the big news everyone is looking for is the International Trade report. Expectations is that trade will be worst than last month but I think the actual numbers will beat expectations thanks to a weak dollar.

It's summer time and that means summer vacations, well usually. Consumer confidence is near all time low levels and discretionary income is hard to find. In the United States the vacation industry and those closely associate with it will be hurting. Las Vegas, Cancun, Disney, are all going to be hurting. More specifically airlines are getting hard especially with oil where it is. I would sell airlines associated with the US market with limited international exposure. The airline I think is worst off is US Airways (LCC $8.89). They are the least efficient of the sector and are over exposed to the United States market. Airlines that may fare better would be European based airlines where "holiday" is a bigger tradition and vacations may be taken more than in the United States.

One thing I observed this week is corn. Pretty exciting right? This year is shaping up to be a very bad year for all agricultural stocks. With the floods, tornadoes, and cold springs the crops haven't gotten in the ground yet across the United States. Corn needs to be in the ground very early in the season or else it doesn't have enough time to grow. Corn prices should be higher this year which makes farmers who got their crops in the ground very happy because they will be getting a very good price. Look for farmers to be buying the new John Deere tractors towards the end of summer/early fall. Buy Deere now before this is reflected (DE $81.95). Other agricultural supporters should also do very well with these high prices such as fertilizer suppliers like Potash (POT $55.17). Buyers of corn will be the losers these high prices. Corn is used in almost all foods as high fructose corn syrup so any major buyer of corn should be seeing high prices if they haven't locked in prices already.

Well this is what I will be watching this week. Let me know what you think. Shout out to Jim Craemer, next time you take my stock tips I want credit and $100.