What We’re Reading

by CC May 24, 2011 9:07 am • Commentary

Bespoke

The Russell 3,000 is currently up 5% year to date. The average stock in the index is only up 3.61% year to date, so the larger cap stocks are clearly outperforming. Fifty-seven (57%) percent of the stocks in the Russell 3,000 are up in 2011, 32% are up more than 10%, 2.7% are up more than 50%, and 0.48% (14 stocks) are up more than 100%.

 

Bloomberg

There’s been a lot of talk about commodities crashing, but you might have been a bit mislead.

Commodities did crash hard early this month, and then have just bounced around a lot, and oil is still just below $100.

And now here comes Goldman (via ZeroHedge) with a big, bullish outlook on oil.

Barons

Intel must find more contract business as it spends $10 billion this year beefing up its fabs, a doubling of last year’s capital spending.

Basically, the old PC business just won’t bring enough revenue to justify the business, but a deal to fab Apple’s chips would help a lot. (Richard doesn’t talk about how production of server chips and networking chips would help, but those are admittedly much smaller markets than the PC by volume.)

 

Bespoke

we have updated the cumulative breadth for both the S&P 500 and Russell 2000.  As shown, breadth for both indices is off of its peak levels.  However, the downtrend in breadth that is forming for the Russell 2000 is considerably more well-defined than the S&P 500.  Whether or not the S&P 500 follows the lead of small caps is unknown, but until the pattern for small caps changes, investors would be best served staying away.

 

Bloomberg

LinkedIn sold 7.84 million shares on May 18. About 85.7 million shares owned by insiders and money managers start to become eligible for trading 180 days after the IPO, regulatory filings show. Social media companies led by Facebook Inc. and Twitter Inc. may conduct their own share sales.

Hani Durzy, a spokesman for LinkedIn, didn’t return a call for comment.

“There’s no way you can justify its valuation,” said Shacknofsky, who helps manage $7 billion in Purchase, New York, for Alpine, which invested in the IPO and sold the shares on the first trading day. “It’s very difficult to understand its valuation. It’s trading on short supply because it wasn’t a big offering to begin with, and a lot of people who wanted exposure to a quality social-networking play bought it.”

 

Bonus:

Tom Brady, looking tough as ever, on a water slide. (with Gisele, so still winning)