Weekly Investor – December 4, 2012
Mixed Bag
Market Summary:
All’s well that ends well, as they say. The broad U.S. equity markets ended last week in positive territory, but not without a mixed bag of news that caused two steps forward, two steps back. Stocks retreated on Monday and Wednesday based in part on cautious comments regarding Fiscal Cliff negotiations. On the other hand, stocks advanced on Tuesday and Thursday due to promising economic news. Specifically, third quarter GDP growth was revised upwards, jobless claims decreased and met expectations, consumer confidence reached a multi-year high and home sales increased more than expected. The markets ended the week generally flat, perhaps due to sheer exhaustion over the mixed bag of high frequency news that had been moving the markets in the short-term. It is a fair bet to expect continued volatility for the balance of the year as Washington continues to negotiate and posture over the future economic ground rules for the United States economy.
The S&P 500® closed up 0.5% for the week. The top-performing sectors in the S&P 500® Index included Utilities (3.5%) and Technology (1.0%), while bottom-performing sectors included Financials (-0.6%) and Energy (-0.6%). In the fixed-income market, the 10-year Treasury yield closed down for the week at 1.62%.
We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.
Solutions Driving Growth
EMC Corp. (EMC) develops solutions for the information technology industry. It provides and supports infrastructure for storing, protecting, organizing and retrieving vast amounts of data. EMC’s information management operations can be broken into three segments: storage, archiving and security. With acquisitions, EMC continues to fill out its product portfolio in order to go after more market share.
With EMC’s core market as storage, the company is well positioned to benefit from the increase in online content from sites such as those specializing in video sharing. Management is aligned to improve market share while ensuring that current business avenues continue to be successful. At Argent, we view EMC as having favorable odds for our clients.
Top 10 Equity Holdings
| . | |
|---|---|
| Google, Inc. | 5.0% |
| Lowes Cos. | 4.5% |
| Qualcomm Inc. | 3.9% |
| Ebay, Inc. | 3.8% |
| Danaher Corp. | 3.8% |
| Suntrust Banks | 3.7% |
| CBS Corp. | 3.7% |
| Forest Laboratories | 3.5% |
| Gilead Sciences, Inc. | 3.4% |
| Mastercard, Inc. | 3.3% |
U.S. Equity Indices
| Index | 11/30/12 | Week % Chg | YTD % Chg |
|---|---|---|---|
| DJIA | 13,025.6 | 0.1% | 6.6% |
| NASDAQ | 3,010.2 | 1.5% | 15.5% |
| S&P 500 | 1,416.2 | 0.5% | 12.6% |
| Russell 1000 G | 659.4 | 0.7% | 13.5% |
U.S. Credit Rates
| Index | 11/30/12 | 11/23/12 | 12/30/11 |
|---|---|---|---|
| 3 Month T-Bill | 0.1% | 0.1% | 0.1% |
| 5 Year T-Note | 0.6% | 0.7% | 2.0% |
| 10 Year T-Note | 1.6% | 1.7% | 3.3% |
| 30 Year T-Bond | 2.7% | 2.8% | 4.3% |
| Prime Rate | 3.3% | 3.3% | 3.3% |
This newsletter presents selected recommendations from portfolio managers of Argent Capital Management LLC, a registered investment advisor. Opinions reflect the portfolio manager’s judgment on the date above and are subject to change. A list of stocks recommended by Argent is available upon request. You should not assume that these recommendations are or will be profitable. In the course of it’s business, Argent’s client accounts may be buying and selling these stocks.
