News & Our Thinking

Weekly Investor

Weekly Investor – April 26, 2013

30 April 2013

Market Turbulence

Market Summary:  

The U.S. equity markets all gained ground last week despite encountering some turbulence along the way.  On Tuesday, a false Twitter feed from the hacked account of the Associated Press sent intraday stock prices plummeting.  The tweet alleged that the White House had been compromised and that President Obama had been hurt. However, sanity won out and stocks quickly recovered.  Additionally, soft economic data caused some concern among investors throughout the week.  Existing home sales and durable goods orders declined. Friday, first quarter GDP growth came in at 2.5% versus expectations of 3.0% growth.  Finally, earnings season continued with mixed results.  Looking ahead, investors prepare to digest the final rounds of earnings announcements from Corporate America and hope the reports provide guidance on the direction of the market.

The S&P 500® up 1.7% for the week.  The top-performing sectors in the S&P 500® Index included Energy (3.2%) and Basic Materials (3.0%), while bottom-performing sectors included Consumer Staples (-0.4%) and Telecommunications       (-0.5%). In the fixed-income market, the 10-year Treasury yield closed even for the week at 1.7%.

We continue to seek those companies possessing identifiable catalysts, and focusing on those stocks with favorable odds.

Growth Potential

AAPLApple Inc. (AAPL) designs, manufactures, and markets mobile communication and media devices, personal computers, and portable digital music players; and sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide.  After producing many popular and innovative products for consumer and domestic markets, AAPL is being gradually adopted by business, international and emerging markets.  AAPL has found increasing success in business markets partly due to its latest product, the iPad.  In addition, AAPL opened approximately 40 new stores in 2012, 30 of which were in international markets including the Asia-Pacific market.  AAPL’s latest in a long line of innovations, the Siri voice activation feature in the iPhone 4, was a huge success for the company, especially in China.  AAPL intends to integrate Siri into other products, potentially an iTV, in the future.   We believe APPL’s new product pipeline and entrance into new markets can power sales and profit growth for many years to come.

Top 10 Equity Holdings

Google, Inc. 5.3%
CBS Corp. 4.4%
Lowes Cos. 4.3%
Gilead Sciences 4.2%
Allstate 4.2%
Danaher Corp. 3.8%
SunTrust Banks 3.7%
Procter & Gamble 3.5%
Qualcomm Inc. 3.5%
Post Holdings, Inc. 3.4%

U.S. Equity Indices

Index 04/26/13 Week % Chg YTD % Chg
DJIA 14,712.6 1.1% 12.3%
NASDAQ 3,279.3 2.3% 8.6%
S&P 500 1,585.2 1.7% 10.9%
Russell 1000 G 723.2 1.8% 9.9%

U.S. Credit Rates

Index 04/26/13 04/19/13 12/31/12
3 Month T-Bill 0.1% 0.1% 0.1%
5 Year T-Note 0.7% 0.7% 0.8%
10 Year T-Note 1.7% 1.7% 1.8%
30 Year T-Bond 2.9% 2.9% 3.0%
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.