Stock Investing Guide

Stocks may find it hard to stay focused on the days earnings parade given the continued stalemate in Washington on the debt ceiling issue. We also have a couple of housing and consumer confidence reports coming out after the markets open. But had Washington not been as distracting as it has been lately, corporate earnings would be the most important news of the day.

The markets have remained fairly stable thus far even as we get closer to the debt ceilings August 2 deadline. With the exception of the gold, no asset class appears to be worried. And this is hardly a sign of complacency. The markets may not be as efficient as some academics believe, but they are smart enough to evaluate Americas financial health. While default and rating downgrades are no doubt headline-grabbing events, the markets have thankfully been able to look past them thus far.

On the earnings front, we got better-than-expected earnings from from Ford (F) on the back of solid top-line gains. We also got a solid EPS and revenue beat from Cummins (CMI).

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Tags: Debt Ceiling, Focus

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With gold prices soaring, it’s not surprising that the estimates on the gold miners are also moving higher. Gold Fields Limited (GFI – Snapshot Report) is expected to grow its earnings by 134% in 2011.

But it’s not too late to get in. This Zacks #1 Rank (strong buy) is trading at just 12x forward estimates.

Gold Fields is one of the largest producers of gold in the world. The South African-based miner produces 3.6 million gold equivalent ounces from 8 mines in Australia, Ghana, Peru and South Africa.

Production Higher in the Second Quarter

On July 5, Gold Fields announced that second quarter production would be about 5% higher than the first quarter at 872,000 gold equivalent ounces compared to 830,000 ounces in the first quarter.

Production in the South African Region was hit by 6 public holidays as well as 2 seismic-related accidents at the KDC mine which resulted in production stoppages.

The Australasia Region also saw a week-long mill-outage which hurt production.

Zacks Consensus Estimates Rise Ahead of Earnings

Gold Fields is expected to report second quarter results on Aug 11, but the 2011 Zacks Consensus is already starting to inch higher.

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Tags: Fields Limited, Gold Fields, Gold Fields Limited, Limited

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The market is still open as I write this so I just want to post a quick update. Two weeks ago I wrote about a potential bullish trade setting up in the gold market. Well since that post the market has  triggered the buy entry and is now beginning to move up nicely.  You can read the original post from two weeks ago by clicking here.

Tags: Update

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The political deadlock in Washington weighed down the markets on the opening day of the week, as lawmakers struggled to find a solution to the impasse over the debt-ceiling issue. The day was also marked by disappointing corporate results, and the fear-gauge index posted its biggest percentage jump in two weeks, reflecting heightened investor anxiety.

The Dow Jones Industrial Average (DJIA) plunged 145 points in intra-day trade before recouping losses partially and finally settled at 12,592.80, dropping 88 points or 0.7%. The Standard & Poor 500 (S&P 500) shed 0.6% to close the day at 1,337.43. The Nasdaq Composite Index was down 0.6% and signed off at 2,842.80. Investor jitteriness was clearly reflected in the fear-gauge CBOE Volatility Index (VIX) and low volumes. The VIX soared 10.5%, recording its highest percentage gain in two weeks. The fear-gauge has increased by 16% in July. As for the volumes, on the New York Stock Exchange, Amex and the Nasdaq, consolidated volumes were 5.94 billion, compared with the daily average of 7.49 billion.

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Tags: 2011 Market, Market

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The number one choice of income investors is utility stocks, especially electric utilities. What electric stocks might give you the biggest charge for your portfolio? One area that investors should look at are the companies that are receiving rate increases, such as the 2.2 percent rate hike for Hawaiian Electric (HE) and the $172 million a year that Ameren (AEE) will receive through its Ameren Missouri division.

WallStreetNewsNetwork.com just updated its list of electric utility stocks and there are over 25 with yields in excess of 3%. Hawaiian Electric and Ameren made the list of the top ten, in terms of yield. These stocks can usually provide relative security, safety, and stability compared to stocks in many other sectors, through the payment of fairly high dividends.

Hawaiian Electric Industries Inc. (HE), the largest supplier of electricity in the state of Hawaii, is one of my favorite utilities (although I still don’t own any shares). I like the fact that it generates electricity from very diverse sources of fuel: oil, coal, hydro, bagasse, recycled oil, wind, geothermal, waste-to-energy, and solar. Full Article…

Tags: Electric Utilities, Utilities

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