If bubbles are out there these 10 sages will warn us

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With the Dow Jones Industrial Average (DJIA)  closing above 16,000 for the first time ever this week, it's hardly surprising that market chatter over whether we're in an asset bubble is intensifying. The 2000 dot-com bubble and the collapse of the housing bubble and financial crisis remain painful memories in investors' minds. But are we so scared of bubbles that we see them even where they don't exist? Recently, Mark Dow, portfolio manager at Pharo Management, suggested as much, telling CBNC in an interview that there's "a bubble in calling for bubbles." With that in mind, here's a look at 10 notable names and their recent take on where the markets stand.

— Wallace Witkowski

1. Warren Buffett

The Oracle of Omaha doesn't seem to be worried about a bubble in his favorite asset class: stocks. Recently, Buffett said stocks are not overbought but in a "zone of reasonableness." Last month, Buffett said in a CNBC interview that he doesn't see stocks as being in a bubble at least not for now. "Stocks are not selling at bubble levels, and, what do you diversify into? Do you want to diversify into cash? I think it's a terrible investment compared to equities. Do you want to diversify into long-term bonds? I think it's a terrible investment compared to equities. You're going to have your assets in something and I think good businesses held for long periods of time are certain to deliver good results."

2. Janet Yellen

Janet Yellen took one step closer to being Federal Reserve Chairman Ben Bernanke's replacement after the Senate Banking Committee voted in favor of her nomination this week. On the subject of bubbles, Yellen has stuck to the Fed script , at least when it comes to stocks. "Stock prices have risen pretty robustly," Yellen said at her confirmation hearing, but added that given several factors "you would not see stock prices in territory that suggest…bubble-like conditions." When asked if there was a federal role to support the stock market, she simply replied, "No." When asked about other possible asset bubbles like housing, Yellen said that rising home prices and all-cash deals — especially in hard-hit places like Phoenix and Las Vegas — are a "logical response" from the market. That does little to assure investors who remember Ben Bernanke's assertion that he didn't see a housing bubble in the works during his confirmation hearing in 2005.

3. Marc Faber

The author of the Boom Gloom & Doom report sees bubbles everywhere and Janet Yellen as Fed chairwoman as cause for even more alarm. "I see a bubble in everything that relates to the financial sector," Faber said on CNBC recently. "We have a bubble in bonds. We have a bubble in low-quality bonds. We have a bubble in equities...We have a huge debt bubble and it's only getting bigger, it's not getting any smaller. So we are the bubble, everything that is in the financial sector is the bubble, and it's been pumped up by central banks."

4. Andy Xie

It's not just U.S. stocks that have investors on edge. Quite a lot of bubble talk has been directed toward China lately, especially in the area of housing. Shanghai economist Andy Xie said China's shadow banking industry will likely see a severe liquidity squeeze when the Fed winds down its easing measures, and that will pressure China's property bubble. "China's rhetoric on growth and the Fed's on unemployment have reinforced each other in expanding a gigantic global bubble, bigger than the one before 2007," according to Xie. "When the bubble bursts, the impact on China and the United States will be very different. The United States' bubble is mainly in the stock market and in the properties for rich people. Its debt is not rising rapidly. Hence, when the bubble bursts, it is merely a round trip for speculators. China's bubble is sustained by debt. Its destructive power is much greater."

5. Nouriel Roubini

We're not in bubble territory yet for stocks, according to NYU economist Nouriel Roubini, but that doesn't mean there aren't bubbles forming all over the world. In a Bloomberg interview, Roubini said central bank liquidity is not going to the economic recovery but into financial transactions "We are maybe not in bubble territory for the U.S. stock market, but if you look at housing around the world — Switzerland, Sweden, Norway, France, Germany, Israel, Brazil, Hong Kong, Singapore, China — we have frothiness if not outright bubbles in housing markets in many parts of the world," he said. Also, the tech sector appears vulnerable with start-ups being overvalued based on forward revenue they haven't even taken in yet. In addition, central bankers face a tough choice between killing off the recovery, or fueling growth at the risk of inflating the next financial crisis.

6. Robert Shiller

Nobel-prize-winning economist Robert Shiller recently called bubbles a form of a "social mental illness." While he's said stocks don't appear bubbly yet, and may have room to grow, a recent rise in his cyclically adjusted price-to-earnings ratio is a "concern." Shiller has even gone as far to say that he doesn't expect another housing bubble in our, or at least his, lifetime. "We're kind of chastened by our recent experience," he said in a recent interview.

7. Laurence Fink

Tapering of asset purchases by the Fed cannot come soon enough to calm down bubble-like markets, according to BlackRock Chief Executive Laurence Fink. "It's imperative that the Fed begins to taper," he told a panel in Chicago last month. "We've had a huge increase in the equity market. We've seen corporate-debt spreads narrow dramatically." Blackrock is the world's largest money manager with $4.1 trillion in assets under management. In fact, Fink said recently the Fed should send off Ben Bernanke in December with a "kiss" by starting the taper.

8. Bill Gross

The bond market may be bubbly but not to the extent it will likely pop, said Pimco co-chief investment officer Bill Gross recently, but that's because the appointment of Janet Yellen to head the Fed will keep the federal funds rate artificially low for years to come. To the extent that equity markets are overheated, margin requirements can be raised to counter historically high margin debt, he said.

9. Paul Krugman

The latest from Princeton economist and New York Times columnist Paul Krugman on bubbles stems from his annoyance at former Treasury Secretary Larry Summers, who recently spoke at an International Monetary Fund research conference and got a lot of attention for ideas similar to Krugman's. On the subject of bubbles, Krugman agrees with Summers that they may be part of the not-so-new normal, that "we may be an economy that needs bubbles just to achieve something near full employment – that in the absence of bubbles the economy has a negative natural rate of interest." Back in March, Krugman went so far to say that there's no standard definition for them and that the growing bubble fear had something to do with a "deep hatred" for Ben Bernanke "and everything he does."

10. Adam Parker

Morgan Stanley's chief U.S. equity strategist Adam Parker lands somewhere in the middle. He sees risks down the road for U.S. stocks, but for the moment, he's not all that worried about the market. "[T]here's no doubt that the bubble is in the belief that policy makers will execute a soft-landing from higher prices than we are trading at today, and that is certainly a risk," Parker said in a recent note. "We are currently of the mindset that the Fed will be able to communicate that tapering and tightening are different this time. On the other hand, we wouldn't be surprised if they tapered far later than the current consensus view. Either way, the consensus view is that the monetary policy will have a huge impact on risk-taking in 2014."

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Three Scenarios for Gold

Hot Bank Stocks To Buy Right Now

We see three potential scenarios for gold; to invest without having these scenarios in mind is simply foolish, says resource specialist Larry Edelson in Money and Markets.

First, it's bottoming. I can't tell you precisely when, or at what price, but I have every reason to believe that gold is now in the timeframe for a bottom, and a major bottom at that.

In fact, it may have already bottomed at $1,178 back in late June. That is possible. Or it may dip back to near $1,178 one last time, soon, or even after a big rally. Or it may just explode higher here and now.

It is impossible for me to say with any certainty. For anyone to say, actually. All I can tell you is, again, that all of my models indicate that gold is very near, or already may have seen, an important bottom.

Second, trying to time the exact day, or even the exact week, and the exact price, would simply be foolish. That said, let me give you the three scenarios I see for gold.

If it seems like I am talking out of both sides of my mouth, let me assure you that I am not. I am merely giving you the three most likely scenarios for gold going forward, scenarios you will need to keep in mind to get properly positioned, so you can minimize risk and maximize potential profits.

Scenario #1:

Gold's low at $1,178 in late June was the major bottom. In this scenario, gold must now confirm it by moving and closing above $1,449.50 on a Friday weekly basis, followed by a weekly close above $1,605.50.

So far, gold has taken out important short-term resistance at the $1,338 level. That does indeed imply a further rally, with the next important level of resistance at the $1,400 level, followed by $1,449.50.

This is now becoming the highest probability projection. But still, as in life, nothing is certain, so we must keep an open mind toward the next scenario.

Scenario #2:

Gold continues to rally, as high as $1,605.50, but fails to close above $1,449.50, or $1,605.50 on a weekly closing basis.

Gold then trades back down, even as low as the $1,265 level in early 2014, and then begins another move higher, one that eventually gives us the buy signals we need to confirm the end of the bear market and the beginning of the next leg up. The $1,178 June 2013 low holds, but gold swings wildly before taking off for good.

Scenario #3:

Gold continues to rally, as high as $1,605.50, but fails to close above $1,449.50, or $1,605.50 on a weekly closing basis, and then collapses into a major new low in 2014.

Whereas a new low below $1,178 was the highest probability before, it is now the lowest probability scenario. But we simply cannot throw it out the window.

In this scenario, we see a decent rally in the weeks ahead, but it fails to issue major confirming buy signals, and instead, trades lower, as in Scenario #2 above.

But instead of holding major support at the $1,265 level early next year, gold crashes right through the June 2013 low at $1,178 and makes a new low down at major system support at the $1,035 to $1,050 levels.

Now, I fully realize you might not like anything I just told you, that you think I'm hedging my gold forecast, or talking out of both sides of my mouth. Or that you like Scenario #1, the most bullish, and you don't like, or agree, with the other two scenarios.

That's okay. I am not trying to win a popularity contest. I am not here to tell you what you want to hear. My job is to tell you what I see ahead, based on my tried-and-true models and indicators, and without any bias.

I always call them like I see them, and precisely the way I would put my own money on the line, which brings me to the question, "What should you do now in gold? In silver? In mining shares?"

As you can tell from the above three scenarios, we are likely to see gold now rally into year-end and as high as $1,605.50 or even higher.

That sounds really exciting, right? Heck, if that kind of rally were to materialize, it would be gold's best performance in almost three years.

But unless gold closes above $1,449.50 and $1,605.50 on a Friday closing basis, then the gold rally would be for naught, it would be nothing but a bear market rally. And if you loaded up too much on gold, it would backfire on you.

So instead, now is merely the time to begin to test the waters. You don't go all in, you don't over commit, you don't become impatient, and you don't get overly emotional.

You map out your strategy based on all the evidence and data you have, and then you focus most of your energy on controlling the unknowns, your risk. That's how the most successful investors and traders make the most money, by controlling, and indeed, insuring against, the unknowns.

For gold, that means long-term investors can start buying gold again lightly, committing at this time, no more than 5% of your funds available for investing in gold, being fully aware that we do not have full confirmation yet that the low has been made. Testing the waters with up to a 5% position will help limit your risk.

For traders, you trade leverage positions, but hedge your bets with limited risk, inverse ETFs with options, or even spread your futures strategy both long and short.

Basically, you put yourself in a position to profit from a rally from a bottom in gold if we have already gotten it, yet you take out some insurance in case you're wrong.

As for silver, this may or may not surprise you, but I would continue to steer clear of the metal. There is a chance silver has not bottomed yet, even if gold has. Hard to believe, I know, but that is what my models are telling me.

For mining shares, my models tell me they have not yet bottomed. Again, hard to believe, but most mining-share ETFs have taken out that important cyclical low they made back on August 6. That means lower lows are possible.

So, like silver, it is indeed possible that mining shares may still move lower, even if gold has already bottomed and even if gold stages a decent rally.

Hard to believe, yes, but that's what my models are telling me, and I never deviate from what they say. They have proven themselves over and over, time and time again. So, for now, mining shares are not yet primed for major investment.

Right now, I urge patience and emotional discipline. Those are always the two most important elements of successful trading and investing, especially near major market turning points.

Major market turning points offer tremendous opportunities for profit, but they are also the most dangerous. The markets never take any prisoners, so you want to make sure, through patience and emotional discipline, that you're not going to be one of its victims.

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Despite the Big Drop, Call Options Dominate Yahoo!

Yahoo! Inc. (NASDAQ: YHOO) may be down about 7% after its earnings signaled what is still a lack of serious growth in its turnaround strategy. What is interesting is that the options trading community is keeping a more bullish stance regarding Yahoo!’s prospects.

One admission has to be made in options trading, and that is without having the market maker order books it is impossible to fully know if the volume is dominated by buying or selling. That is often not really known until the following day when the new open interest readings can be viewed.

The January 31 expiration weekly options are showing more trading interest in the $36 calls and $37 calls. Both are now considered to be speculative, considering that the 7% drop has shares at $35.55. We have seen more than 11,600 contracts trade in the $36 strike and more than 12,400 contracts trade in the $37 strike.

On top of those weekly expirations mentioned, another 10,000 contracts or so have traded among the $35.50, $36.50, $37.50, $38 and $38.50 strike prices. Tally all this up and it is close to 3.5 million shares worth of options on a fully leveraged basis. This compares to only about 12,000 of all the actively traded put option contracts.

If you go out to the February expiration, more than 12,000 contracts have traded among the most active call strike prices, versus about 13,000 contracts traded among the active put strike prices. That imbalance is too small to worry about, and the expiration there is out to February 22. The March expirations are more skewed to Call options as well, although it is too small a difference to measure with any observation of value.

Where Yahoo! stock options get real interesting is out in April. That is another earnings month, and likely investors may have more of an idea of what to expect around an Alibaba IPO at that time. Almost 14,000 contracts have traded among the active April call options, versus only about 3,000 of the active put options.

Even out in the LEAPS, the January 2015 active call strikes have seen more than 3,500 contracts trade, versus a negligible number of put options.

As of 11:30 a.m. EST, this shows an imbalance of the active contracts that is highly in favor of the call options. Some of these are of course selling out of positions, but options traders likely will notice that this is another handy imbalance toward the calls — the right to buy shares.

Yahoo! shares hit a low of $35.01 on Wednesday morning, after opening at $35.75. The $35.55 share price is up more than 1.5% from the intraday lows, and the options are more skewed toward calls (the right to buy). It seems that the bias in the weeks and months ahead remains to the upside, despite what the one-day drop of about 7% might look like on the surface. At least that is what this take indicates. One last reminder to make is that the direction of trading, in shares or in options, can change multiple times throughout a trading day.

Has Eurozone unemployment peaked?

LONDON (AP) — The eurozone's labor market appears to have stabilized, official figures indicated Tuesday, another sign that the region's economy is recovering from its longest-ever recession.

Though Eurostat, the EU's statistics office, said the unemployment rate across the 17-member eurozone held steady at 12% in August, it found the number of people out of work fell for the third month running. That's the first time the region has enjoyed such a run since April 2011.

In total, the number of unemployed dipped by 5,000 to 19.18 million, triggering hopes that the 20 million threshold that many economists had been forecasting this year will not be struck and that the 12.1% record high booked in June may not be breached.

"The eurozone's jobless rate is past its peak for the current economic cycle," said Zach Witton, an economist at Moody's Analytics. "However, the unemployment rate will fall only gradually as the weak recovery provides limited support to profit margins, giving companies little incentive to boost hiring."

As usually happens in a recovery, the modest improvement in the labor market has lagged behind the region's emergence from recession by a few months. The economy grew in the second quarter by a modest quarterly rate of 0.3% after contracting for six straight quarters, its longest recession since the euro currency was launched in 1999.

Most surveys suggest the eurozone expanded further during the summer months and that the growth won't rely only on Germany, Europe's largest economy. Even Greece, mired in recession for the best part of six years as the global financial crisis morphed into a crippling sovereign debt crisis, is expected to start growing soon.

Hopes for an improvement in the eurozone economy were supported by a closely-watched manufacturing survey released Tuesday.

The purchasing managers' index for the manufacturing sector — a gauge of business activity published by financial information company Markit — was 51.1 points in Septemb! er. Though down on August's 26-month high of 51.4, the survey points to continuing expansion — anything above the 50 threshold indicates growth.

"This is good news for the eurozone but also for the global economy," said Chris Williamson, chief economist at Markit. "The downturn in demand caused by the region's recession and the uncertainty generated by its debt crisis had cast a shadow over economic recoveries across the globe. But we must not get too carried away."

Over the past three years, the eurozone has been the laggard of the world economy as it grappled with a debt crisis that at various times threatened the future of the euro currency itself.

Countries across the region, but mainly in the south, such as Greece, Portugal and Spain, have had to enact tough austerity measures to convince bond market investors that they could get a handle on their public finances. A combination of recession, poor management and expensive bank bailouts had caused public debt to swell in the region.

The problems afflicting the eurozone weighed on sentiment around the world, putting a brake on the global economic recovery. The eurozone, with its population of around 330 million, is a key market for global firms seeking to do business.

The wider 28-country European Union, which includes non-euro countries such as Britain and Sweden and has a population of a little over 500 million, has also struggled in the wake of the eurozone's woes in recent years. Here, too, the unemployment rate appears to have steadied, staying unchanged in August at 10.9% for the fourth month running.

Olli Rehn, the EU's commissioner for economic affairs, warned that despite the indications of a rebound, the crisis in the eurozone is not yet over. He said governments should continue their economic reforms and debt cuts, lest they stymie the budding recovery.

He also lamented the shutdown of the U.S. government, but said that he thought the impact on other economies would be limited if it didn't last ve! ry long.

"But, of course, the recovery in the global economy, and also in the European economy, is so fragile that they do not need any new risks or any new elements of political instability," he told reporters in Paris.

Few economists think the eurozone's current economic growth is enough to significantly bring down unemployment, particularly among the young. The manufacturing PMI survey, for example, showed companies in the sector were still shedding jobs in September, though at a slower rate than before.

The Eurostat figures also mask huge divergences across the eurozone: While Germany has an unemployment rate of 5.2%, Spain's jobless rate stood at 26.2%. The situation in Greece is even worse, with 27.9% of people out of work in June — Greek figures are compiled on a different time frame.

The situation among the young — that is, potential workers under the age of 25 — is even more acute. Greece and Spain, for example, have over half their youth unemployed. In Greece, youth unemployment stood at a stunning 61.5% in June.

As well as being a burden to a country's coffers, sky-high levels of youth unemployment have an additional social cost of denying potential workers skills and experience — that's a long-term cost to the region's economic potential and has also fueled an increase in social tensions.

AP Business Writer Sarah DiLorenzo in Paris contributed to this report

Morning Briefing: 10 Things You Should Know

NEW YORK (TheStreet) -- Here are 10 things you should know for Wednesday, Sept. 18:

1. -- U.S. stock futures were rising following modest gains across the globe as investors await an announcement from the Federal Reserve on its plans to taper economic stimulus.

European stocks were higher. Asian shares finished the session mixed. Japan's Nikkei 225 index rose 1.4%.

2. -- The economic calendar in the U.S. Wednesday includes housing starts and building permits for August at 8:30 a.m. EDT, and the rates decision from the Federal Open Market Committee in the afternoon. 3. -- U.S. stocks on Tuesday rose as investors await guidance from the Fed about the future of its sweeping economic stimulus program. The S&P 500 rose 0.42% to close at 1,704.76 while the Dow Jones Industrial Average added 0.29% to finish at 15,539.63. The Nasdaq gained 0.75% to 3,745.70. 4. -- Walgreen (WAG) is set to become one of the largest employers to make sweeping changes to company-backed health programs. The drugstore giant is expected to disclose on Wednesday a plan to provide payments to eligible employees for the subsidized purchase of insurance starting in 2014, according to The Wall Street Journal. The plan would affect roughly 160,000 employees, and will require them to shop for coverage on a private health-insurance marketplace. Walgreen joins a list of companies making changes to their benefits. IBM and Time Warner said recently they will move thousands of retirees from their own company-administered plans to private exchanges. 5. -- Starbucks (SBUX) said guns are no longer welcome in its cafes, though the coffee chain stopped short of an outright ban on firearms. The request is being made in part because more people have been bringing guns into Starbucks over the last six months, prompting confusion and dismay among some patrons and employees, CEO Howard Schultz told Reuters in an interview. In an open letter to customers issued late Tuesday, Schultz said: "Our stores exist to give every customer a safe and comfortable respite from the concerns of daily life." Starbucks' long-standing policy had been to default to local gun laws, including "open carry" regulations that allow people to bring guns into stores, Reuters noted. Schultz said he hopes people will honor the request not to bring in guns but said the company will nevertheless serve those who do. "We will not ask you to leave," he said. Starbucks has almost 7,000 company-operated U.S. stores. 6. -- Adobe Systems (ADBE), the maker of creative-suite products like Photoshop and InDesign, said fiscal third-quarter earnings on an adjusted basis fell to 32 cents a share from 58 cents a share a year earlier. Revenue fell 8% in the quarter to $995.1 million. Wall Street expected Adobe to report earnings of 34 cents a share on revenue of $1.01 billion. Adobe has been shifting its business to a subscription-based model. The company said subscription revenue rose 73% to $299.4 million. The company said its Creative Cloud service gained 331,000 paying subscribers during the quarter, surpassing 1 million. 7. -- FedEx (FDX) is expected by Wall Street on Wednesday to report fiscal first-quarter earnings of $1.50 a share on revenue of $10.97 billion.

8. -- Software maker Oracle (ORCL) is expected by analysts to post fiscal first-quarter earnings of 56 cents a share on revenue of $8.48 billion.

9. -- A report by the 9to5Mac blog said Apple's (AAPL) iPhone 5s could be in short supply. Customers in China and Hong Kong could reserve the iPhone 5s starting Tuesday. But just minutes after the phone became available, most models and colors sold out across the country, the blog reported. The rate at which the 5s sold out in China doesn't bode well for the rest of the world, as it suggests that overall supply in general of the 5s is low, according to 9to5Mac. Apple begins selling the iPhone 5s in retail stores on Friday. 10. -- Employees from US Airways (LCC) and American Airlines (AAMRQ) are in Washington, lobbying members of Congress to support a planned merger of the two carriers, despite opposition from the Justice Department. The employees, including leaders of unions at the two carriers, will hold individual meetings with members of Congress on Wednesday, and they will gather for a noon rally near the Capitol building, The Dallas Morning News reported. -- Written by Joseph Woelfel >To contact the writer of this article, click here: Joseph Woelfel >To submit a news tip, send an email to: tips@thestreet.com.

Copyright 2013 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

3 Stocks Under $10 Triggering Breakouts

DELAFIELD, Wis. (Stockpickr) -- At Stockpickr, we track daily portfolios of stocks that are the biggest percentage gainers and the biggest percentage losers.

>>5 Stocks Under $10 Set to Soar

Stocks that are making large moves like these are favorites among short-term traders because they can jump into these names and try to capture some of that massive volatility. Stocks that are making big-percentage moves either up or down are usually in play because their sector is becoming attractive or they have a major fundamental catalyst such as a recent earnings release. Sometimes stocks making big moves have been hit with an analyst upgrade or an analyst downgrade.

Regardless of the reason behind it, when a stock makes a large-percentage move, it is often just the start of a new major trend -- a trend that can lead to huge profits. If you time your trade correctly, combining technical indicators with fundamental trends, discipline and sound money management, you will be well on your way to investment success.

>>5 Stocks Insiders Love Right Now

With that in mind, let's take a closer look at a several stocks under $10 that are making large moves to the upside.

Orbitz Worldwide

Orbitz Worldwide (OWW) operates as an online travel company worldwide. This stock closed up 0.98% to $7.24 a share in Thursday's trading session.

Thursday's Range: $7.07-$7.25

52-Week Range: $2.68-$13.26

Thursday's Volume: 588,000

Three-Month Average Volume: 946,111

From a technical perspective, OWW trended modestly higher here right off its 50-day moving average of $7.03 with lighter-than-average volume. This move is starting to push shares of OWW within range of triggering a near-term breakout trade. That trade will hit if OWW manages to take out some near-term overhead resistance levels at $7.36 to $7.49 and then once it clears some past overhead resistance at $7.55 with high volume.

Traders should now look for long-biased trades in OWW as long as it's trending above some near-term support levels at $6.92 or at $6.85 and then once it sustains a move or close above those breakout levels with volume that hits near or above 946,111 shares. If that breakout hits soon, then OWW will set up to re-test or possibly take out its next major overhead resistance level at its gap-down-day high of $8.22 from last November. Any high-volume move above that level will then give OWW a chance to re-fill some of its previous gap-down-day zone that started at $9.59.

CBIZ

CBIZ (CBZ), a diversified services company, through its subsidiaries, provides professional business services, products, and solutions to businesses, individuals, governmental entities, and not-for-profit enterprises in the U.S and Canada. This stock closed up 0.43% to $9.25 a share in Thursday's trading session.

Thursday's Range: $9.10-$9.26

52-Week Range: $5.69-$9.40

Thursday's Volume: 453,000

Three-Month Average Volume: 443,482

From a technical perspective, CBZ spiked modestly higher here right above its 50-day moving average of $8.98 with above-average volume. This stock has been trending sideways and consolidating for the last two months, with shares moving between $8.52 on the downside and $9.40 on the upside. Shares of CBZ are now starting to move within range of triggering a big breakout trade above the upper-end of its recent sideways trading chart pattern. That breakout will hit if CBZ manages to take out some near-term overhead resistance levels at $9.29 to its 52-week high at $9.40 with high volume.

Traders should now look for long-biased trades in CBZ as long as it's trending above its 50-day at $8.98 or above more key support at $8.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 443,482 shares. If that breakout hits soon, then CBZ will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $12 to $13.

Camac Energy

Camac Energy (CAK) engages in the exploration, development, and production of oil and gas in Africa and Asia. This stock closed up 6% to $1.59 a share in Thursday's trading session.

Thursday's Range: $1.48-$1.63

52-Week Range: $0.45-$1.64

Thursday's Volume: 869,000

Three-Month Average Volume: 346,774

From a technical perspective, CAK jumped sharply higher here right above some near-term support at $1.40 with strong upside volume. This move is quickly pushing shares of CAK within range of triggering a major breakout trade. That trade will hit if CAK manages to take out Thursday's high of $1.63 to its 52-week high at $1.64 with high volume.

Traders should now look for long-biased trades in CAK as long as it's trending above some key near-term support levels at $1.40 or at its 50-day moving average of $1.30 and then once it sustains a move or close above those breakout levels with volume that hits near or above 346,774 shares. If that breakout triggers soon, then CAK will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $2 to $2.50.

To see more stocks that are making notable moves higher, check out the Stocks Under $10 Moving Higher portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>3 Stocks Spiking on Big Volume

>>5 Shareholder Yield Winners to Beat the S&P 500

>>5 Stocks Under $10 Set to Soar

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com.

You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Glencore Xstrata $8.47 Billion Write-Down Is No Big Surprise

Not even the size of London-listed Glencore Xstrata's $8.47 billion asset impairment came as much of a surprise to observers of the mining industry. The amount, which includes a $7.7 billion goodwill impairment charge related to the acquisition of Xstrata, was at the high end of what analysts were expecting, but apparently Glencore wanted to get the bad news out and behind it.

Big mining firms wrote down more than $50 billion in assets in 2012, led by Rio Tinto PLC (NYSE: RIO), which wrote down $14 billion and fired its CEO. Mergers and acquisitions in the mining business totaled more than $1 trillion in the past decade, and the 5% write-down is really not so bad, all things considered.

Glencore paid $44.6 billion for Xstrata in a deal that closed in May of this year, and based on the impairment charge, the company overpaid by $7.7 billion. Glencore also took a $452 million charge on an Australian nickel mine, and a $324 million charge against its stake in Russian aluminum mining giant Rusal.

The culprit, as with all the other write-downs, is primarily low commodity prices. In addition to write-downs, the miners are combating the lower prices by reducing production and killing off or delaying new projects.

Glencore did not suspend its $0.054 quarterly dividend and the company's CEO said that the company would provide a full update of its plans at its September 10 investor day presentation.

5 Best Industrial Conglomerate Stocks To Own Right Now

Overpaying for an asset by nearly $8 billion might put some CEOs in the unemployment line. But Glencore's chief, Ivan Glasenberg, owns a big chunk of the company's shares and he is unlikely be looking for a new job any time soon. But if the bleeding from the Xstrata acquisition cannot be stopped, even Glasenberg may be in trouble.

10 Best Blue Chip Stocks To Own Right Now

Taking cues from a troubling and unexpected slowdown in China's growth, markets suffered their worst day in months on Monday. Two explosions near the finish line of the Boston Marathon this afternoon drove stocks down further as investors struggled to understand the attacks. The Dow Jones Industrial Average (DJINDICES: ^DJI  ) lost 265 points, or 1.8%, to close at 14,599.

All 30 Dow stocks lost ground today, and Procter & Gamble (NYSE: PG  ) ended as one of just five to lose less than 1%. Losing 0.5% was enough to earn P&G a spot among the day's top performers as the company raised its dividend by 7%, to an annual payout of around 3%.�

Industrials and energy stocks slipped on the Chinese slowdown, as the country saw its industrial production advance 9.5% in the first quarter. While that growth isn't shabby these days from a domestic standpoint, it's a 0.5% slowdown from last year's clip. China's GDP grew at 7.7% after growing by 7.9% in the fourth quarter. General Electric (NYSE: GE  ) ended Monday as one of the worst-performing blue chips in the index, losing 2.8%.

10 Best Blue Chip Stocks To Own Right Now: Philip Morris International Inc(PM)

Philip Morris International Inc., through its subsidiaries, engages in the manufacture and sale of cigarettes and other tobacco products in markets outside of the United States. Its international product brand line comprises Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company also offers its products under the A Mild, Dji Sam Soe, and A Hijau in Indonesia; Diana in Italy; Optima and Apollo-Soyuz in the Russian Federation; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. It operates primarily in the European Union, Eastern Europe, the Middle East, Africa, Asia, Canada, and Latin America. The company is based in New York, New York.

Advisors' Opinion:

• [By GuruFocus]

  The decade low yield of tobacco stocks can be clearly seen from our new interactive charts, which are embedded below. The chart shows the dividend yield of three tobacco stocks: Reynolds American (RAI), Philip Morris International (PM) and British American Tobacco (BTI).

• [By Selena Maranjian]

  Why Altria?
  The company is what's left after international operations were spun off in the form of Philip Morris International (NYSE: PM  ) in 2008. While Philip Morris is favored by many because of lower tobacco taxes and regulations in many parts of the world, as well as the fact that many economies are growing more rapidly than ours, Altria still manages the very valuable Marlboro brand domestically, where it recently held a commanding 43% market share.

• [By WALLSTCHEATSHEET.COM]

  Philip Morris provides cigarette and tobacco products through established brands to an increasing consumer base around the world. The stock has done very well over the last few years and is now trading at all-time high prices. Earnings and revenue figures have been increasing and decreasing, in recent quarters, which has confused investors a bit. Relative to its strong peers and sector, Philip Morris has been an average year-to-date performer. Look for Philip Morris to OUTPERFORM.

10 Best Blue Chip Stocks To Own Right Now: McDonald's Corporation(MCD)

McDonald?s Corporation, together with its subsidiaries, operates as a worldwide foodservice retailer. It franchises and operates McDonald?s restaurants that offer various food items, soft drinks, coffee, and other beverages. As of December 31, 2009, the company operated 32,478 restaurants in 117 countries, of which 26,216 were operated by franchisees; and 6,262 were operated by the company. McDonald?s Corporation was founded in 1948 and is based in Oak Brook, Illinois.

Advisors' Opinion:

• [By Geoff Gannon]

  1. World Acceptance (WRLD)
  2. Express Scripts (ESRX)
  3. Walgreen (WAG)
  4. Humana (HUM)
  5. McDonald's (MCD)

  Those are the kinds of companies a younger ��and poorer ��Warren Buffett might buy. Actually, a few of those companies are big enough for Warren Buffett to buy today.

• [By Kevin Chen]

  On Tuesday, McDonald's� (NYSE: MCD  ) announced plans to open its first location in Ho Chi Minh City by early next year. To make sure the location is a hit, the Illinois company chose to partner with Henry Nguyen, a Vietnamese businessman. While McDonald's has sought a Vietnamese partner for years,�Nguyen seemed to be an easy choice.�

• [By Douglas A. McIntyre]

  Burger Kind has few advantages over its much larger�rival McDonald’s Corp. (NYSE: MCD), which has almost 13,000 locations in the United States.�Burger King has just�over 7,000. Wendy’s Co. (NYSE: WEN) is gaining with almost 6,000 stores. Burger King’s sales last year were less than $2 billion, in contrast to McDonald’s sales of $27.5 billion.

• [By Matt Thalman]

  Another company that has been battling the obesity issue and is falling today is McDonald's (NYSE: MCD  ) . Shares are down 1.04% after the company announced that key sales figures fell again in April. The company is blaming fears of the avian flu as reason for the weak performance in China. Sales fell 0.6% globally in April, even though the U.S. market increased by 0.7%. But the largest decline came from Europe, were sales dropped 2.4% during the month.�

Top 10 Canadian Companies To Watch In Right Now: Visa Inc.(V)

Visa Inc., a payments technology company, engages in the operation of retail electronic payments network worldwide. It facilitates commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities. The company owns and operates VisaNet, a global processing platform that provides transaction processing services. It also offers a range of payments platforms, which enable credit, charge, deferred debit, debit, and prepaid payments, as well as cash access for consumers, businesses, and government entities. The company provides its payment platforms under the Visa, Visa Electron, PLUS, and Interlink brand names. In addition, it offers value-added services, including risk management, issuer processing, loyalty, dispute management, value-added information, and CyberSource-branded services. The company is headquartered in San Francisco, California.

Advisors' Opinion:

• [By Ben Levisohn]

  But regardless of the merits, Alcoa (AA), Hewlett-Packard (HPQ) and Bank of America (BAC) are being booted from the index and replaced with Visa (V), Goldman Sachs (GS) and Nike (NKE).

• [By Adam J. Wiederman]

  Alamy They're "the gift most everyone buys for the holidays," according to USA Today. This holiday season alone, nearly 81 percent of shoppers will buy at least one gift card -- totaling nearly $30 billion, according to the National Retail Federation. The benefits of buying gift cards are clear: They make great last-minute gifts (in a way that seems more personal than cash) and they vastly reduce the odds of you getting someone something just don't want or will never use. In fact, the percentage of consumers who made a holiday return has plummeted over the past few years as gift card purchases rose, according to data from America's Research Group. But if you're not careful, these gift cards could end up leaving you -- or your giftee -- with less money than you thought. Hidden Fees and Dates Recent changes to federal law have made gift cards even more consumer-friendly. For example, gift cards must now remain valid for five years. This law has worked as intended -- the amount unused on gift cards now only totals 1 percent of total sales ... down from 6.4 percent just four years ago, according to CEB TowerGroup. But this unused amount still totals more than $1 billion each year. To make sure your gift card purchase (or receipt) isn't included among these sunk costs, here are some tips to remember whether you're on the giving or receiving end of a gift card this year. If You Are Purchasing a Gift Card: 1. Stick to buying store-branded gift cards. Bankrate.com's annual Gift Card Survey uncovered that the major gift cards offered through banks and credit card companies (generic Visa (V) or American Express (AXP), for example) charged either purchase fees or maintenance/inactivity fees (or both). On the other hand, only a small handful of store-branded cards reviewed carried similar fees. 2. Send either an e-gift card or purchase the gift card in store. Many gift cards (even store-branded ones) carry purchase fees disguised as "delivery fees." For example,

10 Best Blue Chip Stocks To Own Right Now: Apple Inc.(AAPL)

Apple Inc., together with subsidiaries, designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. The company sells its products worldwide through its online stores, retail stores, direct sales force, third-party wholesalers, resellers, and value-added resellers. In addition, it sells third-party Mac, iPhone, iPad, and iPod compatible products, including application software, printers, storage devices, speakers, headphones, and other accessories and peripherals through its online and retail stores; and digital content and applications through the iTunes Store. The company sells its products to consumer, small and mid-sized business, education, enterprise, government, and creative markets. As of September 25, 2010, it had 317 retail stores, including 233 stores in the United States and 84 stores internationally. The company, formerly known as Apple Computer, Inc., was founded in 1976 and is headquartered in Cupertino, California.

Advisors' Opinion:

• [By Steve Heller]

  Mr. Softy blues
  Perhaps the most surprising development out of this forecast is how Apple (NASDAQ: AAPL  ) and Microsoft are expected to be neck and neck in terms of device shipments by the end of 2014. At that time, it's expected that Apple will have shipped a combined 354.9 million iOS and Mac devices and Microsoft will account for 378.1 million devices that run Windows. The storyline is all too familiar: Microsoft continues to lose its computing dominance to players that have more effectively addressed the worldwide shift to mobile computing.

10 Best Blue Chip Stocks To Own Right Now: Chevron Corporation(CVX)

Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. It operates in two segments, Upstream and Downstream. The Upstream segment involves in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as holds interest in a gas-to-liquids project. The Downstream segment engages in the refining of crude oil into petroleum products; marketing of crude oil and refined products primarily under the Chevron, Texaco, and Caltex brand names; transportation of crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacture and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It a lso produces and markets coal and molybdenum; and holds interests in 13 power assets with a total operating capacity of approximately 3,100 megawatts, as well as involves in cash management and debt financing activities, insurance operations, real estate activities, energy services, and alternative fuels and technology business. Chevron Corporation has a joint venture agreement with China National Petroleum Corporation. The company was formerly known as ChevronTexaco Corp. and changed its name to Chevron Corporation in May 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California.

Advisors' Opinion:

• [By Jonas Elmerraji]

  First up is Chevron (CVX), the large-cap oil and gas supermajor. Chevron has spent most of the year in a well-defined uptrend, but lately shares have been tracking more sideways than upwards. Here's why that's actually a good thing for investors right now.

  Chevron is currently forming an ascending triangle pattern, a bullish setup that's formed by horizontal resistance above shares at $127 and uptrending support to the downside. Basically, as CVX bounces between those two technical price levels, it's getting squeezed closer and closer to a breakout above that $127 level. When that happens, traders have a buy signal for shares.

  A lot of Chevron's fortunes are tied to commodities like oil and gas. As an integrated energy firm, CVX has its hands involved in every step in the process from pulling resources out of the ground to selling them at retail. But price action is providing traders with a shortcut for figuring out Chevron's next steps this fall. If you decide to buy the $127 breakout, I'd recommend keeping a protective stop right above the 200-day moving average.

10 Best Blue Chip Stocks To Own Right Now: Colgate-Palmolive Company(CL)

Colgate-Palmolive Company, together with its subsidiaries, manufactures and markets consumer products worldwide. It offers oral care products, including toothpaste, toothbrushes, and mouth rinses, as well as dental floss and pharmaceutical products for dentists and other oral health professionals; personal care products, such as liquid hand soap, shower gels, bar soaps, deodorants, antiperspirants, shampoos, and conditioners; and home care products comprising laundry and dishwashing detergents, fabric conditioners, household cleaners, bleaches, dishwashing liquids, and oil soaps. The company offers its oral, personal, and home care products under the Colgate Total, Colgate Max Fresh, Colgate 360 Advisors' Opinion:

• [By Eric Volkman]

  It's one of the steadiest dividend payers on the market, and it's continuing to fly level. Colgate-Palmolive (NYSE: CL  ) has declared a fresh quarterly common stock dividend, which is to be $0.34 per share, paid on August 15 to shareholders of record as of July 23. That amount matches the firm's previous distribution; this was paid in May. Prior to that, Colgate-Palmolive handed out $0.31 per share.

• [By Dan Caplinger]

  One concern, though, is how the company handled news of Venezuela's currency devaluation. Clorox (NYSE: CLX  ) and Colgate-Palmolive (NYSE: CL  ) also felt the pinch, with Clorox taking about a $0.05 to $0.10 per-share earnings hit and Colgate losing about $0.50 per share. But they also addressed the potential devaluation more proactively than P&G did. Clorox actually�anticipated�the devaluation in its February earnings report, projecting the potential hit if a devaluation took place. Colgate didn't provide specific guidance in advance but clearly saw it as an issue, delivering on a promise to give prompt guidance revisions after the devaluation occurred.

• [By Demitrios Kalogeropoulos]

  Colgate-Palmolive (NYSE: CL  )
  Colgate's shares are trading well below the $62 high they hit just last month. The consumer goods company is heavily levered to international sales, with more than 80% of its business coming from outside the U.S. and more than half coming from emerging markets.

10 Best Blue Chip Stocks To Own Right Now: International Business Machines Corporation(IBM)

International Business Machines Corporation (IBM) provides information technology (IT) products and services worldwide. Its Global Technology Services segment provides IT infrastructure and business process services, including strategic outsourcing, process, integrated technology, and maintenance services, as well as technology-based support services. The company?s Global Business Services segment offers consulting and systems integration, and application management services. Its Software segment offers middleware and operating systems software, such as WebSphere software to integrate and manage business processes; information management software for database and enterprise content management, information integration, data warehousing, business analytics and intelligence, performance management, and predictive analytics; Tivoli software for identity management, data security, storage management, and datacenter automation; Lotus software for collaboration, messaging, and so cial networking; rational software to support software development for IT and embedded systems; business intelligence software, which provides querying and forecasting tools; SPSS predictive analytics software to predict outcomes and act on that insight; and operating systems software. Its Systems and Technology segment provides computing and storage solutions, including servers, disk and tape storage systems and software, point-of-sale retail systems, and microelectronics. The company?s Global Financing segment provides lease and loan financing to end users and internal clients; commercial financing to dealers and remarketers of IT products; and remanufacturing and remarketing services. It serves financial services, public, industrial, distribution, communications, and general business sectors. The company was formerly known as Computing-Tabulating-Recording Co. and changed its name to International Business Machines Corporation in 1924. IBM was founded in 1910 and is based in Armonk, New York.

Advisors' Opinion:

• [By WALLSTCHEATSHEET.COM]

  IBM provides key information technology products to companies participating in a multitude of industries around the world. The stock has done well in recent years and is now consolidating in a range extending back a year. A recent disappointing earnings release sent the stock to the bottom end of its recent range. Earnings, revenue figures, and institutional shareholders have sent mixed signals to investors. Relative to its peers and sector, IBM has underperformed year-to-date. WAIT AND SEE what IBM does this quarter.

• [By Lauren Pollock]

  International Business Machines Corp.(IBM) has agreed to acquire privately held analytics software provider The Now Factory, expanding the company’s big data business. Terms of the deal weren’t disclosed.

• [By Rich Smith]

  IBM (NYSE: IBM  ) is going to buy cloud computing provider�SoftLayer.

  For months, reports have been circulating that IBM and EMC were competing for the right to acquire privately held, Dallas-based SoftLayer, which provides an infrastructure for cloud-centric, performance-intensive applications for�mobile computing and gaming,�social�media, and�analytics. However, an EMC spokesman said today the company was not competing with IBM. "EMC was initially approached, uninterested and decided not to bid," said Senior Director for Public Relations Dave Farmer.

Baby bust: U.S. births at record low

NEW YORK (CNNMoney) The Great Recession and the slow recovery have been quite the romantic buzzkill.

The U.S. fertility rate fell to another record low in 2012, with 63.0 births per 1,000 women ages 15 to 44 years old, according to the Centers for Disease Control and Prevention. That's down slightly from the previous low of 63.2 in 2011.

It marked the fifth year in a row the U.S. birth rate has declined, and the lowest rate on record since the government started tracking the fertility rate in 1909. In 2007, the rate was 69.3.

Falling birth rates can be considered a challenge to future economic growth and the labor pool.

"If there are fewer younger people in the United States, there may be a shortage of young workers to enter the labor force in 18 to 20 years," said University of New Hampshire demographer Kenneth Johnson. "A downturn in the birth rate affects the whole economy."

It takes 2.1 children per woman for a given generation to replace itself, and U.S. births have been below replacement level since 2007.

As of last year, a separate CDC analysis shows an American woman will give birth to an average of 1.88 children over her lifetime, also a record low.

The birth rate has largely been declining since the post-World War II baby boom, but that fall accelerated during the Great Recession, as high unemployment derailed many young people's plans to move out and start families.

About 22% of 18-to-34-year-olds surveyed by the Pew Research Center in December 2011 said they had postponed having a baby because of economic conditions.

Even in 2012 -- three years after the recession officially ended -- 36% of Millennials ages 18 to 31 still lived at home with their parents, according to Pew analysis of U.S. Census data.

  How hackers can invade your home

But here's ! the good news: The declines have slowed and demographers believe the birth rate may level off going forward.

"The decline in fertility rates, which had been dramatic, is stabilizing," Johnson said.

Demographic Intelligence, a firm that forecasts birth rates for clients like Disney (DIS, Fortune 500), Fisher-Price, Gerber and Procter & Gamble (PG, Fortune 500), predicts the birth rate will rise in 2013, to 1.9 children per woman.

"We think that this fertility decline is now over. As the economy rebounds and women have the children they postponed immediately after the Great Recession, we are seeing an uptick in U.S fertility," Sam Sturgeon, president of Demographic Intelligence, said in a statement.

To be sure, birth rates are a lagging economic indicator, reflecting decisions made at least nine months earlier.

"In the 2012 data, you're seeing what women were thinking about in 2011," Johnson said. "If the economy were to be picking up now, you're not seeing that in the birth patterns yet. It will be another year until you'll see the effect of that."

While overall fertility rates have fallen, trends vary by age, race and ethnicity.

For example, the fertility rate decreased among teenagers and women in their 20s, but rose slightly among those over age 30.

It held steady for white women, fell among blacks and Hispanics, and rose among Asians and Pacific Islanders last year.

Overall, about 3.95 million babies were born in 2012.

Nothing to Build On: Homebuilders Tank as New Home Sales Plunge

Remember all that talk that may home buyers would shrug off rising mortgage rates? Well, for one month at least, it looks to be just that–talk.

Scott Dalton

Sales of single-family homes fell 13.4% to an annualized rated 394,000 in July, the Census Bureau reported today, well below forecasts for 487,000.

Homebuilding stocks have plunged on the news. The Ryland Group (RYL) has fallen 4.6% to $35.15, Toll Brothers (TOL) has dropped 3.1% to $31.45, KB Home (KBH) has declined 3.1% to $16.67 and DR Horton (DHI) is off 2.8% at $18.74. Pulte Group (PHM) has dropped 2.7% at $15.80.

Not everyone thinks the drop is such a big deal, however. Here’s Peirpont Securities’ Stephen Stanley:

I am highly dubious, however, that new home sales have weakened in any meaningful way.  The anecdotal and survey evidence do not support such a dramatic weakening in the demand for homes.  Perhaps the backup in rates has had a marginal impact, but July's reading was roughly 25% lower than expectations, and there is nothing I've seen that corroborates anything like that!  Keep in mind that this series tends to be very volatile, and I would wait to see the August reading before getting too excited.

Marketfield’s Michael Shaoul calls the report a “glaring outlier.” He writes:

Regarding the Census Bureau report it is simply too early to be sure. Public statements from homebuilders (and private surveys too) have not suggested a rapid deceleration of housing demand and the NAHB survey (which had no problem registering bearish sentiment in recent years) would generally have been expected to decline sharply if the surveyed homebuilders had actually seen demand destruction on this level…

Top 5 Small Cap Stocks To Own Right Now

[We] doubt whether the New Home market has suffered a reverse close to the magnitude contained in this report, but we respect the fact that for the time being the market will keep the homebuilding sector under a cloud, at least until corporate earnings and additional data prove the matter one way or another.

Sounds like good advice.

China investors rush to buy Neway stock on debut

SHANGHAI--Stock investors rushed to buy shares of China's Neway Valve (Suzhou) on Friday on its trading debut--sending the issue up more than 30% and resulting in a 30-minute cooling-off period.

After resuming trade the shares continued rising and were last up 33% at 23.45 yuan ($3.87).

Pent-up demand from investors after a more than yearlong freeze on initial public offerings was released on the industrial-valve manufacturer as it become the first company to have a stock debut since Zhejiang Shibao in November 2012.

Neway's strong debut was because of investor enthusiasm for new shares after such a long wait, analysts said.

Best Bank Stocks To Buy For 2014

Neway shares were suspended from trading a few minutes after the opening after rising 32% from their 17.66 yuan IPO price to 23.31 yuan.

Thirty-minute trading halts are imposed if debut shares rise or fall more than 10% from their opening level. The first-day rise or fall of a new stock is limited to 44% of its IPO price.

"While Neway's earnings growth is unlikely to be brilliant as the country shifts away from an investment-driven economic growth model as the first debut it's still a favorite of investors--especially those short-term investors," Guosen Securities analyst Yan Li said.

Neway raised 1.46 billion yuan ($241 million) selling 82.5 million shares. The IPO price was 46.47 times 2012 earnings, the company said. The price-to-earnings multiple was 37% above the average of comparable listed companies at 33.85 times.

Underwriter China Securities Co. valued its shares between 14.86 yuan and 18.57 yuan a share.

China imposed the moratorium on IPOs because confidence in stock markets had been eroded as a result of badly priced issues which often surged on trading debuts and performing worse than the broader index.

The moratorium was lifted late last year and around 50 companies are now looking to raise funds.

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Fed: Housing, autos pushing economy ahead

The housing and auto industries continued to support an economy that expanded moderately in most of the country last month, though holiday retail sales were mixed, according to a Federal Reserve report Wednesday.

The Fed's Beige Book, named for the color of its cover, shed little light on a job market that seemed to slow markedly in December, simply stating that two-thirds of the Fed's 12 bank districts reported increases in hiring. The Labor Department said last week that employers added a disappointing 74,000 jobs in December, far below the 200,000 forecast by some economists.

Yet official government data highlighted an economy that was generally shifting into a higher gear last month, with manufacturing output, exports, business investment and consumer spending picking up.

MORE: Read the Fed's Beige Book report

The Beige Book, which provides an anecdotal snapshot of the economy, said nine districts expanded moderately from late November through December. The Boston and Philadelphia regions grew modestly while the economy was unchanged in Kansas City. The economic outlook, though "is positive in most districts," the report said.

Holiday sales were "on plan or up a bit" vs. 2012 in most regions. The Richmond area, however, cited "a general slowdown in retail spending" while the Kansas City region reported lower than expected holiday purchases as a result of a shorter sales season and inclement weather.

Clothing sales surged in the Boston and Richmond regions, and cold-weather items were hot sellers in Philadelphia, Cleveland and Chicago. Meanwhile, the housing recovery continues to boost retailers, with home furnishings moving briskly in the Boston, Philadelphia, Richmond and San Francisco areas.

Car sales, which have helped underpin the recovery, remained strong in Richmond, Atlanta and San Francisco but flagged in New York, Philadelphia and Kansas City. Still this year's outlook for vehicle sales was strong in numerous areas, the report said.

Leisure a! nd tourism was mixed. Hotel bookings were strong in Atlanta, but slow in Richmond and travel and tourism slipped in Hawaii and Las Vegas.

Manufacturing appeared to hold up better than other sectors, with 11 of the 12 districts reporting "both growing sales and an optimistic outlook." Production in commercial aviation, autos and construction materials was especially strong. In the Cleveland area, most auto suppliers were at or near capacity.

A Dallas manufacturer said his company had "too many jobs to bid on" for the first time since the recession. A particular bright spot is that capital spending, which had been sluggish until recently, was up and businesses are anticipating further growth.

But in a sign that business investment was still somewhat crimped by a climate of uncertainty, one Cleveland contact said 85% of auto suppliers "should be adding capacity right now but indicated that many are reluctant to do so."

Defense-related production, a casualty of federal spending cuts last year, was weak. But Cleveland area contacts voiced hope that the recent budget deal, which eases the cuts, "would provide a boost to defense contractors."

The housing recovery continued apace, with home sales rising in most districts. Sales, however fell in the Atlanta, Cleveland and Kansas City districts.

Commercial real estate, which generally has lagged the housing recovery "contained much good news," the Fed said. Commercial leasing picked up in New York City, and the Atlanta, Chicago, St. Louis, Minneapolis and San Francisco regions and investment and construction activity also accelerated in several areas.

The recent rise in mortgage rates continued to dampen refinancing in the New York, Cleveland, Atlanta, Chicago and Kansas City areas. But loans for home purchases held steady.

In several districts, wages rose slightly to modestly, continuing a trend since the end of the recession in 2009. In Minneapolis, however, "labor markets were showing signs of tightening, and wag! e increas! es were moderate."

VelocityShares Rolls Out Risk-Weighted ETF (ERW)

Stocks responded with a last hour sell-off to yesterday's FOMC announcement, yet again signaling uncertainty about how the expected stimulus reduction will actually impact equity markets. Looking ahead, major U.S. indexes still have an opportunity to climb to all-time highs before the end of the week as Friday's monthly employment data may offer the much-needed catalyst to propel the S&P 500 Index to 1,700 and beyond .

Amid the ongoing euphoria on Wall Street, VelocityShares expanded its lineup with an intriguing "risk-weighted" ETF on Thursday that looks to offer a compelling alternative to traditional market cap-weighted strategies.

VelocityShares Equal Risk Weighted Large Cap ETF (ERW)The new VelocityShares ETF looks to join the growing trend of alternative-weighting methodologies; a corner of the ETF market that has seen impressive growth over the past few years as more and more investors have sought out ways to avoid the inherent nuances of traditional market capitalization-weighted funds .

ERW focuses on U.S. large cap equities from the S&P 500 Index with a twist by employing a unique weighting methodology based on each individual security's risk, rather than its market capitalization. The index behind ERW is powered by a proprietary risk-weighting methodology that measures each stock's risk exposure and then weights it relative to the entire portfolio so that in the end each security contributes an equal level of risk to the entire benchmark. VelocityShares measures the risk of each stock based on a combination of two metrics: historical volatility and each stock's sensitivity to market price variation.

The result is a portfolio that avoids the pitfalls of market cap-weighting while also avoiding the over-simplicity of a "Low Volatility ETF," which takes into account only one measure of risk (historical volatility). ERW is rebalanced quarterly and each component contributes the same level of risk to the basket as a whole .

Meet the Com! petitionThe new VelocityShares ETF is joining a competitive space, the Large Cap Blend Equities ETFdb Category, which is made up of nearly 40 ETFs. Although ERW offers a truly unique approach, it will still face very stiff competition from more established funds that fall under the "Low Volatility" umbrella, including:

PowerShares S&P 500 Low Volatility Portfolio  with $4.7 billion in AUM
iShares MSCI USA Minimum Volatility Index Fund with $2.3 billion in AUMPowerShares S&P 500 Downside Hedged Portfolio with $55 million in AUMFrom a cost perspective, ERW's expense ratio of 0.65% falls towards the more expensive end of the cost spectrum as the category average stands at 0.43%. The new VelocityShares ETF warrants a closer look from anyone looking to steer clear of market-cap weighted equity exposure, but is also wary of the simplified "low volatility" approach.

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Disclosure: No positions at time of writing.

The Stock Market's Problem

Moneyshow's Jim Jubak discusses what he sees as the stock market's current problem and what this may mean once the summer is over.

You could argue that well, a little complacency never hurt anybody.  Tell that to the Trojans.  The problem right now in the stock market as I see it is that the VIX, which is a measure of how much traders are willing to pay to get rid of risk in the market.  The VIX go up as people’s willingness to pay more goes up as the market is perceived as riskier and it goes down when the people perceive the market as less risky. 

Right now, it’s at a really, really low level.  It’s back to where it was before the 2007 global financial crisis.  VIX is a pretty good contrarian indicator that when risk is received as this low, it’s usually a sign that the market is over complacent, that people are not very fearful.  The cliche is that a rally or a market that’s moving up climbs a wall of fear. 

What happens is as the market moves higher, people who have been on the sidelines and because they were afraid of the market come in.  When the VIX is really, really low it indicates there aren’t a whole lot of people ought there who are afraid this market waiting to come.  The question is as a rally progresses what you’d really like to see is more money coming in as stocks go higher. 

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With a VIX this low you’d have to ask well, who’s going to come in?  Where is the next group of money to drive this higher?  We are after all at all-time historic highs on the S&P so it’s an important question.  Right now, it’s August and it’s very hard to tell anything in August.  Volumes dry up especially in the last couple of weeks in August as lots of people go away or stop paying attention so it’s not clear that you can draw conclusions from this. 

To me right now the market feels kind of listless, looking for direction, some profit taking.  My real worry, however, is not August but September when everyone comes back and we suddenly get to focus on the Fed and when it’s going to taper and of course the threat to shut down the U.S. government at the end of September.  Those don’t strike me as good things, and I would suspect that at that point the VIX will start to go up which is usually not a good time for stocks in general because that means money is coming out the market as people start to feel that it’s riskier.

This is Jim Jubak for the MoneyShow.com video network.

Why United Natural Foods's Earnings May Not Be So Hot

Although business headlines still tout earnings numbers, many investors have moved past net earnings as a measure of a company's economic output. That's because earnings are very often less trustworthy than cash flow, since earnings are more open to manipulation based on dubious judgment calls.

Earnings' unreliability is one of the reasons Foolish investors often flip straight past the income statement to check the cash flow statement. In general, by taking a close look at the cash moving in and out of the business, you can better understand whether the last batch of earnings brought money into the company, or merely disguised a cash gusher with a pretty headline.

Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on United Natural Foods (Nasdaq: UNFI  ) , whose recent revenue and earnings are plotted below.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. FCF = free cash flow. FY = fiscal year. TTM = trailing 12 months.

Over the past 12 months, United Natural Foods generated $18.9 million cash while it booked net income of $100.9 million. That means it turned 0.3% of its revenue into FCF. That doesn't sound so great. FCF is less than net income. Ideally, we'd like to see the opposite.

All cash is not equal
Unfortunately, the cash flow statement isn't immune from nonsense, either. That's why it pays to take a close look at the components of cash flow from operations, to make sure that the cash flows are of high quality. What does that mean? To me, it means they need to be real and replicable in the upcoming quarters, rather than being offset by continual cash outflows that don't appear on the income statement (such as major capital expenditures).

For instance, cash flow based on cash net income and adjustments for non-cash income-statement expenses (like depreciation) is generally favorable. An increase in cash flow based on stiffing your suppliers (by increasing accounts payable for the short term) or shortchanging Uncle Sam on taxes will come back to bite investors later. The same goes for decreasing accounts receivable; this is good to see, but it's ordinary in recessionary times, and you can only increase collections so much. Finally, adding stock-based compensation expense back to cash flows is questionable when a company hands out a lot of equity to employees and uses cash in later periods to buy back those shares.

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So how does the cash flow at United Natural Foods look? Take a peek at the chart below, which flags questionable cash flow sources with a red bar.

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. Dollar values in millions. TTM = trailing 12 months.

When I say "questionable cash flow sources," I mean items such as changes in taxes payable, tax benefits from stock options, and asset sales, among others. That's not to say that companies booking these as sources of cash flow are weak, or are engaging in any sort of wrongdoing, or that everything that comes up questionable in my graph is automatically bad news. But whenever a company is getting more than, say, 10% of its cash from operations from these dubious sources, investors ought to make sure to refer to the filings and dig in.

With 15.3% of operating cash flow coming from questionable sources, United Natural Foods investors should take a closer look at the underlying numbers. Within the questionable cash flow figure plotted in the TTM period above, stock-based compensation and related tax benefits provided the biggest boost, at 17.4% of cash flow from operations. Overall, the biggest drag on FCF came from capital expenditures, which consumed 71.0% of cash from operations.

A Foolish final thought
Most investors don't keep tabs on their companies' cash flow. I think that's a mistake. If you take the time to read past the headlines and crack a filing now and then, you're in a much better position to spot potential trouble early. Better yet, you'll improve your odds of finding the underappreciated home-run stocks that provide the market's best returns.

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