You can read the original version online:
http://ymlp295.net/zSDZM9 ——————————————————————————– July 1, 2012 Week / Month In Review…
Week / Month In Review For June 25 to June 29, 2012 Canadian Companies mentioned include:
* Stonegate Agricom Ltd. (TSX:ST) * BNK Petroleum Inc. (TSX:BKX) * Edleun Group, Inc. (TSX-Venture:EDU) * DNI Metals Inc. (TSX-Venture:DNI) * Caza Gold Corp. (TSX-Venture:CZY) * Victory Resources Corp. (TSX-Venture:VR) U.S. Companies mentioned include:
* Cardiome Pharma Corp. (NASDAQ:CRME) * AEterna Zentaris Inc. (NASDAQ:AEZS) * Paid Inc. (OTCBB:PAYD) * Lpath Inc. (OTCBB:LPTN) * Medical Marijuana Inc. (Pink Sheets:MJNA) This week on AllPennyStocks.com:
* Article Published, June 26, 2012: Deals with JAKKS and Sunscape Eyewear Should Significantly Boost Revenues for Genius Brands Moving into 2013 (http://www.allpennystocks.com/aps_us/special-reports/274/deals-with-jakks-and-sunscape-eyewear-should-significantly-boost-revenues-for-genius-brands-moving-into-2013.htm) (U.S. Company) * Article Published, June 27, 2012: Changfeng Energy Benefiting from Booming Tourism and Expansion in Sanya Region in China (http://www.allpennystocks.com/aps_ca/special-reports/279/changfeng-energy-benefiting-from-booming-tourism-and-expansion-in-sanya-region-in-china.htm) (CDN Company) * Article Published, June 29, 2012: CNS Response Preps for Clinical Trial at US Military Hospital As Published Trials Showcase Substantially Lower Suicide Attempts (http://www.allpennystocks.com/aps_us/special-reports/275/cns-response-preps-for-clinical-trial-at-us-military-hospital-as-published-trials-showcase-substantially-lower-suicide-attempts..htm) (U.S. Company) Video charts for the week:
* June 27th Technical Video Chart For CRME. Cardiome Pharma is holding a solid support at 38 cents and trying to make a move off that base. Last week, the pps broke through a channel and is now holding a new support at 42 cents, which has it on radar to break through the 50 dma at 47 cents. view:
( http://www.youtube.com/user/AllPennyStocks#p/a/u/1/SLuCKOg7XpM ).
* June 27th Technical Video Chart For ST:CA. A volume surge and push late last week has Stonegate Agricom on watch to push through a resistance at 50 cents (and the 50 dma). Support needs to hold at 45 cents as the stock continues to build a new uptrend off a bottom at 32.5 cents. view:
( http://www.youtube.com/user/AllPennyStocks#p/a/u/1/fzgP0aYDtvI ).
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WEEKLY & MONTHLY UPDATE -DOW POSTS BEST WEEK OF 2012 ON EUROPEAN FINANCIAL BAILOUT PLAN Stocks in North America were centered around activities in Europe once again this past week with an early week slide overrun by a Friday rally based on developments from the euro zone. The week kicked-off with investors lowering their expectations for a late-week European Union summit coming in Brussels on Thursday and Friday, sending stocks lower. Adding to the pessimism, Greek Finance Minister Vassilis Rapanos, who has been hospitalized since the prior Friday, resigned, and Cyprus became the fifth euro zone country to seek a bailout. The sun provided a bright spot, literally, for agricultural stocks with a hot weather forecast boosting those plays and corn futures as some of the few gainers on Monday amidst a broad sell-off.
Leading into the meeting, stocks traded choppily, but managed to edge ahead Tuesday and Wednesday, largely on the back of US economic data that showed the punished housing market continues to gain traction finally, three years after the stock market began its recovery.
Sentiment was dampened in the States on Thursday after the U.S.
Supreme Court`s decision upholding President Obama`s health care reform law, as investors fear that health care costs could further stifle the already struggling economic growth pattern. Justices voted for the most part to keep in place the 2,700-page measure requiring that all Americans be insured, in an effort to begin chipping away at spiraling costs in the U.S. health-care system. With the jobs market showing definite weakness in 2012, investors are concerned that a mandate for all Americans to purchase health insurance will hamstring spending, not to mention the possibility of forcing businesses to spend more on insurance, which could further hurt the job creation, retention and spending on big ticket items that help drive the economy. Another poor report that showed initial jobless claims at yearly highs further darkened the cloud over Thursday`s trading along with the law news from Washington.
Around midnight on Thursday, news from Europe surprised investors and led to triple digit gains on Friday for the benchmark TSX and US exchanges. While not every detail was released after all-night talks, leaders of the 17-nation euro zone agreed rescue funds could be used for sovereign debt purchases without forcing countries to adopt extra austerity measures. Countries will also be able to recapitalize banks directly without increasing their budget deficit. In addition to appointing a single banking regulator, cash injections to banks and relaxed repayment conditions, the leaders are proposing a $149 billion economic-growth plan for the region. Relieved investors, whom were expecting not too much to come from the summit, piled back into commodities and equities. The result was the biggest daily gain in 2012 for the Nasdaq, the Dow Jones closing at its highest level in eight weeks and commodities erasing losses from during the week to broadly advance. The TSX-Venture exchange still continues to falter.
Even with the bigger exchanges advancing around it, the junior-heavy exchange sunk lower and is at its lowest level in nearly three years; closing below 1,200 for the first time since early September 2009.
Also chipping-in to help stocks stride ahead was a better than expected report on Canada`s Gross Domestic Product. Economists were predicting growth to be lackluster after minimal expansion in March, but the country`s number crunchers pleasantly surprised with 0.3 percent growth for the month, giving the bulls more fodder to run with.
The new plan in Europe did not come without some pundits surfacing immediately. The financial responsibility of Spain has been of particular concern, with its monumental bond yields hovering near 7%, Italy positioned for a bailout with 10-year bond yields steadily staying over 6% and other countries with their hands extended looking for some cash. “`Let’s throw more money at it` is essentially their plan, and, `Hopefully we`ll be in a better position to pay it back at some date in the future,`” said Robert Pavlik, chief market strategist at Banyan Partners. “It`s making people feel like they got something, but it doesn`t really address the problem.” So, while there was widespread glee, which may have led to a stack of traders that have been betting against the markets to run to cover shorts, there is still a cautious aroma that is floating around the markets. This will have investors on close watch for any signals of Friday`s run being an overreaction to the news from overseas.
Economic data will be somewhat thin next week and volumes are expected to be low during the holiday week for both Canada and the United States. If traders sit on the EU news during the week, investors will be watching the data closely as new car sales are expected to rise significantly as compared to 2011 and new employment data will be coming from both North American countries, which can always be market moving information.
Markets in Canada will be closed on Monday for Canada Day and the US markets will be shuttered on Wednesday for the 4th of July (Independence Day) holiday.
Immediately after Statistics Canada released stronger than expected GDP data, the Canadian dollar strengthened against the U.S. dollar as the stronger GDP result increases support for a rate hike by the Bank of Canada in the coming months. After skating through a volatile week of being modest up and then falling hard against the greenback on Thursday, risk sensitive assets and currencies got a boost on the news from the EU in addition to Canada`s GDP expansion, with the loonie surging nearly 1.5 percent against its US counterpart on Friday. On the week, the Canadian dollar chugged ahead by 0.72% against the USD, meaning that next week will begin with one Canadian dollar buying US$0.98343. Friday`s climb also helped the CDN to pick-up ground on a monthly basis against the USD; gaining 0.62 percent during June.
* Gold futures rallied by 3.5 percent on Friday as investors cheered the EU plan to stabilize the region’s banks and the USD sank. Gold advanced on expectations Europe’s plan will be inflationary. With the run on Friday, bullion pushed to close back over $1,600 per ounce for the first time in 8 trading sessions. This rise also erased losses from earlier in the week. On the week, August contracts were the most actively traded; rising 2.38%, or $37.3 per ounce to close the week at $1,604.20 on the Comex division of the New York Mercantile Exchange. The move also salvaged the month for gold, with June providing a rise of $35.30 per ounce, or 2.25%.
* Silver prices rallied on Friday as well to erase weekly losses and recover from the new 19-month low hit on Thursday as gloomy investor sentiment regarding economic growth hindered precious metals, including platinum and palladium, to new lows. Silver, which has industrial uses in things such as electronics, solar panels and photography that gold lacks, is more susceptible to sentiment and economic data and was outpacing gold`s losses during the week. The glee from the EU news drove gold`s cousin higher on the week with September silver contracts moving to the most actively traded; advancing 3.57%, or $0.951, to $27.612 per ounce. The gains helped pare losses for the month, with silver contracts ultimately dropping 2.73%, or $0.774, during June. During the second quarter, silver prices dumped 15%.
* Copper prices and volumes soared on Friday after the news from Europe, sending shorts reeling to cover and the price of the industrial red metal up almost 5 percent. The move was the biggest single-day move for copper since November 2011. Volumes were more than double the two-month moving average on Friday`s run with prices settling at their highest closing price since May 21st. September contracts were the most actively traded on New York`s COMEX exchange during the week and finished ahead by 19.05 cents, or 5.76%, at $3.4965 per pound. The move also pushed the month of June into positive territory with a gain of 4.7 cents, or 1.36%, although the metal still shedding 8.79 percent during the second quarter.
* Oil prices also sprung ahead on Friday after falling to an eight-month low the day before as part of the broad commodities and equities rally. Crude prices jumped more than 6 percent, their biggest, single-day pop in more than a year. On the week, August contracts for West Texas Intermediate crude appreciated by $5.20, or 6.52%, to close at $84.96 per barrel. The rise stemmed some major losses during the month of June and the second quarter as prices fell 4.73% and 18.62%, respectively.
Equity Market Snapshot:
(All percentages on a weekly basis unless otherwise noted) * Major gold miners were basically flat, although all closed well above weekly lows. Yamana Gold (YRI, +1.22%), Newmont Mining (NMC, +0.33%) and Goldcorp (G, +0.97%) edged ahead while Barrick Gold (ABX, -1.26%), Agnico-Eagle Mines (AEM, -0.77%) and Kinross Gold (K, -1.66%) nipped lower on the TSX.
* Also in the gold mine, Goldcorp Inc. said that an Ontario judge dismissed Barrick`s claims that Goldcorp`s acquisition of the El Morro project in Chile was illegal. Barrick claimed that it had a deal in October 2009 to acquire a majority stake in the project from European miner Xstrata PLC (Pink Sheets:XSRAY, +0.40%).
* Energy stocks were standouts with oil galloping on Friday. Suncor Energy (NYSE:SU, +5.12%), Talisman Energy (NYSE:TLM, +5.72%), Imperial Oil (NYSE:IMO, +4.64%), Cenovus Energy (NYSE:CVE, +3.55%) and Canadian Natural Resources (NYSE:CNQ, +1.94%) all surged forward.
* Malaysia`s state-owned oil and gas company, Petronas, is offering $5.5 billion to buy Progress Energy Resources Corp. (NYSE:PGN, +0.99%) in an effort to tap Canadian natural gas for export by ship from British Columbia.
* The financial sector in the States paced laggards early in the week, but recovered to lead equities in late-week trading. Bank of America (NYSE:BAC, +3.02%), Wells Fargo & Co. (NYSE:WFC, +1.92%) and Goldman Sachs Group (NYSE:GS, +2.38%) grew more expensive per share.
Citigroup (NYSE:C, -2.07%) still closed down despite rising nearly 10 percent from its lows.
* The New York Times reported that JPMorgan (NYSE:JPM, -0.72%) could be facing losses from its recently reported trading debacle of up to $9 billion.
* On the Canadian banking front, banks primarily posted gains with Bank of Montreal (BMO, +1.83%), Royal Bank of Canada (RY, +0.38%), The Bank of Nova National Bank of Canada (TSX:NA, +0.12%) and Toronto-Dominion Bank (TSX:TD, +1.05%) advancing while Scotia (TSX:BNS, -0.34%) and Canadian Imperial Bank of Commerce (TSX:CM, -1.19%) sifted-off a few.
* Waterloo, Ontario-based Research in Motion (TSX:RIM, -25.49%) is losing it distinction as “Canada`s tech darling” (if it hasn`t already) as it tumbled amidst a $518 million net loss during the latest fiscal quarter and again delayed the much-anticipated launch of its BlackBerry 10. The smart phone maker was tagged with downgrades as Bank of America/Merrill Lynch cut its rating on the stock to underperform from neutral, and CIBC and Scotia each cut their ratings to sell. The company also said it would lay off a third of its workforce — or about 5,000 employees — to contain costs as it pushes ahead with a complete revamp of the BlackBerry operating system.
* More news came from the competitive tech industry as Google Inc.
(NASDAQ:GOOG, +1.50%) took the wraps off its own tablet called the Nexus 7, in an anticipated move that points to growing competition particularly with fellow industry behemoth Apple Inc. (NASDAQ:AAPL, +0.33%). Google said the Nexus 7 will be manufactured by hardware partner Asus and will use Nvidia Corp.’s (NASDAQ:NVDA, +6.35%) Tegra mobile processor. Google will be pricing its Nexus 7 at $199, which puts it directly comparable to Amazon.com Inc.’s (NASDAQ:AMZN, +2.79%) Kindle Fire and far less expensive than Apple’s iPad, which costs about $400 and up.
* Google`s tablet news comes about a week after Microsoft (NASDAQ:MSFT, +4.80%) unveiled a Windows tablet computer of its own design.
* Drug makers were front and center this past week upon reports that Arena Pharmaceuticals (NASDAQ:ARNA, +0.96%) received FDA approval for its anti-obesity drug dubbed “Belviq”. The weight loss drug is the first of its type approved by the FDA in 13 years. Shares of Vivus (NASDAQ:VVUS, +7.66) also surged on the news as its drug may outperform Belviq and is facing a FDA decision in July. Other companies, such as Athersys, Inc. (NASDAQ:ATHX, +11.81%), with obesity-fighting drugs in their portfolio also joined the rise as investors cheered the regulatory agency loosening its reigns on diet pills.
* Bristol-Myers Squibb Co. (NYSE:BMY, +1.67%) said that it will buy Amylin Pharmaceuticals (NASDAQ:AMLN, +1.00%) for about $5.3 billion, or $31 a share. The transaction was unanimously approved by both boards of directors, the companies said. Including a contractual payment obligation to Eli Lilly (NYSE:LLY, +2.00%) and Amylin`s net debt, the total value of the transaction is valued at about $7 billion.
* Watson Pharmaceuticals (NYSE:WPI, +4.18%) rose on news that U.S.
drug regulators gave it permission to produce generic forms of Adderall XR. Until now, Ireland`s Shire (OTCQX:SHPGY, -5.44%) has been the only producer of the drug, administered to those diagnosed with attention deficit hyperactivity disorder.
* Strong housing data and SEC filings lifted KB Home (NYSE:KBH, +19.66%), the Los Angeles-based homebuilder that targets first-time buyers, made its biggest one-day move since March 2009 after reporting a narrower quarterly loss as it sold more houses at higher prices.
The net loss for the fiscal second quarter ended May 31 was $24.1 million, or 31 cents a share, compared with a loss of $68.5 million, or 89 cents, a year earlier.
* Homebuilder Lennar (NYSE:LEN, +17.22%) jumped after reporting higher-than-expected earnings for the second quarter, with net income beating Wall Street`s expectations.
* Athletic shoe retailer Nike Inc. (NYSE:NKE, -11.69%) retreated after reporting a drop in net income in its latest quarter.
* Auto parts retailer O’Reilly Automotive Inc. (NASDAQ:ORLY, -13.95%) was the S&P 500`s biggest loser this past week against warning that its second-quarter sales and profit would not meet earlier forecasts.
* Constellation Brands (NYSE:STZ, +39.40%) had a monster week as the wine and beer firm was far and away the S&P 500’s biggest gainer last week upon quarterly financial reports that topped all expectations.
* More news from the bar came when the world`s largest beer maker Anheuser-Busch InBev (NYSE:BUD, +13.32%) said that it will buy the remaining stake in Corona maker Grupo Modelo that it does not already own in a deal valued at $20.1 billion. Grupo Modelo`s products are imported into the US and marketed through the aforementioned Constellation Brands.
* Big 3 automaker Ford Motor Co. (NYSE:F, -5.89%) said it now expects second-quarter losses to be triple that of the first quarter, mainly because the situation in Europe has “deteriorated significantly” and the automaker is battling competition and pricing pressures in South America.
* Famous gun maker Smith & Wesson Holding Corp. (NASDAQ:SWHC, +17.39%) saw its shares ramp upward when it posted better-than-expected fourth-quarter earnings and said operating earnings for the next fiscal year would grow by at least 50%.
* AGF Management Limited (TSX:AGF.B, -2.85%) said that its second-quarter profit fell to $23.8 million, or 25 cents per share, representing a decline of 30% from $33.9 million, or 35 cents per share, a year earlier.
* Shares of News Corp. Ltd. (NASDAQ:NWSA, +9.48) rose as the company said it will split into two entities: one comprising the 20th Century Fox film studio, the Fox broadcast network and the Fox News Channel; and the other housing its newspaper and book publishing businesses.
Rupert Murdoch will chair both companies.
* Vancouver-based MacDonald, Dettwiler and Associates Ltd. (TSX:MDA, +33.09) watched its shares sizzle upward as it offered to pay $875 million to acquire California-based Space Systems/Loral Inc. as it looks to maximize its opportunities in the U.S. market and worldwide for growth.
* Bombardier Transportation (TSX:BBD/B, +4.15%) announced that it is part of a consortium that has been green-lighted to supply 210 double-deck commuter train cars for line A of the RER, the Greater Paris commuter network. The new order is an option under a contract signed in April 2009 for a firm order of 60 MI09 trains. The order is valued at a total of approximately 1 billion euro ($1.3 billion US), of which Bombardier will realize $417 million for its portion.
* Canadian Pacific Railway (TSX:CP, +0.32%) reported that retired oil executive Rick George has resigned as a director, the latest departure from a board that was transformed by a hard-fought proxy battle led by the company`s largest shareholder, Pershing Square. The company also said that it has named Hunter Harrison, the man widely acknowledged as building Canadian National Railway (TSX:CNR, +0.29%) into North America`s most successful railway, as its new president and chief executive officer. Harrison`s appointment was widely expected after a public battle waged against the Canadian Pacific Railway`s former leadership by William Ackman, head of Pershing Square. CNR claims that Harrison still has contractual obligations with his former employer. CNR publicly congratulated Harrison on his new job, but also warned that they will not be dropping their lawsuit against him.
* With the new ruling from the U.S. Supreme Court on insurance, hospital stocks got a lift. Industry leader HCA Holdings Inc.
(NYSE:HCA, +15.29%) and Health Management Associates Inc. (NYSE:HMA, +15.78%) shooting upward. Medicaid insurer WellCare Health Plans Inc.
(NYSE:WCG,+1.82%) also rose, but commercial insurers took a hit as investors will be expecting higher costs. WellPoint (NYSE:WLP, -8.56%) and Aetna Inc. (NYSE:AET, -7.00%) dropped quickly after the news hit.
* In one of the first tech offering since the Facebook IPO fiasco, ServiceNow, Inc. (NYSE:NOW, +36.67%) got investors jazzed-up again to IPO`s; starting the day at $18 and closing just shy of its highs at $24.60.
Weekly Indices Results:
The S&P TSX Composite Index rallied nicely; gaining 161.02 points, or 1.41%, to 11,596.56. The TSX Venture Exchange continued its downward plight; dropping another 15.04 points, or 1.25%, to 1,190.99.
In the States, the Dow Jones Industrial Average rose for the third time in four weeks, climbing by 239.31 points, or 1.89%, ending the week at 12,880.09. The much-broader S&P 500 followed along; padding its total by 27.14 points, or 2.03%, to close at 1,362.16. The tech-rich NASDAQ Composite, which was the only winner of the major exchanges last week, trekked higher by 42.63 points, or 1.47%, to 2,935.05 on the week.
Canadian Economic Data:
* In May, the Industrial Product Price Index was unchanged from April. Price increases for motor vehicles and other transportation equipment (+1.0%) and lumber and other wood products (+1.7%) were offset mainly by a 2.1% decline in petroleum and coal products. Of the 21 major commodity groups, 11 were up, 6 were down, and 4 were unchanged.
* The Raw Materials Price Index posted its fourth straight decline in May, falling 1.0%. All major product groups except one were down.
Previously, the index had experienced decreases of 1.6% in March and 2.0% in April. The RMPI’s decline was mostly due to mineral fuels (-2.1%), particularly crude oil (-2.2%). More modest downward pressure was exerted on the index by vegetable products (-0.7%) and non-ferrous metals (-0.2%).
* In April, average weekly earnings of non-farm payroll employees were $896.63, up 1.0% from the previous month. On a year-over-year basis, earnings increased by 3.1%. Employees worked 33.0 hours per week on average in April, compared with 32.9 hours a month earlier.
Stats Can said year-over-year growth in average weekly earnings outpaced the national average in three of Canada`s largest industrial sectors: wholesale trade, construction and retail trade.
* Canada`s economy expanded at a faster pace than expected in April, led by increased activity in the mining and oil and gas extraction sector. Real gross domestic product grew 0.3% in April, after edging up 0.1% in March. Most of the April increase was attributable to mining and oil and gas extraction and, to a lesser extent, wholesale trade. On a yearly basis, GDP expanded 2.0 percent in April, after growing 1.7 percent in each of the three months prior.
Next week, economic data will be slow until late week with Building Permits, Ivey PMI and new Unemployment Rate/Employment Change stats coming on Friday.
U.S. Economic Data:
* A limited supply of previously-owned homes helped drive sales of new homes to the highest level since April 2010, according to the Commerce Department. New single-family homes sold at a seasonally adjusted annual rate of 369,000 in May, up 7.6% from April and nearly 20% from a year earlier. On a yearly basis, median prices climbed by 5.6 percent in May as compared to May 2011, suggesting that the housing market may have found a bottom after a six-year downtrend.
* The Standard & Poor`s/Case-Shiller home price index showed increases in 19 of the 20 cities tracked, representing the second straight month that prices have risen in a majority of U.S. cities.
San Francisco, Washington and Phoenix posted the biggest increases in April with Detroit the only major city to post a drop with a fall of 3.6 percent. Overall, a measure of national prices rose 1.3 percent in April from March, the first increase in seven months.
* Further supporting the bottom in the housing market, the National Association of Realtors showed that more Americans than forecast signed contracts to purchase previously owned homes in May. The index of pending home resales climbed 5.9 percent to 101.1, matching a two-year high reached in March, after a 5.5 percent decline in April.
Pending home sales provide insight into actual contract closings a month or two later (which are then tabulated as existing home sales).
* Growing concerns over jobs and incomes dampened confidence among U.S. consumers with the Conference Board`s sentiment index dropping in June for a fourth consecutive month. The index fell to 62, a five- month low, from a revised 64.4 in May, figures from the New York-based private research group showed.
* The Commerce Department said that orders for durable goods, items from toasters to aircraft that are meant to last at least three years, climbed more than forecast in May, easing concern that U.S.
manufacturing is faltering. Bookings rose 1.1 percent after a revised 0.2 percent decrease in April, the first gain in three months.
Leading the advance, orders for transportation equipment, i.e. planes and automobiles, which have risen in three of the past four months, gained 2.7 percent in May.
* The Commerce Department also reported that Gross Domestic Product increased at a 1.9 percent annual rate; unchanged from its estimate last month and in line with economists` expectations. On the bright side, when measured from the income side, the economy grew at a 3.1 percent pace in the first quarter, up from 2.6 percent in the previous quarter. While still showing growth, the first-quarter pace of GDP growth was well lower than the October-December period`s 3.0 percent rate.
* Applications for jobless benefits continue to remain stubbornly high with filings for the week ended June 23, 2012 still holding near the highest level of the year, showing continuing weakness in the U.S.
labor market. Claims for unemployment insurance payments decreased by 6,000 to 386,000 during the week, according to Labor Department. The revised 392,000 claims in the previous week matched the most this year.
* US consumers spent the same amount in May as in April, according to the latest report on income and outlays from the Commerce Department.
Income growth edged up 0.2 percent, primarily because of gains from investments, but consumers appear leery about a fragile job market and are keeping the money in their pockets. Wages, the largest component of income was flat for the month. The report is disappointing because it is signaling that growth in the April-June quarter could be weaker than the previous quarter`s tepid 1.9 percent annual growth pace.
* Chicago PMI, a closely-watched gauge of manufacturing activity in the Chicago activity, edged higher in June. ISM-Chicago reported an increase to 52.9% from May levels of 52.7%, in line with economists` predictions. Readings above 50 indicate expansion in manufacturing.
The Chicago barometer of growth was welcoming after indicators from the East Coast showed the pace slowing, although still modestly expanding.
Next week, data in the States will include ISM Manufacturing Index and Construction Spending updates on Monday; Motor Vehicle Sales on Tuesday; ISM Non-Manufacturing Index, Jobless Claims and ADP`s Employment report on Thursday; and the Employment Situation report on Friday.
Penny Stocks to Watch & Company Spotlight Results:
Among the stocks we watched this week, oil and gas producer BNK Petroleum Inc. (TSX: BKX) drifted lower during the week before staging a comeback on Friday to gain 1 cent on the week, or 1.52%, to close the week at $0.67 with an intraweek high of 68 cents hit on Friday.
The other Canadian stock on our radar, agricultural nutrient developer Stonegate Agricom Ltd. (TSX:ST) came out to immediately hit its intraweek high of 50 cents on Monday, but gave the gains back late week to close down by 6.5 cents, or 13.40%, at 42 cents.
In the States, both technical stocks to watch produced nice gainers.
Healthcare company AEterna Zentaris Inc. (NASDAQ:AEZS) shot ahead on Tuesday to an intraweek high of $0.6349 before cooling to close the week ahead by 3.71 cents, or 7.93%, at $0.505. The other U.S. stock on our watchlist, fellow drug maker Cardiome Pharma Corp. (NASDAQ:CRME) finished the week ahead by 1.95 cents, or 4.53%, at $0.45 with an intraweek high of 46.5 cents.
If you`d invested in all four stocks and held them to the end, you`d have seen an average gain of 0.14%. However, if you`d bought all four at the beginning of the week and sold each at its peak, you`d have realized gains of 12.46%.
On the Corporate Spotlight Front…
Victory Resources Corp. (TSX-Venture:VR, OTCQX:VRCFF) announced that it has entered into an agreement with GEM Global Yield Fund Limited for a $5.0 million CDN financing commitment. Funds raised through this facility will be used for the ongoing drill program and the subsequent engineering work to bring the Reforma mine to feasibility. Funds will also be used for the development of the company`s recently optioned Boleo property in Mexico, the Toni property located near Merritt, B.C., as well as general working capital.
Importantly, Victory will control the timing and maximum amount of any private placement under this agreement, and has the right, not the obligation, to drawdown on available funds. As part of the financing commitment, the company has agreed to issue 5 million warrants to GEM in conjunction with each private placement. The warrants will be exercisable for a period of three years from the closing of each private placement at an exercise price of $0.72 CDN per share.
Medical Marijuana Inc. (Pink Sheets: MJNA) provided updates to its shareholders on the status of its portfolio company, PhytoSPHERE Systems, LLC and related products. The company owns an 80% interest in PhytoSPHERE Systems. Additional updates were provided on the status of its portfolio company, Red Dice Holdings and the Dixie family of products. The company owns 60% of Red Dice Holdings.
Investors are encouraged to read the complete press releases to read about the established and extensive product lists from these two companies which help drive revenue for Medical Marijuana, Inc.
The Month at a Glance – June June could go down as the best month on record when sentiment was terrible, economic data was subpar, commodities were flat and global economic conditions bordered on recession across Europe, yet stocks primarily rose. Go figure. In fact, the Dow Jones posted its biggest monthly gain in 2012. It certainly wasn`t financially commentary from companies that buoyed stocks either. As of June 29, the second quarter’s last trading day, 94 companies in the S&P 500 Index have issued negative guidance versus 26 positives – the most negative period in more than a decade. The last time that many companies issued negative guidance was in the third quarter of 2001 when there were 180 negatives and 30 positives, according to Thomson Reuters I/B/E/S.
Metals saved face on the last trading day of June or perhaps they would have all been devalued further over the last 30 days to add to steep second quarter drops. Oil futures trading was basically in line with metals. Commodities eking their way upward helped the resource-heavy TSX Composite notch gains for the month, but did little for the junior Venture exchange as the only laggard amongst the major indices; showing that investors still remain cautious about speculative plays, but could be aligning the TSXV for a bounce in the near term.
So with near record U.S. unemployment levels, U.S. manufacturing data showing production is barely expanding, China reporting a slowing economy and the European financial crisis, what did bolster stocks in June That answer is simply that things appear to be getting more under control in the euro zone as finance leaders have agreed to take steps to help the economies of its more troubled nations. In short, fears of financial contagion are stemmed for the moment. While panic hit hard in May with investors questioning how much Europeans were willing to commit to help, June brought some definitive answers about how much Spain needed to bailout its faltering banks as well as a larger plan to help additional struggling countries, which offset any concerns about shrinking growth in the US and China.
A big piece of news came from Greece`s shores when an election yielded a win for the New Democracy party – the group that supports the European bailout austerity measures and the country staying in the euro zone. Investors had been nervous that an election victory by the austerity opponents could send the situation in Europe spiraling out of control as Greece would have very likely been exiting the euro.
That news was the cure for one of investor`s ailments about Europe.
Surprising economists, China`s central bank announced an interest rate cut, its first since 2008 as the country is trying to spur its slowing economy.
There were too many credit ratings cuts to near junk level of Spanish banks to count by leading agencies Egan-Jones, Moody`s and Fitch, but Spain got some much needed relief as euro zone finance ministers agreed to lend Spain up to 100 billion euros (US$125 billion) to shore up its teetering banks. Auditors calculated that Spain`s troubled banks need as much as €62 billion ($78.76 billion) to stabilize their faltering positions, which they will receive. Importantly, as mentioned above, the European Union partially uncovered their plan to create widespread relief on euro zone banks, including a Europe-wide banking union, which would deal with future banking crisis on the continent, rather than leaving them in the hands of their already struggling national governments.
Stateside, the U.S. Federal Reserve Board announced that the central bank would be extending “Operation Twist,” a financial move under which it sold $400 billion in short-term securities and replaced them with long-term securities in an effort to put more downward pressure on long-term rates. The program was slated to expire on June 30, but will now be extended to the end of 2012. As part of the program extension, the Federal Reserve will be increasing its holdings in long-term treasuries by $267 billion. Investors were really hoping that Fed Chairman Bernanke would announce a third round a Quantitative Easing, or bond buying and money printing, to stimulate the US economy, but have yet to hear those words mentioned. Bernanke continues to assure that the Fed is watching closely and will continue to provide support by whatever means required when necessary.
On the downside, the Fed lowered its forecast for 2012 economic growth to a range of 1.9% to 2.4% form April`s outlook between 2.4% and 2.9% while raising its forecast for the unemployment rate for 2012 from 7.8% – 8.0% to 8.0% – 8.2%.
All-in-all, it was another wild ride of a month full of triple digit swings in trading. At the moment, it looks like central banks financial ministers have stepped-in to plug all the holes in leaky banks and governments, which generally soothed investor sentiment.
The volatility and difficulty in discerning how investors are going to react to any given piece of news, either foreign or domestic, has even the best of analysts scratching their heads as to what may happen in July. Europe may begin to fade a bit unless some new developments happen to erupt from a different country, such as Italy, as the last few months have been focused on putting out financial fires in Greece and Spain. For the time being, the countries problems seem appeased, but only time will tell what can move into the crosshairs of investors. Safe to say that traders are going to stay sharp and be prepared to react immediately and ride the momentum wave, whichever way it may be moving.
Monthly Indices Results:
* S&P TSX Composite: up 0.72% (+83.35 pts.) * TSX-Venture: down 8.06% (-98.74 pts.) * Dow Jones Industrial Average: up 3.93% (+486.64 pts.) * S&P 500: up 3.96% (+51.83 pts.) * NASDAQ: up 3.81% (+107.71 pts.) Monthly Equity Market Snapshot:
* Research in Motion (TSX:RIM, -29.53%) continues to fall apart.
Ahead of official announcements this past week about job cuts and dismal earnings, the company had said earlier in the month that Chief Legal Officer Karima Bawa resigned amidst the reframing of the struggling BlackBerry maker; joining a parade of long-time company executives to depart since Thorsten Heins took over as CEO earlier this year. The latest executive departure follows the resignation of head of global sales, Patrick Spence, the week prior. RIM also revealed the hiring of J.P. Morgan Securities LLC and RBC Capital Markets to assist in a review of its business and financial performance, effectively put itself up for sale, and announced the nomination of TPG Capital L.P. senior partner (and former partner at Goldman Sachs Group) Timothy Dattels to its board; replacing former Telefonica SA executive Antonio Viana-Baptista.
* In other energy news, TransCanada PipeLines Ltd. (TSX:TRP, +0.80%) reported that it has been selected by Shell (NYSE:RDS/A, +8.44%) for a $4-billion project to build a major pipeline in Canada to transport natural gas. Caterpillar Inc. (NYSE:CAT, -3.09%) announced a partnership with Westport Innovations Inc. (NASDAQ:WPRT, +50.55%) to develop a natural gas fuel system for off-road equipment.
* Automotive parts and service chain Pep Boys (NYSE:PBY, +6.68%) recovered some after reporting that the sale of the company to private equity firm Gores Group has been called off. In January, Manny, Moe & Jack had agreed to be taken private for $15 per share, a 24% premium to the January 13th closing price of $10.47. Shares had fallen below $8.50 each on the news, but pulled back up to $9.90 by the end of the month.
* 700-pound gorilla Google (NASDAQ:GOOG, -0.14%) said that it is buying Meebo, a social networking startup that lets users share pages on various networks including Facebook in a deal valued at about $100 million. The news comes shortly after Google bought another startup called KikScore, a small competitor that rates the trustworthiness of Web retail sites. Apple Inc. (NASDAQ:AAPL, +1.09%) shares moved after the technology maker unveiled its latest computers and software tools at its developer conference in San Francisco. Apple and Google are looking to go toe-to-toe not only in the tablet category mentioned above, but also in the map space as Apple unveiled its new mapping app which has investors wondering if it can pose some level of threat to the Web search giant’s own mapping business.
* Miranda Technologies Inc. (TSX:MT, +59.96%) saw its shares skyrocket after the provider of hardware and software to the television industry agreed to a buyout by Belden Inc. (NYSE:BDC, +6.89%) for $17 a share.
* Netflix (NASDAQ:NFLX, +7.95%) saw shares climb after it said that it would start its own content delivery network to provide its streaming service to customers. Shares of Akamai Technologies (NASDAQ:AKAM, +8.21%), a provider of content delivery networks that speed web-video traffic that provides some of that service to Netflix, slid at first but recovered to a strong month.
* Enterprise social software company Yammer is reportedly being bought by Microsoft (NASDAQ:MSFT, +4.80%) in a deal valued at $1.2 billion.
* After a rough start to its public life, Facebook (NASDAQ:FB, +5.05%) nudged higher in June. The company was the topic of a Wall Street Journal report that said results from a comScore survey showed slowing user growth in the U.S. Zynga Inc. (NASDAQ:ZNGA, -13.10%), which relies on Facebook for the majority of its revenue, was stuck by the report and touched all-time lows of $4.78 in its brief trading history. The two companies were also part of an SEC statement that was released in June related to an investigation before the Facebook IPO in which the agency noted “disproportionate trends in average revenue per user that could be material to investors,” according to an April 10 letter sent to CFO David Ebersman. The SEC also had asked Facebook to disclose more details regarding its revenue stream from Zynga.
* Starbucks (NASDAQ:SBUX, -2.86%) said it is expanding its food offerings by paying $100 million in cash to acquire Bay Bread and its La Boulange Bakery.
* Shares of Finnish cellphone maker Nokia (NYSE:NOK, -22.47%) cannot find the brakes to stop their skid as the company dropped to their lowest level in more than 15 years after announcing that it was cutting 10,000 jobs worldwide and warned that competition in the smart phone business would hurt results somewhat more than expected in the second quarter.
* Shares of Ampio Pharmaceuticals Inc. (NASDAQ:AMPE, +57.28%) rose as the biotech reported positive results from a clinical trial for Optina, a new diabetes-related drug.
* Shares of Bombardier Inc. (TSX:BBD/B, +7.05%) flew higher when the manufacturer of planes and trains reported an order by NetJets of up to 275 Bombardier Challenger business jets in addition to the $417 million order detailed above. The order was the company`s largest business-aircraft sale in Bombardier history; valued at approximately $7.3 billion.
* Air Canada (TSX:AC/B, +7.69%) finally settled their 14-month long labour dispute as an arbitrator selected the company`s final proposal resulting in a new five-year agreement. The airliner also reported making their first flight using biofuel, which the company said is expected to cut emission by at least 40%.
* IntegraMed America Inc. (NASDAQ:INMD, +24.66%) shares soared as the healthcare management company agreed to go private in a cash deal valued at $169.5 million. Terms of the agreement with Sagard Capital Partners LP call for shareholders to receive $14.05 a share, a premium of roughly 24% over IntegraMed’s previous Friday closing price.
* Shares of Theratechnologies Inc. (NASDAQ:THER, -44.01%), plummeted after it said that its European partner Ferrer Internacional SA is withdrawing the marketing application for tesamorelin, a drug to reduce excess abdominal fat in HIV-infected patients, after a health committee raised safety concerns. Theratechnologies said it no longer projects positive earnings for 2013.
Monthly Penny Stocks To Watch Leaders & Company Spotlight Results:
Among the stocks that we watched in June, the champion of the month in Canada was Caza Gold Corp. (TSX-Venture:CZY), which was profiled as one of our first picks of the month when the share price was at 15 cents. Shares rose steadily throughout several weeks and peaked on the 19th at 22 cents for a gain of 7 cents, or 46.67 percent. In the U.S., the winner for June was biotech AEterna Zentaris Inc.
(NASDAQ:AEZS) which was detailed as a pick for last week when the price was $0.4679. Shares peaked during the week at $0.6349, representing a rise of $0.167, or 35.69 percent. We congratulate all the followers of our “Penny Stocks to Watch” who were able to reap rewards from these most recent Companies and look forward to another solid month of penny stocks to watch in July. Be sure to check each weekend for our new Companies as we continue to find gems that are regularly producing solid gains.
Lastly, we wish all investors a safe and enjoyable upcoming week as Canadians celebrate the Canada day holiday tomorrow and Americans enjoy the fourth of July (Independence Day) holiday on Wednesday.
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