Still on the sidelines

While some stocks did more than recover (PCP), I am staying on the sidelines still mainly because of the interest rate meetings next week. The strong inflation data will prevent the Fed from dropping interest rates.
Worse, they may choose a more hawkish stance about the future. I anticipate the ripple effect to be negativity on the stocks (although some would argue that is already baked into the market).

I'm waiting still, but will produce my hitlist this weekend.

Quick thoughts

I really don't see anything out there that will push up stocks this week.

I reviewed some stocks to see if there are some to focus on. My thoughts below

ENERGY STOCKS
ATW – Started up $1 and then faded. ATW has withstood the market selloff the past 2 weeks
CLB – recovered nicely.
DO – Slight fading but in line with the broader market. Worth getting in now for 2 reasons: it has lagged others in the market, so it is due; summer driving is coming up and oil prices will rise
ESV – Recovered well. We are going to buy more.
GRP – Zipped up after an analyst suggested that GRP would make a great takeover target. No more news, so GRP is pulling back a bit. Nevermind that they are a cash-making machine
MDR – We were stopped out at $46, maybe we can buy back in close to that price. MDR sank primarily on a TXU coal plant cancellation (a $500M hit over 10 years). That’s less than a 5% revenue hit if MDR can not recover it. Meanwhile pipe building continues apace: Halliburton just announced plans to move to the Middle East, business is so robust

BIOTECH
ILMN – How the mighty have fallen. ILMN lost a lawsuit to competitor Affymetrix - $17M in damages. That equals one quarter’s profits. Obviously this is being appealed. The keys to remember are that ILMN has the best technology and the lawsuit does not affect forward business. I could see ILMN falling even more and then I’ll buy in.
HOLX – Holding steady.
IMA – Holding steady
DIGE – Keeps dropping and I don’t know why. I don’t think that it is Roche competition.

MATERIALS & INFRASTRUCTURE
KSU – Their strength is impressing me.
TIE – Down hard today.
PCP – I miss owning them.
CRDN – I’m buying.
PWR – They lay cable for electrical and telecommunications. We owned them for a while last year. I like their strength.

HIGHTECH
NUAN – Interesting update: Microsoft is buying TELLME, a NUAN competitor of sorts. Actually, Tellme is a customer of Nuance’s and a competitor of a recent NUAN purchase BeVocal. MS recognizes the strong need for a voice recognition solution. However, Tellme is really just a server farm providing NUAN technology to large SP and enterprise accounts. If anything this highlights the importance of NUAN. Buy this.
T – I own them and they just continue to grow steadily.
TRID – A rumor of losing the Sony account was discounted by an analyst, so the stock rose ~4%. Something I sin the works as well: the stock was moving up the past few days.
UCTT – I miss owning them.
MRVL – Down hard. Now around $17. It’s a broken stock and heading to where it belongs - $12.
INFY – It has lost a lot of momentum and support. $52 seems to be its support level
CTSH – A good short term pullback. I might buy more.

NEW STOCKS
GME – It continues to impress me.
VRGY – fast growing semiconductor company
ESCH – Fast growing CLEC

Buy today or tomorrow

I have missed some excellent buys (PCP, UCTT) but I have wanted to wait because I thought last week was more of a dead cat bounce.

I am still waiting because this is options week - shorts have already covered and underlying price support has left. I'd like to see another down day before jumping in.

But this is still a good day to buy, I am hoping that Wednesday to friday that there may be slightly better.