Dow's Telecoms Are Mixed While J.C. Penney Shorts Run

Markets go higher after mediocre jobs report.

Feb 27, 2014 at 1:00PM

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

The Labor Department reported today that the number of Americans filing for new unemployment benefits rose by 14,000 last week to hit a seasonally adjusted 348,000. The good news is that the four-week moving average didn't change from 338,250 and that we are not far above pre-recession levels. With that data and as of 1:07  p.m. EST, the Dow Jones Industrial Average (DJINDICES:^DJI) is up 41 points, or 0.25%, the S&P 500 is higher by 0.25% and on the verge of setting a new all-time high, and the Nasdaq is up 0.38%.  

Shares of Dow component Verizon (NYSE:VZ) are climbing higher by 2.7%. The move comes with little company news, but continued speculation that the TV and Internet service provider will soon cut its own deal with Netflix, similar to the one the streaming video service recently cut with Comcast. Since Netflix now accounts for nearly one-third all Internet traffic at peak hours, service providers want to be paid more to ensure the video streams at good speeds. The company paid up by an undisclosed amount to Comcast. Any money agreed to in a similar deal with Verizon would likely essentially go straight to the bottom line.

The Dow's other telecom company AT&T (NYSE:T), is up only 0.14% today as a number of high-profile investors and market participants suggest that the long talked about merger between wireless carriers T-Mobile and Sprint may actually happen. This would pose a serious threat to AT&T and Verizon. The competition in this industry has been heating up for a few months, but it this deal goes through things will get really hot.

Shares of J.C. Penney (NYSE:JCP) were up more than 24.5% after the retailer posted fourth-quarter earnings yesterday after the closing bell. The department store chain posted revenue of $3.78 billion and an earnings per share loss of $0.68 Analysts were looking for $3.85 billion and an earnings loss of per share of $0.88. These results point to the idea that the company might have hit rock bottom, a theme CEO Myron Ullman cited after the earnings release.If that is the case, it is fair for shares to be on the rise, but some of today's move upward is likely being driven by short-sellers closing their positions. As of the most recent data, 43% of J.C. Penney's shares had been sold short; buying all those back can really move a stock higher, as we are seeing today.  

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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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