MDRX, BIIB, DRI, FLSR, GOOG, GTI, LNKD, MWE, NOK, OPEN, PKG, PCLN, RSH, VRSN, NCLH,

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ARO, MO, ADM, ATML, CL, CVRR, DNDN, IGT, IP, NKE, LULU, LOW, LSI, OKS, SNDK, TEF, TPH, YUM, CQP, LNG,

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“Morgan Stanley is out with a simple note titled: Closing EUR longs.

That translates to English as: Dump your euros.

In the wake of the Italian election, Ian Stannard, head of Morgan Stanley’s European FX Strategy, says to use any rebounds in the euro as a chance to sell.

…the surprising Italian election results, which have increased the political uncertainty in Italy, will have broader implications for the EUR and currency markets generally, in our view. Hence, we would now look to use any EURUSD rebounds over the coming days into the 1.3150 area to close this long position, and await clarification/stabilisation of the political picture in Italy before re-entering bullish EUR strategies.

So what specifically is the issue?

Stannard puts it nicely. Essentially what’s kept Europe so calm over the last several months has been the ECB’s OMT program…”

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“Gold’s price cycle has probably turned as the recovery in the U.S. economy gathers momentum and investment holdings collapse, according to Goldman Sachs Group Inc., which reduced forecasts for the metal.

The bank cut its three-month target to $1,615 an ounce from $1,825 and lowered the six- and 12-month forecasts to $1,600 and $1,550 from $1,805 and $1,800. Goldman reversed an assumption exchange-traded products holdings will expand in 2013, analysts Damien Courvalin and Jeffrey Currie wrote in a Feb. 25 report.

Gold has dropped 4.8 percent this year as economic data improved, equities advanced and some U.S. central bankers sought more flexibility in their stimulus program. An inevitable unwind of gold’s 12-year bull market has begun, Credit Suisse Group AG said in a Feb. 21 report. ETP holdings are poised for the biggest monthly decline since January 2011.

“The turn in the gold cycle has likely already started,” the Goldman analysts wrote in the report, after predicting an end of gold’s bull run in a Dec. 5 note. “The latest collapse in gold ETF holdings stands in sharp contrast to our assumption that ETF positions were likely driven by longer-term allocation rather than short-term trading.”

Gold for April delivery traded at $1,595.70 an ounce on the Comex at 9:30 a.m. in London, poised for a fifth monthly drop in what would be the worst run since 1997. Holdings in ETPs, also known as exchange-traded funds, fell to a five-month low of 2,536.289 metric tons yesterday and have shrunk 2.9 percent this month, data compiled by Bloomberg show…”

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ABAX, ATVI, AFFY, AKAM, AIG, ETN, GILD, HNZ, IP, OXY, OMG, OC, PAAS, SWY, TTWO, TEVA, TPH, VMW.

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“The pound fell to its weakest level in almost 16 months against the euro after Moody’s Investors Service cut the U.K.’s AAA credit rating, citing weakness in the nation’s growth outlook.

U.K. government bonds pared an earlier decline. Moody’s lowered Britain’s rating by one level to Aa1 from Aaa on Feb. 22. Sterling, which has tumbled 6.8 percent against the dollar this year, dropped to the lowest since July 2010 before a government report this week that analysts said will show Britain’s economy shrank last quarter.

“Although the timing of the downgrade was a surprise, overall the market has been anticipating a ratings change,” said Ian Stannard, head of European foreign-exchange strategy at Morgan Stanley in London. “In recent weeks we have seen sterling’s safe-haven status erode. After the initial knee-jerk reaction there is the potential for a rebound.”

The pound slid 0.7 percent to 87.59 pence per euro as of 11:27 a.m. London time after depreciating to 87.75 pence, the weakest since Oct. 31, 2011. The pound was little changed at $1.5149 after declining to $1.5073, the lowest since July 2010.

Sterling has slumped 6 percent this year, the second-worst performer among 10 developed-market currencies tracked by Bloomberg Correlation-Weighted Indexes. Only the yen has fallen more, losing 6.7 percent. The dollar strengthened 1.7 percent.

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Three-month implied volatility on the pound versus the euro climbed as high as 9.4 percent, the most since May. 18. Volatility on the pound versus the dollar climbed to 9.23 percent, the highest since June. 19….”

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“As we highlighted in our conversation in May 2012 – “Risk-Off Correlations – When Opposites attract”: Commodities and stocks have become far more closely intertwined as resources have taken on a greater role with China’s economic expansion and increasing consumption in Emerging Markets.

In numerous conversations, we pointed out we had been tracking with much interest the ongoing relationship between Oil Prices, the Standard and Poor’s index and the US 10 year Treasury yield since QE2 has been announced.

Looking at the recent weaknesses in commodities such as oil and copper, one could decently argue that the time might have come to take a few chips off the gambling table.

This feeling of “uneasiness” seems to be shared by Bank of America Merrill Lynch which indicated on the 21st of February the following important points:…”

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“Just passing along an out of consensus view.  This was one of David Rosenberg’s tail risks mentioned the other day and is obviously a big driver of global growth.  While China appears to have landed softly, Nomura analysts still see risks to the downside:

“We reiterate our out-of-consensus view that growth will surprise on the downside in H2. We expect GDP growth to slow to 7.3% y-o-y in H2 from 8.1% in H1, for a full-year 2013 average of 7.7%, while the consensus expects the growth recovery to sustain above 8% throughout 2013.

First, there are increasing signs that the government is concerned about financial risks. The China Banking Regulatory Commission (CBRC) has asked banks to control the risks in the “fund pools” practice, which allows banks to pay back maturing wealth management products by issuing new products.

…

Second, another round of energy/utilities price reform appears to be in the pipeline. On 20 February, the National Development
and Reform Commission (NDRC) and the Ministry of Railway (MOR) raised the rail freight tariff by 13.0%, from RMB0.1151 per ton-km to RMB0.1301, the largest hike since 2003. The tariff hike suggests that the government may move to lift other administratively suppressed prices, such as electricity and other public utilities, which will exert upward pressure on inflation….”

 

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ALU, MT, BBRY, BIP, BG, CAT, FSLR, GOV, HPQ, HD, ISRG, MCD, MDT, RFMD, S, TASR, TNK, PAY, VVUS, WEN, XRX, AGU, CF, MOS, POT, RNF,

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BCS, BHP, GME, GOOG, GRPN, HD, LOW, MA, V, NKE, OPEN, TLM, TSLA, UNH, PAY, OMX, ODP,

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“To separate analysts posted reports this morning, arguing that Google‘s stock will go to $1,000 per share.

CLSA said it moved its price target due to Google ability to charge more for clicks on its ads.

And here is Bernstein Research analyst Carlos Kirjner argument, via Forbes:

“We believe mass adoption of smart phones, tablets and the mobile Web is a large value creation opportunity for Google,” Kirjner writes in a research note. “In other words, we disagree with the most popular Google bear case….”

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ACMP, ALXN, ADI, BIDU, BCS, ESRX, GMCR, LOW, MM, NTSP, RDN, SEE, SPLS, HOT, WIN,

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“Bank of America Merrill Lynch said investors should buy emerging market bonds and equities as the so-called BRIC nations of Brazil, Russia, India and China post the biggest improvement in growth this year.

“What we’re saying about emerging markets is that the BRICs are back,” David Hauner, head of fixed-income strategy for emerging Europe, the Middle East and Africa, told reporters in Abu Dhabi yesterday. “Last year a lot of people were saying that the BRICs are finished and of course we had disappointing growth in all of them. Now this year we see a recovery.”

Emerging markets are expected to record economic growth of 5.2 percent this year compared with 4.9 percent last year. The best growth will come from the BRICs as concern over China’s political transition, Indian currency weakness, and currency appreciation in Brazil wane, Hauner said. The best fixed-income opportunities this year will be in Asia because of its superior growth and links to the U.S. dollar, he said.

“People are getting out of bonds and buying more emerging markets, more high yield but they are selling some Treasuries, we think this makes a lot of sense,” Hauner said. “Our own global asset allocation suggests that you should be overweight equities, overweight emerging market bonds, should be overweight high yield.”

BRIC Growth…”

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” It was not that long ago that we saw a research report from Credit Suisse calling the chip sector at an “irresistible cyclical bottom.” Now we have a slew of analyst reports driving shares higher in the semiconductor sector on Tuesday. Chip stocks are responding well, as you will see.

Altera Corp. (NASDAQ: ALTR) was reiterated with a Buy rating and the price target was raised by $4 to $42, based on demand recovery and the possibility of a higher dividend. Shares are up 1.8% at $36.39, against a 52-week range of $29.59 to $40.31.

Atmel Corp. (NASDAQ: ATML) was raised to Buy from Hold at Needham with a price target of $10 on the stock. Shares are up 1.8% at $7.30, against a 52-week range of $4.37 to $10.73.

Cypress Semiconductor Corp. (NASDAQ: CY) was raised to Buy from Hold by Needham, and the price target is $13.00 per share. The upgrade is based in part on valuation and in part due to improving conditions in the SRAM chip market. Shares of Cypress are up 5% at $10.35, against a 52-week range of $8.70 to $18.70.

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APA, BAC, BRK-A, CLF, CSTR, CREE, CY, FITB, GILD, GFI, HAL, HIG, HBC, PHG, PVH, STI, UBS, VECO, WFC,

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“Forecasters boosted expectations for U.S. economic growth in the first and second quarters of the year, with an improving labor market and a stable outlook for real output, a survey released on Friday showed.

Economists expect the economy to grow at an annual rate of 2.1 percent in the current quarter, up from the previous estimate of 1.7 percent growth, according to the Philadelphia Federal Reserve’s quarterly survey of 46 forecasters.

The economists pegged second quarter gross domestic product at 2.3 percent, up from the previous estimate of 2 percent.

However, GDP for all of 2013 was estimated at 1.9 percent, down slightly from a previous estimate of 2 percent. U.S. growth for 2014 was estimated at 2.8 percent, up marginally from the previous forecast of 2.7 percent.

The unemployment rate was forecast to average 7.8 percent in the first quarter compared with the previous estimate of 7.9 percent, while unemployment in the second quarter was forecast at 7.7 percent, down from 7.8 percent in the previous estimate. The third quarter jobless rate was estimated at 7.6 percent, down from the previous forecast of 7.8 percent….”

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CTL, CSCO, GRMN, GNRC, GFI, HAIN, HBAN, JCP, KGC, MWW, NTGR, GOLD, RIG, URBN, YNDX,

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CTL, SCHW, CL, DELL, DNDN, ETFC, JCP, LEAP, MAS, NVDA, OII, PLCM, PBH, PG, LMT, RAX, AMTD, VZ,

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• “….The company’s evolution beyond its core push email business to pull (search engine, direct site traffic) will ultimately prove successful
• Management’s renewed focus on the international segment will yield positive results in the coming quarters
• Competition is easing a bit and we believe underscores how GRPN’s scale is a real advantage in a business with low barriers to entry
• GRPN’s valuation seems compelling on a relative and absolute basis. GRPN is trading at 0.8x EV to Sales (2014E), which is an 80% discount to its peer group trading at 3.7x. In fact, GRPN has the lowest valuation among its peer group.”

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AVP, BBVA, RATE, BPL, CLWR, CLF, CMCSA, CXO, DELL, FOSL, GE, GRPN, PM, PXD, SD, ZMH,

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