Five Things to Watch: Bin Laden Effect & More
Two days after Osama Bin Laden was killed, how different will the world look? On Monday, oil and gold barely moved, and the dollar fell, while stocks struggled to hold a rally. Could auto sales and better earnings reports change that picture?
The Next Day: What happened to the relief rally? A few years ago, when there was talk of Bin Laden being killed or captured, the prognosticators posited that the Dow would rise by several hundred points. On Monday, the rally fizzled, but will we look back on this day as a turning point for a renewed confidence in America and in the stock market by retail investors? Tuesday may set the tone more than Monday.
Life after Lipitor: The earnings drumbeat continues but one we’ll be watching particularly closely is Pfizer . The world's largest drug maker’s stock has been on a tear since CEO Ian Read took over a few months ago and embarked on a cost-cutting program — slashing nearly $2 billion in R&D alone. But with the patent expiring on the cholesterol reducing blockbuster Lipitor later this year, Mr. Read will have to show investors whether he has a promising pipeline of new drugs.
Full Throttle: Auto sales for April are expected to continue at roughly the same clip as March, or perhaps a tad less. So anything above 13 million should be greeted warmly. The real question is how much gas prices are hurting truck sales (46 percent of total sales) and what automakers say about summer production plans given the tenuous supplier situation in Japan.
Silver Lining: Hold onto to that silver tea set and other silver baubles. After a stunning rise, silver got clobbered on Sunday and Monday. A major reason, as reported by our Sharon Epperson, is that margin requirements are being raised by the exchange. Translation: that makes it more expensive for short-term traders to make speculative bets. The silver lining is that industries that use silver as a component are breathing a sigh of relief.
The Stagecoach on Stage: What's driving the stagecoach these days? Wells Fargo is on a tear rebranding Wachovia branches in the East but at its annual shareholders meeting out West, CEO John Stumpf is likely to face questions about some tarnish on the Wells Fargo brand following the sudden, and stealth, departure in February of the firm's former CFO, Howard Atkins. Also, watch for any signals about the housing market and whether the banks set to spend some money to buy asset managers or insurance brokers.