Stocks declined on Wednesday as bank shares continued to struggle and retail sales unexpectedly fell for a second straight month. Some analysts said these fits and starts are just the market cooling down, after a runup of 30 percent since its 12-year low in early March. Read and listen to what the experts had to say... (UPDATED)
An Era of Consumer Frugality
Britt Beemer of America’s Research Group said to expect consumers to stay in an “era of frugality” for a long time. He expects to see 20 percent fewer stores or outlets in one year’s time. He said discount stores will be the winners and highly leveraged department stores will be the losers.
Secondary Offerings Surge
The role of secondary markets has "taken on a new name," said David Menlow of IPOfinancial.com. He said he doesn’t think that companies should be doing secondary offeringsat this point, but the trend is expected to continue.
Forget the ‘Buy-and-Hold’ Strategy
“We’ve long had a buy and hold strategy, but that’s a strategy only in a secular bull market, which we’re not in right now,” said Jack DeGan of Harbor Advisors. He suggested investors be "more opportunistic around valuations and trade in a core position."
Commercial Real Estate: ‘Not as Severe’
Martin Cohen of Cohen & Steers Capital Management said the problem with commercial real estate is “not as severe” as the worst prognosticators suggested. He said there’s a few hundred billion dollars of commercial real estate loans due over the next three to four years—and that not all of those loans are necessarily bad.
Housing Prices May Mitigate Credit Losses
Comptroller of the Currency John Dugan said his agency is focusing on banks' rising credit losses across all assets. “We’re still seeing the biggest losses on the consumer side with credit cards and mortgages,” he said. But he said there’s been some hope that as mortgages and house prices bottom out, those losses will decline.
Consumers Struggle Through Summer?
Michelle Girard of RBS said she thinks consumers are going to continue to struggle through the spring and into the summer until the unemployment situation turns.
Oil Might Trade at $69 Soon
Addison Armstrong of Tradition Energy said just by looking at fundamentals, oil should be trading at under $40 a barrel. “But if the world is willing to ignore the fundamentals, we’re going to be trading at $69 very soon,” he said.
Auto Dealers Head to Capitol Hill
Hundreds of auto dealers are heading to Capitol Hill to make a last minute plea to their congressmen. “We just don’t think that it should lead to 200,000 people losing jobs from dealerships all over the country,” said John McEleney of the National Auto Dealer Association.
Medical Front: A Quicker Fix for Back Pain?
Medical device maker NuVasive promises a unique approach to spine surgery through the patient’s side rather than the back or the front. This makes the process 50 percent faster, said Alexis Lukianov of NuVasive. “You’re walking in the same day versus 3 to 5 days later, and your recovery is done in 4 to 6 weeks versus 6 months. So it’s a huge advantage over conservative methods,” he said.
CNBC's Companies in the News:
- AIG CEO Liddy: Bailout Payback Possible in 3-5 Years
- As GM Bankruptcy Looms, Congress Faces Pressure
- Intel CEO: We Didn't Do What EC Claims
Bank of America (Merrill Lynch parent)