We'll avoid discussion of the " Deal or no Deal", circus in Washington, like we said, GREAT!..here comes Obama/ McCain!.
So... is RIMM the sign of things to come in the near term? Our beloved RIMM came out with earnings that simply met expectation with guidance on the soft side. For a company that taunts endless growth, this is just not acceptable. Well, this is also has to do with the fact that we are already in a very fragile trading environment. Last time we checked, RIMM was trading at $78 and change and that's a drop of about 20%. If this drop holds, effectively, RIMM is down about 50% from its high this year.
This, of course is a concern to us. RIMM, along with AAPL, GOOG, BIDU... are considered beta stocks to us. They simply represent growth stocks, period. If these stocks start to get hit one after another, market will be under more stress on top of an already overstressed environment.
For most of the market participants, there's simply more hiding than trading these days. When the market stabilizes somewhat, we wouldn't be surprised to see a steadier flow of money into this market. For now, we just have to let the market show us what to avoid and what has potential. We have been looking and adding a little bit of commodity stocks lately and recently we have been concentrating a bit more on the natural gas related stocks. The action in the etf UNG is showing an encouraging pattern and many "shale" plays on our screen showing some stability as well.
Tomorrow is the last day to this otherwise low volume week. We are pretty sure that all of us are looking forward to the weekend already. It'll be interesting to see if the bailout deal gets finalized by Monday.