MorningWord 110212 Beware of the Pitfalls of Compressed 2012 Calendar

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MorningWord11/01/12?

YesterdaystradingfeltabitlikethedayafterThanksgiving,orChristmasEve,fewparticipants,lightvolumesandwhippyaction(lesstheholidaycheerofcourse)。

IfyoumisseditmostofthemajorindiciesintheU。

S。

closedflat,exceptfortheNasdaq(down36bps)astooofitslargestcomponents,AAPLandAMZNsufferedlossesof1。

44%and2。

24%respectively?

AsEnismentionedinhisMacroWrapearlierthismorning,therewasagoodbitofsinglestockvolatility,whichmakessensegiventheSPXsalmost1%range,butmaskedbytheindexsflatclose?

Sandyornot,thismighthavebeenthecourseforthelast2monthsof2012anyway,whereinvestorshappytohavegainsfortheyearlockinprofitsinfrontofanextweekselectionandthenthenexthurdleoftacklingthefiscalcliff,nottomentionsubparexpectedearningsgrowthfortheSP500thatwasapparentinQ4guidanceoverthelastfewweeksbywhatseemedtobeamajorityofthosetoreport。

Allofthisleadsmetorollingupoursleevesabitanddoingsomeworkonthemicro?

ForinstanceLNKDreportsthiseveningaftertheclose(wewilldoamoredetailedreportlater),theoptionsmarketisimplyingabouta12%movevsthe9。

46%avgoverthelast5qtrssincegoingpublicin2011?

LNKDisafairlyinterestingstorygivenits70%gainsytd,anditsnearly140%gainsfromitsIPOprice?

SincemakinganewalltimehighinSept,thestockisdown14%insympathywithothertechhigh-flierslikeAMZNandAAPL,whohavegivenQ3results?

Thestreetremainsoverwhelminglypositiveonthestockwith17Buys,9HoldsandNoSells,withanavg12monthpricetargetofabout$133?

Investorsare?

decidedly?

lessbearishonthestockthantheywerelastyear,withshortinterestdownsubstantiallytoabout6%ofthefloat。

SBUXisalsoreportingtonight,andthisonecouldbeinterestingasthestockisessentiallyflatontheyearafterbeingupnearly35%ytdinApraftermakinganewalltimehigh?

SBUXisExhibitAforapastgrowthleaderfeelingtheeffectsofslowinggrowthdomesticallyandworriesabouttherateofinternational?

expansion?

Theoptionsmarketisimplyingabouta6%movevsthe4qtravgmoveofabout5。

7%,whichseemskindoffairgivensomeofthevolatilitywehaveseenoflateinotherconsumerdiscretionarystockswithsimilarexposure。

PCLNisalsoreportingthiseveningandthisoneislikelytobewatchedfairlycloselyafterEXPEsmonstermovelastweekonitsresults(up15%)?

Theoptionsmarketisimplyingabouta9%movevsthe~9。

5%moveoverthelast4qtrsanditsmassive17%gaplowerafterlastqtrsdisappointment。

Soeveninaslowmarket,therewillbestufftodo,wewillbetakingacloserlookatall3ofthesenamesandwillpostourfindingsabitlater。