NEWARK, N.J., Jan. 6 (UPI) -- A multiparty settlement has been reached to ensure a highly polluted landfill site in New Jersey is cleaned up, federal officials said Tuesday.
Steady demand for everyday products should keep the credit fundamentals for US consumer products stable over the next 12-18 months, according to Moody’s. But a sharp drop in purchases of discretionary, big-ticket items like boats and appliances means a negative outlook for the US consumer-durables sector.
Despite a weakening global economy, Moody’s expects revenue will grow [...]
The Wall Street Journalargues that the stock market drop may have killed so many sectors that "defensive stocks" may have disappeared. In many market corrections, there are some companies with shares that have held up because their business are less likely to be hurt by a recession.
The paper says that "a number of defensive stocks lately are acting more like cyclical names." The analysts points to companies such as PepsiCo (NYSE:PEP) and Johnson & Johnson (NYSE:JNJ).
The viewpoint may be flawed. What may have happened is that there has been a rotation out of stocks that used to do well in bear markets to a new set of shares which have held up well.. Over the last year, shares of Wal-Mart (NYSE:WMT) are up over 20%. Shares in Colgate (NYSE:CL) are only off a little over 10%, but the company pays a 2.3% dividend. Shares in Genentech (NYSE:DNA) are up 20%. Granted, it is a takeover target, but it has been considered one for some time.
Maybe The Wall Street Journal is just looking in the wrong places.
Douglas A. McIntyre is an editor at 247wallst.com.
Ted Allrich is the founder of The Online Investor and author of the book: Comfort Zone Investing:Build Wealth and Sleep Well at Night. In this weekly column, he'll offer advice to investors who are just getting started.
For a better investing year in 2009, think about championship basketball. Winners at every level have one thing in common: defense. It's defense that wins rings. And this year, in the stock market, defense will keep you alive. It will be the kind of year where making a little money makes you a winner. Think defensively until there are clear signs that the economy is improving.
First, keep your expectations low. No one knows when the current economic cycle will end and begin to heal. What we do know is that all indicators keep going lower: housing starts, employment, consumer spending, housing prices. While the market discounts good news well in advance (some 6 to 9 months ahead of the real numbers), there's no indication from any front that better days are ahead. We know the new administration will spend money to create jobs so more spending power will be in the economy. We know there will most likely be tax breaks for companies to encourage production and hiring. But none of that is in place. Investors have to wait and see how and if these develop and what effect they will have on the economy and on stocks. It might take all year. Or longer. If it does, the stock market won't be doing too much.
TheStreet.com's Jim Cramer says comparisons will be so easy that companies with strong pricing will outperform.
These year-over-year declines in energy costs along with the inability of the Chinese market to fall much further are the two bright spots that long-term investing can give us. The notion that there are consumer-products companies that have put in price increases that for the most part are sticking and that the developing world could come back with lower rates, makes me feel that the Unilever (NYSE: UN) (Cramer's Take)/Procter (NYSE: PG) (Cramer's Take)/Colgate (NYSE: CL) (Cramer's Take) cohort could have a remarkable rally.
But not until after this current quarter, because the price decreases have been incredibly slow to come in and the dollar is so strong.
I key on those because frankly, oil looks like it is going to struggle to hold $50, and while that is a sure sign of a terrible recession coming, it is, alas, good news for the companies like Kellogg (NYSE: K) (Cramer's Take) and General Mills (NYSE: GIS) (Cramer's Take) that use energy and whose product pricing has held.