New Highs for Dow and S&P 500, but Tech Took a Hit

Wall Street had another rising day, with the Dow Industrials and the S&P 500 reaching new record highs. But one tech stock tanked and the momentum took a bunch of others in the sector down with it. The Dow Jones industrial average (^DJI) closed 25 points higher, the Nasdaq composite (^IXIC) added 8 points, and the Standard & Poor's 500 index (^GPSC) was up 3 points. One of the top gainers on the S&P 500 was used car giant CarMax (KMX). Its share price zoomed higher by 16.5 percent with revenue and profits hitting record levels. The still lackluster economic recovery is causing many to drive off lots in used cars instead of new vehicles. And the hottest model over the past two years? The Nissan Altima. Automotive retailer AutoNation (AN), which runs new and used dealerships, also got a boost, rising more than 5 percent. It was a different story for software giant Oracle (ORCL), which was one of the S&P 500's biggest losers. Its stock fell 4 percent on sagging earnings. Social media stocks fell too. Pandora (P) was down 1.5 percent as was Groupon (GRPN), LinkedIn (LNKD) lost almost 1 percent and Amazon (AMZN) fell less than 1 percent two days after unveiling its first smartphone. But poor Radioshack (RSH). Its stock hit a new low, trading below a dollar a share for the first time after falling almost 10 percent. Since the beginning of the year the stock is down 64 percent. One analyst has a price target of zero on the stock. Ouch. (We hope you don't have that one in your portfolio.) And Darden's (DRI) earnings weren't very appetizing. Profits came in much lower than expected and guidance was weak. The stock fell 4 percent. It is selling its Red Lobster chain and trying to focus on revamping Olive Garden. Solar stocks had a bright day, though. Shares of SunEdison (SUNE) shone brightly rising 1.5 percent on news it was acquiring some solar farms in Massachusetts. Other solar stocks also basked on the day. Canadian Solar gained 6 percent, and SolarCity (SCTY) was up 1.5 percent. In the pharmaceutical sector, there were some clear winners and losers. Alexion Pharmaceuticals (ALXN) was up 3.5 percent, Eli Lilly (LLY) gained by 3.5 percent as well, but Regeneron Pharmaceuticals (REGN) was down 4 percent. What to Watch Monday: The National Association of Realtors releases existing home sales for May at 10 a.m. Eastern time. These major companies are scheduled to release quarterly financial statements: Micron Technology (MU) Sonic (SONC) -.

Apart from the health costs (which are worth considering), smoking can drain your finances. The average cost of a pack of cigarettes is $5.51, according to the American Lung Association. If you're a pack-a-day smoker, that means you're burning through $2,011.15 per year. That's enough to take your significant other on an one-week vacation -– including airfare, hotel and restaurants. If that's not compelling enough, consider this: If you invested $2,011 per year ($167 a month) for 10 years, compounding yearly at a reasonable 7 percent growth rate, you'll have $27,690 within a decade. And the power of compounding only picks up the longer it has to play out. Even if you never added to that stash after the first decade, at that rate, the value will about double every 10 years. And that's not even touching on any medical bills you may face.)

1. Smoking There's a reason that some people call the lottery a "voluntary tax" -- or, more harshly, a "tax on people who are bad at math." Even if you're "just" buying a $1 scratch-off ticket each day, you're still throwing your money away. The odds of winning small lottery prizes are low, and the payouts are stacked heavily in favor of lottery. And the odds of winning a large lottery drawing like Mega Millions or Powerball are one in hundreds of millions. To put it in perspective, you have a (much) better chance of being struck by lightning. And what if you're gambling with bigger stakes, such as slot machines or casino table games? Then we don't need to tell you how much you lose for every dollar you "make," because chances are, you're painfully aware of it.

Benzinga Weekly Preview: Several Large Retailers Set To Report

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Several large retailers are set to release their earnings reports next week after a quarter of depressed consumer spending due to the US' severe winter weather.

Meanwhile, the world will be holding its breath in the aftermath of a succession vote in Ukraine, scheduled for Sunday. Many expect that the vote, being held by pro-Russian separatists, will drive the country to the brink of a civil war.

Key Earnings Reports

Next week investors will be waiting for several key earnings reports including Cisco Systems (NASDAQ: CSCO), Macy's (NYSE: M), Wal-Mart Stores (NYSE: WMT) and JC Penney (NYSE: JCP).

Cisco Systems

Cisco is expected to report EPS of $0.43, compared to last year's EPS of $0.47.

On April 10, Suntrust gave Cisco a Buy rating with a $27.00 price target. The analysts at Suntrust cited Cisco's product refresh as a driver for growth and expects to see the company expand in 2015.

Related: Market Wrap For May 9: Markets Marginally Higher, But Nasdaq Still Suffers

"Refreshed Product Line, Brighter Outlook: Cisco is emerging from a broad product upgrade cycle across its core switching and routing businesses (~50% of revenue), akin to what it has done in the past, but this product transition has been a contributor to the weak results in the last few qtrs. While other factors contributed (Snowden effect in China, emg market volatility, US federal gov't shutdown), we believe Cisco will begin a return to y/y growth in core switching & routing in the next few qtrs, and think Cisco will regain share."

Wunderlich Securities downgraded Cisco from a Buy rating to a Hold rating with a $24.00 price target on April 8th, saying that they believe the market has less interest in Cisco products.

"We see more opportunity in recent valuation compression among small cap/growth stocks in networking than the implied haven of the Cisco (CSCO) market cap, but our downgrade is more than a trading call. We came away from industry interviews in recent weeks with the view that the market has less interest in the Cisco product suite than in past transitions.

"We see the range of alternatives for network automation/software defined networking (SDN), network function virtualization (NFV), and cloud services as dilutive to the Cisco installed base upgrade opportunity. We have trimmed our forecast moderately and with the adjustment we have reduced our 12-month target to $24 from $25. Because we view Cisco shares to be close to fully valued, we are downgrading to Hold from Buy."

Macy's

Macy's is expected to report EPS of $0.59, compared to last year's EPS of $0.55.

Merrill Lynch gave Macy's a Buy rating on April 24th, saying that the company may issue debt for buybacks in the near future.

"Macy's leverage ratio at the end of F2013 was 2.4x and its coverage ratio was 8.6x, as compared to the company's 2.4-2.7x and 6.4-6.6x targeted ranges. Macy's adjusted total debt rose $156mn during the year, due to its $400mn issuance, partially offset by debt pay down, including repaying $109mn of its senior debentures due August 2013. A y/y reduction in the underfunded status of postemployment and postretirement benefits also lowered F2013's adjusted debt.

"Our analysis indicates the company has room to issue another $1bn of debt and still remain within its targeted leverage ratio. While we do not anticipate that management will add debt that places it at the high-end of its target ranges, we believe it will continue to take advantage of favorable credit markets to issue debt for buybacks while rates are low."

On May 5, Credit Suisse gave Macy's an Outperform rating with a $54.00 price target, noting that consumer spending will likely rise in the near term which could have positive effects on the retail company.

"Last week, we attended National Retail Federation Chief Economist Jack Kleinhenz's presentation at the New York Association of Business Economists. A key lesson from the presentation was the three drivers of consumer spending that the NRF pays close attention to: credit growth; wage growth; and job growth. As Kleinhenz noted, outstanding credit balances have yet to expand to the highs last seen in the 2006-2007 period, while a recent Gallup poll found that the percentage of credit card holders who say they always pay the full amount rose from 42% in 2006 to 48% in 2014, while the percentage who say they usually leave a balance fell from 27% in 2006 to 20% this year. While consumers remain wary of credit card debt, wage growth and job growth are both beginning to show signs of reacceleration, suggesting a thawing out of consumer spending ahead."

On May 3rd, S&P Capital IQ was more conservative with a Hold rating and a $57.00 price target. The analysts at S&P noted that increased customer engagement could be a driver for future growth.

"We see benefits from the successful execution of My Macy's and customer engagement strategies as well as improved confidence among M's higher-income customer base at Bloomingdale's over the next 12 months. We believe these positive factors, coupled with increased investments in its Omnichannel strategy will enable the company to drive top-line growth, while benefiting from cost reduction initiatives, in a challenging economy."

On May 7, Morgan Stanley gave Macy's an Overweight rating with a $60.00 price target, saying that the first quarter was likely difficult, but that the outlook was bright for the second quarter and beyond.

"1Q faced several headwinds and results could come in below consensus. But M gathered momentum in April that will likely carry into 2Q. We see high earnings achievability for FY14. Trading at 11x our/consensus FY15 EPSe, M remains our top dept. store pick. Reiterate OW."

Wal-Mart Stores

Wal-Mart is expected to report EPS of $1.15, compared to last year's EPS of $1.14.

On May 3rd, S&P Capital IQ gave Wal-Mart a Hold rating with a price target of $78.00, citing more conservative customer spending in the near term.

"We expect WMT's core customer to spend cautiously over the near term given government benefit reductions and job market uncertainties. However, we think downside macro risks will be somewhat mitigated by WMT's lowpriced offerings of everyday items, aggressive pricing investments and increased marketing of its value message. Longer term, we believe an acceleration in small format growth in the U.S. will help support EPS growth."

JC Penney Company

JC Penney is expected to report a loss of $1.25, compared to last year's loss of $1.31.

Merrill Lynch gave JC Penney a Neutral rating on April 4th, noting that deep discounts and promotional selling were responsible for the company's declining gross margin.

"JCPenney's gross margin contracted 190bp y/y in F2013. The company provided a detailed breakdown of what drove the decline. Increased promotional selling / clearance markdowns was the biggest factor for the gross margin decline (-217bp impact). This includes the negative impact from deep clearance markdowns taken to clear through the new brands that were not resonating with customers.

"Increased incremental re-ticketing costs (as the company shifts back to a promotional strategy) and reduced vendor cost concessions were also headwinds (-27bp and -6bp). Lower markdown accruals / permanent markdowns at year-end and other miscellaneous items were each a 30bp benefit to gross margins."

On May 3rd, S&P Capital IQ gave JC Penney a Hold rating with an $8.50 price target. The analysts at S&P said they expect to see the company begin to reconnect with its customers this year.

"Under CEO Mike Ullman's leadership, we think is JCP starting to reconnect with core customers. We see the company driving higher purchase conversion on apparel in its stores and on jcp.com with weekly sales promotions, the re-launch of traditional private brands that were dropped in FY 13 (e.g., St. John's women's casual sportswear), and improved in-stock positions in key items and sizes. However, we think it will take another couple of quarters for the company to regain traction in its home business through improvements in brand mix and in-store presentation. JCP is projecting over $2 billion in liquidity at the end of FY 14, including $785 million in net cash proceeds from its recent share offering."

On May 7, UBS shifted its rating for JC Penney from Sell to Neutral and upped its price target from $4.00 to $9.00. The analysts at UBS cited less risk and the opportunity for growth in the near term for their positivity.

"In our view, JCP has less "miss & lower" risk on SSS/GM's in 1H14 while lapping significant one-time drags from extremely high clearance levels—and having 19% of total sq. footage under construction—in 1H13. In our view, the stock debate shifts to 2H14, when these one-time tailwinds abate and JCP will once again be tested on whether it can drive significant traffic back to stores as YOY comparisons normalize. With many of the concerns from our Jan-13 downgrade having played out already, and less downside SSS/GM risk in the near-term, we're upgrading to Neutral from Sell."

Economic Releases

Investors will be tuned in for US data next week, looking for further confirmation that the nation will return to steady growth in the second quarter after a bit of a stumble at the start of the year. Most expect to see April retail sales improve after March's impressive gains. The housing sector remains a concern for the region, but analysts expect to see that housing starts rose at their fastest rate this year in April.

Daily Schedule

Monday

Earnings Releases Expected:  McKesson (NYSE: MCK), Concho Resources (NYSE: CXO), Diamondrock Hospitality (NYSE: DRH) Economic Releases Expected:  US Federal budget balance, Indian industrial production

Tuesday

Earnings Expected: Fossil Group (NASDAQ: FOSL), CST Brands (NYSE: CST), First Majestic Silver (NYSE: AG) Economic Releases Expected: US retail sales, US redbook, German ZEW economic sentiment, Chinese retail sales, Chinese industrial production

Wednesday

Earnings Expected: Cisco Systems (NASDAQ: CSCO), Macy's (NYSE: M), Sony (NYSE: SNE), Kate Spade (NYSE: KATE) Economic Releases Expected:  Japanese GDP, US PPI, eurozone industrial production, British unemployment rate

Thursday

Earnings Expected From: Wal-Mart (NYSE: WMT), Nordstrom (NYSE: JWN), Kohl's (NYSE: KSS), Flowers Foods (NYSE: FLO) Economic Releases Expected:  US industrial production, US CPI, eurozone GDP, eurozone CPI, German GDP, French GDP

Friday

Earnings Expected From: Tsakos Energy Navigation (NYSE: TNP) Economic Releases Expected: Japanese industrial production, French GDP, Italian trade balance, Hong Kong GDP, US building permits, US housing starts

Posted-In: Federal Reserve UkraineEarnings News Guidance Previews Pre-Market Outlook Markets Trading Ideas Best of Benzinga

© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Chinese tourists boost U.S. businesses

From hotels to tour operators, U.S. businesses are looking to cash in on a surge of Chinese tourists.

NEW YORK (CNNMoney) Last year, thousands of Chinese tourists flocked to Yellowstone National Park to view the mountains, the buffalo and Old Faithful.

Later, at least 1,600 trekked to the Ranch at Ucross, some 200 miles to the east, where they feasted on burgers made from said beast, baked beans and biscuits. Following lunch, they were treated to a demonstration of rodeo-style riding by 14-year-old Katie Wilhelm.

"She takes off with that big American flag in her stirrup, and they go crazy," said ranch owner Judie Blair. "All the political issues between the two countries just evaporate."

Blair is one of a growing number of U.S. business owners looking to capitalize on the surge in Chinese tourism to the United States.

Spurred by increasing urbanization, rising levels of disposable income and relaxed travel restrictions, Chinese visitors to the United States jumped from under 400,000 in 2007 to almost 1.5 million in 2012, according to the U.S. Commerce Department. The Chinese spend more traveling than any other nation: In 2012, they spent almost $9 billion in the United States.

Blair hosted over 80 buses of Chinese tourists at the three hotels she owns in Cody, Wyo., last year. It's a small but rapidly growing part of her family-run business, Blair Hotels, which also includes the ranch. This year, she's expecting 160 buses, and over 200 are already booked for 2015. The increase in Chinese tour groups has helped offset losses from other Asian countries.

Cody (founded by William "Buffalo Bill" Cody) offers easy access to Yellowstone -- which is hugely popular with Chinese tourists thanks to an Chinese television program on U.S. National Parks, said Blair.

For the last five ye! ars, she's been attending tourism trade shows to meet with operators of Chinese tours and tout her properties and the local activities. Other than translate a few brochures and a local promotional video into Mandarin, she said she doesn't have to do much to cater to the Chinese crowd. She used to serve a classic Chinese breakfast -- a kind of rice porridge known as congee -- but she said her Chinese guests clamored for bacon and eggs.

"They ooh and aah over the little packs of jelly," she said. "They don't want to be treated like Chinese. They want the full American experience."

At the ranch -- three hours east of Cody -- Chinese tourists stop for lunch on their way from Yellowstone to Mount Rushmore -- part of a popular bus loop that starts in Denver or Salt Lake City and runs through parts of the Rockies. Blair hopes the Chinese tour groups will soon start spending the night at the ranch, which is a more upscale property.

Not surprisingly, other popular U.S. destinations include Los Angeles, New York City, Washington D.C., Las Vegas and Niagara Falls, said Nick Hentschel, head of business development at AmericanTours International.

Hentschel's company is also trying to tap the Chinese tourism market, and Chinese patrons now make up nearly 20% of the tour operator's business.

The company is partnering with big Chinese-based tour operators to increase its businesses, and offers cross-country tour packages popular with Chinese customers.

  Paris vs London: Wooing Chinese tourists

Shopping is the number one activity Chinese nationals enjoy in the United States, according to the Commerce Department.

It's so popular in Los Angeles that some stores on fancy Rodeo Drive now get 60% of their business from Chinese cust! omers, sa! id Karissa Fowler, a spokeswoman for the Beverly Hills Conference & Visitors Bureau. Some stores have even started accepting UnionPay, a credit card popular in China.

In addition to the touristy things, what the Chinese like most about coming to America is seeing the everyday stuff, said Hentschel. His company arranges visits to places like grocery stores or the homes of company executives. The Chinese, he said, love to see how Americans live.

What they complain about the most: The smoking bans.

Superstition Ain't the Way - John Hussman

"The problem with QE is that it works in practice but it doesn't work in theory."

- Ben Bernanke, Former Federal Reserve Chairman, January 16, 2014

"When you believe in things that you don't understand, then you suffer. Superstition ain't the way."

- Stevie Wonder, Superstition, 1972

Bernanke clearly meant it as a joke, but it is also an unfortunate statement on recent monetary policy. It's poetic that Stevie Wonder recorded Superstition in 1972, just before the stock market fell by half. A few weeks ago, William Dudley made the same point as Bernanke – even the Fed doesn't quite understand how quantitative easing works. What FOMC officials are really saying is that aside from a very predictable effect on short-maturity interest rates, there is no mechanistic link between the monetary base and any other variables – financial or economic – that they are trying to control. There is a sense that creating more monetary base helps stocks advance, and that this contributes to economic confidence. What's missing is a transmission mechanism that operates through identifiablebanking and economic channels – other than promoting a speculative reach-for-yield and the psychological exuberance that accompanies a bull market.

The fact is that Treasury bond yields are above where they were when QE2 was initiated in 2010, and year-over-year growth in non-farm payrolls, civilian employment, real GDP and real final sales have at best done little but hover at the thresholds that have historically bordered expansion and recession. Good economic policy acts to ease constraints that are binding, and monetary policy can clearly be useful in that regard – particularly during liquidity crises when depositors are rushing for cash. At present, however, quantitative easing acts by massively loosening a constraint that is not binding at all, drowning the economy with idle bank reserves that aren't even desired. That's going to have negative consequences.

The chart below shows the ratio of bank reserves to the M1 money supply. We are increasingly moving away from a "fractional reserve" banking system, as the relationship between reserve creation and lending has collapsed. Idle bank reserves now exceed the amount of demand deposits in the U.S. banking system by more than two-to-one, and exceed 25% of all deposits in the U.S. banking system. Keep in mind that these reserves don't "go into" the stock market (every buyer of stocks is matched by a seller who gets the cash). Rather, these reserves may change owners, but stay in the banking system in aggregate, depressing short-term interest rates, and resulting in a pool of zero-interest deposits that change hands from one uncomfortable holder to another.

The crux of the issue is this. QE only "works" to the extent that zero-interest liquidity is treated as an undesirable "hot potato," forcing investors to seek yield by chasing increasingly speculative assets. Having achieved that end, easy money will do nothing to support stock prices in situations where investors actually find short-term liquidity desirable, or approach speculative assets with the slightest amount of risk-aversion.

Of course, part of the impression that QE is effective also traces to misattribution: the belief that it was responsible for avoiding "global financial meltdown." As I noted in Did Monetary Policy Cause the Recovery?:

"The novelty of quantitative easing, and the misattributed belief that monetary policy ended the banking crisis, has created financial distortions where perception-is-reality, at least for now. We believe that the modifier 'for now' will prove no more durable than it was during the tech bubble or the housing bubble.

"A proper understanding of the credit crisis is essential. Much of the present faith in monetary policy derives from the belief that it was the central factor in ending the banking crisis during what is often called the Great Recession. On careful analysis, however, the clearest and most immediate event that ended the banking crisis was not monetary policy, but the abandonment of mark-to-market accounting by the Financial Accounting Standards Board on March 16, 2009, in response to Congressional pressure by the House Committee on Financial Services on March 12, 2009. The change to the accounting rule FAS 157 removed the risk of widespread bank insolvency by eliminating the need for banks to make their losses transparent. No mark-to-market losses, no need for added capital, no need for regulatory intervention, recievership, or even bailouts. Misattributing the recovery to monetary policy has contributed to a faith in its effectiveness that cannot even withstand scrutiny of the 2000-2002 and 2007-2009 recessions, and the accompanying market plunges. This faith is already wavering, but the loss of this faith will be one of the most painful aspects of the completion of the present market cycle."

On Valuation

Ben Bernanke asserted last week that market valuations seem to be within historical ranges at the moment – which is true, if you take price/earnings ratios wholly at face value, with no adjustment for profit margins, and no consideration of the fact that stocks are long-lived claims on future cash flows. The problem here, as I detailed in An Open Letter to the FOMC: Recognizing the Valuation Bubble in Equities, is that the "equity risk premium" models embraced by Bernanke, Yellen and Greenspan are terribly unreliable compared with methods that account for the cyclical variation in profit margins. The fact is that even if year-to-year earnings are volatile, the discounted value of a long-term stream of those cash flows is very smooth. As a result, the most reliable valuation measures generally have a very smooth denominator. That's why a dozen alternative measures are far better correlated with actual subsequent total returns (these include market cap/GDP, price/revenue, cyclically-adjusted P/E, price-to-record earnings, and others).

If one examines the errors of the Fed-embraced "equity risk premium" models, one immediately finds that those errors are highly (negatively) correlated with the level of profit margins. In other words, the higher profit margins are at any point in time, the worse actual subsequent market returns tend to be, compared with the returns implied by those models. That's not a surprise. If you take cyclically elevated profit margins at face value, you're going to overpay. This is the principal reason that the Fed overlooks valuation risks here.

The chart below shows corporate profits as a share of GDP, with a reminder of how elevated levels relate to subsequent profit growth. I can't emphasize enough that the issue is not what happens to profits over just the next 4 years, however. The issue is whether current profit margins are representative of what investors should expect for the next 50 years. More on that below.

Continue reading: 

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Also check out: John Hussman Undervalued Stocks John Hussman Top Growth Companies John Hussman High Yield stocks, and Stocks that John Hussman keeps buying
About the author:Canadian Valuehttp://valueinvestorcanada.blogspot.com/

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Subscribe via Email Subscribe RSS Comments AlbertaSunwapta - 5 hours ago

"At Berkshire we focus almost exclusively on the valuations of individual companies, looking only to a very limited extent at the valuation of the overall market. Even then, valuing the market has nothing to do with where it's going to go next week or next month or next year, a line of thought we never get into. The fact is that markets behave in ways, sometimes for a very long stretch, that are not linked to value. Sooner or later, though,..."

...

"(2) Corporate profitability in relation to GDP must rise. You know, someone once told me that ... When you begin to expect the growth of a component factor to forever outpace that of the aggregate, you get into certain mathematical problems. In my opinion, you have to be wildly optimistic to believe that corporate profits as a percent of GDP can, for any sustained period, hold much above 6%. ... If corporate investors, in aggregate, are going to eat an ever-growing portion of the American economic pie, some other group will have to settle for a smaller portion. That would ..." - Warren Buffett

Mr. Buffett On The Stock Market, By Warren Buffett; Carol Loomis, November 22, 1999

http://money.cnn.com/magazines/fortune/fortune_archive/1999/11/22/269071/

 

 

 

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SNL: Top 5 Banks Own 44% of Industry

Big banks are getting bigger.

A new report released Thursday by data provider SNL Financial found that the country's five largest banks own 44% of the industry's total assets. That continues a march higher that has been going on since at least 1990, when 9.67% of the industry's total assets came from the top five banks.

"Total assets concentrated in the five largest banking institutions have steadily increased since 1990, reaching a peak in the third quarter of this year," said SNL analyst Marshall Schraibman in his report.

J.P. Morgan Chase(JPM), Bank of America(BAC), Citibank, Wells Fargo(WFC) and U.S. Bank held $6.46 trillion in assets as of the third quarter of 2013, SNL found. The rest of the industry, comprised of thousands of midsize, regional and smaller players, held a total of $8.15 trillion.

In 1990, the five largest financial institutions held $457.92 billion, or 9.67% of the industry's total assets, according to the research firm.
The top five banks in 1990 were predecessors to the top five institutions today.

Mr. Schraibman said varying narratives have developed to explain the concentration of assets. Some argue that new regulatory burdens make banking overly costly for smaller institutions. Others say the history of consolidation that created "too big to fail" institutions are still impacting the banking sector today.

While some observers had predicted a wave of M&A among smaller institutions to deal with the increased regulatory costs, Mr. Schraibman said those deals have failed to "move the needle" in terms of asset concentration. Mergers among big banks are largely a thing of the past, due to heightened regulatory concerns after the financial crisis.

One other trend noted by Mr. Schraibman was that the median return on average assets for the top five institutions today is nearly 50% higher than the overall industry. That's in sharp contrast to the return on average assets in 1990, where the largest institutions trailed the sector by 0.33 percentage points.

Make This Oil Move Immediately

From the Editor: In yesterday's members-only message, you got a rare look at Kent's track record and why he averages 55% on every recommendation. Today, Kent recommends a short-term move, based on the latest developments in Syria...

Damascus may have dodged a bullet (or a cruise missile), but nothing else has changed very much. Not in terms of risk.

That explains why the "Syrian Premium" remains. It may be slightly reduced, as you'll see. But it is likely to stay with us even after the threat of a military solution has been averted.

At least for now...

But in addition to the ongoing uncertainty, there are other aspects of market pricing that are coming into focus. These pressures were building even before the latest round of Syrian intrigue.

They involve the traditional factors of supply and demand, with some regional wrinkles thrown in for good measure.

I will have more to say shortly about the best way you can profit from these opportunities. But for the moment, there's one move to make in the immediate aftermath of the latest Syrian developments.

Here's my full briefing...

The U.N. Chemical Weapons Report Emerges

The U.N. report on chemical weapons usage in Syria, released Monday, may not hold the Assad regime responsible for their usage directly. But the conclusions certainly supported the version put forward by Washington, Paris, and Riyadh.

The August attack on suburban Damascus employed massive amounts of sarin gas in a coordinated effort, one labeled a war crime in the report and the worst witnessed worldwide in 25 years. It required missile delivery systems, while the trajectories indicated launches from territory controlled by government forces. That combined with earlier intelligence discounting that the opposition had access to such nerve gas leaves little doubt.

Whether authorized by Syrian President Bashar al-Assad or some underling, this was a coordinated attack on civilians using a substance held in distain by the global community. Russia is continuing to question which side in the festering Syrian civil war bears responsibility.

On the other hand, Cyrillic lettering on casings points toward Moscow's hand in providing Assad with the weapons. They were also more potent than initially thought. The U.N. report concludes the gas was of higher quality than sarin found in Saddam Hussein's arsenal in Iraq.

A few weeks ago, all of this would have been enough for the U.S. to initiate a missile attack of its own on military installations inside Syria. The report may have been enough for the U.K. to come on board (the Parliament in London had refused to support a military move pending the report) and may have even attracted additional European support.

But the situation changed dramatically late last week...

A Deal for International Control

The Russian-brokered deal places Assad's chemical weapons under international control, with destruction of them set for the first half of 2014.

Now, those experienced in such matters flatly declare the time scale is unrealistic; accounting for 100% of the weapons is also not possible.

But the threat level is reduced. A powder keg situation had turned from a threatened military reprisal to a diplomatic initiative - one now likely to have a U.N. Security Council resolution to back it up.

Much is unresolved in this approach. But it does mean, at least for now, Washington has pulled back from an attack while Moscow has bought some time for its erstwhile ally.

Nonetheless, the reduction in tension, even if it turns out to be short-lived, will have an impact on oil prices.

How to Play the Next Big Oil Move

As the crisis escalated, what I have called a "Syrian Premium" (about $4 per barrel in New York and London) had been introduced into the pricing for crude. That premium had increased as the rhetoric on war increased.

As trade opened Tuesday morning, West Texas Intermediate (WTI, the benchmark crude traded on NYMEX) stood at a bit above $106 and Brent in London at more than $109. These levels were down 2.7% and 3.2% for the week, respectively.

Yet each still remained more than $3 a barrel above the anticipated pricing levels in the absence of a Syrian crisis.

In short, the prices have eased, but a premium remains.

That's because much uncertainty remains, as well.

Will the diplomatic approach succeed? Will the weapons be catalogued and destroyed? Will the Security Council step up and put some serious sanctions on Damascus? Will the new U.S.-Russian joint approach hold?

You can see why oil's volatility will continue even with chemical weapons use off the table. The Syrian mess remains even without the impending U.S. attack. The stability of the entire region is at issue, the conflict deepens, the Saudi-Iranian disagreement over surrogate plays in the Persian Gulf region is becoming worse, and the pressures on the global crude oil outlook remains pressured as a consequence.

So here's what to do...

1. Take a profit.

It's time to pull back a bit on exchange-traded fund (ETF) holdings allowing moves playing the WTI-Brent crude pricing spread. I have suggested previously the two primary plays here are PowerShares DB Energy (NYSE Arca: DBE) and United States Brent Oil Fund (NYSE Arca: BNO).

DBE provides a play on both the WTI-Brent spread as well as crack spreads (the difference between the crude oil prices and those for selected oil products). BNO is a straight entry into dollar-denominated Brent pricing in London.

Both have made gains during the Syrian run up, and some of that profit needs now to be creamed.

2. Redeploy the proceeds.

It's time to position yourself for regional variations in price. They're approaching. Fast. Here, the strategy will offset companies controlling large amounts of oil availability in certain global areas with the pricing variations emerging.

Simply put, this approach will be locating where the difference is pronounced enough to generate an added premium.

Much more on this as we move forward...

3 FTSE 100 Growth-and-Income Shares

LONDON -- Some investors prioritize capital growth through a rising share price, while some prioritize income growth from a rising dividend. But some shares -- growth-and-income shares -- offer investors a bit of both.

Imperial Tobacco (LSE: IMT  ) (NASDAQOTH: ITYBY  ) , British Sky Broadcasting (LSE: BSY  ) , and United Utilities (LSE: UU  ) (NASDAQOTH: UUGRY  ) are three companies from the U.K.'s elite FTSE 100 index that have grown both their earnings and dividends faster than inflation -- and are forecast to continue doing so.

Imperial Tobacco
Imperial Tobacco reported decent growth from emerging economies within its latest interim results. However, this was insufficient to offset challenging conditions in some of the company's other markets, including the EU. The group's first-half earnings per share declined 3.1%, or 1.6% at constant exchange rates.

Nevertheless, Imperial is looking forward to a stronger second half. Management expects full-year EPS to be toward the lower end of its 4% to 8% annual growth earnings model (before the beneficial impact of share buybacks). The board showed its confidence by lifting the interim dividend 11%, in line with its intention to grow the payout by 10% a year over the medium term.

At a share price of 2,402 pence, Imperial is on an undemanding forward price-to-earnings ratio of 11 and offers a prospective dividend income of 5%.

British Sky Broadcasting
At 786 pence, BSkyB's shares are about 14% off their 900 pence high in March. The decline is due in no small part to an announcement from BT Group last month that it will be offering free sports channels to any BT broadband customer.

BSkyB has been growing its earnings at more than 20% a year for the last few years. Analysts expect this to moderate to 15% for the year ending June 2013 and to a mid-single-digit for the next year -- with the dividend broadly tracking the EPS growth.

BSkyB is on a 12-month forward P/E of about 13 and a dividend yield of 4%. The rating is attractive relative to both the wider market and the company's own historical P/E and yield levels.

United Utilities
United Utilities holds a license to provide water and sewage services in the north west of England. Over the last decade the company has sold its telecom and electricity businesses and assets to focus on the regulated water industry.

Regulated companies are known more for income than growth, but United Utilities increased EPS by 11% last year, and analysts are expecting a rise of a similar order for the year ending March 2014. The dividend has been growing at 7% a year, and the board has said it intends to "continue with our dividend policy of targeting 2% per annum growth above the rate of RPI inflation through to at least 2015."

Utilities have been popular with investors hungry for yield in the prevailing low-interest rate environment. This, together with takeover activity in the sector, has driven the ratings of water companies higher. At a current share price of 752 pence, United Utilities is trading on a forecast P/E of more than 17. There's a prospective dividend yield of 4.8%, which is above the FTSE 100 average but on the low side of United Utilities' own historical level.

Growth and income
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If you're more interested in growth than income, we have another exclusive report just for you. The company analyzed in this in-depth report pays a dividend, but the main attraction is a set of compelling drivers for growth. This report is also 100% free -- simply click here and it's yours.

Meet the world's No. 1 dealer in Guinness art

  He found $2 million of lost art NEW YORK (CNNMoney) Robert Lloyd, a New York antique dealer, holds an unusual distinction: He is the world's largest dealer of Guinness advertising art.

He has bought hundreds of paintings, once lost to obscurity in a London archive, that were original renderings of iconic Guinness posters displayed in pubs and college dorm rooms.

The paintings are by the English artist John Gilroy, who died in 1985.

Gilroy worked for S.H. Benson, an advertising agency that held the Guinness account from 1929 until the late 1960s. Gilroy designed thousands of posters for the beer giant's ad campaigns.

Lloyd, the antique dealer, came upon his Guinness obsession somewhat accidentally.

Nearly five years ago, he was at an antique show in Florida when he stumbled on a few of the original Guinness paintings.

Lloyd bought what the dealer had on hand but was thirsty for more. He went to London to see the rest of the paintings -- and wasted no time snapping them up.

"I bought them from a very astute business man," said Lloyd, declining to elaborate. "They were not on the market."

The paintings had apparently spent some 40 years stored away in a London building that had housed the offices of the S.H. Benson agency.

Lloyd won't say exactly how many he bought, but he said he has sold a couple hundred and has about 125 left.

The paintings are all single originals -- there are no copies.

"The genius of Gilroy was the empathy the public had with his drawings," writes David Hughes, an ex-Guinness brewer and author of "Gilroy was good for Guinness."

Gilroy was in fact very good for Guinness. But in 1969, a change in leadership at Guinness meant S.H. Benson and Gilroy were out. And so were the paintings.

There is some speculation about who might have had them for 40 years. Hughes suspects it was Jacob Rothschild, a British banker who bought the building that housed S.H. Benson for years.

Today, Lloyd is cashing in on the paintings. He sells them for $9,500 to $40,000 each at local antique fairs and out of his shop in Manhattan.

Lloyd declined to say what his collection is worth. But Hughes, the author, suspects Lloyd could have close to $2 million worth of Guinness paintings.

Among his customers: Rory Guinness, related to the! founder of Guinness, who bought a number of paintings for his personal collection.

Walmart: What to Expect For the Third Quarter

Who?

Walmart (WMT) is a Bentonville, Arkansas-based American multinational retail corporation that maintains multiple large discount department stores and warehouses throughout the world.

When?

Walmart is scheduled to report its fiscal third quarter earnings before the opening bell on Thursday, Nov. 13. The retail giant lowered its full-year outlook back in October, reasoning that overseas sales were being negatively affected by the rise in value of the U.S. dollar. Walmart is currently the 10th worst performer on the Dow-Jones Industrial Average, only increasing about 0.5% this year so far. Walmart investors are hopeful that the recent decrease in gas prices will allow low-income consumers to spend more money coming into the holiday season this year.

Where?

Walmart's quarterly report and pre-recorded phone call will be available at 6:00 am CST on Thursday on the company's website. Analysts expect Walmart to report $1.12 earnings per share for the quarter, down from $1.14 the same quarter the year prior. On the other hand, revenue is expected to increase to $118.4 billion from $115.7 billion last year.

What?

Investors are anticipating Walmart to give an update on consumer sentiment and spending, holiday plans, and whether sales have slowed down at the company's Neighborhood Markets.

Walmart is expected to give an update on the introduction online price-matching in addition to its potential plans to follow Target (TGT) in offering free shipping with no minimum on purchase orders during the holiday season.

Analysts also want an update on actions the company is in the process of testing, including company-owned health clinics that offer doctor visits as low

FCC calls timeout on Comcast-Time Warner Cable merger

The FCC pauses its review of the Comcast-Time Warner Cable deal sending the merger potentially in 2015. NEW YORK (CNNMoney) Those waiting for a Comcast-Time Warner Cable merger -- and possibly improved cable service in cities like New York City and Los Angeles -- are going to have to hold out a bit longer.

Government regulators at the Federal Communications Commission have paused the unofficial 180-day clock on the review of the proposed deal between the two cable giants.

The delay was reported on Wednesday, one day before Comcast reported better-than-expected third quarter earnings.

"The stoppage... doesn't reflect any substantive concerns with our transaction," Comcast CEO Brian Roberts told investors on a conference call on Thursday. "We continue to believe that the review will get completed, as we previously said, and hopefully close sometime early in 2015."

The pause comes amid objections by rival content companies like Disney and CBS over disclosing confidential programming contracts with providers.

"It is routine for the FCC to pause the review of significant transactions as it works to create a full record," Sena Fitzmaurice, VP of Comcast's government communications, said in a statement. "In the meantime, review of information and evidence already in the docket will continue."

All along, Comcast has expressed confidence that the merger will be approved, and will ultimately benefit customers, particularly those in Time Warner Cable markets. The merger has also had a wide array of critics, including big companies like Netflix and Dish Network.

On Thursday, Roberts brought up the notion that Comcast will almost immediately enhance service in Time Warner Cable's two biggest markets, New York and Los Angeles, upon completion of the merger.

Comcast has been rolling out next-generation set top boxes that are connected to the Internet and are, by some accounts, the best in the industry.

"Those of you in New York or in L.A. on the call, we have been really looking forward to bringing this suite of products as fast as possible," Roberts told investors.

5 Stocks Poised for Big Breakouts

DELAFIELD, Wis. (Stockpickr) -- Trading stocks that trigger major breakouts can lead to massive profits. Once a stock trends to a new high or takes out a prior overhead resistance point, then it's free to find new buyers and momentum players who can ultimately push the stock significantly higher.

Read More: Warren Buffett's Top 10 Dividend Stocks




One example of a successful breakout trade I flagged recently was technology player MobileIron (MOBL), which I featured in Aug. 22's "5 Breakout Stocks Under $10 Set to Soar" at around $9.14 per share. I mentioned in that piece that shares of MobileIron recently formed a double bottom chart pattern at $8.20 to $8.30 a share. Following that bottom, shares of MOBL were starting to trend higher and move within range of triggering a big breakout trade above some key near-term overhead resistance at $9.60 a share.

Guess what happened? Shares of MobileIron triggered that breakout a few treading sessions later with strong upside volume flows. Volume on Aug. 25 registered 1.49 million shares, which is well above its three-month average action of 696,350 shares. Shares of MOBL continued to tend higher following that breakout, with this stock recently tagging a new all-time high of $12.96 a share. That represents a monster gain of right around 40% in just a few trading sessions for anyone who bought shares of MOBL around the time of my article. As you can see, when breakouts trigger with volume the gains can be large once a stock catches momentum and trends higher.

Breakout candidates are something that I tweet about on a daily basis. I frequently tweet out high-probability setups, breakout plays and stocks that are acting technically bullish. These are the stocks that often go on to make monster moves to the upside. What's great about breakout trading is that you focus on trend, price and volume. You don't have to concern yourself with anything else. The charts do all the talking.

Trading breakouts is not a new game on Wall Street. This strategy has been mastered by legendary traders such as William O'Neal, Stan Weinstein and Nicolas Darvas. These pros know that once a stock starts to break out above past resistance levels and hold above those breakout prices, then it can easily trend significantly higher.

With that in mind, here's a look at five stocks that are setting up to break out and trade higher from current levels.

Read More: 5 Breakout Stocks Under $10 Set to Soar

Staples

One specialty retail player that's starting to move within range of triggering a big breakout trade is Staples (SPLS), which operates office products superstores. This stock has been under some selling pressure so far in 2014, with shares off by 14%.

If you take a look at the chart for Staples, you'll notice that this stock recently formed a double bottom chart pattern at $10.70 to $10.82 a share. Following that bottom, shares of SPLS have started to uptrend with the stock moving back above its 50-day moving average. That uptrend has now quickly pushing shares of SPLS within range of triggering a big breakout trade above some key near-term overhead resistance levels.

Traders should now look for long-biased trades in SPLS if it manages to break out above some near-term overhead resistance at $11.83 a share to its gap-down-day from May at $12.14 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average volume of 9.31 million shares. If that breakout triggers soon, then SPLS will set up to re-fill some of its previous gap-down-day zone from May that started just above $13.20 a share.

Traders can look to buy SPLS off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $11.21 a share. One can also buy SPLS off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Read More: 5 Toxic Stocks You Need to Sell Now

Facebook

A technology player that's starting to trend within range of triggering a big breakout trade is Facebook (FB), which operates as a social networking company worldwide. This stock has been on fire so far in 2014, with shares up sharply by 36%.

If you take a glance at the chart for Facebook, you'll see that this stock has been uptrending a bit for the last month, with shares moving higher from its low of $71.55 to its recent high of $75.99 a share. During that uptrend, shares of FB have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FB within range of triggering a big breakout trade above some key near-term overhead resistance levels.

Traders should now look for long-biased trades in FB if it manages to break out above some key near-term overhead resistance at $75.99 to its all-time high of $76.74 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 38.88 million shares. If that breakout develops soon, then FB will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $85 to $90 a share, or even north of $95 a share.

Traders can look to buy FB off weakness to anticipate that breakout and simply use a stop that sits right around some key near-term support at $72 a share or around its 50-day moving average of $70.74 a share. One could also buy FB off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Read More: 3 Tech Stocks on Traders' Radars

Arrowhead Research

A biopharmaceutical player that's starting to trend within range of triggering a big breakout trade is Arrowhead Research (ARWR), which develops targeted RNAi therapeutics in the U.S. This stock is off to a very strong start so far in 2014, with shares up sharply by 34%.

If you take a glance at the chart for Arrowhead Research, you'll notice that this stock has been uptrending strong for the last month, with shares moving higher from its low of $10.62 to its recent high of $15.63 a share. During that uptrend, shares of ARWR have been consistently making higher lows and higher highs, which is bullish technical price action. That strong move has now started to push shares of ARWR within range of triggering a big breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in ARWR if it manages to break out above some key overhead resistance levels at $15.63 to $15.73 a share with high volume. Watch for a sustained move or close above those levels with volume that hits near or above its three-month average action 2.90 million shares. If that breakout materializes soon, then ARWR will set up to re-test or possibly take out its next major overhead resistance levels at $18.87 to around $20 a share. Any high-volume move above those levels will then give ARWR a chance to tag its next major overhead resistance level at around $24 a share.

Traders can look to buy ARWR off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $12.90 a share. One can also buy ARWR off strength once it starts to move above those breakout levels share with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Read More: 5 Dividend Stocks Ready to Pay You More

Infoblox

Another technology player that's starting to trend within range of triggering a major breakout trade is Infoblox (BLOX), which develops, markets, and sells automated network control solutions worldwide. This stock has been destroyed by the bears so far in 2014, with shares of huge by 59%.

If you take a glance at the chart for Infoblox, you'll see that this stock spiked sharply higher on last Friday right above its 50-day moving average of $12.47 a share with decent upside volume flows. This sharp move to the upside is quickly pushing shares of BLOX within range of triggering a major breakout trade above some key overhead resistance levels.

Traders should now look for long-biased trades in BLOX if it manages to break out above some key overhead resistance levels at $13.47 to $13.98 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average volume of 1.46 million shares. If that breakout gets underway soon, then BLOX will set up to re-fill some of its previous gap-down-day zone from May that started just above $20 a share.

Traders can look to buy BLOX off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $12.47 a share or around more support at $12 a share. One can also buy BLOX off strength once it starts to take out those breakout levels with volume and then simply use a stop that sits a comfortable percentage from your entry point.

Read More: 10 Stocks George Soros Is Buying

Recon Technology

My final breakout trading prospect is energy player Recon Technology (RCON), which provides hardware, software, and on-site services to companies in the petroleum mining and extraction industry in the People's Republic of China. This stock has been moving very strong to the upside so far in 2014, with shares up large by 51%.

If you look at the chart for Recon Technology, you'll notice that this stock has been uptrending a bit over the last month, with shares moving higher from is low of $3.46 to its recent high of $5 a share. During that move, shares of RCON have been making mostly higher lows and higher highs, which is bullish technical price action. This action has now pushed shares of RCON back above both its 50-day and 200-day moving averages, which is bullish. Shares of RCON are now quickly moving within range of triggering a near-term breakout trade.

Traders should now look for long-biased trades in RCON if it manages to break out above some key near-term overhead resistance levels at $5 to $5.05 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 98,703 shares. If that breakout materializes soon, then RCON will set up to re-test or possibly take out its next major overhead resistance levels at $5.62 to around $6.50 a share, or even $7 a share.

Traders can look to buy RCON off weakness to anticipate that breakout and simply use a stop that sits right below its 50-day moving average of $4.16 a share or near some more support at $3.75 a share. One can also buy RCON off strength once it starts to clear those breakout levels with volume and then simply use a stop that sits a conformable percentage from your entry point.

Read More: 10 Stocks Carl Icahn Loves in 2014

To see more breakout candidates, check out the Breakout Stocks of the Week portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>Must-See Charts: 5 Big Trades for S&P 2,000

>>3 Biotech Stocks Under $10 in Breakout Territory

>>4 Big Stocks to Trade (or Not)

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Westport Select Cap Fund Comments on Zebra Technologies Corp

The Fund made one new purchase during the quarter, Zebra Technologies Corp (ZBRA), Class A shares ("Zebra"). This company has established a leading position in data collection and product identification and announced the acquisition of a unit of Motorola Solutions, Inc. This deal will expand Zebra's market position into mobile and network solutions while doubling the company's size and adding significantly to its earnings per share. From Westport Asset Management (Trades, Portfolio)'s Westport Select Cap Fund Second Quarter 2014 Commentary.Also check out: Westport Asset Management Undervalued Stocks Westport Asset Management Top Growth Companies Westport Asset Management High Yield stocks, and Stocks that Westport Asset Management keeps buying

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Sex Valley: Tech's booming prostitution trade

  Valley sex worker: Techies great clients NEW YORK (CNNMoney) Business is booming for sex workers in Silicon Valley, but it's becoming increasingly risky.

Startups are transforming into multi-billion companies. And the staffs are overwhelmingly male. Sex workers tell CNNMoney they have a growing clientele who have plenty of excess cash.

Two recent events have raised concerns.

The arrest this week of an alleged prostitute, Alix Tichelman, in connection with the death of Google executive Forrest Timothy Hayes has prostitutes worried about the impact on business.

"I do worry that people are going to think that this is something that's normal and happens, but it really doesn't," said "Maxine Holloway" a high-end prostitute working in Silicon Valley. (To protect their privacy, CNNMoney agreed to use pseudonyms or the professional names of the sex workers we spoke with for this story.)

Other sex workers CNNMoney spoke to expressed worry as well -- though none said they had experienced cancellations.

A second issue affecting business was the shut down of a prominent website for both solicitation and screening of prostitutes and their clients.

Late last month, the FBI raided and shut down MyRedbook, a website that allowed escorts to advertise their services and negotiate with clients.

Women in the industry relied heavily on MyRedbook to do background checks on their clients. Sex workers would post about instances of violence or circumstances in which they felt unsafe.

  Why sex workers are celebrating Obamacare

Without MyRedbook, prostitutes are having a difficult time vetting their clients.

"It's like sex workers lost their Yelp," said Bay Area sex worker and activist "Siouxsie Q."

Male clients also used the site to review and discuss their experiences.

That's why call girls say that the further underground sex work goes, the more dangerous it is for everyone involved.

Hayes did not solicit Tichelman on MyRedbook; according to detectives, they met on SeekingArrangement.com, where users sign up to be "Sugar Bab! ies" or "Sugar Daddies" in search of "mutually beneficial" relationships.

The FBI indicted the founders of MyRedbook on charges of using the Internet to facilitate prostitution and on multiple charges of money laundering.

Bay Area sex workers say high-powered tech executives likely joked about MyRedbook, which had kind a 1990's-era website look to it.

"I'm sure that they had all kinds of technological critiques of the actual website -- but they were definitely using it," Holloway said.

Another prostitute, who asked that her name not be used, says she has a roster of regular clients from major tech companies. She is a high-end prostitute and estimates that she's made nearly $1 million over the 10 years that she's been working in the area.

She says that her clients are increasingly worried about their own security, which is one of the reasons they been coming back to her so consistently -- they know what they're getting.

GoPro driving tech stocks up

NEW YORK (CNNMoney) The Fourth of July is a week away, but there have been a few fireworks this Friday in the stock market.

The S&P 500 is hovering around flat. The Dow Jones Industrial Average is down slightly, and the Nasdaq is up 0.4%. The tech-heavy Nasdaq has been a star performer for the week. It's on tap to finish the week up 0.6%. The other two indexes will end the week down.

Here's what you need to know before you take off early on this summer Friday:

1. Investors ignore Michaels debut, but clamor for more GoPro: Shares in GoPro (GPRO), the sports-oriented camera maker whose shares started trading Wednesday, have continued to surge. The stock is up 16% Friday, nearly as strong a move after yesterday's momentous 30% spike.

To put that in perspective, the stock priced at $24 and is now trading at over $36.

Investors are less enthusiastic about crafts retailer Michaels (MIK). It started trading Friday morning -- eight years after private equity firms Blackstone and Bain Capital took it private -- on the Nasdaq with the symbol "MIK". The company's shares priced at $17 and have moved little since trading commenced. The company raised $472 million the IPO.

Perhaps the biggest news in the IPO world this week is that Chinese e-commerce giant Alibaba chose to take what could be America's largest-ever IPO to the New York Stock Exchange. Yahoo (YHOO, Tech30), which owns a stake in Alibaba, has enjoyed a nice bounce the past two days. It's up 2.3%.

2. It's the shoes: Nike (NKE) and sneaker store chain Finish Line (FINL) both gained after the companies reported earnings and sales that surpassed Wall Street expectations, though they have since settled and remain in positive territory.

Nike said in its earnings report that the best news is coming out of Europe, with 18% sales growth. And with all the focus on the World Cup in Brazil, it should come as no surprise that sales from the company's soccer segment were also up sharply.

Shares of Nike rival Adidas (ADDDF) closed slightly higher in Germany, and Finish Line competitor Foot Locker (FOOT) is up 2.5%.

  Nike 1, Adidas 0

3. Dollar store drama and coffee surge: Shares in Dollar ! General (DG) are down more than 7% after CEO Rick Dreiling announced that he was retiring in 2015. Activist investor Carl Icahn has a 9.4% stake in Family Dollar (FDO), which many suspect he wants to merge with Dollar General. Family Dollar stock is down 2%. Related company Dollar Tree (DLTR) is slightly negative as well.

Keurig Green Mountain (GMCR) shares are having a perky day, up over 4% to lead the S&P 500. Research firm Argus upgraded the stock to "buy" on estimates that sales and profits will improve.

4. BNP pares dividend: The Wall Street Journal is reporting that BNP Paribas (BNPQF), the French banking giant that's nearing a $9 billion settlement with the Justice Department, will be cutting its dividend by an unspecified amount because the payment will hurt its balance sheet. The Paris-listed shares of the bank closed flat.

London-listed Barclays (BCS), another big European bank in the spotlight because of a dark pool-related lawsuit from the New York Attorney General, also closed flat after yesterday's 6.5% drop.

5. International markets: Asian stocks finished the day mixed, with Chinese and Indian stocks closing slightly higher. European markets closed mixed today, but all ended the week in the red.