Dow Jones has ended flat for the straight second consecutive day and this is sign of some bit of weakness in the Dow Jones as well as other major United States indices. The index is taking much more time that it should take in crossing the resistance level. Nearly most of the world markets have broke out of their ranges in the end of the past year, but the Dow Jones is still trading below its crucial resistance level of 13500. The index is showing some bit difficulty in crossing this level, most of the analysts say.

If this weakness continues they say that we may see lower levels on the Dow Jones. Some of the analysts argue that the markets are watching out for the earnings of the big blue chip companies in the United States and that is the reason why they are consolidating.

Kyle Harrington, managing partner at Harrington Capital Management, said, “If you’re going to be in the financial services arena, I like the regional banks.” Banks are one pocket in the markets in which many are finding some value buying.

Bank of America, Citi group, Goldman Sachs, etc., all of them have moved up quite swiftly in the past few months. Majority of the blue chip banks are going to report some excellent numbers according to some investors.

Kyle also added, “When this housing market comes back and people put cash back into the real estate market, those banks will benefit first. I think some of these big banks have a lot of these big mortgages and big loans that they’ve held on to that they still don’t know exactly how to flush out, and I feel like the risk-reward profile is not as great as the regionals.”

Stocks to watch out for:

Dell Corporation is in the news today after reports suggest that the company is likely to go private and is in talks with few players to do so. This move was welcomed by many investors and the stock soared high in late trade yesterday. The stock ended more than 10 percent higher on the back of this news.

Angelo Zino, S&P Capital IQ analyst, said, “The market value of Dell has come down so much that a buyout has become something that is plausible. They have about $5 billion in net cash and also free cash flow generation that could sustain payments on debt from a leveraged buyout.” This is making the investors to cheer and that is the reason the stock is rising.

On the other hand, Apple has been consistently facing problems for the last 3 months. This time Apple is facing problems with its main business, Smart phones. According to a report released yesterday, Apple is going to cut order for its iPhone parts. This implies that the demand is weakening in this business and the company may generate lower revenue going forward. This news made the stock to fall by around 4 percent in yesterday’s trade.

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Category: Finances
Keywords: Dow Jones, Toyota motors, General motors, Europe markets, Dell, Apple