Dear Subscribers,

It's funny how often the immediate reaction of the market is just dead wrong. What I mean is that the market was down big time Tuesday morning before the Fed's announcement. Immediately after it was released stocks raged higher and even got into positive territory for a while. After sleeping on it, investors decided that the Feds statements were actually bad news for the economy and thus stocks tumbled violently all day Wednesday. The critical question at this juncture is; Does the Fed see something ominous on the economic horizon or are they saying exactly what they see happening which is not so scary (muddle through economy)? The investor reaction Wednesday morning means that most think the Fed is forecasting recession and/or deflation. I actually believe the Fed is simply saying that the economy will proceed with slow growth and they are ready to further support the economy if necessary. Why am I in that camp? Because Bernanke has been the most transparent Fed chairman on record. So I think we have to take him at his word. Unfortunately I am in the minority. Which means the market probably will deliver some more painful losses in the near term until there is greater clarity on the future direction of the economy.

Let me turn your attention to one of the top members of Zacks' investment community, www.PeopleAndPicks.com. "Havoc 356" is primarily a fundamental investor using earnings to screen his candidates and then checks the charts for timing. The result is a stellar 75% accuracy in picking profitable stocks. His best winner was Medifast (MED), which he held for just one month for a +46.3% return. See all Havoc's current picks at:http://www.peopleandpicks.com/profile/havoc356/

Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

Today's Top Stories: Thursday- August 12, 2010

ZACKS RANK BUY STOCKS

• Aggressive Growth - CAI International (CAP) reported net income of $5.7 million, up 73% since the same period last year. Earnings broke down 31 cents per share, beating the Zacks Consensus Estimate by 7 cents. Read More...
   
• Growth & Income - Nalco (NLC) announced second-quarter revenue of $1.1 billion, up 19% year-over-year. The company had EPS of $0.41, beating the Zacks Consensus by 7 cents, or 20.6%. Read More...
   
• Momentum - 51job Inc. (JOBS) recently hit a new multi-year high and earnings were in line with the Zacks Consensus Estimate at 29 cents, moving the company's average earnings surprise to 81% over the last four quarters. Read More...
   
• Value - Quaker Chemical Corporation (KWR) had another quarter of solid earnings in the second quarter as earnings per share of 80 cents blew by the Zacks Consensus of 54 cents on July 28. It made just 29 cents in the year ago quarter. Read More...
   

Learn how to profit from our exclusive Zacks Rank stock-ranking system with free resources. Read More...

• Top 5 Government Bond Mutual Funds
  Add government bonds to your portfolio with Oppenheimer US Government A (OUSGX), Vanguard Long-Term Treasury Investor (VUSTX), Putnam American Government Income A (PAGVX), T. Rowe Price US Treasury Long-Term (PRULX) and Managers Intermediate Duration Gove Read More...
  

See all the great mutual fund resources.

• Bull Of The Day: Wynn Resorts, Ltd. (WYNN)
  Full Zacks research report: Read More...
  
  
• Bear Of The Day: StanCorp Financial Group (SFG)
  Full Zacks research report: Read More...
  
  
• ZACKS INDUSTRY OUTLOOK: Restaurant Industry Review - August 2010
  Riding on the back of a slowly reviving U.S. economy and the consequent rise in comparable-store sales along with a drop in costs, restaurant operators posted improved results in the first half of 2010. Read More...
  
  
• Raytheon (RTN) Wins Air Force Contract
• Deeper Loss for Raser (RZ), Misses Ests
• Teva (TEVA) Acquires Ratiopharm

• Stocks get a beatdown on global concerns @ CNNMoney.com
• Cisco: Earnings Central @ TheStreet.com
• Old-School Scams We Still Fall For @ MAINSTREET.com
• Dow Drowns in Sea of Double-Dip Fears @ FOXBUSINESS.com
• Best of the Rewards Cards @ Kiplinger.com

EDUCATION: Growth and Income

Understanding Dividend Dates Read More...

• Using ROE for YOUR ROI
• Aggressive Growth Stock Picks-Aug.11, 2010
• Momentum Stock Picking

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Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

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