Dear Subscribers,

Friday's debacle made it 6 straight losing weeks for stocks. The last time that happened was in 2002 when everyone got their clocks cleaned by that nasty bear market. This slow grind lower in 2011 now has us back under Dow 12,000 for the first time since March.

The reason for the decline is simple. Recent soft economic data has too many people thinking the worst...recession. That "glass is completely empty" kind of thinking is way over done. You see there is a great deal of difference between soft data and scary data.
Soft data = still showing growth, but just not as impressive as before.
Scary data = expansion is over. Here comes the recession. Watch out below!

Remember on Thursday we got good news that exports were higher in April. That alone could add up to 0.5% increase in US GDP. And then on Friday I see another promising piece of news. That being a report that the Up Front sales for TV advertising saw very healthy year over year increases. What's so great about that Reity? (you ask). Advertising is a big expense for most firms. It's the first item to get cut when times are tough. And the last to get reinstated when things are going well again. So if the big firms are spending big dollars on advertising buys for the coming year, then it means that they are very confident that the economy is in good shape and they will get a good ROI on that ad spend.

So there still may be a bit more shakeout until the perma-bears are satisfied. But once more people appreciate that we do have positive GDP growth. And earnings are headed higher. And there is no other place to put your money given low interest rates...then stocks will start to rise again.

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Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

Today's Top Stories: Monday- June 13, 2011

ZACKS RANK BUY STOCKS

• Aggressive Growth - Avis Budget Group (CAR) reported its fifth consecutive earnings surprise and analysts started raising estimates. The full-year consensus for 2011 is up 22 cents, to $1.47. Read More...
   
• Growth & Income - Watsco, Inc. (WSO) reported first quarter earnings per share of 21 cents, easily beating the Zacks Consensus Estimate of 18 cents. It was a 110% increase over the same quarter in 2010. Read More...
   
• Momentum - Omega Protein Corp. (OME) saw some pretty nice revisions in estimates off the good quarter, with the current year gaining 7 cents to $1.22. The next-year estimate is pegged at $1.33. Read More...
   
• Value - Douglas Dynamics, Inc. (PLOW) made 56 cents per share in 2010 but analysts expect it to make $1.08 in 2011. That is earnings growth of 93%. 1 estimate has risen for 2011 in just the last week. Read More...
   

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

• Bull Of The Day: The Cooper Companies
  Full Zacks research report: Read More...
  
  
• Bear Of The Day: Staples, Inc.
  Full Zacks research report: Read More...
  
  
• Ahead of Wall Street
  Read More...
  


• Zacks Industry Outlook: Publishing Stock Review - June 2011
  The publishing industry has long been grappling with sinking advertising revenue, and the recent global economic meltdown has worsened the situation. Read More...
  
  
• Analyst Blog Highlights
• Arrow Teams with EcoLogic
• Quest Awarded for Simplexa
• U.S. Cellular Catches 4G Wave
• Full Analyst Blog

• New PFP-TV: Some Reasons To Be Defensive
• Growth & Income Stock Picks-June 10, 2011
• Momentum Stock Picks-June 9, 2011

EDUCATION: Aggressive Growth

"Short-Selling" Stocks Read More...

PeopleAndPicks.com:

VIP "InvestmentMAGE" diversified his picks to withstand the market drop with BUY calls in (DAR), (PEP) and (WAG). Read More...

• Recession risk: Small, but growing @ CNNMoney.com
• Apple Eases Subscription Guidelines @ TheStreet.com
• 400 Banks Face Capital Shortfalls by 2012 @ MAINSTREET.com
• Hot Internet IPOs Leaning Toward NYSE This Time Around @ FOXBUSINESS.com

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Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

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