Dear Subscribers,

The market has bounced big time on the first trading day of the month 5 out of the 8 previous months this year. So this makes 6 big first day jumps. Is it a good predictor of what will be? I'll let the -6% loss on the market through August stand in testament to its lack of staying power. So why did it bounce? The biggest reason at the open was news of strong growth in China and Australia which helps to mitigate the worldwide economic slowdown theory. Then at 10am ET we got awesome news from the ISM Manufacturing survey which was well above estimates showing continued strength in this sector. So investors, at least for today, overlooked the weaker than expected reading from the ADP employment report which showed 10,000 jobs lost after several months of modest gains. That is a bad foreshadowing for the heavyweight August Employment Situation report on Friday.

On the one hand, I am unconvinced of the longevity of this upward move in the short run given all the pessimism still in the air. On the other hand, I do believe in the case for the Muddle Through/slow growth economy. That will lead to equity prices being higher by year's end as this becomes the prevailing economic/market outlook. So it's possible that today's move is the start of something more substantial. And that my friends is the trick with investing. It's not always so clear. A balanced portfolio that is prepared for the market to move in either direction is the right call these days until there is greater clarity. So don't get too long…and don't get too short.

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Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

Today's Top Stories: Thursday- September 02, 2010

ZACKS RANK BUY STOCKS

• Aggressive Growth - Albany International Corp. (AIN) reported second-quarter net income of $7.9 million and earnings per share came in at 50 cents per share, blowing estimates out of the water, which were averaging just 37 cents. Read More...
   
• Growth & Income - The Gorman-Rupp Company (GRC) 2010 Zacks Consensus is up by 9 cents to $1.26 per share in the last 2 months for an earnings growth of 15.6%. Similarly, 2011, is expecting 15.1% earnings growth. Read More...
   
• Momentum - JinkoSolar Holding Co. Ltd. (JKS) share price is up more than 200% since its May IPO. With a 41% Q2 earnings surprise driving shares, this Zacks #1 rank stock has plenty of upward momentum. Read More...
   
• Value - Sirona Dental Inc. (SIRO) for the fourth quarter in a row, surprised on the Zacks Consensus Estimate. Earnings per share were 65 cents compared to the consensus of 50 cents. 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
  Get yield with Sentinel Government Securities A (SEGSX), SunAmerica US Government Securities A (SGTAX), JPMorgan Government Bond A (OGGAX), Legg Mason Western Asset Government Securities A (SGVAX), and Wasatch-Hoisington US Treasury (WHOSX). Read More...
  

See all the great mutual fund resources.

• Bull Of The Day: DST Systems, Inc. (DST)
  Full Zacks research report: Read More...
  
  
• Bear Of The Day: PPL Corporation (PPL)
  Full Zacks research report: Read More...
  
  
• ZACKS INDUSTRY OUTLOOK: Metals and Mining Review - Sept. 2010
  While the slow economic recovery is a significant factor in short-term decisions regarding M&A activity, mining companies expect to make acquisitions over the next three years. Read More...
  
  
• Vicor Tech (VCRT) Q2 Disappoints
• Forest Labs (FRX) Presents Mixed Data
• AWS Acquisition Upgrades AAR (AIR)

• September surprise: Stocks soar @ CNNMoney.com
• Pension Deficits Hit Historic High: $506 Billion @ TheStreet.com
• Last-Minute Labor Day Travel Deals @ MAINSTREET.com
• Auto Parts Company Thriving @ FOXBUSINESS.com
• Fabulous Freebies 2010 @ Kiplinger.com

EDUCATION: Growth and Income

Reinvesting Your Dividends Read More...

PeopleAndPicks.com:

VIP "rjm77me" prepped his portfolio for the market with BUY calls in (AKS), (AMR), (GLW), and (IPI). Read More...

• Best Industries, Best Stocks
• Aggressive Growth Stock Picks-Sept.1, 2010
• Momentum Stock Picks-August 26, 2010

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Best,

Steve Reitmeister
Executive VP, Zacks Investment Research

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