Weekly Market Overview

Wall Street received a boost today after bank-to-bank lending rates (known as Libor rates) dropped sharply. After two weeks of extreme volatility, many investors are hoping that an improvement in the credit markets will signal a bottom in the stock market. Meanwhile, hundreds of companies are set to report earnings this week while Federal Reserve Chairman Ben Bernanke is also set to testify before the House Budget Committee on the state of the economy.

Top 10 Stocks to Watch this Week

Fundamental Analysis

1. Emerson Electric Co. (EMR) - Emerson shares are trading near their 52-week lows despite a lack of any bad news. The world's largest maker of power equipment for oil companies beat estimates last quarter with a 6.6% rise in quarterly profits on strong overseas demand for software that manages oil refineries and power plants. Net income reached $612 million or 87 cents per share, compared to 72 cents a year earlier. The company also increased the lower end of its full-year forecast in a further show of confidence. (Read More)
2. Sears Holdings Corporation (SHLD) - Sears shares dropped sharply as the pressure on U.S. retailers continues to rise. The economic crisis has already claimed one of the largest home retail chains in the United States, Linens N' Things, and there are very few signs of recovery. In fact, many economists don't expect retailers to turn around until the second quarter of 2009 with consumer spending and commercial credit continuing to slow down. (Read More)
3. Petroleo Brasileiro SA (PBR) - Petroleo Brasileiro, or Petrobras as it's known in the investment community, shares recovered today after oil prices surged higher. OPEC is expected to announce a cut production to help boost prices, but a continued economic decline has many concerned about a further deterioration of demand. Despite this uncertainty, Petrobras continues to experience record oil production and continued successes in its deep water drilling off the coast of Rio de Janeiro. (Read More)
4. ConAgra Foods, Inc. (CAG) - ConAgra shares may be trading well off of their 52-week highs, but some investors believe this stock is a bargain. The food processing company lost ground over the past year as commodity prices rose, putting pressure on its profit margins. However, the recent retreat in commodities has not jumped the stock up to its historic levels despite its hefty dividend yield of over four percent. (Read More)
   
5. Sysco Corporation (SYY) - Sysco shares opened lower despite a positive recommendation by CNBC's Jim Cramer on his Mad Money Lightning Round. The hedge fund manager turned television star believes that the company is well run and management is capable of doing well even in a difficult time for the industry. As a result, Cramer recommended that his viewers buy it other than on a pullback, which means that investors may have to wait a bit before getting in this week. (Read More)

Technical Analysis

1. Gold Fields Ltd. Adr (GFI) - Intermediate-term bullish diamond bottom.
2. Innovative Solutions & Support (ISSC) - Intermediate-term bullish diamond bottom.
3. Hudson City Bancorp  Inc. (HCBK) - Intermediate-term bullish continuation wedge.
4. Imclone Systems Inc. (IMCL) - Intermediate-term bullish ascending triangle.
5. Vulcan Materials Co (VMC) - Intermediate-term bullish continuation wedge.
   

Stocks of the Week : Why You Should Check Out Emerson Electric

Emerson Electric shares are trading near their 52-week lows despite a lack of any bad news. The world's largest maker of power equipment for oil companies beat estimates last quarter with a 6.6% rise in quarterly profits on strong overseas demand for software that manages oil refineries and power plants. Net income reached $612 million or 87 cents per share, compared to 72 cents a year earlier. The company also increased the lower end of its full-year forecast in a further show of confidence. (Read More)

Article of the Week : Who Really Benefits from Higher Oil Prices?

Oil prices rose today to hit a new record of $126.98 per barrel as inflation continues to soar. Higher oil prices tend to hit the same groups of stocks day after day: Exploration and production companies tend to increase sharply, transportation companies rise marginally, and refiners tend to drop sharply. The rationale for this price movement is simple... (Read More)

Final Words

The future of the U.S. economy remains uncertain as inflation continues to rise. Overall, the economy seems to be healing, but consumers may lag a bit behind as weakness in spending is seen for at least a couple more quarters.