Divergent Issues August 17 2010 Hostile Edition

Note: The BHP bid for POT was the big news of the day.

POT +12.1 BHP offers unsolicited bid for POT at 30% premium (Reuters)
ABX +1.2 Gold trades higher.  No news.
WLT +1.4 Technical breakout.  No news.
BEN +1.1 Franklin AUM still growing (Marketwire)
BNS +1.2 Bank of Nova Scotia drops mortgage rates (Newswire)
DLTR -1.1 JP Morgan cuts Dollar Tree to underweight (Marketwatch)
ANF -2.2 Abercrombie & Fitch Posts Profit; to Close 60 Stores (WSJ)
KFT -2 Warren Buffet sells some Kraft (IndieResearch)
HD +1.5 Home Depot Sees Profit Growth Despite Weaker Demand (CNBC)
MLM +1.1 Looks like a bit of a short squeeze — 15% short float (DynamicHedge)

Divergent Issues is a segment devoted to cataloging anomalies in the market. Tickers are displayed in the first column, the magnitude of the move versus a closely correlated sector stock is shown in the middle, and the story in the right. The magnitude is based on on the average movement the volatility balanced spread, where ‘2′ is equal to twice the expected volatility threshold, ‘3′ is triple, etc. Volatility calculations used to construct the spread are based on a proprietary ranking system. This is not an exhaustive list — it is based on stocks I have on my watchlist.


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