Jeez, this market likes down-and-outers. Take the big percentage gainers today. Start with Transocean (RIG) . While it is terrific for the oil bulls to see crude go above $45 on talk of cooperation that, you know, I think is fanciful, the notion is that we should all be buyers of offshore drillers, where the cost is way too high.
I know that the deep water projects are long-lived, but give me a break. The rig count is creeping up, but I don't think you are going to see big orders of the magnitude Transocean needs to keep up this move. Dead oil platform bounce.
Now Micron (MU) , which is rallying again, makes sense, because I simply don't believe the glut for flash will be as bad or isn't already totally reflected in the stock. For the record, I prefer Marvell Technologies (MRVL) .
And then there's Chesapeake (CHK) . A heat wave means huge natural gas use, so people figure that the reconstituted Chesapeake, now that it has sold its Barnett obligations, which eliminates $1.9 billion in killer commitments, can really climb. The stock does seem cheap, given that CHK has managed to take a lot of the big risk off the table. That said, though, it is highly speculative still, given that debt load.
The fact is all three of these stocks were refuse not that long ago. Now they are climbing as part of the mean reversion after falling so far behind the market.
Random musings:I like this Vonage VG story by the Fill or Kill team. Makes a ton of sense.