Apple, the most valuable company in the world

After overtook Microsoft last year, the market capitalization of Apple continues to soar with their stock hitting the historical new high. Their stock was priced at $300 last October and in less than a year, the stock price reached $400. After few weeks of swapping the top spot with Exxon Mobil, the company now stays in the lead and become the most valuable public listed company, with the value of $370 billions. The company's $75 billions financial reserves, which were greater than US Government back in July this year, serves as the strong war chest for their strategic acquisition. This amount is more than the market capitalization of Hewlett Packard.

Starting from the company with a goal to produce user friendly computer, the company has transformed into consumer electronic company after the return of Steve Job. The company now owns its own operating system and its own hardware (A4, A5 and A6 processors), which allowing it to fully integrate hardware and software in its products. That's part of the reason that Apple delivers such great user experience. Owning the operating system also means Apple doesn't have to pay license fees, which have better margins. And if you think about people with iPads, iPhones or iPods, you've got all your music in iTunes, you've got all your apps from Apps Store and there are apps that are only available on Apple products. So, when you buy your next phone or first tablet computer, it's much easier to buy an Apple product again and just transfer all your data to the new Apple product, as opposed to completely replacing it with an Android product and having to start from scratch. So, I think there's some stickiness to the operating model which should work well for them going forward.

Consider this landscape, Microsoft makes money by selling an operating system threatened by Google's Android, which is free. Microsoft also has little control over its customer, computer makers, who are slashing prices in a race to the bottom that can't good for Windows revenues. Google makes money from advertising, but gives away its operating system to boost its search business. Only Apple, has a cohesive system, with each part adding to the value of the whole.

With little challenges from the competitors in the tablet, and the Oct 4's release of next generation iPhone, the revenue and the profit will continue to grow. Furthermore, the company seems possess great resistant to global economic turbulent. With these factors, Goldman Sachs analyst seeing the company have great potential to outperform their previous expectation, and lifting Apple's 12-month target price from $480 to $520.

The rising trend after release of iPad 2

The release of second generation of iPad has lead the rise in number of stocks. Firstly, of course the company itself, Apple (AAPL), closing at $359.56, a jump of more than 2 percent from 2 March closing price. The appearance of Steve Jobs in this major product release, although he still looked weak, but that might have boast the confidence of investors, and destroyed the rumor of his dying condition. 

A year ago, iPad received a rather bad justification from the industry when it was announced; The industry don't see the need of having a device that categorized between a PC and mobile phone. People think that might be the end of Steve Job's innovative gadget. BUT, today, we have seen how popular this device is; the other big brothers, like Samsung, HP, Motorola start targeting this new category, and we will see more tablet coming soon in 2011. In the meantime, the netbook category might have started falling out of favor by the industry.

The release of iPad 2 and Verizon iPhone 4 have brought a great fortune for their component suppliers as well. Qualcomm (QCOM), the provider of iPad and iPhone baseband chip, rose to $58.84, up around 3 percent. With now the support of both GSM and CDMA networks, the dual-switch baseband chip definitely provides a great revenue to Qualcomm. Next we have Cirrus Logic (CRUS); it closed at $24.98, rise more than 7 percent. This usage of this audio chip was first revealed in the tear down report of iPhone 4, since then its share is in the rising trend. The company has their audio chips in both iPad and iPhone product lines and foresee the company will continue grow fast with their largest customer. Lastly, the NAND flash provider of iPad and iPhone, Micron (MU). After struggling for a couple of years, the Micron finally return to profit in the last quarter. The NAND flash as well as the memory chips in MacBook series will continue driving more profit for the company. In fact, Seeking Alpha recently pointed out that shares are among the cheapest in the semiconductor arena. Micron closed at $11.57, went up more than 4 percent from previous day's close.

All the 4 stocks are traded close to their 52 weeks' high, and traded slightly above 20 SMA. Should unrest in Middle East and Africa relieve and better economic outlook, these stocks will continue to rise.

Conspiracy Theory on Euro Zone Crisis

There's a conspiracy theory out there that tries to explain what's happening in the global financial market today. The theory goes like this: The US has been in a weak financial position due to the credit crisis occurs in past 3 years. China has been gaining economically since then. The US will not sit back quietly and watch as the East rises. By triggering a debt crisis in Greece, the US is killing several birds with that proverbial one stone.

One, it is dealing a blow to Chinese foreign reserves held in euros. China has been selling its US-dollar holdings and switching to euros. Two, in the ensuing panic, the US dollar strengthens because it is seen as the more stable currency. And three, the US could have already placed bets against the euro or eurozone instruments. The crisis is an opportunity for it to refill its coffers - just as it did during the Asian financial crisis.

While most conspiracy theories are eventually proved to be more fiction than fact, they do make for interesting dinner conversations.

Two ETFs to bank on: FAZ and FAS

Financial stocks return to the highlight in recent Greek crises. The financial stocks become either biggest loser or gainer in the past two weeks. The volume of these two ETFs have increased significantly.

However, due to the leverage nature, these two ETFs are meant for the short term trading. It can be used to take the short term profit or to hedge your long positions against the downturn. For instance, seeing the increased bad conditions in Euro zone, you might want to use FAZ, the Direxion Financial bear fund to hedge the exposure.

Have a look at the links below for the detail coverage:
ETF DAILY NEWS » The Most Bank For Your Buck With These Direxion 3X Financial ETFs (FAS, FAZ)
Want to Bet Big on Banks? Try These Triple X Funds - CNBC

Two shares soar when markets tank

This week, majority sessions are ending in red. Rumour and glitch in trading system on Thursday have triggered the massive sell off, Dow Jones at one point sink close to 1000 points.

However, two shares in my watch list shoot up high as markets drops. They are the inverse/bearish ETFs offered by ProShares and Direxion Funds. These two ETFs bet against the financial sector with leverage feature; They are:

• ProShares UltraShort Financials (ETF), SKF
• Direxion Daily Finan. Bear 3X Shs (ETF),  FAZ

These two shares have gone up high in 2008 - 2009 financial crisis, correction in last Jan/Feb. It would be a good choice to hedge against the downtrend, or ways of earning some handsome profit while waiting a chance to buy at dip.

Eastman Kodak Company continue in downtrend

After recovering a small percentage yesterday, Eastman Kodak continues in downtrend, returning to the level in early April.

Prior its earning report, the shares of Eastman Kodak has been raising, anticipated by the market with powerful earning. The shares at one point reached $9 mark. However, after the disappointed earning report, much lower than market expectation, the shares has been sinking.

Technically, the shares will continue trend down. The company is expecting flat revenue this year, however, Eastman Kodak still has a great number of patents in imaging. Could it be another take-over target, like PALM?

Shares of U.S. chipmakers sink after Samsung's comment

Shares of U.S chipmakers sink after Samsung's comment on the excess inventory. Samsung warned that the low-end DRAM memory chip market may go into oversupply by the year's end. 

The Philadelphia Semiconductor Index, SOX, a price-weighted index composed of 18 U.S. semiconductor companies primarily involved in the design, distribution, manufacture, and sale of semiconductors, closed down 4.5 percent. 

Here are some of big losers in this sector:

Micron Technology, Inc (Nasday:MU) fell 8.4 percent to $9.35

Advanced Micron Device, Inc (NYSE:AMD) fell 6.8 percent to $9.06

SanDisk Corporation (NASDAQ:SNDK) fell 5.2 percent to $39.84

NVIDIA Corporation (NASDAQ:NVDA) down 5.7 percent to $15.71

Intel Corporation (NASDAQ:INTC) down 2.8 percent to $22.84