ARGUS MARKET W - TD Ameritrade

ARGUS ?

Independent Equity Research Since 1934

M ARKET W ATCH

FRIDAY, AUGUST 31, 2012

Market Outlook

DAILY SPOTLIGHT:

Short Term:

Bearish Markets Poised for Bernanke Speech

PORTFOLIO S TRATEGY

The market is anxiously waiting to hear from Federal Reserve Chairman Ben

Equity:

65% Bernanke, who is scheduled to speak from the central bank's annual summit in

Cash:

5%

Today's Market Movers

Bernanke to Speak

IMPACT +

European Markets Higher

+

Splunk Climbs on Q2 Results

+

July Factory Orders Est. Up 2%

+

Recent Research Review

GILD, GSK, IHS, JBL, HNZ, MDT, IBM, MYL, WPI, TEVA, NYT, HFC, DELL, HPQ, BXP, CHK, VNO, VZ, MA, ADSK, ZMH, ADI, HAIN, GPS, ANF, SYK, SYY, PSA

Jackson Hole, WY, today. Though Bernanke in the past two years has not explicitly announced policy changes from this podium, he has strongly hinted that the Fed would take action -- and his words turned into concrete steps in both November 2010 (QE2) and September 2011 (Operation Twist). We would be very surprised if Mr. Bernanke didn't continue the Fed's negative real interest rate policy, which actually began under Chairman Alan Greenspan after the 9/11 attacks. Greenspan did let rates rise as his term ended in January 2006, and Bernanke briefly pushed them higher. But strains in the banking system in mid-2007 took real rates back to negative territory.

E Though stock investors like the QE programs, we think the continuation of negative

real rate and easy money growth policies creates the risk of higher inflation and/or renewed decline in the U.S. dollar.

PL ARGUS INTEREST RATE OUTLOOK (%)

Statistics Diary

12-MonthS&P 500 Forecast: 1165-1465

S&P 500 Current/NextEPS: 103.5/113.5

S&P 500 Current Est. P/E:

13.52

12-MonthS&P P/E Range: 10.3 - 12.9

10-Year Yield:

1.63%

M 12-Mth10-Yr.BondForecast: 1.5-2.5%

Current Fed Funds Target:

0.25%

12-MonthFedFunds Forecast: 0.0-1.00%

A DJIA:

S&P 500: NASDAQ:

SLarge/Small Cap.

PREVIOUS 200-DAY CLOSE AVERAGE

13000.71 12701.96 1399.48 1337.27 3048.71 2876.76

0.97 0.95

Stockpicker's Corner

KRAFT FOODS INC. (NYSE: KFT).......................................... BUY Kraft, a Focus List selection, continues to post sector-leading sales growth during a period of soft consumer spending and significant cost inflation. Kraft's

Growth/Value:

1.21 1.19

forthcoming split into two separate businesses, one focusing on international

CURRENT RANKING

snack brands and the other on domestic groceries, should enable the company

Five-Day Put/Call: Momentum: Bullish Sentiment: Mutual Fund Cash:

0.87 Positive -522000 Positive

34% Positive 4.30% Neutral

to further capitalize on its opportunities through more-targeted business strategies and more-efficient capital allocation. The separation is expected to occur on October 1, 2012. The announcement of the spinoff and interim robust earnings growth should continue to serve as catalysts for share-price appreciation. Our target price on the KFT shares is $46.

Vickers Insider Index:

3.54 Negative

A R G U S R E S E A R C H C O M P A N Y t 6 1 B R O A D W A Y t N E W Y O R K , N. Y. 1 0 0 0 6 t ( 2 1 2 ) 4 2 5 - 7 5 0 0

PLEASE SEE PAGE 2 FOR DISCLAIMER INFORMATION.

ARGUS M ARKET W ATCH ?

Argus Research is an independent investment research provider whose parent company, Argus Investors' Counsel, Inc., is registered wIinthdethpeeUnd.Se.nSt eEcquuriittyieRseasnedarEchxcShinacneg1e9C3o4mmission; and whose affiliate, Argus Global Equity Analytics, Ltd., is registered with the Financial Services Authority. Argus is not a member of the FINRA or the SIPC. Argus Research is not a registered broker dealer

and does not have investment banking operations. The Argus trademark, service mark and logo are the intellectual property of Argus

DAILY SPOTLIGHT: GdMurpoluaicpraItkinocen.,tTrehOdeisiuntrftioblruomtiooantkioonr

contained disclosure

in this research is prohibited by

report is produced and copyrighted by Argus, and any unauthorized use, law and can result in prosecution. The content of this report may be derived

fsrSoouhmrocreAtsTrbegerumlsie:rveesedatrochbererpeoliratbs,len,obtuets,Aorrgaunsamlyaskeess.

The opinions and no representation

information contained herein have been obtained or derived from as to their timeliness, accuracy or completeness or for their fitness

for any partPicOuRTlaFOrLpIOuSrpToRAsTeE.GTY his report is not an offer to sell or a solicitation of an offer to buy any security. The information and

mEaqtueirtiya:l presented in this report are for general information only and do not specifically address individual investment objectives, fsiCtnraaatsnehcg:iiaelssditiusactuisosnesdomr tahyenpoatrtbiecusluairtanbeleedfsoorfyaonuyasnpdecitifiiscrpeecrosmonmwenhdoemd athyarteycoeuivceotnhsiuslrteapnoritn.dIenpveensdtienngtiinnvaensytmseecnutriatdyvoisroirn.vNesottmhienngt in this report constitutes individual investment, legal or tax advice. Argus may issue or may have issued other reports that are

inTcoondsisateynt'switMh oar mrkayerteaMchodivffeerernst conclusions than those represented in this report, and all opinions are reflective of judgments

made on the original date of publIMicPaAtiCoTn. Argus is under no obligation to ensure that other reports are brought to the attention of any recipient of this report. Argus shall accept no liability for any loss arising from the use of this report, nor shall Argus treat all recipients of this report as customers simply by virtue of their receipt of this material. Investments involve risk and an investor may incur either profits or losses. Past performance should not be taken as an indication or guarantee of future performance. Argus has

E provided independent research since 1934. Argus officers, employees, agents and/or affiliates may have positions in

stocks discussed in this report. No Argus officers, employees, agents and/or affiliates may serve as officers or directors of covered companies, or may own more than one percent of a covered company's stock.

PL Recent Research Review

Statistics Diary

12-Month S&P 500 Forecast: S&P 500 Current/Next EPS: S&P 500 Current Est. P/E: 12-Month S&P P/E Range: 10-Year Yield:

M 12-Mth10-Yr. Bond Forecast:

Current Fed Funds Target: 12-Month Fed Funds Forecast:

A DJIA:

S&P 500:

SNASDAQ:

PREVIOUS 200-DAY CLOSE AVERAGE

Stockpicker's Corner

Large/Small Cap.

Growth/Value:

Five-Day Put/Call:

CURRENT RANKING

Momentum:

Bullish Sentiment:

Mutual Fund Cash:

Vickers Insider Index:

A R G U S R E S E A R C H C O M P A N Y t 6 1 B R O A D W A Y t N E W Y O R K , N. Y. 1 0 0 0 6 t ( 2 1 2 ) 4 2 5 - 7 5 0 0

PLEASE SEE PAGE 2 FOR DISCLAIMER INFORMATION.

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