Raise the drawbridge and man the parapets. Some investors are looking to defend their portfolios with help from mutual funds and exchange-traded funds that buy stocks of companies with “wide moats”—meaning barriers to entry that their competitors find extremely difficult to overcome. “Moat” is Warren Buffett’s description of such an advantage. The famed investor has said that he seeks “economic castles protected by unbreachable ‘moats.’ ” The idea is to buy, when they are reasonably priced, shares of companies that dominate their industries and show clear potential to maintain their superiority over decades.
Warren Buffett’s bets on housing aid Berkshire Hathaway (Omaha)
Berkshire Hathaway Inc. is benefiting after billionaire Chairman and CEO Warren Buffett increased investments tied to the U.S. housing market and sidestepped bets on Europe amid the region’s debt crisis. …Buffett added to holdings of Wells Fargo & Co., the largest U.S. home lender, bought real-estate brokers and bid on mortgage assets of bankrupt Residential Capital LLC as he bets on a rebound in housing in the world’s largest economy. Rather than spend his company’s cash pile on European companies after a 2008 trip to the region, he made his largest acquisitions in the U.S., including Fort Worth, Texas-based railroad Burlington Northern Santa Fe.
Finally, It Is Time to Buy a House (WSJ)
Warren Buffett famously once said: “Be fearful when others are greedy, be greedy when others are fearful.” And if you’re not instinctively scared of the housing market, then global warming, saturated fat, running with scissors and the bogeyman probably aren’t keeping you awake at night, either.
Berkshire Hathaway results to reflect weak economy (MarketWatch)
Burdened by a feeble U.S. economy and a lackluster stock market, Warren Buffett’s Berkshire Hathaway Inc. is expected to report only a marginal increase in earnings when it releases second-quarter results on Friday. “There are three different dynamics in the quarter. The economy is slowing down, which is offset by the fact that housing is getting better. But car insurance claims costs are going up rapidly,” said Meyer Shields, an analyst at Stifel Nicolaus.
Obama’s Golf Buddy: ‘Businesses Doing Extremely Well’ (CNBC)
The banker who got into hot water apparently for his public embrace of President Barack Obama is no longer chief of UBS in the Americas. A day after he left the Swiss bank, Robert Wolf appeared Thursday on CNBC’s “Squawk Box,” defending his golf buddy’s attempt to win re-election to the White House. There are many bright spots in the economy, he told CNBC, adding that for every Obama foe like Donald Trump, there’s a supporter like Warren Buffett.
Domtar Paper Enters Oversold Territory (Forbes)
Legendary investor Warren Buffett advises to be fearful when others are greedy, and be greedy when others are fearful. One way we can try to measure the level of fear in a given stock is through a technical analysis indicator called the Relative Strength Index, or RSI, which measures momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30. In trading on Thursday, shares of Domtar Paper Incorporated (Toronto: UFX) entered into oversold territory, hitting an RSI reading of 28.3, after changing hands as low as $71.00 per share.
Investors in Phillips 66 Should Not Focus on Buffett and Berkshire Hathaway Stake (PSX, COP, BRK-A) (247Wallst)
Phillips 66 (NYSE: PSX) has risen handily since Warren Buffett disclosed that he has a stake in the oil company in the middle of July. Now shares have hit a new post-IPO high after earnings, although shares have backed handily off from those highs. It seems that investors added too much Buffett-hype this morning as the media outlets were pumping that Buffett owns a new stake in the company. It was in mid-July that Warren Buffett said Berkshire Hathaway Inc. (NYSE: BRK-A) has invested additional capital via one of his new investment managers (Ted Weschler or Todd Coombs). When Buffett made this announcement on Bloomberg TV, the share price of Phillips 66 was $34.75 on a dividend adjusted price basis, but shares had dipped down into the high $20s just a month before.
Questions to ask before investing in Nokia or RIMM (EmergingMoney)
Despite recent bullish developments for Nokia Corporation (NOK, quote) and Research in Motion (RIMM, quote), traders should still be very cautious before buying. Nokia is up 23.31% for the last week of trading after posting earnings with some favorable results. Over the same period, Research in Motion rose by 8.78%. Research in Motion received a massive investment from Prem Watsa, known as the Warren Buffett of Canada. Watsa nearly doubled his stake in the Blackberry smart phone maker to almost 10%, making him the largest shareholder.
Executives, Shareholders Sell China BYD Stock (WSJ)
Key executives and other big shareholders of Chinese car and battery maker BYD Co. 1211.HK -1.49% have sold 859 million yuan ($135 million) of shares in the company in the past month, highlighting concerns about the growth prospects of the company backed by billionaire U.S. investor Warren Buffett. Data from the Shenzhen Stock Exchange show that 53.77 million shares, or 2.3% of BYD’s total outstanding stock, had been sold through the exchange’s block trading system at prices ranging from 12.78 yuan to 18.30 yuan each from July 2 to Aug. 1.
Buffett Railroad Beats Coal Slump With 75% Gain In Oil (Bloomberg)
Warren Buffett’s Burlington Northern Santa Fe railroad and Union Pacific Corp. (UNP) are combating a drop in coal cargoes by catering to the industry responsible: the hydraulic fracturing of shale formations. BNSF, Union Pacific and their peers are hauling in energy producers’ gear to extract crude oil and gas from shale, then shipping out petroleum products. BNSF’s petroleum carloads rose 75 percent in the second quarter from a year earlier while Union Pacific saw a 12 percent gain in the unit where it groups fracking-related freight.
