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PRIME STOCK NEWSLETTER FOR DECEMBER 17th, 2009

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Position Statement: In our Prime Recommendation Letter we attempt to identify the recommendation with the highest probability of moving higher.  We recommend that stop orders be placed at the time of purchase,  and once the position has moved profitable we recommend a stop be placed a minimum of $0.375 above the purchase price and moved higher as the position moves higher.

Today's Comments: The overall market was mixed on Wednesday with the Dow Jones Industrial Average finishing the day slightly lower while the NASDAQ and S&P 500 finished the day slightly higher. There was strength in the Airlines, Disk Drive Manufacturers, Broker/Dealer, Semiconductors, Commodities, Oil Services, Gold/Silver, Natural Gas, Chemicals, Insurance, High Tech, Oil & Gas, Cyclicals, Transports, and Pharmaceuticals. There was weakness in the Biotech, Healthcare Providers, Retailers, COnsumer, Banking, and Telecom indices. Oil was higher by $2.25 to $72.92/barrel, and Gold was higher by $18.00 to $1,141.00 per ounce.


Sterling Calendars for December 17th, 2009
Economic Calendar
Date Est. Time Release

For

Consensus Prior
12/17 8:30am Initial Claims 12/12 465K 474K
12/17 8:30am Continuing Claims 12/05 5,170K 5,157K
12/17 10:00am Leading Indicators Nov. 0.7% 0.3%
12/17 10:00am Philadelphia Fed. Dec. 16.0 16.7

Recommendation: Sell/Short

The Travelers Companies, Inc. 'TRV'

Company: Travelers Companies, Inc. Symbol: 'TRV' Closing Price: $49.70

Web: www.travelers.com

YH: $54.47 YL: $33.07 EPS: $5.38 P/E: 9

Shares Outstanding: 546 Million

Forecasted EPS: $5.62 Market Cap.: $27 Billion
Dividend: $1.32 Yield: 2.60% Aver. Daily Trading Volume: 5 Million Shares  
Price Targets:  $48.02 and then $44.93 Upside Stop:  $50.31/share
Options Rec.: January 50 Puts @ $1.60/contract Options Symbol: TRV M 50

Additional information on The Travelers Companies, Inc. 'TRV' can be found (here)

Company Description: The Travelers Companies, Inc., a holding company, provides various commercial and personal property and casualty insurance products and services to businesses, government units, associations, and individuals primarily in the United States. The company operates in three segments: Business Insurance; Financial, Professional, and International Insurance; and Personal Insurance. Business Insurance segment offers property and casualty products and services, such as commercial multi-peril, property, general liability, commercial auto, and workers’ compensation insurance. It operates in six groups: Select Accounts, which serves small businesses; Commercial Accounts that serves mid-sized businesses; National Accounts, which serves large companies; Industry-Focused Underwriting that serves targeted industries; Target Risk Underwriting, which serves commercial businesses requiring specialized product underwriting, claims handling, and risk management services; and Specialized Distribution that offers products to customers through licensed wholesale, general, and program agents. Financial, Professional, and International Insurance segment provides surety and financial liability coverage, which requires a credit-based underwriting process, and property and casualty products primarily in the U.S., the United Kingdom, Ireland, and Canada. Personal Insurance segment offers property and casualty insurance covering personal risks, including primarily automobile and homeowners insurance to individuals. It distributes its products through independent agents, sponsoring organizations, joint marketing arrangements with other insurers, and direct marketing. The Travelers Companies was formerly known as The St. Paul Travelers Companies, Inc. and changed its name to The Travelers Companies, Inc. in February 2007. The company was founded in 1853 and is headquartered in St. Paul, Minnesota. The Travelers Companies, Inc. operates independently of Citigroup, Inc. as of August 20, 2002..

Chart for Mosaic Company

Chart updates daily

Recent News:
12/16 Coverage initiated on Travelers by Deutsche Bank Briefing.com (Wed 1:12am)
  12/09 2010 Hurricane Season Seen as "Above Average"  at Fox Business (Wed, Dec 9)
  12/02 US House panel backs watershed financial risk bill  at Reuters (Wed, Dec 2)
A full list of the news headlines for The Travelers Companies, Inc. 'TRV' can be found (here)

Our Analysis: The shares of The Travelers Companies, Inc. 'TRV' moved sharply lower yesterday. They finished the day by closing below a recently established support level. This is a bearish trading signal. The shares of 'TRV' should continue to move lower and test $48.02/share, the point from which they gapped higher on the open of trading on October 22nd of this year. If the shares of 'TRV' close below that level, then they should continue to move lower and test $44.93/share, a point of downside support established on August 11th of this year. I see upside resistance on the shares of 'TRV' @ $49.92/share, and have set my stops accordingly at $50.31/share.


Stocks Looking Higher
BID, WDC, CYBX, MRVL, AWK, SF, BRCM, LINE, UNH, GDI, CRTX, GWR, DTSI, NETL, ADBE, IRF, NVLS, SCL, ANR, TDC, EAC, OC, SFSF, NVDA, DELL, HPQ, X, LLTC, DE, CTXS, DBRN, SYK, PAY
Stocks Looking Lower
CVS, T, GILD, VZ, ESRX, AMZN, MHS, ME, PCAR, NFLX, PWRD, CBE

Yesterday's Edition of the Prime Stock Newsletter
The Sterling Investment series of newsletters is produced by Sterling Investment Services, Inc.  If you would like to receive a chart on any index or stock mentioned in this report please contact us at the below mentioned numbers.  We also offer custom research reports on any stock investment that you may desire information on.  To receive further information on these services please visit our web page at:  www.sterlinginvestments.com   If you would like to contact us our # is 800-275-6901,  fax # (404)-816-8830  Email address is: enelson@sterlinginvestments.com  Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.
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