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

ARGUS MARKET W ATCH

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Market Outlook

PREVIOUS 200-DAYCLOSE AVERAGE

DJIA:S&P 500:NASDAQ:Large/Small Cap.Growth/Value:

CURRENT RANKING

IMPACT

DAILY SPOTLIGHT:

Today’s Market Movers

Statistics Diary

Short Term:

Equity:Cash:

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:12-Mth 10-Yr. Bond Forecast:Current Fed Funds Target:12-Month Fed Funds Forecast:

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

Recent Research Review

PORTFOLIO S TRATEGY

Independent Equity Research Since 1934

®

1165-1465 103.5/113.5

13.5210.3 - 12.9

1.63%1.5-2.5%

0.25%0.0-1.00%

Bernanke to Speak +

European Markets Higher +

Splunk Climbs on Q2 Results +

July Factory Orders Est. Up 2% +

13000.71 12701.961399.48 1337.273048.71 2876.76

0.97 0.951.21 1.19

0.87 Positive-522000 Positive

34% Positive4.30% Neutral

3.54 Negative

FRIDAY, AUGUST 31, 2012

Markets Poised for Bernanke SpeechThe market is anxiously waiting to hear from Federal Reserve Chairman BenBernanke, who is scheduled to speak from the central bank’s annual summit inJackson Hole, WY, today. Though Bernanke in the past two years has not explicitlyannounced policy changes from this podium, he has strongly hinted that the Fedwould 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 actuallybegan under Chairman Alan Greenspan after the 9/11 attacks. Greenspan did let ratesrise as his term ended in January 2006, and Bernanke briefly pushed them higher. Butstrains in the banking system in mid-2007 took real rates back to negative territory.Though stock investors like the QE programs, we think the continuation of negativereal rate and easy money growth policies creates the risk of higher inflation and/orrenewed decline in the U.S. dollar.

KRAFT FOODS INC. (NYSE: KFT).......................................... BUYKraft, a Focus List selection, continues to post sector-leading sales growthduring a period of soft consumer spending and significant cost inflation. Kraft’sforthcoming split into two separate businesses, one focusing on internationalsnack brands and the other on domestic groceries, should enable the companyto further capitalize on its opportunities through more-targeted businessstrategies and more-efficient capital allocation. The separation is expected tooccur on October 1, 2012. The announcement of the spinoff and interim robustearnings growth should continue to serve as catalysts for share-price appreciation.Our target price on the KFT shares is $46.

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

Bearish

65%5%

ARGUS INTEREST RATE OUTLOOK (%)

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Stockpicker's Corner

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

ARGUS MARKET W ATCH

PLEASE SEE PAGE 2 FOR DISCLAIMER INFORMATION.

Market Outlook

PREVIOUS 200-DAYCLOSE AVERAGE

DJIA:S&P 500:NASDAQ:Large/Small Cap.Growth/Value:

CURRENT RANKING

IMPACT

DAILY SPOTLIGHT:

Today’s Market Movers

Statistics Diary

Short Term:

Equity:Cash:

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:12-Mth 10-Yr. Bond Forecast:Current Fed Funds Target:12-Month Fed Funds Forecast:

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

Recent Research Review

PORTFOLIO S TRATEGY

Independent Equity Research Since 1934

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