Morning Perspective:Three-headed Monster Warns Markets

Former Fed Chairman Alan Greenspan said that the U.S. economy was at risk due to high inventories of unsold homes and that he was not confident about how quickly the glut could be reduced. Billionaire investor George Soros warned at a lecture at New York University that the U.S. economy is “on the verge of a very serious economic correction” after decades of overspending. Further Bond King Bill Gross of PIMCO said the Fed needed to cut rates aggressively to 3.5% because it could not afford to let U.S. housing prices plunge. (From Reuters) Read Professor Depew’s daily column Five Things You Need To Know.

From the Bull Pen: With concerns about economic growth, watch for a rotation into consumer non-durables. Altria (MO), with a stop below the trend-line at $72 and Schering Plough (SGP), with a stop below $29, are potential vehicles.

From the Bear Cave: If global growth concerns manifest, Boeing (BA), with a stop above $99, and General Electric (GE), with a stop above $42, are potential downside vehicles.


Wal-Mart Woos Customers

Last week, retail giant Wal-Mart (WMT) said it would offer the discounts typically reserved for Black Friday in an attempt to woo customers three weeks early. The company slashed prices on electronics and other items listed on its website to appeal to consumers squeezed by high energy and food costs. CNN reports other retailers are following the lead such as rival Target (TGT), and Best Buy (BBY) and J.C. Penney (JCP). Read Professor Shedlock’s Consumer Credit VS. Weakening Demand.

From the Bull Pen: Wal-Mart bulls may place sell-stops below $42 (triple bottom dating back to 2005). Contrarian players with more risk-tolerance may look to TGT with sell-stops below $56 (the 52-week low). Other plays include BBY, support at $46.

From the Bear Cave: Traders believing that the price wars will inevitably pressure margins can look to play the downside on WMT, buy-stops above $46. JCP is approaching its 52-week low; buy-stops may be placed above $55.00 (the 10-DMA).

Click on Minyanville's Stocks to Watch for more company-specific ideas.


Quick Check Around the World

Traders jump puddles on the Street this morning as they come in to find Europe in the green and Asia skewed to the red.

Asian trading closed with the Hang Seng +1.71%, Nikkei -0.12%, Sensex -0.61%, Taiwan -0.17% and Shanghai -1.74%.

Glancing across the Atlantic, we find the CAC +0.34%, DAX +0.58%, FTSE +0.48%, ATX +0.42%, Swiss Mkt. +0.49% and Stockholm +0.74%.

As of 8:30 AM EST, S&P futures are trading +7.80 and Nasdaq futures are up +14.25 points.


A Look At Commodities

Crude oil is trading higher +1.82 to 95.79. Gold is up +12.7 to 823.40. Silver is also higher +0.25 to 15.03. Copper is up 3.9 to 334.10.


On the Radar

Today is another light day on the radar with no economic events scheduled.

Click here for Minyanville’s full Trading Radar.

It’s always a sunny day at Minyanville! Good luck and have a great day!