Buzz Bits: Dow and Nasdaq End Lower
Your daily Buzz & Banter highlights.
Get over it, go out with someone else! - Todd Harrison - 3:03 PM
Seriously, is anyone else having a tough time shaking the Monday's? Hoofy sure seems to be as the combination of upside resistance and Super Bowl Sunday is making for a somber session. I'll raise my hand as well despite what was, by all accounts, a rather tame night as Gotham got it's groove on. Some top-line vibes:
- I've been trading small and smaller following last week's lift to our level. The mechanics of the swing (pharma over banks) seems right, for now, but I'm trading with Todd-lots and have no issues with further flattening both ways.
- The drillers are out-performing as crude wags some 'tude (+1%). Keep OSX 270 on ye radar as that resistance is coming up quick.
- You can learn a lot just by watching. On Friday, Wells Fargo (WFC) acted punk and punker. Today, as money rotates out of the financials, it's taking it on the chin (-7.5%).
- Overall, given the lift we've seen by the banks and homies, some giveback is to be expected. How the bulls react to this wave of selling will speak volumes as we find our way through the freaky fray.
- Sometimes right, sometimes wrong always honest? Yeah, that be me and, as such, I can share that we positioned for a bungee off the lows a few weeks back and pulled in the horns (and sniffed at some fur) as we edged to our level. It seems a bit pat but if one would script "textbook" action, that would be it.
- Breathe. We're almost there cookie.
Fed Senior Loan Officer Survey - Kevin Depew - 2:45 PM
Here is a link to the full copy of the Fed's quarterly Senior Loan Officer Survey.
The net of the survey is a clear pattern of a combined tightening of credit standards and weakening loan demand spread across a wide range of loan types. If there was a lingering perception that these credit issues are contained to real estate, specifically subprime, then this report should end any doubts.
About 55 percent of domestic respondents indicated that they had tightened their lending standards on prime mortgages, up from about 40 percent in the October survey.
Concerning residential real estate loans, between about 70 percent and 80 percent of domestic respondents expect the quality of their prime, nontraditional, and subprime residential mortgage loans, as well as of their revolving home equity loans, to deteriorate in 2008.
The credit issues are widespread and infecting both business and household loan demand.
End of the End of the World Ideas - Ryan Krueger - 1:39 PM
I'm not very good at calling the next seven S&P handles either way, but I will share seven stocks that I am taking a peek at (one I own, two I'm chewing on) resulting from a page in my playbook about what to run when "investors" listen to stocks' noise more than news.
During the most volatile months I have always enjoyed looking back at headlines relegated to the back pages, and in January's case that means fundamental data released into a tape that didn't have room for it.
Here are seven stocks that quietly beat on the bottom line, beat on the top line, and guided estimates higher.
- Airgas (ARG)
- Eastman Chemical (EMN)
- Evergreen Solar (ESLR)
- Forest Laboratories (FRX)
- Harris (HRS)
- PerkinElmer (PKI)
- Symantec (SYMC)
Position in HRS
Perfectville - Adam Warner - 11:39 AM
I may be a tad biased, but this from Reebok is the Best... Ad... Ever.
Anyway, interesting little juncture here in the VIX. Friday's drop literally went right to the 50 DMA. Not to mention that it dipped 10% below the 10 Day SMA, sort of kind of sort of a signal that it has become overbought in the very short term. I add those qualifiers because I don't consider this the greatest timing tool in the shed. Rather, I think the way to look at it is almost backwards.
Click to enlarge
How does the market act WHEN this indicator gets oversold (overbought)? What does it tell us about the intermediate term strength of the market? Two weeks ago the VIX was very overbought, and it got worse and worse before the market decline ebbed. It's still early, but the market has not reacted well to the reverse, an oversold VIX. That's not a great sign, but again I would reiterate it's not even lunch time yet. So just something to keep on the radar.
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