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MV Weather Report: Whitney Rains on Banks' Parade


Rain or shine, we review the day's biggest stock stories.

After a long slumber, Meredith Whitney finally awoke today. Don't remember her? She's the one who told us to sell the banks eons ago, then went bullish on them just before this last run.

As Professor Cooper says, "Follow the leader." Whitney said that, on a core basis, she would absolutely not own the financial stocks, as she believes their earnings power is negligible. She attributed the recent rally to short-covering and reweighting.

The financials had a rough day today. The big losers were PNC Financial (PNC), Wells Fargo (WFC), Capital One (COF) and JPMorgan (JPM). I would note that the financials were down before Whitney's comments.

Whitney went on to say she believes the credit contraction is accelerating as consumer spending slows, and that shorting the retailers may be the way to play. The easiest way to do this is by shorting the retail ETF (RTH).

Other then Whitney's bearish vibes, there were some bright spots in technology today, which rebounded from last week. Stocks like Amazon (AMZN), Apple (AAPL), Google (GOOG), and Microsoft (MSFT) had nice up days.

As for the S&P 500, it was down almost 20 points to 909. Today on the Buzz and Banter, Professor Jeff Cooper offered his opinion as to where he thinks the S&P could be headed for the week, giving the added pressure of options expiration.

"Without a conspicuous news catalyst pointing to this morning's weakness, it may be that the arbs have pulled the plug prior to options expiration.

"According to my gnome high in the Appalachians, last week (on Wednesday) there were a substantial number of upside Spyders call sold and downside puts bought.

"So in the short run Thursday may have been a small A wave down with Friday being a B wave back up and today having a better than average likelihood of being a C wave back down.

"The Weekly Swing Chart turns back down on trade below 879.20. But, a break below 90 Spyder or 900 S&P will be a warning of a weakened uptrend.

"The arbs would probably love to see a close for the week near 900 thereby pocketing the most premium, but will the S&P trade meaningfully lower first?"

Long week ahead, Minyans. Heads up tomorrow for Turnaround Tuesday -- I hate it, and so does Terry Woo -- but you gotta learn to love it.

Rest up, and have a great night!
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No positions in stocks mentioned.

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