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Minyanville's Before The Bell: A Fresh Wall of Worries; The Earnings Game


Credit-market jitters are back but NYX is trading to success. Futures are pointing higher.


Morning Perspective: A Fresh Wall of Worries

The WSJ reports the credit-market turmoil that rocked the markets this summer is starting to gain steam again. Yesterday, an analyst with CIBC commented that Citigroup (C) would need to cut its dividend or sell assets just to meet a $30 bln shortfall. Further, the major credit rating firms downgraded over $100 bln in CDOs in October alone. With UBS (UBS) holding more than $20 bln of super-senior tranches of CDOs, it may be reason why the firm has warned of further losses. Todd spoke of the warning signs in the banks in yesterday's Random Thoughts.

The Bull Pen: Traders believing the dividend chatter with respect to Citigroup is overdone may find an entry here attractive, with sell-stops below $38, which is a technical zone dating back to 2003.

The Bear Cave: Those concerned that UBS will report more losses may play the downside with a stop above $51.25, which is the bottom end of the recent gap.

The Earnings Game

NYSE Euronext (NYX) reported this morning with EPS figures for the third quarter at $0.76 vs. estimates of $0.72. Revenues rose 77.2% year-over-year to $1.07 bln vs. $0.99 bln consensus.

Viacom (VIA) reported 3Q earnings of $0.65 better than analyst estimates of $0.60. Revenues rose 24.2% year over year to $3.27 bln vs. consensus estimates of $3.01 bln. Profits rose 80% on advertising and ticket sales from movies such as "Transformers," the year's third-highest grossing film in the U.S. (from Bloomberg)

Get more insight and ideas in Professor Tatro's article Trading As The Dust Settles.

From the Bull Pen: Those looking to play NYX from the long side can set stops below $88, which is recent support.

From the Bear Cave: Those bearish Viacom can play the downside with stops just above the October high ($41.50).

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

Quick Check Around the World

Asian trading closed with the Hang Seng -3.25%, Nikkei -2.09%, Sensex +1.28%, Taiwan -3.39% and Shanghai -2.31%.

A quick check across the Atlantic finds the CAC -0.93%, DAX -0.89%, FTSE -1.13%, ATX -1.76%, Swiss Mkt. -0.95% and Stockholm -1.26%. As of 9:00 AM EST, S&P futures are up 4.7 points and Nasdaq futures are up 13.75 points.

A Look At Commodities

Crude is up +0.97 to 94.46. Metals are higher with gold +2.1 to 795.8, Silver +0.03 to 14.33, and Copper +0.40 to 336.65.

On the Radar

Below is a list of economic events schedule for today.


8:30 Nonfarm Payrolls: 90k cons
8:30 Unemployment Rate: 4.7% cons
8:30 Hourly Earnings: 0.3% cons
8:30 Average Workweek: 33.8 cons
10:00 Factory Orders: 1.0% cons

Click here for Minyanville's full Trading Radar.

Happy Friday, Minyans! Good luck today!

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No positions in stocks mentioned.

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