Two Ways: Citi Breaks the Buck
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Citigroup (C) shares sunk below $1 today as the rest of the banking sector was bathed in red - a symptom of ongoing concerns of a downward-spiraling economy.
Formerly the largest bank by market capitalization, Citi traded to $0.97 cents a share intraday. Government action has done little to spur investor confidence even after the Treasury said last week it will convert up to $25 billion of preferred stock to common stock.
According to Bloomberg, Citigroup has reported over $37.5 billion in losses over the last 5 quarters. The fact that the US government has provided the company with $45 billion has done little to stem the bleeding.
In late 2006, the stock hit an all-time high of $57 a share, back when the bank had a market capitalization of $277.2 billion. Today, Citi's stock closed today down 9.7% to $1.02, setting the total dollar market value of the firm at a little over $5 billion.
From the Bull Pen: Today's tape was the modern-day version of the Wild West: You were a winner if you were long gold and guns. Bulls can still look to yellow metal, which finally broke its 8-day losing streak with a bang. One can use the ETF (GLD) with a 2-point sell stop.
From the Bear Cave: Something seemed to be keeping General Electric (GE) afloat today. Nonetheless, bears can still press the downside. Defined risk using puts could be an option.
Thirsty Thursday's! See you at Stag's Head! Goodnight!
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