Before The Bell: China's Biggest Risk; CROCodile Rock!
China's biggest risk is a slowdown in the U.S. Do the CROCodile Rock! Futures are up this morning.
FT reports China's commerce ministry is warning that the slowing of global growth stemming from the U.S. subprime mortgage crisis represents the "biggest challenge to China's economy next year." The Chinese government is concerned that a drop in Chinese exports would mark a "turning point" for the country's rapid growth. Chinese exports account for over 33% of the country's economic growth and 10% of overall GDP. Just four years ago, exports contributed nothing to headline growth figures. Read Todd's Eight Rays Of Light.
From the Bull Pen: Those bullish on both economies in the near-term may play the China 25 Index Fund (FXI); sell-stops below $178.80 (20-DMA) or $170.00 (uptrend from August low) for those with a longer-term risk profile.
From the Bear Cave: Should global growth concerns manifest, bears may see a play in General Electric (GE); buy-stops placed above $38.40 (trendline from November high).
The WSJ reports Crocs (CROX) unveiled 28 new models for its Spring 2008 collection. Crocs CEO Ron Snyder emphasized a strategy of function and comfort as well as fashion in an effort to diversify the company's product line. Crocs' stock has risen sixfold since its IPO in February 2006; however, shares plunged 36% earlier last month due to a disproportionate rise in inventories. Read Prof. David Nelson's Staying Honest With Losses and Prof. Jeffrey Cooper's Wall Street's Information Game.
From the Bull Pen: Professor Cooper has recently been bullish on CROX. Those bullish may place sell-stops below $40.90 which represents the trendline from the November low.
From the Bear Cave: A bearish play in the retail footwear space may rest in Timberland (TBL). Dr. Jon Najarian recently mentioned the company closing 40 stores nationwide with more to come in 2008. Bears may see a prudent entry should the stock rally to its 20-DMA ($16.10); buy-stops set above.
Click on Minyanville's Stocks To Watch for more company-specific ideas.
Quick Check Around the World
Asian trading closed with the Hang Seng +1.61%, Nikkei +0.83%, Sensex +1.07%, Taiwan +0.30% and Shanghai +2.58%.
A quick glance towards Europe finds the CAC +0.98%, DAX +0.75%, FTSE +1.38%, ATX +1.15%, Swiss Mkt. +0.47% and Stockholm +0.96%.
A Look At Commodities
Crude oil is up this morning 1.26 to 89.58. Gold is higher 1.40 to 809.00. Silver is up 0.03 to 14.50, and copper is down -1.8 to 300.20.
As of 8:30 AM, S&P futures are up by 15.0 points, and Nasdaq futures are higher by 25.75 points.
On the Radar
8:30 Productivity-Rev: 5.5% cons
10:00 Factory Orders: 0.4% cons
10:00 ISM Services: 55.0 cons
10:30 Crude Inventories
Click here for the full trading radar.
Happy Weekly Crude Inventories Day! Good luck!
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