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Before The Bell: Morgan Stanley Write-Off, Ford Tough

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Morgan Stanley comes clean in write-offs. Ford is turnin' around! Stock futures are mixed.

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Morning Perspective: Morgan Stanley Reveals

Morgan Stanley (MS) announced an additional $3.7 bln in write-offs in the two months ending October 31 on securities linked to risky subprime mortgages. The news coincides with a report by the FT stating the big investment banks would be forced to sharply increase their write-offs on these securities to the tune of $60-70 bln in the coming months, making the forecasts of losses approximately $40 bln more than the banks have acknowledged so far. Toddo mentioned this in yesterday's Random Thoughts.

From the Bull Pen: Lehman Brothers (LEH) held the late October lows yesterday and a trade below $55 can be used as a short-term stop.

From the Bear Cave: Expect an early relief rally in Morgan Stanley as the news wasn't as bad as feared. $60 is a triple bottom break and can be used as a backstop for short-side tries.


Ford Tough

Ford Motor (F) reported a loss of $0.01 EPS, $0.47 better than expectations of -$0.48. Revenues worldwide rose 11.7% year-over-year to $36.3 bln vs. $33.46 bln consensus. The company also stated it was on track to meet its N. American cost reduction target of $5 bln by 2008. The CEO stated the company is achieving its market share goals and ahead of its cash outflow targets while adding the quarterly and year-to-date performances indicate the turnaround plan is working. Read Professor Depew's Five Things You Need To Know from last week for more on consumer spending.

From the Bull Pen: Those believing in Ford's turnaround may set sell-stops at $8.20.

From the Bear Cave: Auto Bears may look to Daimler AG (DAI) if it breaks the recent uptrend line at $106.5

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


Quick Check Around the World

Asian trading closed with the Hang Seng -3.19%, Nikkei -2.02%, Sensex -1.20%, Taiwan -3.90% and Shanghai -4.85%.

A quick check of European bourses finds the CAC -0.47%, DAX +0.28%, FTSE +0.30%, ATX -0.10%, Swiss Mkt. -0.63% and Stockholm -0.51%.


As of 8:30 AM EST, S&P futures are trading +2.20 points and Nasdaq futures are down –5.25 points.


A Look At Commodities

Crude oil is trading higher +0.42 to 96.79. Gold is up +1.10 to 834.60. Silver is also higher +0.07 to 15.39. Copper is lower -0.02 to 323.00. The dollar index (DXY) is up +0.045 to 75.45.


On the Radar

On the radar weekly initial claims data is due out at 8:30 AM EST.

Click here for Minyanville's full trading radar.

Check out Hoofy & Boo's new video! Good luck and have a great day!
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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