Before The Bell: India Losing Its Luster; Bank of America Earnings
Rising doubt India's ability to turn into a global superpower.
According to the WSJ, the prospect of India becoming the next economic superpower is losing its magic as inflation and a slumping global economy continue to take their toll. India's GDP, which has averaged slightly below 9% for the past five years and grew 9.6% in 2007, is expected to grow between 7% to 8.7% in the fiscal year that ended last month. Although the difference may not sound like much, some believe the country's economy must continue to grow between 9% to 10% to wipe out the deficit of previous growth rates. Get Professor Sally Limantour's perspective in The Global Infrastructure Boom.
From the Bull Pen: Bulls are aware of the challenges but still see the upside in infrastructure plays such as Caterpillar (CAT); entry near $80, sell-stops can be set below $75.
From the Bear Cave: Bears can play the downside in the India Fund (IFN); buy-stops can be set above the 200 DMA ($52).
Bank of America's (BAC) earnings net fell 77% to $1.21 bln, or 23 cents per share in the first quarter. The figure was far below consensus estimates which called for the second largest U.S. bank to report $0.41 per share. Revenues fell 6.4% on a y/y basis to $17.3 bln vs. $16.46 bln consensus. The company also reported $1.31 bln in trading-related losses which included $1.47 bln in writedowns of collateralized-debt obligations and $439 mln on leveraged loans. Further, BAC increased its provision for credit losses to $6.01 bln from $1.24 bln amid rising credit costs in home-equity, small-business and homebuilder portfolios. Read Toddo's Random Thoughts as we continue to progress through the heart of earnings season.
From the Bull Pen: Those that believe there is upside in BAC in the near-term can set sell-stops below $38.
From the Bear Cave: Financial bears can look to Lehman Brothers (LEH) for a downside play; entry near $50 with buy-stops set above.
For more ideas, check out Minyanville's Spotlight Stocks.
Quick Check Around the World
Asian trading closed with the Hang Seng +2.17%, Nikkei +1.63%, Sensex +1.57%, Taiwan +0.10% and Shanghai +0.72%.
A quick look towards Europe finds the CAC -1.12%, DAX -0.82%, FTSE -0.20%
As of 8:15 AM EST, S&P futures are lower -1.1 points to 1386, and Nasdaq futures are down -1.5 points to 1901.
A Look At Commodities
In commodities, Gold is higher +10.3 points to 922.50. Crude oil is higher +0.38 to 117.07. Silver is up +0.040 to 17.860. and copper is lower -2.25 to 391.95.
The dollar index is lower -0.340 to 71.666.
No events on the radar today, but click here to see all the events for the week.
Happy Monday! Have a great day!
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