Minyanville's Before The Bell: More Banks Expected to Disclose, Futures Point Higher
More Banks are expected to disclose large writedowns. Investors are pleased as futures point higher.
Write-downs in the big banks may continue this morning. Sanford Bernstein analysts say JPMorgan Chase (JPM) and Bank of America (BAC) may write down a combined $3 bln in fixed-income securities that have been rocked due to this summer's credit crunch. (From Bloomberg) As we've said all week, these large disclosures have had a positive impact for the trading day. Look for strength in JPM, BAC, GS, and possibly some of the other large investment banks for a quick rally today. Continue to watch the levels of BKX and XBD. Also read Professor Shedlock's Problems For Banks, Problems For You? for more insight into the financials sector.
In an effort to clear their balance sheets, homebuilders such as KB Home (KBH), and Hovnanian (HOV) slashed prices in overbuild developments as much as six figures. (From Businessweek). Professor Depew gave a context on the housing industry noting the long-term sales trends. Click here to read his Five Things You Need To Know from Tuesday.
Private Equity giant Carlyle Group is expected to announce a $605 mln ventures in the U.S. that will focus mainly on later-stage deals and buyouts. The later stage deals will likely involve $20-30 mln investments in mature companies already producing revenues compared with a typical initial investment of around $5 mln in a start-up with little revenue. The transition may be a prediction of what is in store for the U.S. economy. Read Mr. Practical's views for more context in his article The Fed Rate Cut Aftermath.
For stock-specific ideas, click here to get Minyanville's Stocks to Watch. Also, get a quick review of yesterday's trading with our Buzz Bits and Professor Tuttle's Winners & Sinners.
A Quick Check Around The World
Hong Kong's Hang Seng surged in last night's trading closing up +3.18%. Other Asian markets were flat and Shanghai remained closed due to a holiday. Expect a major move in the iShares China 25 Index (FXI) when China comes back live. Also read Professor Depew's Five Things You Need To Know from earlier this week for a hilarious, yet informative view on the Hang Seng market.
A Look In Commodities
Crude is lower by a penny to $81.43 and Gold is lower by $1.60 to $742.20. Many of the professors here at the 'Ville continue to be bullish on energy and the metals. Keep eyeing the major ETF's (USO, OIH, GLD, GDX, and SLV).
What To Expect Today
The all-important jobs report is due out at 8:30 AM EST. Nonfarm payrolls is expected to come in at 100 k and the unemployment rate is expected to be slightly higher at 4.7%. Hourly Earnings and Average workweek are expected to be at 0.3% and 33.8% respectively. Consumer credit data is due out at 3:00 PM EST. The data is not considerably market-moving, but keep an eye out on Retail HOLDRS (RTH) as well as the individual consumer stocks (WMT, TGT, GPS, COH).
It's Friday, Minyans. Only a few hours until lunch and then it's practically the weekend! Keep checking back with us for continuously-updated information you need to know. Good luck and have a great day!
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