Two Ways: Another Bank Bites the Dust
Strengthen your portfolio in good times and bad.
Last night US bank regulators seized BankUnited FSB, a Florida lending company owned by parent company BankUnited Financial Corp. (BKUNA) in what amounts to be the biggest bank failure for 2009.
According to Reuters, a team of private equity players led by John Kansas, former head of North Fork Bank, will put up $900 million to take over the banking operations. Other parties include Wilbur Ross' WL Ross & Co, Carlyle Croup, Blackstone Group (BX), and Centerbridge Partners. The Federal Deposit Insurance Corp said it is trying to get more companies involved to invest in failing banks in an effort to tap the $1 trillion in underinvested capital among private equity firms. The failure of BankUnited will cost the FDIC $4.9 billion.
For related comments on the banking sector, see Minyan Peter's State Street to Investors: Heads I Win, Tails You Lose.
From the Bull Pen: Bulls can look elsewhere. For a technical play, consider engineering and construction company KBR (KBR). Previous resistance at $16.50 is now acting as support. One can set a sell stop below that level on upside tries.
From the Bear Cave: Banking stocks are ignoring the news this morning and rallying. But the seizure is still a reminder of the fragility of the banking system. For bears, watch the financial ETF (XLF). Failing below $12.40 would mark a lower high, while closing below $11.20 would mark a lower low. Continue to eye this stock for signs of an intermediate downtrend in the sector.
Quick Check Around the World
Asian trading closed with the Hang Seng -0.80%, India 1.10%, Nikkei -0.41%, Shanghai -0.50% and Taiwan 0.28%.
Glancing towards Europe, we see the CAC 0.99%, DAX 0.97%, FTSE 0.76%
As of 8:30 AM EST, S&P Futures are trading +5 to 893.00, and Nasdaq futures are +6 to 1374.00.
A Look at Commodities
Over in commodities, crude oil is trading +0.52 to 61.57 while gold is +5.90 at 957.10 this morning. Silver is +0.340 to 14.78 and copper +4.65 to 209.75.
The dollar index is -0.4950 to 80.1450.
Nothing on the radar for this Fat Friday. Good luck and have a great, long weekend!
Actionable ideas, instant analysis. Real-time from bell to bell.
Minyanville's Buzz & Banter - 14 day FREE trial
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.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter