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Minyanville's Market Recap: Countrywide's New Friend Bank of America, Markets Still Finish Lower

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Countrywide received a gift from Bank of America while Bill Gross offered a solutions to the economy.

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Stocks ended their winning streaks as investors took profits from an overall positive week. The Dow ended down 0.25 points at 13,235, Nasdaq ended down 11.10 points at 2541, and the S&P ended down 1.57 points to finish at 1462.

Topping the headlines was news released late yesterday that Countrywide (CFC) received a $2 bln dollar injection from Bank of America (BAC). Countrywide CEO Angelo Mozilo was on CNBC attempting to assuage investor concern that the deal was a "win-win" for both sides. Although the stock opened up strong, CFC gradually faded throughout the day finishing +0.92% at $22.02. Toddo warned readers on the Buzz and Banter that "CFC must stay bid or the wheels will wobble off the wagon." Professor David also spoke of the deal in his article Financial Sector, Heal Thyself.

Although the CFC/BAC news dominated the headlines today, Bloomberg reported outstanding commercial paper fell 4.2% this week, the biggest weekly drop in seven years. Data released by the Fed showed short-term debt maturing in 270 days or less fell $90.2 bln in the week ended yesterday. The retreat may have suggested that last week's decision to cut the discount rate by the Fed did not do enough to calm the markets. Please read Professor Zucchi's Financials Gone Wild for more insight into the CFC/BAC deal and the Fed's decision-making.

Pimco's Bill Gross also made headlines today when he released a statement saying the solution to the current financial picture had to begin with Fiscal policy in Washington and bailing out the homeowners. Not even a 200-300 basis point cut would do the trick, Gross said. Please read Mr. Practical's article More Bailouts Could Bring Disaster Down The Road as he discusses and argues the points of Gross' comments.

In some stock-specific news, Apple (AAPL) was a notable laggard losing 1.17% to finish at $130.95. The loss may be seen as a healthy pull-back as the stock gained over $10 the previous two trading sessions. Please read Professor Udall's 21 Bullish Predictions For Tech as he mentions Apple and other investment ideas for the remaining half of the year.

Home Depot (HD) was also on the radar but mainly for the deadline to close the sale of its wholesale-distribution unit. HD finished -2.16% at $34.02. Toddo mentioned on the Buzz that he was seeing big two-sided option bets predicting a strong move in the stock.

Below is a recap of the idea flow on today's Buzz and Banter. Please note that stocks may appear on both bearish and bullish categories due to long and short term trades by our many Minyanville professors.

Some bullish trade or investment ideas: ACKS, ANAD, BMRN, LLNW, GME, ZUMZ, TGT, FWLT, MDR, BX, APKT, JDSU, IDTI, CLMS, BRCD, GSS

Some bearish trade or investment ideas: NOV, CFC, GDX, .RUT, TEX, MA, SNE, RIMM, AAPL, CROX, BIDU

Also be sure to click on our Buzz Bits to see a more in-depth summary of the Buzz and Banter. Have a goodnight Minyans. Rest up because it's only one more day until the weekend!
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.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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