Minyanville's Before The Bell: Europe Showing Signs, Investors Google Happy
Two SIVs could really use the help of the Superconduit as they may already be selling assets. Investors are Oogly Googly! Futures are mixed this Friday.
European structure investment vehicles (SIVs) are already beginning to sell assets. Just yesterday, two SIV funds, Tango Finance and Rhinebridge, which had approximately $16 billion in assets last summer, were reported to be in the process of selling off assets or on the verge of doing so.
The news come as Citigroup (C) announced it has secured funding through the year's end for the $80 billion in SIVs it manages. The bank was forced to dump $20 billion in assets after this summer's global credit turmoil. (From WSJ) Have a look at Professor Mike Shedlock's article written earlier this month, Problems For Banks, Problems For You? In addition, read The Super Conduit Proposal for more context.
The Bull Pen: For those that believe the worst is over for the financials, a look to Goldman Sachs (GS) may be a good play. Professor Jeffrey Cooper noted yesterday how well GS knows the breakout pivot at $225. Trades below that could act as a reasonable sell-stop.
The Bear Cave: We've highlighted BKX 111.50 as the most important (and reliable) resistance for the backs. Active traders may roll down their stops to 105.50 (the most recent break) for tighter and defined risk. Note also Citigroup has broken its 2007 low of $44.70. Near-term traders may use trades above that level as a reasonable buy-stop.
More Earnings Plays
Google (GOOG) reported results for the third quarter last night $0.14 better than analyst estimates with earnings per share coming in at $3.91. Revenues grew 57.3% year-over-year to $4.23 billion versus $4.13 billion. CEO Eric Schmidt stated "Our core search advertising business experienced continued momentum driven by growth in monetization and traffic, and we are creating deeper ads systems through our focus on innovation…" Professor Sean Udall noted on the Buzz that it was a solid quarter and, "more importantly, worries of slowing growth seem ill-conceived."
Schlumberger (SLB) reported third quarter results above expectations $0.03 above analyst expectations. Earnings per share came in at $1.09 versus estimates of $1.06. Revenues rose 5.1% year-over-year to $5.93 billion versus $5.89 billion consensus.
Caterpillar (CAT) missed expectations reporting earnings for the third quarter at $1.40, $0.03 less than estimates. Revenues rose 8.4% year-over-year to $10.67 billion versus estimates of $10.33 billion.
Read Professor Adam Michael's Crude Update and get an updated version of tech plays in Professor Udall's Revisiting 21 Bullish Predictions For Tech.
The Bull Pen: Tech bulls appear to be in control as GOOG is up currently $22 in the premarket. Yesterday's closing price at $639 is an important psychological level and could be a reasonable sell-stop.
The Bear Cave: Todd noted yesterday that drillers were not keeping up with the price of crude. "The natural question is begged, if they can't lift with this price spike, what are they gonna do when crude reverses lower?" he asked. Traders looking to test SLB on the dark side could set buy-stops near $114 (the all-time high reached on October 15).
As for CAT, recent resistance levels lie in the range of $80-81. Trades above those levels could act as a reasonable buy-stop.
Click on Minyanville's Stocks To Watch for more company-specific ideas.
A Quick Check Around the World
Asian markets all closed lower. The Nikkei fell -1.71%, the Sensex fell -2.44%, Taiwan's TAIEX fell -0.26%, and China's Shanghai Composite fell -0.12%.
European markets are mixed with the CAC +0.03%, DAX up +0.16%, and the FTSE down -0.13%. As of 9:00 AM EST, S&P futures are lower by 4 points and Nasdaq futures are higher by 3.5 points.
A Look At Commodities
Crude is trading higher +0.11 to 88.15. Metals are higher as well with Gold up +4.0 to 772.70, Silver up +0.11 to 13.92, and Copper up +0.009 to 3.55.
On the Radar
The radar is light today with no economic events.
Click here for the full Minyanville Trading Radar.
TGI Friday! Join us after the bell at the Bull & Bear! Good luck and have a great day!
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