Two Ways To Play: Borrowers Get the Thumbs Down
Strengthen your portfolio in good times and bad.
According to Bloomberg, Standard & Poor's says the number of borrowers at risk of credit-rating downgrades rose in October to its highest level since September of 2005. Companies in jeopardy of a downgrade to junk (AAA to B-) rose to 786 in October - an increase of 28 over the previous month and 135 higher from a year earlier.
There are 3 times as many borrowers at risk as there are those due for an upgrade. This trend has been in place for nearly 15 months.
For more on the economy, see Professor Kevin Depew's Five Things You Need To Know: The Podcast.
From the Bull Pen: What's clear is that the markets are not trading on fundamentals. And a lot of the gloom may already be priced in. Bulls can consider a play like Visa (V) for an upside trade. Is today's pullback just another setup to break the top of the channel? One option is to buy on the move toward $50 with a sell stop near $48.
From the Bear Cave: Bears can consider a play in Best Buy (BBY). Downside entry near $25 with a buy stop above its 20 DMA ($25.80).
Quick Check Around the World
Asian trading closed with the Hang Seng 2.52%, Nikkei -5.01%, Sensex 8.22%, Taiwan -3.99% and Shanghai -1.97%.
Glancing towards Europe, we see the CAC -1.91%, DAX 0.06%, FTSE -1.51%
As of 8:20 a.m. EST, S&P Futures are trading -15 to 946, and Nasdaq futures are -24 to 1321.
A Look At Commodities
Crude oil is trading -2.27 to 63.68. Gold is -11.60 to 726.90. Silver is -0.435 to 9.350 and copper is -19.20 to 188.85.
The dollar index is +1.189 to 85.741.
On the Radar
08:30 Personal Income
08:30 PCE Deflator
08:30 Employment Cost Index
08:30 Personal Spending
08:30 PCE Core
08:30 Employment Cost Index
09:00 RPX Composite 28day Index
09:45 Chicago Purchasing Manager
10:00 U. of Michigan Confidence
10:00 NAPM- Milwaukee
Click here for the full trading radar.
Happy Halloween! Good luck and have a great weekend!
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