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Two Ways: CIT's Bailout Talks Fizzle

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Strengthen your portfolio in good times and bad.

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No Bailout for CIT

Negotiations on a bailout for CIT Group (CIT) have broken down, likely spelling the end of the century-old financial firm. According to The Wall Street Journal CIT reps were scrambling last night to secure a line of at least $2 billion from current debt-holders. But the company said last night "there is no appreciable likelihood" that it will receive any rescue package in the near future.

All eyes will be on how the nation's economy can absorb this mess, particularly small and midsized businesses in California. CIT's bankruptcy would mark the biggest failure of a financial firm for 2009 and since the government allowed Lehman Brothers to collapse.

From the Bull Pen: Despite the grim news, bulls can look to Wells Fargo (WFC). A check of the daily chart will show the stock has broken the downtrend since mid-May. A sell stop can be set near $22-23, depending on your risk profile.

From the Bear Cave: For a short term trade, bears can look to Visa (V). See the heavy resistance at $64? Those playing the downside can set a buy stop above that level.

Quick Check Around the World

Asian trading closed with the Hang Seng 0.57%, India -0.02%, Shanghai -0.15%, Nikkei 0.81%, and Taiwan 0.62%.

Glancing towards Europe, we see the FTSE 0.39%, CAC 1.14%, DAX 1.05%

As of 8:15 AM EST, S&P Futures are trading +0.300 to 927.50 and Nasdaq futures are -2.000 to 1495.25.

A Look at Commodities

Over in commodities, crude oil is trading -0.38 to 61.16 while gold is -1.00 at 938.40 this morning. Silver is +0.200 to 13.21 and copper +0.00 to 238.25.

The dollar index is -0.0350 to 79.4250.

On the Radar

Economics

08:30 Initial Claims
09:00 Net Long- Term TIC Flows
10:00 Philadelphia Fed -5.0%

Click here for the full trading radar.

Thirsty Thursday! Good luck!
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.

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