Friday, January 11, 2008

Morning Look: Financials Trading Higher

It looks like the vote is skewing towards the 'end of day' preference. That's fine, I just wanted to get an idea of what is more helpful. I will still post morning comments frequently as well.

This morning, the market is opening on a down note, although the market has recovered from early losses the last couple of days. Consumer worries are weighing on the market after American Express (AXP) warned about increasing consumer defaults. This follows yesterday's cautious comments from Capital One (COF).

But the financials are trading higher today, after rumors swirl that WaMu (WM) could be in merger talks with JP Morgan (JPM). This follows confirmation that Bank of America (BAC) is buying Countrywide (CFC) for $4 billion, a fairly low price tag. The brokers are also trading higher.

Asian markets were mostly lower overnight. Oil is flattish around $93.50, while gold touched $900 this morning. The Yen is higher, which is likely also pressuring stocks. I want to see that uptrend halted soon. And the 10-yr yield is still languishing at low levels of 3.84%.

The market breathed a sigh of relief on Bernanke's comments yesterday, hoping that he finally "gets it". But the rate cuts can't come soon enough, imo.


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