Monday, October 20, 2008

Monday Morning Musings

Asian markets rallied overnight after the Korean govt said it will guarantee some foreign debt and inject $30 billion into its financial system. Also, India cut its key lending rate, and the Netherlands will inject $13 billion into ING. All of this helped improve sentiment in overseas markets.

The good news washed up on our shores this morning, and the market is trading higher. Energy stocks are leading the way following oil prices bouncing near $74. Nat. gas is higher also.

The dollar is up again vs. the Euro, and the 10-year yield is steady at 3.93%. Credit angst is easing as Libor rates are down across all maturities this morning. And the VIX is falling 11% to 62.42. This is a good sign, but that is still a very high level.

Bernanke is testifying before the House Budget Committee this morning, and saying that another fiscal stimulus program would be appropriate, given that credit has become costlier. Paulson will speak later.

There were some more solid earnings reports this morning from Eaton (ETN), Halliburton (HAL), and Hasbro (HAS). This week also will see more important tech earnings reports from the likes of Apple (AAPL), Microsoft (MSFT) and Amazon (AMZN), among others.

I have been waiting patiently to put new money to work, but I think this week will see some action on my part. I am looking at some of the beaten down natural gas stocks, a couple big-cap biotech and medical tech names, and the big tech leaders. (I will update with specific names if I buy any).

The markets remain very oversold, and due for a nice tradable bounce. I plan to trade around my positions, both long and short, as volatility remains high.

long AAPL


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