Monday, January 12, 2009

Monday Morning Musings

The market is lower in early trading, pickup up where it left off Friday afternoon. Earnings season kicks off tonight when Alcoa (AA) reports results. Investors seem leery to buy this recent market dip amid worries that corporate outlooks could be weak when companies provide guidance in the coming weeks.

Consumer staples and medical stocks are higher in early trading, while materials and energy stocks are weak. Morgan Stanley is up +5% after a report that says MS and Citi (C) are close to a deal to combine their brokerage units, with Morgan paying as much as $2.5 - 3.5 billion for Citi's Smith Barney.

Asian markets were mostly lower overnight. The dollar is mixed vs. the Euro and Yen. Oil is trading lower again, back down near $38. The 10-year yield is lower to 2.35%. And the VIX is up a bit to 43.3.

Trading comment: I put some money to work on Friday, choosing to buy after the market had dipped 5% from its recent highs. I would like to see the SPX and Nazz find support at their respective 50-days. Given the fact that bear market rules still apply, I will adhere to my 10-15% stop-loss rule on all new positions.

long SSO


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