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When markets rally, the media focuses like a cyclops on anything positive. When markets stumble, negativity takes center stage. As savvy investors, we want to keep our eyes on the highest probabilities for risk. Here is your Cheat Sheet for the top 5 negative stories in focus now:

5. Israeli Blockade of Palestinian Aid

Israel’s (NYSE: EIS) Flotilla raid has quickly made global headlines and once again adds fuel to the seemingly never ending fire in the Middle East. Now, Turkey’s Prime Minister Recep Tayyip Erdogan says economic ties between the two countries will suffer after Turks were killed during the blockade. Turkey is Israel’s largest trading partner in the Muslim world. Moreover, rising political tensions put indirect pressure on oil (NYSE: USO) as geopolitical risk can spread to Iran.

4. North Korea War Threats to South Korea

When countries get desperate, war — or at least rhetorical threats of war — is a key political tool to distract the masses. In this case, Kim Jong-il is back using his nuclear threats to extort the West for more money. This is bad news for economic powerhouse South Korea (NYSE: EWY) as they are already dealing with a fragile economic recovery.

3. BP Oil Spill

The credit and housing bubble collapses were the direct results of a poorly established set of basic rules for economic safety. In the same era, we have billions of dollars more in damage because BP (NYSE: BP), Transocean (NYSE: RIG), and Haliburton (NYSE: HAL) lobbied away some of the most important safety features of the oil drilling process. The Gulf region is screwed on multiple levels, and the mess may spiral to new levels if hurricane season spreads the oil into the Atlantic and beyond.

2. China’s Slowing Growth (and Real Estate Bubble)

We raised red flags about China (NYSE: FXI) several weeks ago and discussed it on Yahoo TechTicker (Nasdaq: YHOO). Now, new economic data out of China shows manufacturing down month over month and property sales slowing. While all eyes are on Europe and the sovereign debt crisis, a Chinese property bubble burst or manufacturing slowdown could seriously hamper any chance for a near-term economic recovery.

1. Sovereign Debt Crisis

If you haven’t heard more about Greece now than when you were in high school english class, you must be a major outdoors person or video gamer. The sovereign debt crisis is unfolding like dominos in slow motion. First it was Greece, then credit downgrades hit the EU. Portugal, Spain, and Italy are on deck. And across the pond Ireland and the UK are crumbling under the weight of their debt. Although the EU and IMF have established a bailout package to save the Euro (FOREX: EURUSD), this crisis is far from over.

Disclosure: No positions

Source: 5 Monsters Eating the Global Economy