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INVESTORS ON THIN ICE

|Includes:AAPL, ANF, BAC, BWX, BZF, C, DBA, DBB, DJP, EEM, EPI, EWA, EWC, EWG, EWI, EWJ, EWP, EWY, EWZ, EZU, FXA, FXE, FXI, GAZ, GDX, GLD, GS, HYG, IBM, IEF, IEV, IWM, JJC, JJG, JPM, KBE, KRE, MS, MUB, QQQ, RSX, SGG, SLV, SPDR S&P 500 Trust ETF (SPY), TGT, TLT, UGA, USO, UUP, XLE, XLK, XRT

Risks are moving back to center stage as financials continue to drag markets lower. As we’ve stated here for a long time, there has never been a bull market when financials haven’t been with the overall trend. But you say these are unique times and we can ignore this? Not a chance—financials are at the core of our market woes.

 

Markets responded poorly when Fitch issued a report stating that while U.S. bank ratings are lower overall, and seem to have stabilized some, the risk of a “negative shock” remains high. This is a eurozone exposure warning which claims victims just as quickly as MF Global. Given the rapidity of failures, it’s no wonder investors sold stocks immediately.

 

Earnings news continued with Target (NYSE:TGT) reporting better than expected earnings but again featured 6% fewer shares outstanding. Also in retail Abercrombie & Fitch (NYSE:ANF) disappointed taking the stock lower by roughly 14%.

 

Economic data featured better Industrial Production and a lower CPI reading although the much watched “core” rate was higher.


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Stocks: SPY, IWM, QQQ, AAPL, IBM, XLK, BAC, C, JPM, GS, MS, KBE, KRE, TGT, ANF, XRT, IEF, TLT, HYG, MUB, BWX, UUP, FXE, FXA, BZF, GLD, GDX, SLV, JJC, DBB, DJP, USO, UGA, GAZ, XLE, DBA, JJG, SGG, EZU, IEV, EEM, EWJ, EWA, EWC, EWG, EWI, EWP, EWY, EWZ, RSX, EPI, FXI