US Morning wrap 240409

Morning!

Since I'm on the run today, I will give some brief comments over my view for the market today.

Leads from Asia was mixed, although it was general down for Japan, Korea and Australia.

However, leads from crudes remains to point some support for the oil stocks, while our continual emphasis on precious metals play is paying off.

As for the market today, I personally anticipate a big move with the financials. My opinion goes on the downside given that UK may lose its AAA rating, with the economy contracting 1.9%. While releases from Bloomberg points to banks may struggle to raise money after stress test as bad asset triples, which continues to confirm our opinion over bad debt issues from consumer credits.

Despite the current optimism in FTSE, as we speak now, futures are also pointing down, indicating a lower start. I believe the market today will go red roughly 2%, with regional banks and consumer crediting lending businesses dragging the market down.

GM and Chrysler may continue its decline over bankruptcy concern, and consumer staples may have a technical rebound after an unanticipated selloff from my behalf. I continue to favour this defensive play amid the cautious trading over the current market rally.

I must note, however, if the results from stress test provides positive tone, the market will continue this current rally, and it may be an option to enter into sold down financials over the last few sessions.

As of today, I continue to recommend the following trade:

1. Sell Citigroup (C)
2. Buy Spdr Gold
3. Sell S&P500 financials
4.Buy S&P 500 Healthcare

Happy trading!

ongy out.