May 7, 2010

Monster Market Review:

U.S. stock futures on Friday rose after one of the most tumultuous sessions in history, with markets prepping for the release of payrolls data, news on the Greek rescue and who will lead Britain.

U.S. stocks ended with steep losses Thursday after an afternoon meltdown lopped nearly 1,000 points off the Dow Jones Industrials Average, its biggest intraday drop ever, before a comeback of sorts, as Europe’s troubles took hold on Wall Street and talk of errant trades exacerbated the swift selloff. The Dow Jones Industrial Average finished the day down 347 points, or 3.2%, and at one point blue chip Procter & Gamble was down 37%.

The Nasdaq OMX Group said late Thursday that they would cancel errant trades made between 2:40 p.m. and 3 p.m. Eastern. A rumor that Citigroup accidentally made a $16 billion rather than a $16 million futures transaction was rejected by the Chicago Mercantile Exchange, which said trading by Citigroup in its stock index futures markets “does not appear to be irregular or unusual in light of market activity today.”

The finance ministers of the Group of Seven leading economies are due to hold a telephone conference to discuss the Greek debt turmoil. Japan’s finance minister, Naoto Kan, said they weren’t likely to jointly intervene to help the euro, but the shared currency nonetheless rose on the news.

Through Thursday, U.S. stocks are down 7.6% from April highs.

Payrolls report, due at 8:30 a.m. Eastern, will be a primary market focus for this morning.

Monster Portfolio Weekly Review:

Currently we are holding no positions.  Yesterday we luckily only had one open position in BAC and still are in shock it traded under $16.  Yesterday’s market action is very disturbing and we were fortunate that we slowed it down towards the end of last week with trades as we did not like the market trading we were seeing.  The one positive from this breakdown yesterday was that we did see a flurry of buying scream back into the market beginning about 2:45 yesterday.  This could be a positive sign moving forward in that the bottom has been stamped for this pullback and now we move forward.  This morning we will carefully evaluate data and trading.  Be prepared for new trades and we may begin shorting a few stocks should we see a breakdown.  Our overall feeling is still bullish in that we believe this market still has room to run higher.  This weekend the EU meets and come Monday we could be in the midst of a strong rally should the bailout news\details be taken positively by traders.  One strong statement thats received well and we believe we are off to the races in the short term. Right now there is some great value trades out there.  Let’s be cautious however but be ready for new trades.