posted
Well time is up on the Short Sell Ban today and its not helping the market today.. Glad I am out and in cash until next week:::: NEWS::
UPDATE: Financials Sold Off As Short-Selling Ban Lifted 13 minutes ago - Dow Jones News
Related Companies Symbol Last %Chg AIG 2.60 -18.50% BBT 29.82 -9.66% CIT 5.29 -18.24% FITB 10.54 -12.24% HIG 22.67 -8.81%
As of 2:18 PM ET 10/9/08
DOW JONES NEWSWIRES
Financial services companies slumped Thursday, leading stocks lower, as the Securities and Exchange Commission's ban on short-selling expired at midnight and as fears over the health of the credit markets continued to weigh on the financial sector. Among the biggest decliners were XL Capital Ltd. (XL) which dropped 54 to $3.99, student lender SLM Corp. (SLM) which sank 16.2% to $6.58, and Wachovia Corp. (WB), down 16% to $4.25. Insurer American International Group Inc. (AIG) tumbled 18.5% to $2.60. Prudential Financial Inc. (PRU) dropped 14.7% to S36.81The company's credit default swaps, an indicator of sentiment about the company's credit, widened by 50 basis points from Wednesday to 785 basis points, according to CMA DataVision, suggesting heightened concern. Still, the spreads have not reached distressed levels seen last week. The Financial Select Sector SPDR Fund (XLF), an exchange traded fund of financial stocks, dropped 2.4% to $14.91. The SEC's ban on short-selling had sought to protect as many as 950 stocks, most from the financial sector, from steep declines. Stocks have fallen sharply anyway, as worldwide equities markets saw a mass exodus of capital. Some say that with the ban now lifted, many financial stocks are returning to valuations that reflect the general sentiment in the market. But other traders say it has been difficult for short sellers to borrow stock. It has become difficult to borrow stocks in order to short them, said Steve Sachs, head of trading at Rydex Investments. "From what we've heard talking to a lot of trading desks, we haven't heard of about a lot of new shorts....the loan market is pretty tight right now," Sachs said, pointing to some holders of long positions deciding not to lend stocks. Last month, California Public Employees' Retirement System, or Calpers, said it temporarily halted lending out shares of four investment banks: Goldman Sachs Group Inc., (GS), Morgan Stanley (MS), State Street Corp. (SST) and Wachovia to "help mitigate the current instability of the market and any potential adverse short-selling impact on these important financial institution." Other large institutions have also followed suit since. Other traders, meanwhile, maintain that short-sellers are driving the momentum in bringing down Morgan Stanley (MS) stock, which declined 9.9% to $15.13. In addition to any contribution of short-sellers to Thursday's stock moves, there are other catalysts damping sentiment for the financial sector. Comments from Treasury Secretary Henry Paulson suggesting that more banks could fail seemed to undercut any relief found in the coordinated move by the world's central banks to cut short-term lending rates in unison. Furthermore, with the Treasury hinting at injecting more capital into the market, there is a fear of diluting value for existing shareholders, said Craig Peckham, equity trading strategist at Jefferies & Co. Among regional banks, the only one strongly in the black Thursday wasNational City Corp. (NCC). Thursday, The Wall Street Journal said the regional bank is in talks with a number of banks about a possible sale. The bank's stock rallied on the news, gaining 7.6% to $2.41. In recent weeks, investors have been rapidly fleeing National City's stock amid widespread fears. It is down by nearly two-thirds over the past three weeks as investors have eyed the regional bank as a next potential victim of the nation's widening financial crisis. The company has maintained that the sell-off is unjustified. Thursday, investors rapidly sold off their shares in other regional banks amid increasing worries. KeyCorp (KEY) was recently down 19.9%, while Marshall & Ilsley Corp. (MI) fell 16%. Fifth Third Bancorp (FITB), Zions Bancorp (ZIONS) and Regions Financial Corp. (RF) were also down. -Kejal Vyas, Dow Jones Newswires; 201-938-5460, kejal.vyas*dowjones.com -By Donna Kardos, Dow Jones Newswires; 201-938-5963; donna.kardos*dowjones.com (Geoffrey Rogow and Rob Curran contributed to this report.)
Posts: 1986 | From: Florida | Registered: Mar 2006
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posted
I'm suprised nobody commented on this....as soon as they lifted the ban....the market crashed like a mother!
Posts: 2321 | Registered: Aug 2006
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posted
Well everyone cashed in on the options and drove the fins down , but still I think that will make a great buying ops for us on monday after the dust settles from this . A lot of people are looking at the drop to be a great buying oportunity to get back in..Just get in and get out for your gains though in my opinion until this markets settles down a little more,which could be months more of buying oportunties with the up and down market..
Posts: 1986 | From: Florida | Registered: Mar 2006
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