Before the Open (Oct 22)

Posted on by Jason Leavitt

Good morning. Happy Thursday.
On Sept 12, 2008 (a Friday), Dick Bove, a banking analyst said he didn’t think Lehman Brothers was headed for insolvency. (He has previously stated 3 weeks prior (Aug 22) LEH would attract hostile take over bids around $20/share). Three days later when the market opened Mon, Sept 15, Lehman filed for bankruptcy.
In most industries, being so horribly wrong is grounds for being fired or moved to a different job. Not on Wall St.
Dick Bove is still around, and his voice is still listened to. He was at it again yesterday by downgrading Wells Fargo 45 minutes before the close. The stock got clobbered; the market swung from a decent gain to a moderate loss.
Why do people still listen to Dick Bove when his incompetance is obvious?
I’ve heard it said most analysts are no different than financial journalists – they have opinions which are no better or more accurate than anyone else…they just make more money.
(side note: I guess if you’re am umpire, you can make some pretty bad calls and not lose your job either)
In any case, the world markets have followed the US markets down. Asia/Pacific closed down across the board – there were a couple 1% losers. Europe currently has no winners – there are only 2 indexes not down at least 1%.
Futures here in the States are flat.
Here’s the daily SPX. I don’t see anything wrong with this chart on a larger scale. Higher highs and higher lows remain the pattern. This doesn’t mean I blindly hold through a pullback to support – it just means there’s no reason to suddenly get bearish just because the market dropped into yesterday’s close.

Here’s the 60-min. Many unfilled gaps below.

And as stated yesterday, the US dollar is very important right now. If it finds support at 75 and moves up, the market is likely to take a break from its uptrend. More after the open.
headlines at Yahoo Finance
today’s upgrades/downgrades
yesterday’s Sector Performance
this week’s Earnings Reports
this week’s Economic Numbers

0 thoughts on “Before the Open (Oct 22)”

  1. Bove is just noise the real action is in the fed policy corner which is a shill game. Ben knows he is not going to raise rates and Congress does not care. Overall it is a setup for a lousy movie.

  2. Prominent banking analyst Dick Bove, who caused a stir Wednesday with seemingly contradictory remarks on Wells Fargo, has decided he’ll no longer provide immediate earnings commentary on air.
    “I’m not going to do it anymore. I’m going to have to see the numbers before I go on air,” Bove told Dow Jones Newswires Thursday. “It creates an untenable situation.”
    viva la untenable situations! WFC recovered nicely today. Bove is the sort of person that causes trade-able events. Sorry to see he’s going to be more cautious. I’ll still keep my eye on him.
    At times what seems incompetent is a deliberate act.

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