GadZEWks!

The markets were roiled yesterday…light on volume and light on news. Worry ahead of a big earnings week and Hal Turner’s supposedly leaked Stress Test results conspired to produce the worst day for the SPX in 7 weeks. I think it was instructive how hard risk assets took a pasting on the back of a specious rumour from a spurious source. Not to say the story is wrong but the references to non Stress Test banks (e.g. HSBC) certainly called into question the veracity of the post.

However, I think the moves was saw served to tell us that people are worried up here at these lofty levels. There was certainly a feeling of, well this rumour may not be right, but there’s a good chance it’s not too far off the mark…in which case, a market dirtnap is around the corner.

A lot of noise is being made about the rising credit card delinquencies reported by BAC. This should be no surprise and I mentioned this last week post the AMEX figs and the Capital One charge off rate. The credit card issue is not going away anytime soon and will only worsen as the crisis continues to make its way from Wall St to Main St, as will cars loans, student loans etc.

The government bailout programs make the news again today ahead of TARP Tzar Barofsky’s report. NYT has got the report it seems and reports it’s going to criticise TARP and say PPIP is open to fraud and needs taxpayer safeguards before it is initiated.

In other news, the ZEW posted its first +ve number in almost 2 years (July 07 to be precise). More green shoots!! The market however, feels less inclined this week to focus on the good (or less bad) news than it has been for the last 6.

I’m in the US Weds-Fri so thoughts could be less daily and more if I get the chance.