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The market staged a massive rally off of lows in the last 90 minutes of the trading day, with S&P 500 futures being down nearly 30 points during the morning, only to be up 4 points at the time of this writing. But with all this intraday volatility, it’s anyone’s guess where it’ll close. It was all banking news today. Bank of America (BAC) was down sharply on worries that it might need more bailout money to absorb losses from acquiring Merrill Lynch. And there was speculation that the US government would take over Citigroup (C). When it was revealed later that BAC would only need a mere $15 billion, and that FDIC Chairman Sheila Blair said that she would be “very surprised” if any banks need to be nationalized. That’s all BAC and C needed to hear to reduce their losses, and propel the market higher.
Some contestants had big positions in the inverse ETFs, which go up in value when the market goes down, so hopefully they’ve been able to make some nice gains in the past couple of days. We’ll see if these big market swings rearrange the leader board.
Tom Preston
thinkorswim, Inc.
Member FINRA/SIPC/NFA
thinkorswim, Inc. and its registered employee, Tom Preston, do not solicit or recommend any form of trading in the individual stocks (or their derivatives) mentioned above. Please do careful, independent research before investing any money as well as weigh the possible consequences on your particular financial situation before doing so. The risk of loss may be substantial.
