David Lutz, managing director at Stifel Nicolaus Capital Markets, and Jim Iuorio, director at TJM Institutional Services, advised investors what to buy, sell and hold now.
Claymore/Delta Global Shipping — With improving consumer confidence numbers, "no matter what people are buying, you can still profit from this,” Iuorio told CNBC.
“Plus, it has some good global exposure, and as long as the long end of the yield curve doesn’t totally get demolished, it will be a good entry point now.”
“S&P warned yesterday that proposed changes to their Commercial Mortgage-Backed Securities (CMBS) rating method could cause substantial downgrade to 'AAA' rated bonds from ‘05 to ’07,” said Lutz. “So this is causing CMBS spreads to blow really wide. Therefore, CMBS underlying valuations are lower and lower. This is a negative for any banker REITs that marks the worth of their CMBS to these spreads.”
He said these regional banks could be most at risk:
BB&T —Lutz said his firm has a "sell" rating on the company.
SunTrust Bank—Lutz said his firm has a "hold" rating on the company.
Lutz does not own shares of any of the bank companies mentioned above. No immediate information was available for Iuorio or his firm.