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Is Trading Always Rational? Sorry, No

Birinyi just put out a great, two-page report that contains ZERO analysis. It notes that there are only 12 companies in the S&P 100 that break out revenue from Japan, and that of those who have the greatest exposure

Freeport McMoRan ,

Texas Instruments ,

Weyerhauser ,

Qualcomm and

Exxon Mobil

— all of which have exposure from 8.8 percent for XOM to 18 percent for FCX — four out of five are trading UP since the crisis began. Only TXN is trading down, and that only about 1 percent.

Birinyi also notes there are 39 members in the S&P 500 who break out Asia/Pacific exposure — they range from the very high (Qualcomm at 77 percent) to very low (General Dynamics at 3 percent). Once again, almost as many are trading UP as have been trading DOWN since the crisis began.

The biggest decliner? Nike , which was an obvious choice for a short, is down 11 percent — but it has exposure of only 13 percent of its total revenues to Asia/Pacific — at the lower end of the 39 companies listed.

Financials underperform. I've been asked why big banks are down on a big up day for the markets. The simple answer is that the strategy was to buy bank stocks going into their dividend hike announcement on Friday — they outperformed last week. The strategy now is to sell, at least short term. Some are also noting that Treasury Dept's announcement that it will begin selling their supply of mortgage backed securities may also be putting some pressure on them.

Citigroup, with its 1-for-10 reverse stock split, is a different story. Mike Mayo at CLSE and others have noted that AIG and E-Trade were two other financials with reverse splits. Both underperformed the S&P 500 in the months after the announcement.

Other casualties. Sprint (S) and Qwest (Q) not the only potential losers in today's AT&T (T) deal for T-Mobile. Brightpoint (CELL), a mobile phone distributor (middlemen likely to make less money), and cellphone infrastructure plays like American Tower (AMT) and Motorola Mobility Holdings (MMI) (lower demand for telecom infrastructure), are all trading down.

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