Thursday, June 10, 2010

Financials Overview : $GS- growing CDO exposures


· The financials finished up more than 3% (outperforming the tape).

· MIs/financial guarantors – the group v strong following pos. comments from AIG’s MI unit (on Bloomberg).  MTG, PMI, RDN all up ~10%.

· Credit cards all pretty strong – in addition to the general rally in the group, there is growing optimism that the Durbin bill will be softened.  DFS up on takeover spec (up 8%) per DJ.  MA, V, AXP, COF all up ~6%.  Next up is master trust numbers June 15.

· GS – the stock finishes off 2% on the day at 133.77 (off lows 131.31); worries about growing CDO exposures (overnight press reports discussed how SEC is expanding inquiry and looking at more GS deals).

· Other brokers – MS, JEF, AMTD, SCHW all strong.  There has been some worry about soft business trends in the Q (UBS made cautious comments this morning) but that doesn’t seem to have dented the group.

· Asset managers – strength across the board; AMG, EV, BEN, TROW, LM all up ~4-5%; JNS v strong w/an 8% advance.

· Life insurers end up ~4% in aggregate; there has been an overhang on this group b/c of fears concerning European debt in their portfolios – given the optimism around Europe today, the space traded well.

· Banks – strength across the board.  BBT, CMA, CYN, FITB, MI, RF, USB, WFC all up ~3.5-5%.  C was a laggard and was up less than 1%, but keep in mind the stock had a strong move on Wed (due to the rebalance).

· Best performing sp500 financials: JNS, DFS, GNW, MI, PLD, AIV, AVB, ETFC, KIM


· GS was the only sp500 financial to trade in the red today

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