12:50pm (EST)
The bears are trying to get back Friday’s triple-digit win by the bulls and so far they are doing a pretty good job. Futures were already pointing towards a lower open and the market has been a steady decline since the open. The euro is weaker on the bank “stress test” news while China, the world’s largest producer and user of steel, said it is temporarily cutting its steel production.
The Financial and Energy sectors are seeing some increased selling pressure as both are trading lower. U.S. Financial stocks are down nearly 2% due to the weakness in the European Bank stocks, which tumbled on concerns about the health of their balance sheets. Bank of America (BAC, $13.25, down $0.25), Capital One (COF, $39.45, down $1.24) and Wells Fargo (WFC, $25.25, down $0.59) are all trading lower as a result.

China halted its production of steel during the seasonally busy September-October period as the use of electrical power slipped due to efficiency goals. The move has been a lift to U.S. Steel stocks today as some analysts feel “spot product pricing” will be good for steel manufacturers going forward. U.S. Steel (X, $47.79, up $1.80) is up nearly 4% on the news and is making a run at breaking out above its 200-day moving average.
Meanwhile, President Obama plans to introduce a $50 billion infrastructure package and an extension of the research and development tax credit by as early as Wednesday. He is expected to propose a $200 billion tax credit for businesses spending on new plant and equipment with write-offs up to 100%.
As we head to press, the Dow is down 84 points, to 10,363. The S&P 500 is down 6 ticks to 1,095 while the Nasdaq down 20 points to 2,213.

Gold is up $8 to $1,259/ ounce while oil is slipping 72 cents and is at $73.88 a barrel.
This week is shaping up to favor the bears and the sentiment is negative. The key levels to watch for today will be Dow 10,350; S&P 1,095; Nasdaq 2,200. If these levels fail then we could see a quick test back to support levels.
We have added a few more stocks to our Watch List with possible option trades as we look to capitalize on the current volatility. Although we are currently “full” with current trades, we do see some opportunities for some quick ones as there are a couple of earnings announcements we are following closely.
Subscribers, check for the updates on all of our current trades and we will see everyone on Tuesday morning at 9am (EST) sharp.
Tags: option picks, stock options trading, U.S. Steel, x, X takeover rumors










