Earnings Season Start On The Wrong Foot

After reading the after market news on AA's disappointing Q3 results, I think the market will start on a negative tone the next trading day. AA is already down 6% after market closed (AMC). Expect it to drag the rest in the basic industry sector down.

Although DNA reported good results & raised Yr 06 guidance, some of its drug sales came in below street expectation. Stock is down 1.7% AMC.

LM is down 9.8% AMC as it guides below consensus. Though its reason for guiding down looks company specific, it may well provide a good excuse for profit taking in the rest of the financial sector which has been on a run lately.

All in, with the overall market looking over extended & losing some upside momentum in the last 2-3 trading sessions, these earnings result is not going to go down well with the market. Get ready your PUT options.