Don't worry. They will be back with heightened attention to the sequester and what it will mean for unemployment, but they are treading warily because if they come down too hard about how profits are going to fall, they run into the Bernanke buzz saw because he will keep the easy-money spigot going.
So what do you do? How do you make money from this pressure that they will exert on the market next week?
I say when we come in on Monday and we have no real deal or a deal that the people who know more than we do pronounce as bad, we are going to get a chance to buy a couple of high-quality companies at a discount.
I say you go all domestic and you go for our retailers and our financials, the two groups least impacted by Europe and yet two sectors that go down hard with the S&P futures.The two best? Next week PVH (PVH) reports and I think that the Street has turned very negative on the company. I suggest you buy PVH calls, specifically the May 100s at $13. PVH reports on Wednesday and it will be able to talk about how the synergies between Warnaco, purchased recently, and PVH are much better than expected and that the Warnaco portion of Calvin Klein -- the part that PVH didn't own -- is going to do much better under PVH than it was under an independent Warnaco. The increasingly negative analysts don't seem to remember that they got pessimistic ahead of the first time PVH reported after the Tommy Hilfiger purchase. This time I think will be no different. I suggest the May calls to give the stock time in case there are other worries about the stock market that could bring this wild trader down. And if you are wary of this one, buy half of a position before and half after, as I think that the analyst community will get positive on the company after it reports even if it doesn't do a terrific number.
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