MORNING TRADE

Shocking, but the markets are lower again this morning on the heels of more bad news- MCO predicts a major hedge fund will fail and sees large impairment losses at many banks. Now for the good news, the RUT is green, not the safe large caps but the lousy risky small caps.

Strongest sectors include airlines, banks and small caps while metals, xchanges, gaming, oils, defense, brokers and internets continue to get hammered.

The action on the XCHANGES- CME -21; ICE -9; NYX -3.6 and NMX -6 all stand out.

Winners- NTAP INTU GILD XRAY ISRG VRTX LINTA PDCO SIAL INTC BAC USB PG SO WB RF DD HNZ WFC PEP HURC PRFT AIRM LKQX CEDC ARD.

Losers- TBSI DSX ACH TKC CPL BIDU ICE POT VIP PCP DRYS CNH FTK ELP PDA MR ATI AA AES GM EP WY SLB F COP BA DOW FDX TYC LTD AKAM NIHD MICC AAPL BEAS JNPR.

Internals - awful as usual with 730 UP and 2500 down on the NYSE and 1100 up and 1800 down on the NAZ.

The OEX with 25 winners and the NDX much better with almost 40 stocks in the green.

VIX index up another 9%+ and trading at 33.5 - only 16.5 points away from Acampora's target.

My guess is if the market does rally a bit - the shorts will be all over it- So be careful with the longs as the reaction to the news continues to be poor.