Tuesday Afternoon

S&P support in 850-850 range today. Below could get very ugly.

But if it hold maybe we could get a turnaround Tuesday even as Banks will get more negative focus today from Bernankes speech:

However, with the worsening of the economy's growth prospects, continued credit losses and asset markdowns may maintain for a time the pressure on the capital and balance sheet capacities of financial institutions. Consequently, more capital injections and guarantees may become necessary to ensure stability and the normalisation of credit markets. A continuing barrier to private investment in financial institutions is the large quantity of troubled, hard-to-value assets that remain on institution's balance sheets. The presence of these assets significantly increases uncertainty about the underlying value of these institutions and may inhibit both new private investment and new lending.

Probably not a statement that will support banks stocks today after the weak performance yesterday. After closing at 5.5 Citigroup (C) seems to open at 5 today, down 8-10%.

In bunds strong resistance in the 125.30-50 level

... and focus in credit markets is shifting to intra European Sovereign spreads