Click to Enlarge The longer the U.S. government shutdown continues, the more painful the drag on Q4 GDP growth will be. According to Bank of America Merrill Lynch, a one-month shutdown would be enough to result in an outright contraction in the economy.
That’s bad news for economically sensitive materials stocks like Cemex (CX), which is drifting lower after forming a double-top pattern in May and August. Shares are threatening to fall through their 200-day moving average and return to their June lows — which would be worth roughly a 16% gain to shorts from here.
I’ve added all three to my Edge Letter Sample Portfolio as short possibilities.
Anthony Mirhaydari has recommended short positions in CX, SNE and HPQ to his clients.