Why Banco Santander Brasil SA (BSBR), JetBlue Airways Corporation (JBLU) and Vale SA (VALE) Are 3 of Today’s Worst Stocks

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After a two-day pause in the shadow of last week’s sizeable market rally, investors finally decided stocks had come a little too far, too fast. All the indices made lower highs today, hinting a rollover was in the offing. The S&P 500 lost 0.68% to end the day at 2,003.69.

Why Banco Santander Brasil SA (BSBR), JetBlue Airways Corporation (JBLU) and Vale SA (VALE) Are 3 of Today's Worst StocksLeading the slightly bearish charge from the market with exceedingly bearish moves of their own were JetBlue Airways Corporation (NASDAQ:JBLU), Banco Santander Brasil SA (NYSE:BSBR) and Vale SA (NYSE:VALE). Here’s what investors need to know about them.

Banco Santander Brasil SA (BSBR)

To say it was a bad day for Brazil’s banks would be a considerable understatement. It was a horrible day for them, with Banco Bradesco SA (NYSE:BBD) and Itau Unibanco Holding SA (NYSE:ITUB) down 7% and 6%, respectively.

None of them got hit as hard as Banco Santander Brasil, however — BSBR shares fell more than 9%, as it was dealt a healthy dose of bad news.

In simplest terms, the bank says it’s owed $1.6 billion from so-called “snowball swaps” that have since gone sour. It’s not clear if the parties at the other end of the agreement can pay all or even a portion of what’s owed, leading BSBR owners to wonder if there are more ticking time bombs on the bank’s balance sheet.

Vale SA (VALE)

It wasn’t just Brazil’s banks taking one on the chin on Tuesday. Brazilian iron ore company Vale fell sharply too.

Falling commodity prices have to get part of the blame for Tuesday’s sizable pullback, but what really spooked investors was news that Chinese demand for iron fell for an 11th straight month in September … and that’s despite the fact that Brazil’s currency has been in a slump of late, which has made exports from the country very cheap for foreign buyers.

Fanning the bullish flames was this report, suggesting that despite lousy prices, global iron ore production could and likely will grow from here, even if it goes unused.

VALE ended the day down nearly 10%.

JetBlue Airways Corporation (JBLU)

Last but not least, JetBlue Airways was grounded by a downgrade today, sending JBLU shares lower to the tune of nearly 8%.

JPMorgan did the deed, lowering its opinion on JBLU from an “overweight” to only a “neutral” after the airline reported traffic results for September; passenger revenue per available seat was only up 1% compared to September of 2014.

That being said, it’s worth understanding that the downgrade of JBLU was as much (if not more) about the industry itself and the fact that JetBlue Airways shares have performed very well of late, and were at or near their maximum plausible value.

Based on the current trend, JP Morgan analyst Jamie Baker lowered the airline industry’s per-seat revenue outlook for 2016 from growth of 1.3% to a dip of -2%.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/10/banco-santander-brasil-sa-bsbr-jetblue-airways-corporation-jblu-vale-sa-vale-3-todays-worst-stocks/.

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