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Early cheer for details of the “New Plan Version 3.0” takes a backseat to raised concerns over economic challenges and as likely—decent motives for profit-taking already in place. As of 16:00 ET the “Cubes” (QQQQ) and “SPYder” (SPY) are off 1.48% to 4.33% on heavier daytrading efforts.

It was another extraordinary day of “business as unusual” for traders so willing. Bankers and bears returned from their short holiday and after a generous Opening Bell turned devilish following cheer for the details of New Plan Version 3.0. Highlighting the well-scribed bailout plan is $250.0B in recapitalization funds. Half of that princely sum will be distributed to nine, more familiar than ever names, Anchor Bankers (MER, C, WFC, BK, STT, BAC, JPM, MS, GS); were almost uniformly treated with kids gloves in Wednesday’s session.

Additionally, new bank debt guarantees for a three-year period being implemented and FDIC insurance for non-interest bearing accounts rounded out the new initiatives aimed at restoring confidence, liquidity and rescue the economy from the credit scandal / crisis. Unfortunately for more than a few opening bulls outside the financials, on the heels of a two day historic jump in share prices for the broader averages; the devil was truly in the details as a “Sell the News” response took hold for the remainder of the session.

On the earnings front, shares of J&J (JNJ) finished up 2.11% at 63 after retreating from opening minute highs near 67.50. The consumer healthcare products giant posted “b-t-e” results of $1.17 per share, topping estimates of $1.11 and showing growth of 10% from the year-ago period. Additionally and helping shares maintain some of their gains; “b-t-e” sales growth of 6% and management’s “No more tears” upside surprise above Street views guidance were announced.

Separately, “Coke was kinda It” versus rival Pepsi (PEP). Shares of the latter beverage giant closed down nearly 12% at 54.40 after posting a two cent miss of $1.06 on an 11% revenue increase. Investors owe much of the less-than-bubbly response to the company’s reduction of FY08 guidance. Range views fell below consensus estimates, while news of six facility closings and global job cuts of 3,300, in an effort to reduce overhead by $1.2B, didn’t seem to help bulls on Wednesday. For their part, management cited the global economic situation and strengthening Greenback as factors in today’s disappointing report.

In related and intertwined markets, credit markets found some early restoration efforts of lost confidence, but failed to maintain their uniform game face. Overnight Libor rates did well by shrinking 0.2875 to 2.1813, but the Treasury Euro-Dollar or TED, winded up increasing by 0.106 to 4.3865 after opening on lower but more stabile ground.

Likewise, opening bell confidence in Black Gold attributed to optimism over the financial bailout and its potential positive impact on the economy, winded up seeing aggressively lower prices on the session. For its part the US Oil Fund (USO) tumbled more than 4% near 65 as trader views swung back towards fears of a drawn out recession and as a result; visions of folks reverting to foot, pedal and public transportation.

And finally, many pundits will likely decry today’s decliner as ominous. It certainly was for bulls just thinking the party was getting started this morning. A different reality is with early highs in the broader market finding open gains in excess of 25% from lows set just two sessions prior—I’d rather go with “Mama Bottoms” to buy, but realize a bull has to know his limitations, particularly so in a still mad money market.

Chris Tyler
Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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The information offered here is based upon Christopher Tyler’s observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual. 

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