Sun Microsystems (JAVA) NewsBite - JAVA Lower on Recession Worries

Posted on Thursday, March 13, 2008 10:27 AM

Sun Microsystems (JAVA) opened at $16.54. So far today the stock has hit a low of $16.39 and a high of $16.74. JAVA is now trading at $16.50, down 0.46 (-2.71%). After hitting a one-year high of $26.04 last March, the stock hit a one-year low of $14.20 in Janaury. JAVA shares are declining with the rest of the tech sector as economic data released today has investors worried once again that the economy is headed for recession. The Commerce Department reported that retail sales dipped by 0.6 percent in February, below economists' predictions of a 0.2 percent gain. California research firm RealtyTrac Inc. also reported that home foreclosures in February rose 59.8 percent over the year-ago period. Technical indicators for JAVA are neutral and improving, while S&P gives the stock a positive 4 STARS (out of 5) buy rating. If you’re looking for a hedged play on this stock, consider a July bear-call credit spread above the $20 range. JAVA hasn’t been above $20 since December and has shown resistance around $17.50 recently. This trade could be risky if the economy bounces back, but even if that happens, this position could be protected by resistance JAVA might find around $18, where it has topped out over the past month. [LHF- Seven Summits Strategic Investments NewsBite]