Two days of hard selling leave investors shell shocked by the amount of the damage. There was no Fed Governor Bullard stick save for equities such that occurred last October. You might remember then markets were falling sharply but then Bullard stated QE4 might be a possibility and markets rallied from a near disaster. But Friday Bullard spoke again saying, “…Fed doesn’t react directly to equity markets”.
Friday was a high volume take no prisoners rout. Major indexes fell from 3% to 3.4%. And, markets globally were all glowing hot red. Only gold and bonds (modestly) were spared. The two day losses were the largest since the financial crisis.
As I’ve repeatedly been saying for the past month, “U.S. stocks can’t take a lonely walk away from all other international markets.”
Little noticed amid the carnage was another unhelpful economic report showing PMI Manufacturing Index FLASH
fell again to 52.9 vs 54.2 expected & prior 53.8. Once again signs of a weakening economy.
The powers that be, including the Fed and all the product salesmen, will be circling the wagons by Monday’s open. Buy the dip dammit!
Below is the crucial “monthly” chart the S&P 500 Index with the 12 period “monthly” moving average. Many
Market sectors moving higher included: Volatility (VIX), Euro (FXE), Japanese Yen (FXY), Swiss Franc (FXF) and Gold (GLD).
Market sectors moving lower included: Need I list them?
The top 20 market movers by percentage change in volume whether rising or falling is available daily.
Volume was as high as we’ve seen in many months. Breadth per the WSJ was very negative with some components again in 10/90 views. Money Flow (below) is on a one way street lower.