A weaker than expected Case-Shiller price data wasn’t enough to shake this market lower. Volume was lower on the session and perhaps institutions simply do not want to get ahead of the FOMC policy announcement tomorrow at 2pmEST. Whatever the reason, we levitated on very light volume after yesterday’s volume advancement. The lack of follow-through from yesterday’s buying with volume may not matter with the FOMC tomorrow. Still, there is something missing from this market that has given us pause regarding the future direction. So many growth names pounded and we are left with defensive sectors leading the charge begs the question is this bull market over?
The Dow Jones Industrial Average alongside the S&P500 has held up in tremendous fashion when compared directly with the Russell 2000 and NASDAQ Composite. We can certainly argue financial engineering and manipulation from Quantitative Easing have kept this dying patient afloat. Price indications from sectors like energy and utilities are proving money is flowing into defensive sectors. Sure, the trend can reverse, but really are you willing to beat a strong moving in utilities will do a quick turn? It is highly unlikely and we wouldn’t bet on these sectors losing in favor of high growth areas.
Tomorrow’s FOMC policy announcement will be, dare we say the most watched? We simply don’t care, but what we will care about is how the market is after the close tomorrow. Volume will likely get a boost from everyone trying to game the direction of the market after Yellen’s FOMC announcement. It truly is a guessing game and one we aren’t about to participate in. CNBC will be ushering in “experts” or “gurus” to “help” you. In reality, CNBC is trying to sell ad space to make money. Their goal to sell ad space is in direct competition with your goal to make coin.
We can’t forget to mention today is Tuesday and it has been the only day of this year that has provided the Dow Jones Industrial Average with gains since the beginning of the year. The only day with gains year-to-date is Tuesday. Too funny!
TWTR and EBAY reported after-the-bell and both stocks have moved lower. TWTR’s offer price was $26 and there doesn’t appear anything stopping it from trading to that price level. EBAY continues to chop around, but it too continues to be a disappointing stock. Tomorrow will be fun and we’ll get a front row seat to all the action.
