Friends
After the bulls finally had a good week last week, the bears basically erased all that hard work in four trading sessions this week. Once again the 2602 October low for the S&P 500 appears to be a magnet for technicians. We continue to test it. Will it hold? We’ll find out next week. Today’s jobs report appeared on the surface to be just want the market should want. Not too hot, and not too cold. Enough good news to help the economy is fine crowd, and enough softness to make the “Fed is too hawkish” crowd more comfortable. But, after a feeble attempt to rally at the open, the bears quickly gained control of the situation and stocks tumbled throughout the rest of the trading session.
By the close, the Dow Jones Industrial Average was down 558 points to finish the day at 24,388. The S&P 500 was down 62 points to close at 2633. Gold was up $10 to trade at $1,253 per ounce, while oil was up $.95 to trade at $52.44 per barrel WTI.
Simply put, market participants are pricing in an economic slowdown. Sentiment is becoming negative which actually feeds into a slowdown. If one is concerned that things might be taking a turn for the worse(and his 401k has dropped in value lately) one may put off that new car purchase, new kitchen and bathroom upgrades, or decide the home he is living in is fine and a shelve any thoughts of building a new one.
Let’s see what next week has in store for us. Try to stay dry tonight and we’ll see you next week.
Have a great weekend everyone.
