Friends
The first part of the trading day was defined by the massive sell-off in commodities, as gold, oil, copper and most everything else seemed to be just being dumped regardless of price. For most of the morning, stocks seemed to be weathering the storm only showing modest losses with the Dow down no more than 10 to 20 points. But when the Fed minutes were released (just like last time), showing discussion among Fed governors about when to ease up on asset purchases, traders once again became somewhat nauseous just thinking about their punch bowl being taken away, and stocks were sold off aggressively. No, the Fed members did not say when they would begin to pare back the bond buying, but just the fact that they are thinking about it spooks the market every time it is revealed. Imagine what will happen when they actually do inform the markets that they are going to curb asset purchases (stop providing the steroids).
As for today, the Dow Jones Industrial Average was down 108 points to close at 13,927. The S&P 500 was down 19 points to finish the day at $1511. As mentioned commodities were crushed with gold down $40 to trade at $1563 per ounce, while oil was down $2.20 to trade at $94.90 per barrel. Yes, the S&P still is above 1500, but the Dow slumped back below 14,000 for the umpteenth time. The bulls will have to regroup some after today’s shelling.
As for economic news, the PPI was uneventful as core inflation (I know gas prices are rising) seems to be tamed. We’ll see what the CPI delivers tomorrow. Besides that, we’ll see if the bears can build on today’s thrashing. The bulls have had a party for months now; did the Fed just spoil the party?
Have a nice evening everyone.
