[Chart courtesy of MarketWatch.com]
- Moving the markets
There was not much motivation on the part of the bulls to engage and keep this market from fizzling. The big three, namely lack of progress on the trade dispute with China, mixed earnings results and weak headlines for economic numbers, combined to create a lackluster session.
In other words, the recently observed last 30-minute pump was only a distant memory causing the major indexes, who spent most of the day below their unchanged lines, to dive into the close. The losses were moderate, given the recent relentless push into record territory, but it appeared that we simply ran out of steam.
Not helping matters were Building Permits, which plummeted the most in 3 years (-6.1% MoM) putting another nail in the coffin of weak home sales data and mortgage applications, despite ongoing low interest rates. ZH reported that Housing Starts followed suit and dropped -0.9% MoM (vs. -0.7% expected).
Bond yields headed lower again with the widely held 10-year having almost made up the losses sustained in the last week, when we hovered around the 2.14% marker, which is quite a drop to today’s 2.06%. At the same time, the US Dollar pulled back, while Oil continued its downward spiral after a de-escalation of tensions with Iran.
Only about 7% of the S&P 500 companies have reported earnings so far, so we certainly will have more surprises on deck, any of which can push the markets in either direction.(more…)