There isn't that much in the way of market moving news this morning, so the markets are taking their cues from overseas. Asian markets were lower overnight, and Europe is lower this morning. Concerns about Greece's ability to reach a compromise to its debt situation is weighing on Europe, and the euro is also weaker.
Commodities are sliding. Gold prices have eased back to $1725; oil prices are lower near $98.80; and copper and silver prices are down also.
There were a few companies reporting earnings this morning, but nothing too notable. Earnings season continues this week, but many of the biggies have already reported.
All 10 of the S&P sectors are lower so far today. Energy stocks are down the most, while utilities are down the least. Among international ETFs, China (FXI) is down the most in early trading.
The buying in the bond market has been furious since the FOMC meeting, and the 10-year yield continues to drop as a result. The 10-year yield is now below 1.85%, and nearing its lows from mid-December. Last year's lows back in September were 1.70%.
As for the VIX, it is spiking +9% today back above the 20 level. That's right about at the downtrend line that has been in place since late November, so we will have to see if that trendline holds.
Trading comment: We trimmed a few positions last week as the market got overbought, but will look to add back to positions on any further pullback. Usually the normal course of these short-term pullbacks is that the market gets overbought, pulls back a little to relieve that condition, and then rallies back again. If it goes on to make a higher high, the uptrend is in tack. But if the market makes a lower high, it is often a sign that a deeper or longer consolidation is in the works. For now, let's not get ahead of ourselves and see how quickly this dip gets bought. I think a lot of portfolio managers were not positions for the strong January we have seen and remain underinvested.
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