The Asian markets were mixed, HK +0.02%, Shanghai +2.14% and Japan -1.32%. The Chinese markets had a some strength after a difficult period.
European markets were sluggish today, Euro STOXX -0.06% and DAX +0.02%. The EU CPI was 0.8% and 2.4% y/y. The Core was 1.1% and +2.9%. It did not improve as much as hoped.
There were no economic reports beyond the Beige Book.
S&P 500 -29,20, -0.58% to 2,022.21.
After a 5,075 gap up opening, the market dribbled down to 5,007 by 1 PM. It reversed and got back to 5,050 around 2:45.PM. A quick drop to 5,021 was followed by a sideways churn into the close.
It had the same pattern as yesterday, a gap up opening and then fail the rest of the day. The oversold brings in early buyers. The market had several negative forces today.
First, the algorithm systematic investment funds, like the CTA group, are selling steadily. The trader element knows this and is more hesitant to buy into this.
The second factor was a disappointing report from an AI star, ASML. It reported good earnings, but poor orders. Companies were over ordering in China creating a near term vacuum of demand. This had a wide impact on the Semi group, particularly the producers of equipment.
Also, when the algo's sell futures, it puts pressure on growth stocks since they are such a large portion of the index.
The Beige Book had little impact, indicating modest growth. It doesn't match the reported data?
The DJIA slipped 0.12%. The NASDAQ fell 1.15% and the QQQ 1.22%. The IWM was -0.99%.
WTI slid $2.87 to 82.69. Traders are worried about no resolution by Israel, knowing the price will go down if there is a more peaceful resolution. The XOP declined 1.2% and the XLE 0.3%.
The 10 yr T bond rate finally ran out of steam, -6.8 bps to 4.589%. The main negative was a very strong 20 yr auction. The level has attracted buyers!! The KBWB rose 0.7%. The XLU popped 2.1% !!
The VIX dropped 1% to 18.21, a positive divergence. The declines led, the NYSE 1.05 to 1.and the NASDAQ 1.6 to 1. The NYSE volume was average and the NASDAQ just above average.
There are some possibilities to help the market. Oil sliding would help. If the 10 yr could stop going up it could encourage some buyers Of course the oversold is severe.
The overhang is what Israel does????
NFLX reports after the close tomorrow, one of the big stocks.
Blub
Jerry