Reading the headlines and listening to the talking heads you would believe this is one great market we are in currently. I just wish I had some of whatever they are taking to make them that optimistic. They must have a better crystal ball than I do. That said, the markets did find some positives to trade higher on early, but then the sellers tested the moves. Technology stocks like Google led the upside for the NASDAQ while the other indexes limped through the day and the Dow closed in the red thanks to Disney getting dumped.
Interest rates rose again on the day dinging the bonds on the downside. That is two days of yields moving higher thanks in large part to the Fed monkeys all confirming September FOMC meeting would be reasonable for hiking rates. The short side of the bond sector is still my trade of choice.
Crude oil continues to slip lower despite the drop in inventory data the last two weeks. The worry about the coming supply from the largest producing countries is hanging over the price. Energy stocks headed lower again on the day after a small bounce earlier this week. Still thinking downside for now in this sector.
China is biding it’s time on the economic front and regulates short selling to stop the bleeding. This is all going to work out in time, but with the regulations and other issues not a sector I want to be exposed to currently.
ISM services data was better than expected hitting the 60.3% level in July. At least one part of the economy is growing. The other economic data has not been as positive for July. The jobs report is due out on Friday and we will watch to see how that impacts the markets as well. Overall not bad data. Earnings remain a very mixed issue for stocks and I am watching how that unfolds as well looking forward.
Overall I am willing to play golf, hike, go to the movies, travel, anything fun, but please don’t make me wade into what stocks and sectors to buy in this current environment. Sideways we go and patiently we travel.
See you tomorrow.