Well that was a calm week wasn’t it? The markets reared their ugly heads once again this past Thursday and Friday contributing to a 6% loss and ending down 4.7% this week for the major averages. We saw the lowest trading volume of the year on Wednesday where 3.3 Billion shares traded hands on the consolidated NYSE tape; this was considered the calm before the storm. Thursday was a filled day with data. Up first at 8:30 were the jobless claims which came out up 9,000 to 408K (last week’s # was revised up to 399K, breaking the 4+ month cycle of 400K). CPI then followed with a smaller than expected increase of .5% (food+energy) increase of .2% (ex. food+energy); expected .3%. Y-o-y continues to increase 1.8% core CPI, very much shows signs of inflation, rather stagflation. Stagflation is where inflation rate is high but economic growth rate is low.
Philly Fed also came out blowing the markets down even more with the worst month-over-month in 2.5 yrs.
Negative sentiment seems to still be in place for the upcoming week, as I type we are up 8 handles, but I would be very cautious; the fact we sold into Friday’s close tells me could go lower, possibly test 1,070. Europe is badly damaged right now; unless they have their elephant gun loaded for this something this week, expect red.
We have a lot of housing data coming out this week, with another look at GDP and Big Ben Bernanke speaking Friday (expect increased volatility, he tends to rock the boat)
I’d like to write more but extremely busy with being back at school, made a $ARO trade lost some $ ended up profiting 10 whopping dollars on 4 day trades this summer, trying to tell myself I'm still an amateur at this; have a good week everyone, don’t be an all-star, go for those base hits.