[Chart courtesy of MarketWatch.com]

1. Moving the markets

A couple of forces combined to slap the major indexes around until, late in the session, the markets found some footing and managed to reduce the early losses.

Leading the charge to the downside was what appeared to be the bursting of the tech bubble in China, with its Hang Seng Tech index having been sliding down a slippery slope since early this year (-43%).

When charted vs. the Nasdaq, similarities emerge making the already nervous Wall Street traders wondering whether this current disconnect is an advance warning of things to come here in the US.

While the answer is unknown, it was enough of an uncertainty to rattle the markets. Not helping matters, and accelerating weakness, was the latest in “science” after ‘Delta’ Masking headlines appeared and shrugging off all that had been settled before.

That proved to be unsettling for stocks, which made intra-day lows and contributed to the Nasdaq’s biggest daily drop since early May, as ZeroHedge reported. Small Caps were trounced at the rated of -1.14% (VBK) with the ETF faring far worse than its value cousin (RPV), which only bled -0.11%.   

Not to be outdone, the US Dollar index dove in unison with bond yields, with the 10-year heading towards the 1.22% level. Gold worked both sides of its unchanged line and managed a meager yet green close (+0.18%).

On the earnings front, the tech heavyweights Alphabet, Microsoft, and Apple all are reporting this afternoon.

On deck tomorrow will be the result of the Fed’s latest two-day meeting, but expectations are for no earth-shaking announcements but more of the same rhetoric we hear every month.

Read More

[Chart courtesy of MarketWatch.com]

1. Moving the markets

Touching new all-time highs seems to be a regular occurrence, and today was no exception with the S&P 500 hovering again in record territory.

That came as a surprise, as in overnight trading the Chinese tech stocks were a bloodbath again, as Beijing’s crackdown intensified. So far, the US markets seem to be ignoring it and continue dancing to the beat of their own drummer.

Expectations are that, with the busiest earnings week on deck, results will remain market pleasing hence the run higher ahead of actual outcomes. The well-known adage “buy the rumor, sell the fact,” may be proven correct again.

Despite jawboning to the contrary, the economic recovery remains doubtful at best with sales of US single family homes dropping unexpectedly in June, falling 6.6% to a seasonally adjusted rate of 676k units vs. expectations of an increase to 795k units.

In terms of market behavior, we saw the US Dollar index slipping, along with Small Caps, while value (RPV) outperformed with a +0.94% gain. The 10-year bond yield did its own interpretation of a roller coaster ride but ended unchanged.

Gold struggled all day and lost its $1,800 level, but only by a small margin with even collapsing yields not being able to prop up the precious metal. The Nasdaq just about broke even, but that may change with some of the tech titans report cards waiting on deck.

Read More