Yesterday was a sea of red, but there wasn’t any panic. Buyers began to make their moves half an hour before the closing bell. After waiting for all the sessions for weak hands to blink, it was buyers. The last thirty minutes of trading tells me a bounce could happen at any moment.

Ten of eleven sectors succumbed to selling, with Consumer Discretionary (XLY) holding on for slim gains. Consumer Discretionary remains hot, underscoring the recent development of buyers piling into the hottest sectors for safety no matter how much they’ve already rallied.

I thought the Twelve Days Would Be Jollier

I’ve seen articles calling “The Twelve Days of Christmas” the most annoying Christmas carol. Still, I’d take any options over the twelve consecutive days of more decliners than advancers.

Moreover, decliners are getting progressively worse.

Where’s All the Cash Going?

Just as troubling (not a panic signal) is the mounting 52-week low closes.  However, record amounts of money have cascaded into this market, and it will still work – see up volume on the NASDAQ Composite.

Market Breadth	NYSE	NASDAQ
Advancers	699	1,481
Decliners	2,111	2,897
New Highs	42	117
New Lows	160	229
Up Volume	1.40 billion	4.68 billion
Down Volume	1.83 billion	3.62 billion

Heat Map

Some “Mag Seven” names tried to step up, but it wasn’t enough. Drugmakers were yesterday's positive surprise niche; the names popped up after strong comments from Pfizer (PFE).

Peddling U.S. Bonds

It was another brutal bond auction, but the silver lining is that it was better than those disastrous auctions in November. But that is splitting hairs and maybe whistling past the graveyard.

Indirect

• 62.0% from 69.5% in November and the six-month average of 71.4%.

Direct

• 20.1% from 7.9% in November and the six-month average of 15.3%.

Dealers

• 17.9% from 22.0% in November, but the six-month average of 13.3%.

FOMC

Everyone expects the Federal Open Market Committee (FOMC) to cut 25 basis points (bps) today, but all bets are off afterward. The question-and-answer period should be ‘lit’ (I've got you covered on Fox Business).

Today’s Session

This could be a huge day for the market. At 2:00PM, we expect to hear the FOMC cut Fed funds 25 basis in moments. 

However, the focus will be on the updated Summary of Economic Projections or September’s SEP revisions from assumptions.

The Street is looking for a higher GDP, and lower unemployment assumption.

All eyes will be on Jerome Powell's question-and-answer session. He will be pressed on whether the Fed cut too much to start this easing cycle.

I'm more concerned with Powell's ability to portray a nuanced version of the economy.

He knows folks are replacing vehicles destroyed during hurricanes which made retail sales numbers "strong."

He knows the job-finding rate has collapsed. 

Powell & Co have basked in the glow of thus far engineering a potential soft or no landing scenario.  The glide path has become bumpier, and everyone has fastened their seat belts awaiting today’s decision and discussion.

This morning, we saw housing starts stumble to 1.289 million annualized, the Street was looking for a bounce to 1.34 million. Permits came in better, but this is a disappointing trend.

Comments

CP, I had been making income from Apartment Rentals but due to multifamily insurance doubling, utilities doubling, taxes doubling, and a drop in occupancy, the management cut my cash flow to Zero. Not good for an average retired guy. If my family asks me what I think of POTUS 46, I'll have to smile and leave the room. After all, Peace on Earth and all that jazz. T in Tx Tim in Texas on 12/18/2024 10:06:43 AM

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.