WASHINGTON, July 28, 2015 – Short report today, as the Maven is about to take off for a two-week hiatus, vacationing in America’s still Wild West. Perhaps in honor of this impending voyage, Wall Street took a brief hiatus (at least today) from the bears’ most recent efforts to club stocks into oblivion via short sales and outright sales, with all major averages closing up rather nicely.
The Dow Jones Industrials (DJIA) closed up 189.68 points, a bit over 1 percent; the S&P 500 closed up 25.61, again decently over 1 percent; and the techy, smaller-cap NASDAQ closed up a nifty 49.43 points, just shy of that 1 percent marker.
There were many reasons for today’s half-decent market bounce, not the least of which was that Chinese markets—after their horrendous 8.6 percent collapse Monday—behaved reasonably well Tuesday, while West Texas Intermediate (WTI) finally stopped going down, at least for today, closing up 32 cents at $47.71 bbl. So, greedy oil dudes, where’s our savings at the pump? We thought so….
Longer term, we’re not prepared to trust this bounce just yet, given that we will get more news or non-news from the Fed Wednesday. Today’s latest rumors have the Fed telegraph a 0.1 percent rate hike, whenever. But these are just rumors and have not yet been certified by the Wall Street Journal’s inside man at the Fed, Jon Hilsenrath, so we have to take them with a grain of salt.
Otherwise, we remain touchy about this market, having been burned more than a few times in 2015, a year when absolutely all working models governing investment choices seem to have failed. So cash looks good to us right now, along with little nibbles at stable regional banks—although this story, as we have warned, is likely to play out too slowly for the impatient.
Otherwise, who knows what will freak investors out tomorrow? Whatever the case, 2015’s bungee-jumping market action is likely to continue until it doesn’t, and we don’t know when that will be.
In any event, we’re off to the west on the morrow. Reports here will be sporadic while we’re gone, but if we gain any insights while we’re on the road, we’ll be sure to let you know.
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