WASHINGTON, February 24, 2017 – After acting dazed and confused for much of this week, stocks looked wobbly during Thursday’s trading action, pointing toward a negative opening Friday; and a negative opening bell trade is exactly what U.S. markets got.
Stocks and major averages alike took a tumble in Friday morning trading action, with the Dow Jones Industrial Average (DJIA) dropping in excess of 45 points (-0.23 percent or thereabouts) as the broader-based S&P 500 and the tech-heavy NASDAQ falling by roughly the same percentage.
Today’s noon-hour trading result is hardly an opening gambit for the epic crash some stalwart anti-Trump Rally bears have been looking for since November 9, 2016. Yes, it could build a bit early next week, and may very well do so for a time. But this YUGE Trump Rally—now very close to four months old save for an occasional interruption—clearly needs a breather if it’s to proceed very much further.
One of the culprits giving the willies to DJIA fans was this morning’s sharp pullback in the major banks, a direction that Thursday’s downward blip in this sector seemed to be predicting. Temporary though it may be, this nasty little reversal in the major financials could be one of two things:
- A much-needed temporary rest in the financials, which haven’t had this kind of run since before the onset of the Great Recession;
- A hint that “the boyz” know the Fed won’t jack up rates in March, meaning that rate recovery for most banks has been put off yet again because the Fed is seeing something in the economy that’s still not quite right; or
- Both of the above.
And yes, that’s actually three. My bad.
Opined Schwab VP of trading and derivatives Randy Frederick on CNBC,
“It does look like things have softened up a bit…. But I don’t see any major meltdown coming. The economic backdrop is still incredibly strong.”
Yep. Unless the Russians are really coming.
What’s really going on in the general market is most likely this: Wounded permabears are shorting again, absolutely knowing, for sure, that we’re going to really, really experience a market crash and very soon. At the same time, pro-Trump traders, investors and partiers are cashing in current months-long profits, the better to pile up that cash to deploy after the bears are finished battering stocks for a few days.
Even so, it’s clear that with so many bulls currently in the ring, traders and investors alike could get gored at any point in this ongoing game, although the overall market picture remains bullish for most market sectors.
Read also: CNBC/NBC/Survey Monkey tout fake Trump poll
Healthcare issues and the shares of pharmaceutical companies could get wobbly here and there, however, just about any time President Trump sends out an anti-Obamacare tweet or drills in on that issue publicly. In fact, that’s what he did just moments ago in his Friday morning address to CPAC’s audience of conservative True Believers during his appearance at that group’s annual confab on the Potomac, just outside DC’s boundaries in suburban Maryland.
We expect a negative, limp-wristed (can we say that?) market close Friday afternoon, with some kind of downside follow-through on Monday. Then, who knows?
The one thing about the stock market thus far under President Trump: it’s like the spinning game wheel in a carney sideshow. “Round and round and round she goes, and where she stops, nobody knows.” (Except for the insiders, that is.)
Have a good weekend. As for us, unless Monday’s trading action is a snoozer, we’ll be back at the beginning of the new business week.Click here for reuse options!
Copyright 2017 Communities Digital News
This article is the copyrighted property of the writer and Communities Digital News, LLC. Written permission must be obtained before reprint in online or print media. REPRINTING CONTENT WITHOUT PERMISSION AND/OR PAYMENT IS THEFT AND PUNISHABLE BY LAW.
Correspondingly, Communities Digital News, LLC uses its best efforts to operate in accordance with the Fair Use Doctrine under US Copyright Law and always tries to provide proper attribution. If you have reason to believe that any written material or image has been innocently infringed, please bring it to the immediate attention of CDN via the e-mail address or phone number listed on the Contact page so that it can be resolved expeditiously.