Disinterest and Disgust Drive Dreary Market
There's one key problem with this kind of trading environment.
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The market action on Monday wasn’t terrible. The major indexes were close to flat, and the Russell 2000 lost about 1%. Breadth was 3,850 advancers to 5,450 decliners, and there were over 250 stocks hitting new 12-month highs. Gains in Nvidia NVDA, Apple AAPL, Walmart WMT, and Costco COST offset weakness elsewhere.
However, it was a lackluster day with little energy and limited speculative traders. Investors had little interest in putting capital to work, and who can blame them as we head into some potentially troublesome economic data and the poor seasonality of August and September?
There was some strength in energy due to the talk about potential hostilities in the Middle East, which contributed to weakness in the broader market.
The problem with this sort of market environment is that it isn’t bad enough to cause some fear and take things down to support levels. It is just a steady drip of selling. As I’ve often written, bad markets don’t scare you out — they wear you out, and this one is getting tiresome.
We have a PPI report on Tuesday morning and a CPI report on Wednesday that could shake things up, but this looks like a market that could easily drift lower due to disinterest and disgust. Stay patient.
Have a good evening. I’ll see you Tuesday.
