With one of the most volatile days the market has seen in quite a while it looks like tomorrow could be equally as interesting. Tomorrow’s reports include weekly jobless claims at 8:30 a.m. ET; U.S. manufacturing PMI at 8:58 a.m.; FHFA home prices at 9: a.m. and new home sales at 10 a.m. U.S. markets will also be watching PMI data for China and the euro zone. With the largest spread in share prices in a long time, the Dow Jones Industrial Average closed down by 80.41 points to 15307.17. In fact this was the first time since March 16, 2009, that the Dow closed down after trading up by over 150 points during intraday trading. The S&P 500 lost 13.81 points, or 0.8 percent, to finish at 1655.35. The Nasdaq dropped 38.82 points, or 1.11 percent, to close at 3463.30. Both the Dow and S&P were up as much as 1 percent earlier in the session.
It seems that uncertainty in quantitative easing is what drove the markets to such a volatile day, when Bernanke first came out say that the Fed purchasing would continue as jobless markets and the over market would not be changing its current policies anytime soon. Then selling took hold when Bernanke was questioned about the unwinding of quantitative easing. He said the Fed could start paring back purchases in a couple of months, and even though New York Fed President William Dudley had publicly said the same thing, markets went into a tail spin. It seems we currently have a conflicted Fed and it’s time to start looking at how this quantitative easing is truly helping the markets. As reported last night it seems strange that during home buildings biggest season that we would see 2 directors of Standard Pacific Corporation who both sold off nearly $220 million in shares during this time in the market. We will report further on this during tomorrow night’s trading room so be sure to tune into then.
After market close Hewlett-Packard released their quarter 2 results which outpaced expectations all though significantly below year over year results. On top of their guidance beat for the quarter, they also raised internal guidance for the third quarter which sent the stock trading up over 15% during aftermarket trading. Although the PC business has been suffering it seems that HP has controlled cost enough to make up for this downturn in the PC market and may still yet be able to evolve into the 21st century. We will keep a close eye on this tomorrow to see if the aftermarket trading was simply euphoria, or truly the beliefs of investors in this company. It seems like we could see a pullback in the markets as we had more potential shorts during our scans then we have seen in sometime. However the market has fooled us before during this recent bull run so being causes and looking for individual stocks that meet your criteria continues to be the rule of thumb.