The market is obvoiusly down this past month and especially this past few days. Now I recently read an expectation that fund managers would try to run up the market at the end of the month to prop up their second quarter stats - a bit of quarter end painting of the tape. If they tried they failed miserably. Alternatively, my preferred theory is that fund managers did not want to have to admit at quarter end to some of the poor performing stocks they bought so they sold them this past week to take them out of the portfolio for quarter's end. Now if they can actually get away with this quarter end BS one more thing is wrong with the system, but from what I have read they can do this and that is what I suspect explains part of the month end drop. Tomorrow will tell big time. If we have a big bounce - especially if there is no big positive market news - then we know the past few days were due in large part to issues having nothing to do with stock values. I hate that understanding the market carries all this baggage but it is what it is. If stocks stay in the doldrums, then it could be the recent down market is actually for once due to market sentiment.
Personally, I did not buy the reason for the market being up this morning or for it being down at the end. If the market is truly swayed by the factors Bloomberg is pointing to for intra-day swings, this is truly sad.
Disclosures: None.
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I suspect we saw some "sell stops" get triggered late today, and may see more tomorrow.
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