Thursday, September 24, 2009
Is It Just Profit Taking?
Stock saw a sell off Wednesday despite a bullish statement from the Fed. The Dow fell 81.32 points to end on 9,748.55. The SPX lost 10.79 points to end on 1,060.87. We are in the green and looking better than we were at about 3.00pm est. We can still welcome some more down movement.
Stocks rallied most the session up and after the Fed statement, but the last 90 minutes of trading saw strong profit taking. Intraday, the Dow hit a high of 9,918, than preceded to lose 170 points from this high. The SPX hit 1080 and then fell twenty points.
You would have a hard time interpreting the Fed statement as anything other than optimistic. The committee stated that economic activity has "picked up" compared with the statement in the prior meeting that the economy was "leveling out." The Fed did state it would slow its purchase of mortgage debt, which would allow the program to extend through March. The Fed feels that inflation remains subdued and should remain so for some time. This news led to further gains immediately following the statement, but eventually, traders decided now was a good time to take some money off the table.
Now that the Fed is out of the way, we will be looking forward to third quarter earnings. Also over the next few days there are some key economic reports due out tincluding jobless claims, existing home sales, new home sales, durable goods orders and consumer sentiment.
Until next time.
Stocks rallied most the session up and after the Fed statement, but the last 90 minutes of trading saw strong profit taking. Intraday, the Dow hit a high of 9,918, than preceded to lose 170 points from this high. The SPX hit 1080 and then fell twenty points.
You would have a hard time interpreting the Fed statement as anything other than optimistic. The committee stated that economic activity has "picked up" compared with the statement in the prior meeting that the economy was "leveling out." The Fed did state it would slow its purchase of mortgage debt, which would allow the program to extend through March. The Fed feels that inflation remains subdued and should remain so for some time. This news led to further gains immediately following the statement, but eventually, traders decided now was a good time to take some money off the table.
Now that the Fed is out of the way, we will be looking forward to third quarter earnings. Also over the next few days there are some key economic reports due out tincluding jobless claims, existing home sales, new home sales, durable goods orders and consumer sentiment.
Until next time.
# posted by Paul @ 7:42 AM 
