True to form, the market moved sharply once again during the final hour, completely negating the progress it had made earlier in the afternoon. By the close, each of the major S&P sectors was in the red while the indices finished with losses of 3.13%, on average. With a loss of over 4%, the Nasdaq was particularly weak as several big-cap tech names fell sharply, which was likely due, at least in part, to the poor earnings report last night from TXN. As we write this, market players are waiting anxiously to see what sort of news AAPL delivers.
Still, despite the losses and continuing whipsaws, credit market conditions continued to slowly improve and the trading range between the bells narrowed a bit once again. What we’d really like to see is for some of this volatility to calm down and for investors to take a break from chasing moves in both directions. If emotions can cool down and we can start to build some tighter ranges, then maybe we can start to see some better set-ups develop. Like we’ve said, we are seeing some improvements, and even though we gave back the majority of yesterday’s gains, today’s action doesn’t change that.