The fact that the market failed to follow through on Wednesday's low volume shouldn’t be a big surprise -- but that doesn’t make it any more pleasant. The market has often caused great frustration for folks who don’t trust low-volume bounces, but this time it actually turned out to be the right move.
The catalyst for today’s intraday reversal was a speech by Fed chief Ben Bernanke that failed to cover any new ground. It was basically a rehash of his Jackson Hole speech last month and it disappointed market players looking for hints about what the FOMC might do at its meeting later this month. It probably wouldn’t have taken much for Bernanke to bring in some buyers, but he offered nothing of interest.
The next news item on the agenda is President Obama’s jobs speech. Unless he offers something truly new and surprising, I can’t imagine it having much market impact. In fact, it will probably stir up another political struggle and help to cement the belief that Washington is hurting the economy more than helping it.