Courtesy of John Nyaradi.
Stock market warnings flash everywhere!
Major U.S. indexes (DIA) (SPY) declined sharply with the financial sector leading the way after a combination of warnings from Europe and disappointing earnings dampened investors’ attitudes.
China’s (FXI) growth slowed to the slowest rate in two years, signalling the possibility of a “hard landing” for the world’s second largest economy while Germany dampened expectations of a speedy resolution to the simmering crisis in Greece and other PIIGS nations.
France was put on notice by Moody’s that its AAA credit rating could be in jeopardy in relation to bailing out its banks and the Euro declined on further concerns for a quick resolution of the credit crisis on the Continent.
At home, Wells Fargo disappointed with its earnings reports and investors punished it with a -8.4% hit on its stock price. Financials overall got hammered with the sector (XLF) down -3.1%. IBM disappointed and dropped 2%.
Also things continued looking bleak on the retail front with Gap and Lowes closing stores around the country and the Empire Index declined for the 5th month in a row. The only bright spot in today’s economic reports was a gain of +0.2% in September.
Tomorrow we get significant earnings reports from Goldman Sachs, Bank of America, Coca Cola and tech heavyweight Apple in its first release since Steve Jobs’s untimely and sad death.
Wall Street Sector Selector remains defensively positioned, expecting a dangerous environment ahead.
Disclaimer: Wall Street Sector Selector actively trades a wide range of exchange traded funds and positions can change at any time.
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