Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
The NASDAQ is taking the brunt of the hit today for obvious reasons. It is remarkable to see the divergence in the indexes today as the Dow is sailing along on the backs of IBM and Caterpillar. Meanwhile most of the stocks the retail crowd likes to trade are being smashed. Small caps are actually positive in relation to the S&P 500 and NASDAQ – rare in 2012.
That said the indexes have fallen from peak, but it’s been in a very rotational manner – only a handful of days have been very seriously in the red with all groups falling together as we saw often in latter 2011. It would seem hard to believe a bottom is in put place when people still “want” to buy. And people continue to look for hideouts as the sector rotation is showing. Usually a good bottom is in when “dip buyers” emotionally don’t want to buy.
If you are keeping track at home these are the drops versus peaks in late March
- NASDAQ -5.8%
- S&P 500 -3.7%
- Russell 2K -6.2%
- DJIA -2.4%
The action in the S&P 500 and DJIA show why it doesnt feel like much of a correction – while the NASDAQ and R2K is showing the deterioration under the covers.
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