Courtesy of John Nyaradi.
Major Index ETFs To Begin The Plunge?
Major index ETFs finished in flat to negatative territory today, as major indexes continued their losses for the 6th day in a row. The SPDR S&P 500 ETF (NYSEARCA:SPY) lost .48%, the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) lost .27%, the PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) lost .94%, and the iShares Russell 2000 Index ETF (NYSEARCA:WIM) lost .34%. While the QQQ’s underperformed the worst with a near 1% decline, the rest of the market, although negative, finished relatively flat.
Today’s “flatline” declines were likely spurred by a “less worse” unemployment claims report released today, which indicated a 26,000 decline in unemployment claims for last week. Any news is good news, but the 26,000 decrease in claims is certainly nothing to shout especially because the decline was likely due to the Independence Day holiday. More accurately, the “less worse” report is a depressing indicator of our “flatlined” economy. Read more about the unemployment claims report here.
The rest of the world is flatlining (declining?) as well, as a Eurostat report indicated a 2.8% decline in manufacturing within the Eurozone in May 2012 compared to May of 2011. Furthermore, Spanish bond yields spiked to 6.64% and the Japanese Yen continues to rise, thus crippling the debt-ridden nation’s ability to sell their products abroad. Bad news bears continues to strike world news, and everyone is maybe starting to realize that this is all likely far from over. Read more about the dismal state of world affairs here.
So, are we facing a flatline or a decline for the US and the global economy? Likely a mix of both, as the US and global markets continue to show slowing numbers. Couple these numbers with election year turmoil, a possible fiscal cliff in December, Euro crisis, the lazy, hazy, crazy doldrum days of summer, and one would think that something is bound to give somewhere sometime soon…
Bottom Line: Markets continue to decline and at best flatline as the world economy struggles to stay afloat.
Click here to learn more about John’s book and for a free membership to Wall Street Sector Selector
