Tuesday, September 18, 2012

With Everything Priced In, Trading Remains Sluggish

Well, absolutely everything from QE3 to the ECB's bond-buying program to Midwest drought to the presidential election has been completely priced into stocks, so they have nowhere to go at present.

The NASDAQ traded in about an eight-point range, a fivepoint swing top to bottom as all the S&P could muster, while the Dow - the only index higher on the session - was range-bound by 64 points. Volume, not unexpectedly, was light and volatility was nowhere to be found.

This, of course, is the direct result of government intervention into what used to be free markets, central planning of the economy and socialization of losses by financial firms.

It goes without saying that it is tough to make money in such an environment. Stocks are poised either near all-time highs or, as in the case of the NASDAQ, multi-year highs. The level of complacency, knowing that the Fed can and will step in at any sign of weakness, is almost unbearably stupid.

Since Fed chairman Ben Bernanke called for $40 billion in monthly MBS purchases without placing a duration limit, the major averages have more or less flat-lined.

That's about the whole story for today. Nothing much happened.

There was one bit of good news: oil fell substantially for the second straight day. If the current move downward (oil prices usually drop after Labor Day) is sustained, within a month, drivers should begin to see lower prices at the pump.

Dow 13,564.64, -11.54(0.09%)
NASDAQ 3,177.80, -0.87 (0.03%)
S&P 500 1,459.32, -1.87 (0.13%)
NYSE Composite 8,387.52, -21.45 (0.26%)
NASDAQ Volume 1,672,492,500
NYSE Volume 3,350,519,000
Combined NYSE & NASDAQ Advance - Decline: 2560-2973
Combined NYSE & NASDAQ New highs - New lows: 191-20
WTI crude oil: 95.29, -1.33
Gold: 1,771.20, +0.60
Silver: 34.72, +0.35

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