Wall Street is Becoming a Falling Stock Zone

Is anyone other than the Fed governors and CNBC hosts convinced that ZIRP and QE aren't exactly working?

For the second day out of the past three, stocks suffered severe, across-the-board losses, extending the pullback that began on Friday.

The worst performing index has been the NASDAQ, which has dropped nearly 100 points since the close on Thursday (1300.18).

Dow stocks, predominated by high-yielding, dividend-producing income companies - the creme de la creme - have fared better, though the index is still down 247 points and there are still two days remaining in the trading week.

While the recent moves may be described as a precursor of the time-honored tradition of "sell in May and stay away," the directionality is troubling, because the US is supposed to be in a recovery.

Not helping matters much are the oddities coming out of Boston in the aftermath of Monday's bomb strikes, and Washington, where packages containing ricin have been showing up with increasing frequency.

Larger issues loom in Europe, where data continues to deteriorate, even in Germany, thought to be the bastion of strength.

Corporate earnings have been less-than-encouraging as well. Today's numbers from Bank of America (BAC) were notably weak, spurring the drop at the opening bell.

Still, the losses have not reached even three percent, so it may well be too early to make a call that direction has changed, though, as has been pointed out repeatedly here and elsewhere, bull markets do not last forever, and this one is heading into its 50th month.

Key data this week has included a wicked drop in the Empire State manufacturing index, from 9.2 to 3.1, a negative reading (-0.2) on CPI for March and a drop-off in building permits, suggesting that the housing sector may not be quite as healthy as the pundits have been preaching.

Volume on the day was particularly heavy, a signal not lost on both bulls and bears; decliners outpaced advancing issues four-to-one; new lows, for the first time this year, superseded new highs, and by a rather large amount, another key metric.

After the bell, both American Express (AXP) and eBay (EBAY) missed gross revenue targets and just barely beat (each by a penny) the per share earnings forecasts.

Commodities continue to be beaten down as deflationary forces appear to be winning at the present time. Depending upon which side you butter your bread, that may be good or bad news.

There is good news in oil, which hit a multi-month low. If prices for crude continue to depress and remain so, it won't be long before driving Americans finally get a break at the gas pump.

Gold and silver continue to be on sale, though shortages in physical metal are widespread and premiums over spot prices are ranging anywhere from 16 to 35 percent. If that condition persists, forget the gold and silver ETFs, they will eventually break down as the backers are unable to deliver physical metal on contracts.

LATE BREAKING: Senate votes down gun control "compromise" measure. Long live the 2nd amendment!
and...
Europe's leading parliamentarian, Nigel Farage:



Dow 14,618.59, -138.19 (0.94%)
NASDAQ 3,204.67, -59.96 (1.84%)
S&P 500 1,552.01, -22.56 (1.43%)
NYSE Composite 8,955.47, -130.96 (1.44%)
NASDAQ Volume 1,889,783,125
NYSE Volume 4,579,846,000
Combined NYSE & NASDAQ Advance - Decline: 1382-5083
Combined NYSE & NASDAQ New highs - New lows: 87-178 (this could be huge!)
WTI crude oil: 86.68, -2.04
Gold: 1,373.10, -14.30
Silver: 23.24, -0.383