Market had the shakes premarket and it was pretty evident early it wasn’t going to shake off what was bothering it.  On a day when the U.S markets should have looked ahead to its future (Stimulus signing), instead it got trapped in current global turmoil ( European bank exposure to East/Central banks and Japanese dismal GDP numbers led the way).   That was the negative tone to start the day, later things turned negative here as the eco’ data dismissed for the time being a bottoming we saw in recent January PMI’s numbers here and in China.   The Empire February reading,  showed a rapid decline in manufacturing still exists, which was the opposite of what we had discussed as a potential catalyst (Eco data) to turn investors attention to better events and the future.  Also,  MER-BAC tossed a 660 SPX scenario into the mix to spook investors.    Stick this in a blender and you have a break of the crucial 800 level as stocks across the board went on sale with any chance of recovery over 800 met with more selling throughout the day.  There was no late short covering rally in the makings as seen lately.  Unfortunately,  SPX 800,  most likely is the new 840- 850 resistance in the short term unless we get some positive newsflow quickly.   Besides any positive D.C noise, a glimmer of hope is the realization US financials have little exposure to the new European bank problems, the problems in Japan should be weighted against the better outlook in China and the Empire number may only be a blip, besides the fact that we have all kinds of stimulus on the horizon.   The question is can and will the investors focus on what’s going on here and not globally at this moment.  

Simply a flight to quality theme today as the SPX closed in on November 2008 lows, we had Gold surging while all base metals/ commods lagged,  treasuries surging,  USD surging,  VIX exploding = a worldwide equity plunge!.   

Best to stay clear now and watch if US financials can shake off their peers misery across the pond.  This is what we’ll be watching (a financial led bounce) to initiate any new intraday trades on the long side tomorrow.