Day started messy …and finished ugly (SP 1313)! That not only sums the day, but also the month of May. All U.S major indexes now off >6% as the May equity shellacking continued with markets erasing previous days rally. All the right sectors that were responsible for rally on Tuesday were the culprits for today’s downfall. To no surprise, any optimism and/or ‘hope’ over the Eurozone faded overnight with Spanish yields crying ‘bailout’ time.
*Athens, Dublin and Lisbon lasted just 16, 24 and 34 days after the premium they pay to borrow over Germany reached 500 basis points before seeking international help. Spain hit 500bp on Monday (currently 533bps). FT
The next few days, U.S markets will focus on its saving grace (employment…housing). The ADP (150k), Initial claims (370k)on Thursday and NFP# (150k) need to come at consensus. If these numbers falter, the market will have nothing to hang its coat on.
Today, retailers got smacked around as one firm (Cleveland research) has taken advantage of fragile market sentiment to nail some names lately. Considering the market has nothing to play individually, it goes after these type of calls twice as hard to the downside. This unknown firm has recently shattered TSCO and today it was KSS, SHLD.. SSS# for retailers are out Thursday and hopefully they can refute this ‘cautious’ call.