Stocks were battered today following comments from a conference in Las Vegas last night by hedge fund manager David Tepper. Tepper in a Q &A session let the audience know that it might be a good idea not to be fully invested in stocks right now. This is a man who has been very aggressively in stocks since 2010 and was letting everyone know that instead of 100% in stocks he was more comfortable at 60%. I think this is in line with the thinking of the hedge fund community. They have been confused by the macro environment for some time now and it seems most of these managers are more comfortable having one foot in and one foot out right now.
On the economic front, the CPI came in as expected and weekly jobless claims were nicely below 300,000. The Empire State Manufacturing Index surged (way better than expected), but Industrial Production for April disappointed. The Philly Fed Survey also showed general business conditions improving in May. Despite or because of all that, bond yields continued to fall.
As for stocks, by the close the Dow Jones Industrial Average was down 167 points to close at 16,446. The S&P 500 was down 17 points to close at 1870. Gold was down $9 to trade at $1296 per ounce, while oil was down $.86 to trade at $101.51 per barrel WTI.
It has been quite a volatile week. The bears seem to have the narrative on their side for the moment. Let’s see if they can capitalize on it.
Have a nice evening everyone.