This was not a good day for the bulls. After yesterday’s turnaround Tuesday recovery, today was supposed to be an “all clear” bullish move with Fed Chair Janet Yellen testifying before the House Financial Services Committee, and likely spinning a dovish yarn. Well, Ms. Yellen did testify before the house and somewhat held fast to the hope that the economy will improve and fiscal policy will proceed as scheduled. Of course, she did leave open the possibility that things won’t get better and the Fed will remain data dependent and thus delay the scheduled tightening. Oh, and a discussion of possible negative interest rates was part of the proceedings. The Fed Chair indicated that she believes that the Fed has the power to create a negative interest rate environment, but she still has to verify the legalities. Oh my.
As for stocks, after the expected early morning rally, stocks spent the rest of the session disappointing the bulls. By the close, the Dow Jones Industrial Average was down 99 points to finish the day at 15,914. The S&P 500 was down less than a point to close at 1851. Gold was down $4 to trade at $1,194 per ounce, while oil was down $.32 to trade at $27.62 per barrel WTI.
As indicated, it wasn’t a terrible day for the bulls as the S&P ended mostly unchanged, but the set up was for better things. Earnings season is winding down and Corporate America is fighting hard to keep bottom lines intact, but managements are struggling to maintain revenues and are guiding analysts down in their estimates of future revenues and earnings. Let’s see if the bulls can gather themselves and make a stand as the week winds down.
Have a nice evening everyone.