Top Line: The Dow closed up on the day with the NASDAQ down after a wild ride. This felt a little different than we've seen over the past two weeks. Time is running out on this decline...
Another roller coaster of a day on Wall Street. The market opened down and then went on a tear taking the Dow up nearly 400 points from its low about 90 minutes into the trading session. Then the bottom fell out and the Dow dropped from 8800 to 8250 over the course of the day before jumping into the close to finish near 8700. Crazy.
As the Dow was dropping to that 8250 low, the NDX decided to drop to a new low for the move. The prior low was 1192 and today's low was 1177. Most other major indexes did not fall below their prior lows. It's true, the Russell 2000 did just about touch it but it didn't.
We don't consider the GDX or HUI to be a "major index" and they did selloff more giving us a couple of great opportunities. We had an order in to buy at 17.98 which filled early in the session when the GDX dropped to 17.90. From there the GDX went to 19.53 and we were feeling pretty smart just before it started dropping and went under 17...so we decided to buy some more there...yes, we are Crazy, too.
A possible reason for the early drop in the GDX was that gold dropped under $700 briefly. From that low gold bolted up nearly $40 taking GDX up to that 19.53. Gold then sagged back to $710 as the GDX dropped below 17. We can't believe how GDX continues to get hammered. The GDX expects that gold should go to $250 an ounce...Crazy.
Going over to Japan, SONY warned on earnings and has taken the Japanese market (Nikkei) down about 7% this evening. The rest of Asia is down tonight as well and has taken down the US futures tonight. The Dow was up 172 during the regular trading session and tonight the futures are down 172...Crazy.
Wednesday evening AMZN (Amazon) reported disappointing earnings which dragged the futures down overnight. AMZN dropped from 50 to 43 Wednesday evening so we expected the FSI (remember that?) might be able to break to a new low on Thursday...but by the end of the day AMZN was Up on the day so no new low in the FSI...Crazy.
Greenspan testified before the House Oversight Committee on Thursday. (Or check out Friday's WSJ. This is the WSJ's article, vicious attack on Greenspan.) He was Grilled or Skewered as the case may be. The committee asked him some tough questions and he admitted some failures in his model and his view of the world. A few years ago he's the Maestro and now he is being de-"Maestro"ed in front of the world...Crazy.
We need to remind you of the great marketing scheme put forth by Chrysler this summer. Do you remember the gas price guarantee of $2.99? Even at the time, we thought it was brilliant because of our view that gas would not be above $2.99 for long. We saw a station with a price of $2.29.9 this evening. Crazy...
Have a great weekend.