Dumb Headline of the Day: Why the Market Reversed
By Barry Ritholtz - October 26th, 2009, 1:17PM
This is one of the less helpful things you will read today:
U.S. Stocks Retreat on Concern Housing Tax Credit to Phase Out
Bloomberg, Oct 26 2009
That’s the worst Bloomie headline I’ve seen in a long while. Let’s review some things that, according to this headline writer, are note very relevant. Examples of what the equity retreat is apparently not based on include:
• An Equity market that has rallied 65% in seven months;
• $80 plus Oil;
• Overhead resistance at 1100
The Tax credit, whose expiration date was well-known to just about everyone since it was conceived, is the cause of the reversal, and not these other factors. (Thanks for the heads up!)
~~~
UPDATE: 7:40pm
OK, now they are just screwing with me . . .
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October 26th, 2009 at 1:27 pm
Drum roll………..and the number one reason is…………
The dollar is rising because of undeniable fundamentals. If this gets going, the financial market mess will be really ugly.
October 26th, 2009 at 1:37 pm
This is why we need the Ritholtz News Network.
October 26th, 2009 at 1:48 pm
To the average investor, the Bloomberg headline sounds intelligent enough, but in reality, 90% of the time, the headline SHOULD be
“Stocks (rise/fall/reverse) due to idle speculation and random noise.”
Seriously, wake me up when something important actually occurs on a day to day basis…
HCF
October 26th, 2009 at 2:18 pm
Market reverses because someone sold a massive block of SPOOZ doesn’t work for ya, Bazza?
October 26th, 2009 at 2:24 pm
It is a very good observation. Thank you for pointing it out.
Many times it is very hard to figure out why a move in the market is happening. But by observing closely the market moves, timing signals can give me a perspective of when to get in and when to get out.
I get my timing signals at http://invetrics.com
October 26th, 2009 at 2:33 pm
Market’s been tipsy for the past several sessions now. SPX below 1071 on the close could trigger a wave of selling tomorrow. If it holds, more range bound trading perhaps. But soon enough, a big move down is inevitable.
October 26th, 2009 at 2:40 pm
Like always, the MSM is just GUESSING and/or they have an ulterior motive, probably to push for an extension of the credit.
~~~
BR: I dont know the motiviation, I only know the headline is silly
October 26th, 2009 at 2:46 pm
It’s kinda funny because Yahoo blames it on the rising(at least for today) dollar. Which is closer to the truth. Although why the abrupt change mid-day is any ones guess.
October 26th, 2009 at 2:46 pm
Lakshman Achuthan sees textbook recovery !! No worries….
I like the flag, Harry, good to know you are BULLISH on America. Remember Treasury needs to sell a lot of bonds this week so it was never likely to be a great week for stocks.
October 26th, 2009 at 3:01 pm
If I could draw, I would make a comic panel of Mr. Miyagi, instructing Daniel-San. Miyagi would be holding a Dow 10,000 hat and repeating, “Hat’s On, left hand! Hat’s Off, right hand!”
October 26th, 2009 at 3:06 pm
Yeah, that is a stupid headline. Everyone knows the market being down today has something to do with the Yankees being back in the World Series. Exactly what it is about the Yankees being back in the World Series that has caused the sell off, I don’t know. But I know the answer is out there. (Go Phils.)
October 26th, 2009 at 3:16 pm
well, we should remember that karen called the Top, last week..
and, as was mentioned.. http://quotes.ino.com/chart/?s=NYBOT_DX&t=f
the ‘Paperback’ is catching a bid..
lb, you mean the 1/8 Trillion they’re trying to find a home for? Best of Luck!~ USTreas.
also, just to remind people, http://crawfordperspectives.com/ Arch is seeing ominous potents in the astral entrails.. an FYI~
October 26th, 2009 at 3:18 pm
I nominate this for nonsensical headline of the day (As seen on “TOP” news stories on bloomberg).
“Pound Poised for Goldman Sachs Rally Not Helping Brown With U.K. So Cheap”
-That is verbatim what was on TOP, not edited at all by me…
October 26th, 2009 at 3:48 pm
I guess shifting back and forth between “Markets up today because there are more buyers than sellers” and “Markets are down today because there are more sellers than buyers” isn’t much fun for the headline writers….
October 26th, 2009 at 4:01 pm
A good day for the dollar – after Marc Faber’s call for it to go to zero…..
October 26th, 2009 at 4:05 pm
@gordo365: Here’s a novel idea: maybe they can stop trying to assign a simple reason to something as multi-factored (and mysterious) as our “markets” and other similar things? I know we as humans hate that sort of ambiguity, but……..
Just stop making shit up to make everyone happy. How about that?
October 26th, 2009 at 4:15 pm
You cannot print your way to prosperity and you cannot solve a debt problem with more debt. Therefore the rally is doomed. It does seem that stocks now move inverse to the dollar. That is also an unsustainable conundrum. You can’t debase your currency to prosperity. So what will give?
Gold speculation is at record highs…dollar is also heavily shorted. Those two go hand in hand. Since other currencies are equally as bad, and China can’t have the dollar collapse, fundamentals and sentiment calls for a huge dollar rally. Physical demand for gold is plunging – this is a deflationary debt crash.
Therefore, I conclude big dollar rally coming, massive gold and stock collapse. According to Hussman last week, we are at record overbought conditions in stocks.
October 26th, 2009 at 6:17 pm
It is human nature to seek a simple answer for a complex problem. It is a stress reducer, makes us feel like we are in control of our circumstances. LOL
Question: Why did the market go up/down?
Answer: Buyers were more/less motivated than sellers.
That’s all I need to know about the day’s market action.
October 26th, 2009 at 7:01 pm
Here is my take – I don’t think this dollar rally has legs. I am bearish on stocks (since last week) in the short term, but market is going to find support after a minor correction. We will rally into Christmas and then another big correction in Q1 next year. This is going to be more of a range bound market next year. Hope you followed my call on shorting Oil.
October 26th, 2009 at 8:21 pm
Nnot only does concerned headline-writer have his head up his rectum, his’ mind is on the house he’s buying and he is worried he it might not close before Nov 30th.
October 26th, 2009 at 8:24 pm
@super_trooper: No worries there. He’ll have plenty of time to do that once the bill is extended and “phased out” over the next 14 months!
October 26th, 2009 at 9:36 pm
I still think it has to do with the fact that the 30y didn’t do so well at the last auction and the Fed/Treasury have to get people to buy Tsys. This will only work a few times because I believe we will have a failed auction soon.
October 26th, 2009 at 11:23 pm
Am I the only one that glanced at the Bloomberg screen capture and initially thought Barry had a problem with the innuendo-filled main headline: “Financing in the dark hits Americans with back-door tax”. I guess that is what happens when you have just read Barry’s “teabagger” post.
October 27th, 2009 at 4:20 am
Can’t assume it’s a human these days. I think they have a bot to make these headlines.
It allows them to cut costs, therefore beating analyst estimates.