Art Cashin: The Dow's 'Bomb Shelter' Number
Nonfarm employers cut payrolls by 345,000 last month, well below the 525,000 drop expected. And the previous month was revised to show fewer jobs were lost than initially reported. As the Dow, S&P 500 and Nasdaq hover, what's the bigger stock-market picture?
Art Cashin, director of floor operations at UBS, offered CNBC his insights.
Generally, "we're living in an environment where a lot of portfolio managers are underweighted," Cashin explained. The managers were "waiting for a pullback that never came" and now "they have nothing to show for."
Cashin said "one of the reasons for these late-day surges" is fund managers' desperation: "You've got to hold your nose and buy'em."
What does he expect going forward?
"I think — as I said when you had Byron Wein on — you might get as much as a 10 percent overtrade here. But if we went up another 1,000 points on the Dow, I would head directly to the bomb shelter."
"As we just heard from Mr. [Bill] Gross, there are stretches in this economy that are not sustainable."
CNBC's Companies in the News:
Bank of America
Disclosure information was not available for Cashin or his company.