US stocks began August with midday gains of nearly 2 percent. But trading volume in July was at the lowest since December, which speaks to the fragility of the recovery, said Richard Repetto, principal at Sandler O’Neill.
“It doesn’t seem like there’s conviction to drive volumes out there,” Repetto told CNBC.
“Even last year, when you saw the market up 35 percent, the volumes over the years declined and what you’re seeing this year is a decline in volume," he explained.
"And the market’s waiting to be pointed in one direction or the other,” he added.
Repetto said investors should expect to see a continuation in tepid volume levels over the short-term, as August is typically the slowest month of the year in the best of times.
“[Investors] have been scared…they are not fully engaged or confident in the recovery and it’s going to take more than a few [economic] data points,” he said.
Scorecard—What He Said:
- Repetto's Previous Appearance on CNBC (Jun. 25, 2010)
More Market Views—Across the Board:
- Markets Likely Higher in August: BlackRock's Doll
- Debt Spotlight Shifts from Europe to US
- Equity Markets Are Still Looking Cheap: CIO
CNBC Data Pages:
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No immediate information was available for Repetto or his firm.