Markets zigzagged at the open on Wednesday after a mixed bag of economic data: jobless claims and personal spending rose above expectations but durable goods fell short. Art Cashin, director of floor operations at UBS Financial Services, shared his market insights.
“The dollar’s moves are more important” than today's data, Cashin told CNBC.
“They have been moving the market now for almost two full months—whenever the dollar index dips, stocks go up… The initial claims may have benefited from the holiday—employers are a little loath to fire or lay someone off a week before Thanksgiving.”
Cashin said although stocks are benefiting this week due to the Thanksgiving bias, there are divergences.
“Things like the Russell 2000, which represents a lot of the smaller stocks which led much of the early rally from March, is now lagging and it is underperforming. It’s below its 50-day average,” he said.
“You’ve seen people yesterday moving out of financials and into dividend-paying stocks. So there are signs of growing caution here."
"We’re seeing fewer new highs in stocks, and we’re seeing highs in some of the averages," he added. "The reverse of that is what led the March rally, so you’ve got to be cautious.”
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No immediate information was available for Cashin or his firm.