Stocks start up then move down. Why, you ask?
It's a disappointing day so far...the rocketed up almost eight points at the open, but within a half hour began a slow but steady decent into negative territory. What happened?
First: On the strong Q2 GDP, up 4.0 percent, there were detractors the minute the report came out.
A lot of inventory building, some complained. But most felt the numbers didn't change their outlook for the second half dramatically. Barclays is a good example: "We do not view the outperformance in this report as a signal that the outlook for growth has improved," they said.
Second: There's the inflation-fearing camp. Modest growth or not, many fear that interest rates could move dramatically on any sign the economy is putting together a consistent series of above-expectation economic stats.
Treasury yields are up this morning, and many are wondering if the Fed will make some comment about the possibility of a rate increase sooner than expectations (mid-to-late- 2015).
I'm not in that camp, but some are: Interest-rate sensitive stocks like Utilities, Telecom, Housing are all underperforming the market.
Third: There are continuing issues with the Ukraine. Reuters is reporting comments from NATO that the number of troops continue to increase along the Russian-Ukraine border.
Finally: Let's drag out the "market is tired" argument and that it is long due for a 10 percent correction. Alan Greenspan, on a competing network this morning, said stocks were due for a "significant correction" at some point. Really, Mr. Greenspan? The market IS tired, but we have been hearing about a 10 percent correction for two years. Those that got out then, when the S&P was at 1400, are now watching stocks up 40 percent since then.
My take? Things are continuing to get better, but they are getting better at a very slow rate. And the data is still choppy. And that is good for the markets.