Traders Feel Market Still Hostage To Credit Crisis

What's up with these last hour sell-offs three of the last four days? Many traders believe there is another major round of quant fund de-risking which is forcing many other large, plain vanilla hedge funds to de-risk.

For the moment, traders note, the market remains hostage to the credit/CDO worries. Many feel it's hard to know if we are entering recession or stagflation. PPI and CPI next few days are critical.

Wal-Mart beat third quarter estimates and more importantly fourth quarter guidance was about in line with expectations--many have feared that retailers would be lowering guidance. More good news: 2008 guidance above expectations.

Wal-Mart news is a relief but Home Depot reflects more softness. They cut their fiscal year guidance and said they may limit their buyback plan. Bulls are hopeful that other retailers reporting will indicate that with weather getting colder early November has shown improvements. Corning raising guidance for sales and earnings.

Questions? Comments?