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What Will Today's Close Look Like?

What will today's close look like? Some think not as bad as the open. The thinking is that most who really wanted to sell did it using futures at 8:30am ET, and at the open at 9:30am ET. The question is, how many buyers are around? That's a problem, because after 12pm ET traders will be leaving in droves.

What's the implication for stocks? It makes trading tougher than ever. At best, this muddies the waters (recent data on Chicago PMI, ISM, and ADP were better than expected), and at worst greatly diminishes the outlook for the second half of the year.

A couple specific observations:

1) it's bad for financials. Forget rate hikes, they are not happening any time soon. That's bad for financials because it pushes out the chances for higher net interest margins and higher EPS.

2) it sure isn't good news for asset gatherers (mutual funds, online brokerage firms). Equity flows will likely remain miserable because traders will be uncertain about the markets.

Is the rally over? Not necessarily:

1) earnings are coming...so far there have not been an avalanche of warnings.

2) this increases the likelihood that additional stimulus measures will be enacted. Look for more talk of payroll tax holiday, repatriation of foreign profits, etc.

Jealous yet? Canada added 28,000 to its workforce in June...this in a country with 33 million (the U.S. has 307 million)..unemployment rate is 7.4 percent, vs. 9.2 in the U.S.

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