Stock Market Commentary:
Stocks ended mixed after trading between positive and negative territory on Tuesday as the S&P 500 retested Aug’s low. Oil negatively reversed and closed down on the day which is not ideal. Overnight, China said its GDP grew by 6.9% for 2015 which was the slowest pace since 1990! Additionally, China said Q4 2015 GDP grew by 6.8% year-over-year which matched estimates. In the U.S., December retail sales grew by 11.1%. Meanwhile, industrial production rose by 5.9%. Both came in below estimates. In other news, The International Monetary Fund (IMF) cut its global economic growth forecast for 2016 on Tuesday. The IMF now believes the global economy will grow by 3.4% in 2016, lower than the last forecast of 3.6%. The fact that the market can’t bounce from these deeply oversold levels continues to show you how weak the market is right now.
Gary’s Thoughts: We must tell you that even with the stretched, extended and oversold condition this market has…and even though a good bounce would be normal, so far, bounces have lasted a day and rolled over quickly. Due to the fact Monday’s action was again very suspect underneath the surface of a Dow that was up, we are thinking price may just have to move lower to attract any buying of consequence. The big picture remains gross…and we are being nice.