The major averages became caught up in a technical tug-o-war this past week, trying to regain bullish momentum only to have every rally attempt cut short of extending a one-day move.
Just 10 trading days ago, the S&P 500 was at 2,715 and, as of last Friday, March 2, the index trades at 2,670. The big two-day 75-point rally in the S&P that occurred on Feb. 23 and Feb. 26 had investors feeling like the correction had run its course, it was clear sailing ahead and February would close out on a positive note.
That expectation was cut short following the release of the lower-than-forecast Durable Goods Orders for January (-3.7%), a softer Chicago PMI reading (61.9 vs 64.5 expected), very soft Pending Home Sales for January (-4.7% vs 0.4% expected) and Fed Chairman Jerome Powellâ??s testimony to the House Financial Services Committee that stoked fears of four interest rate hikes instead of the three-hike consensus followed by President Trumpâ??s tariff headlines. Powell focuses more on frankness and less on â??Fedspeak,â?ť which is something the market is going to have to get used to. And Trump focuses on just being Trump. It was a one-two gut punch to the marketâ??s already-sour stomach of volatility.
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