The S&P 500 Drops -1.26%

Ugly day today. At noon, the market was mostly unchanged, but then Dennis Lockhart, the president of the Atlanta Fed, said he supports more tapering (he’s not a voting member this year). The market started to head south. By the closing bell, the S&P 500 had dropped down to 1,819.20 which is its lowest close since December 20th. For the day, the index lost -1.26%.


My take: I don’t think there’s any real news here. The Fed will most likely continue with tapering this year but hold off on any rate increases.

Breaking down the market, the biggest damage today came among cyclical stocks. The energy, consumer discretionary, and financials got hit the most while utes, healthcare and staples were down least. Bonds were up, but not by much. The 10-year yield fell to 2.83% which is 21 points below its peak from December 31.

Our Buy List had a rough day. We lost 1.27% on the day which was almost the same as the S&P 500. Eighteen of our 20 stocks lost ground; only Ford ($F) and eBay (EBAY) made money. Ford made a lot of headlines with the unveiling of its new F-150 at the Detroit Auto Show. The new pickups are made out of aluminum. Although they cost more, they’re more fuel efficient.

Our worst performers today were Microsoft ($MSFT), Bed Bath & Beyond ($BBBY) and Cognizant ($CTSH). Next up, we get the earnings report from Wells Fargo ($WFC).

Posted by on January 13th, 2014 at 4:35 pm

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