The Zigmont Report (Daily Market Recap for 9/17/18)

Mike Zigmont

Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $12B AUM, offering volatility management solutions to its investor base worldwide.  Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business since 2008, sending it daily shortly after the market close.

The opinions expressed below are my own and do not necessarily represent those of Harvest Volatility Management, LLC.

Sleepy slide.  News continues to be of the mild variety and the US equity market continues to wander around.  Towards the end of the day some Trump news broke that new tariff announcements would come after the close.  That headline took 3-4 handles out of the S&P 500 but the market was already off about 10 at the time.  My point here is that the market was down modestly today and the tariff news only added to the drop by a small amount.  In the last hour of trading Trump answered some questions from the White House which spooked the market a bit further.  Capital flow for the day was a touch light at 98%.

The bears won today but there was no compelling catalyst (in my opinion).  The dip-buyers are still a force to be reckoned with.  Last week they asserted themselves, but without a lot of oompf.  At some point, the tape will be too low for them to resist.

I wonder when they jump in again.  Two weeks ago 2870 was the bottom.  That’s probably where everyone expects another stand.

This all flies out the window if a major news event breaks.  I don’t think the next tariff announcement qualifies but we shall see.

And remember, the biggest foreseeable event on the horizon is the next FOMC decision on Sep 26th (25 bip hike almost 100% expected).

See you tomorrow,