As you know we have long been in need of a pullback in the Capital Markets. From the March low we have smartly moved up almost 40% without much hesitation. Markets, just like a marathon jogger, need a break, and to use our jogger as an example, there is little possible reason to assume we can continue on the pace we started in March.
We are uncertain if the yesterday’s move was a break, or just left over trading from Friday’s option expiration. It is summer, and our sense is many are taking their vacations now with a few weeks until official earnings season and the Fourth of July coming soon. Low trading volumes can sometimes lead to fast and violent moving markets.
The end of this month marks the end of a very interesting quarter, and many large money managers will certainly be posturing for a good second quarter report to their investors. This may make for an interesting few weeks of trading if we have no major outside events. JK