Talking Points:
• The capital markets avoided a straight-line collapse for a second day, but volatility is still extreme
• St. Louis Fed President Bullard triggered a flush of hope when he remarked QE3 could delay a final Taper
• Volatility ensures that the short-term will be erratic, but medium-term points a strong trend
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US equity indexes closed this past session little changed after another painful start. That is two days in a row that we these benchmarks have sought stability. Considering we are just a month off a five-year bull trend in capital markets, it should come as little surprise that there is plenty of hope bubbling to the surface that we have hit the bottom in the painful correction. Yet, is the 9.8 percent peak-to-trough retreat from the S&P 500 substantial enough to satisfy the imbalances in the market? Have fundamentals and positioning improved enough to turn sentiment back onto optimism and snuff recently buoyant volatility levels? Has Fed official James Bullard's suggestion that the final QE3 Taper could be delayed given investors a fundamental backdrop to reinvest on? We discuss this and more in today's Trading Video.
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