The Apocalypse Now?

Could this be the end of the U.S. markets? 

Credit crisis narrowly averted and an end to the financial stimulus along with a credit downgrade making the markets go crazy – is it all just panic trading?

We are sitting at the lows (support) set back on November 16 2010 of 1171…

Next stop down (support) would be a low August 25 2010 of 1037

Then further down would be July 2009 of 865

Beyond that we show a low of 665 on March 29 2009 – 665 is probably out of the question since it is an aweful long way to go but we could reach the first or second level of support.

Jobs are the major factor fueling the fear.

Basically everyone is fearful except Warren Buffet – his stocks have dropped some but he is pumping the US as though we should have a ‘quadruple A credit rating’ – he must have some skin in the game to need to pump the US so much and I imagine his companies and his stocks have a lot to do with it. 

The S&P Futures today we are skidding along waiting to see if anything gets worse or some more bad news creates more fear.

Futures currently are bouncing around the 1171 low of November 16 2010 and will probably just thrash around today.  Europe showed some down numbers and that will have some influence on the US markets today, they are buying up Spanish and Italian bonds and that should be a good thing but maybe it’s just a move to try to bolster the markets there and traders know better…

The MSCI index tumbled 8.5 percent last week as gauges of U.S. manufacturing and consumer spending trailed economists’ estimates, fueling speculation that the world’s largest economy may fall back into a recession.   Industrial, technology and energy companies have led the five-day slide on concern slowing exports to the U.S. and Europe will curb earnings.

About $5.4 trillion in market value has been erased from global equities since July 26, according to data compiled by Bloomberg.

Capital protection is the name of the game currently and is probably a good idea until the market shows some kind of turn and a couple of follow-through days.