Disappointment on Wall Street?
After frenzied activity this morning when market futures looked like they would hit circuit breakers --which trigger temporary halts in trading -- some traders expressed disappointment that, so far, at least, the market is down sharply but not to a full-blown capitulation level.
“Traders down here were actually hoping for a much stronger capitulation or panic,” said Ben Willis, floor broker with VDM, an institutional brokerage firm. He explained that clients are ready to pounce on buying opportunities once they believe the market has hit a bottom. “We’re all ready to spend their money. It’s healthy for markets to finally have capitulation,” he said.
Trading floor veteran Art Cashin, director of floor operations at UBS Financial Services, said the futures market almost looked like they were operating in a vacuum. “I’m somewhat frustrated given what happened in Europe and Asia,” he said, noting that the trading activity today is far less than other Fridays.
When asked what was moving the markets, he explained it was hedge funds, mutual funds and other investors pulling their money out of 401(k) retirement funds. “When you can’t sell what you want to sell you’re forced to sell whatever you can -- including your grandmother’s necklace,” Cashin said. “That’s a little bit of what’s happening here.”
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