[Thursday, December 6, 2018]
It was a volatile session with steep early losses largely erased by session end. Overnight declines in Asia were followed by weakness across Europe with exchanges down more than -3%, at session lows, on investor concerns over the Brexit vote scheduled for next week. US futures were down big before trading and shares gapped lower at the open, sliding further to session lows just before the European close. Investors fear the impact of trade tariffs and a global economic slowdown as well as the next Fed move on rates. Recent economic data has telegraphed some weakness in the economy and the group may back off on the widely anticipated December hike. But with markets so oversold following Tuesday’s drop value conscious buyers stepped in just before noon and markets saw a slow but steady recovery, led by gains in Technology and the Nasdaq Composite. Indices were mixed at the close. The S&P 500 slipped -4.11 to 2,695.95 and the Dow dropped -79.40 to 24,947.67, recovering from a better than -700 point loss earlier. The Nasdaq Composite managed a modest gain of +29.83 to 7,188.26. The Russell 2000 moved closer to bear market territory, down -3.34 to 1,477.41. Real Estate led the day while Energy and Materials were off the most. Financials were also weak with many banks sitting at or near 52-week lows. Crude prices tumbled as OPEC failed to agree on production output levels. Saudi Arabia is proposing smaller than expected cuts as Qatar leaves the group. WTI futures fell more than -2% to 51.68 per barrel. Gold gained fractionally. Bond Yields were under pressure; the 10-Year offering 2.876% Volatility closed near the day’s lows, gaining modestly to 21.19.