“June Gloom” Sets In

After a stellar start to June, the stock market gives up almost all of it’s June gains in two trading days. Yesterday’s loss of 188 points plus today’s negative 107 points takes the Dow back to just a couple of points from where it started June at. This sharp sell off may be a sign of things to come as the market absorbed today’s good housing startup data and continued to fall further. This looks very similar to the trend in May when bad news was absorbed and the market continue to rise; something like a “bizarro” effect. The rapid decline in the last 15 minutes of trading does not bold well for Wednesday. With options expirations coming this Friday (Quadruple Witching), this could be the beginning of a shorterm selloff as many families prepare for Summer break.