After being higher for most of the day, the indexes closed lower on higher than normal volume. Where have we heard that before? On down days the volume accelerates.
The DJIA was lower by 70.48 points to 16912.11 and the S&P 500 was lower by 8.96 points to 1969.95. The Nasdaq finished down 2.21 at 4442.70. The Russell 2000 was the only index to close in the green, up 2.14 at 1141.64, still "Trend Bearish" and down nearly 2% for the year to date.
The S&P 500 Trust Series ETF (SPY) volume came in at over 80 million shares traded, the highest volume day since July 18.
Two weeks ago, Goldman Sachs put out a call to sell gold. The U.S. 10-year Treasury yields are back down under 2.5% since that call and remain as bearish as gold is bullish. If you are bearish on third-quarter U.S. GDP growth slowing, you are bullish on bonds and bullish on gold. If you are bullish on third-quarter U.S. GDP growth accelerating, you are bearish on bonds and bearish on gold.
So far in 2014, gold is up 8% YTD and the Barclays 7-10 Year Treasury Bond Fund (IEF) is up 5% YTD.
I continue to look for inflation accelerating that will slow down U.S. consumption growth. In addition, I am looking for the Federal Reserve to become more dovish and start a new round of quantitative easing as we head into 2015.