US stock market is going through another of those bouts where, nothing is working except those short the market....
Every sector which I monitor is down anywhere from highs about 3.96% to 17.00%....
Individual stocks are taking IT on the chin and they are on the race to new 52 week lows, some major stocks have already made It to new 52 week low list.....
Only in end of July about 8 weeks ago most sectors were making new 52 weeks high.....
SO
What changed in last 8 weeks....
Biggest change IS INTEREST RATE have skyrocketed to 16 years high....look @ 2 year & 10 year rates not a source of confidence
Interest rates alone is causing havoc in corporate financing & Individual financing a bad mix of financial pressure....
Banks are also impacted by high high Interest rates as few were ready for 5% +++
Interest rate alone is causing PE compression for all stocks......
Even high flying energy stocks is down 3.96% from high IF we take XLE close.
SOX as a sector is worst hit with 17.00% lower from high
RUSSELL 2000 is 2nd worst with a slump of 11.11% from high...
SO
There is NO PLACE TO HIDE...
BUT.....one has to look @ RISK / REWARD ratio....
Those who are afraid of these swings may take It as a warning sign of more downside....
BUT OPTIMISTIC trader like me may take a different view, time to get overexposed in discounted stocks
In my opinion, based on history, we may be close to major support in markets & individual stocks...
RISK / REWARD IS VERY COMPELLING....
Wall street offers no guarantees BUT being patient and staying with conviction, pays off in the long run.
Good luck with your own analysis and comfort level.
BLOG does NOT give buy or sell.
Saleem