The Market Strategy Radar Screen

While it was the disappointing Non-Farm Payroll number that played center stage last week for investors, it was the marked decline in the VIX as volatility plunged some 24% from a closing high of 27.63 on Monday ending the week at 20.94 that caught our eyes on the market radar screen.

It was almost as if the VIX was reflecting a sigh of relief that was coming from the markets with each key manufacturing gauge that had disappointed and missed economist survey expectations last week. (Misses included: ISM Milwaukee, Chicago Purchasing Manager, ISM manufacturing and the US Manufacturers New Orders Total among others)..

The effect of the misses in aggregate appeared by Friday’s close to have been taken by the market as making it less likely that the Fed would begin raising interest rates in October--- perhaps not even in December and perhaps not until March of next year. And that looked to be a better thing than a bad thing to both the bond and the equity markets....

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