Intraday Market Update
Equities in the US and throughout Europe are under solid pressure as the market digests yesterday's FOMC announcement. Traders are flowing funds into Treasuries and gold as they ponder various economic scenarios that could force the Federal Reserve into further quantitative easing and their pledge to fight deflation. The US dollar continues its descent after the money printing promises from the Fed which is helping many commodities and commodity related stocks catch a bid. All of the major US indexes look vulnerable and are under solid pressure being led by the Russell 2000 which has lost more than -1.50% and the NASDAQ which is off by -1.00%. The S&P 500 and DJIA have lost -0.60% and -0.40% respectively. Gold has tacked on more than $16 and printed another all-time just below $1,300 per ounce. Front month crude has lost -1% after a larger than expected build in inventories. European markets posted solid declines with most markets losing more than -1%, while the Asia-Pacific region was mostly higher with no big winners or losers.

Economic data is light today with the lone report coming from the Mortgage Bankers Association Purchase Applications Index. Purchase applications fell -3.3% which follows a -0.3% dip the prior week. Refinance applications also slipped -0.9% for the third consecutive weekly decline. Refinance applications made up 81% of all mortgage applications. The average 30-year fixed rate mortgage fell 3 bps to 4.44% which is near record low rates last seen in 1990. Obviously the low rates are not enticing buyers into the market as they remain cautious due to the struggling jobs market. While popular opinion says the housing market is unlikely to plunge anew, it is definitely lacking traction. Existing home sales for August will be released tomorrow at 10:AM EST.

In equities, Adobe's (ADBE) losses in the after market yesterday remain in tact. The stock is getting lambasted (down -20%) after the company offered weak guidance and was the recipient of multiple analyst downgrades. Jefferies (JEF) is down nearly -5%, but off of its worst levels, after the broker dealer missed estimates in its Q3 report. General Mills (GIS) is up better that +3% after an upbeat earnings report and reaffirming their full year outlook. However, GIS's q/q earnings are moving in the wrong direction as this year's Q1 earnings were well below last year's Q1. Carmax (KMX) is up +7% after beating earnings estimates with the top and bottom line registering their highest levels in several years.

After plenty of cautious comments from the semiconductor sector in recent weeks, it's PMC-Sierra's (PMCS) turn to get taken out the woodshed (-7%) after they lowered their Q3 revenue guidance. In other equity news, Ebay was down more than -5% after a key executive left the firm for personal reasons. However, the stock has recovered after the company also guided to the high end of their prior range.

Core Sector List: Overall reading: 4 sectors advancing, 16 sectors declining
Strongest Sectors: Gold Miners, Coal Miners, Utilities
Weakest Sectors: Software, Semiconductors, Banks, Broker Dealers


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