It is summer on Wall Street.
This means that at some point in August, a lull hits markets as traders take time off and trading volumes drop.
Deutsche Bank strategist Jim Reid is one of the more colourful and forthright strategists on Wall Street. On Tuesday, his daily “Early Morning Reid” started as usual with a personal anecdote.
And this one captures the market’s quietness right now.
Here’s an excerpt (emphasis added):
Talking of TV, when I was a kid there was a program entitled “Why Don’t You” with the subtitle “just switch off your television set and do something less boring instead”. It can be filed under ‘turkeys voting for Xmas’. However today’s EMR feels similar. It’s been a genuinely dull 24 hours and if you want to have 5 minutes you won’t ever get back to do something else less boring instead then feel free to ignore the rest of this report.
There was no major US economic data on Monday, and it was one of the lightest trading sessions of the year. As of Tuesday, the S&P 500 had not risen or fallen by more than 1% for 18 straight days.
Of course, this doesn’t mean that nothing is going on.
On Monday, crude oil rose 2% after the oil group OPEC announced that will hold an informal meeting in September, raising hopes of talks towards some kind of production freeze.
It could be another quiet day on Wall Street, with no major market-moving data and stocks already going nowhere in futures trading.